Digital Dealer - July 2019 - 25

on service they should have done on
their car. We'll follow up a week later
and remind them the mechanic had
recommended some work, maybe it's a
safety-related issue, and it's important
to get the work done, so we'd like to
schedule their appointment.
We also call new customers, those
who bought a car from us but have
not had it serviced with us yet to set
up their first appointment. We'll call
lost customers, people who haven't
had their car serviced in ten or more
months and try to entice them with a
special offer.
Besides the calls, we started
using Conversica, an AI service that
essentially emails customers for us.
We use them for both sales and service
emails. When someone engages with
the AI message, then we get involved.
That frees up a lot of our time and
allows us to make other calls.
We also use TEXT2DRIVE for
do some automatic texting. These
are follow-ups instead of marketing
messages, reminding them it's time
for a service visit. I've been happily
using both of these services for the past
couple years. And on the sales side, I've
used Digital Air Strike for AI and have
been happy with them, as well.
DEALER MAGAZINE:

Approximately, what percentage of
inbound calls at Paramus Honda are
for service versus, say, for sales or
parts?
JASON: Using last month as an
example, we tracked about 12,000
calls: 7,000 in service or about 60%;
about 2,000 calls ended up in my
overall sales department, and that's
20%; we had 10% for parts, about
1,000 calls; then the rest fell into a
category we call other, where they were
looking for their license plates or from
an insurance company, random calls
not necessarily looking to schedule an
appointment.
DEALER MAGAZINE: Dealers know
service can generate huge revenue for
their dealership. Yet you've referred

to the service department as the
"forgotten department." Why do you
think its contribution to dealership
success is often ignored?
JASON: When I said that, I was
referring specifically to marketing.
In most dealerships, more than 90%
of their ad budget is geared toward
variable ops and sales. Less than 10%
is dedicated to fixed ops and service.
When it comes to a dealership's
website, 90% of the content is geared
toward sales and financing and so forth
and a very small amount is set aside
for promoting service. Which is crazy,
when you think about it. Almost 50%
of the average dealership's gross profit
comes from the service department, it's
almost split half and half.
I think the reason for the difference
is most GMs come from the sales side
and don't know as much about service.
Those that do come from service were
promoted from being service advisers
or mechanics and really don't have
much experience with advertising. So,
what we have is a culture of not getting
service involved in marketing. Plus, it's
a lot more exciting to sell a car than it is
to sell an oil change or a brake job.
Frankly, I think this is one of the
reasons that led the automotive
industry to losing so much business
to the independents. When it comes
to service, we really fall behind in
marketing and advertising, whereas
independents are spending tons of
money on this. They have highly
developed websites with lots of servicerelated content that answer customers
questions better than our sites do and
people enjoy going back to those sites.
DEALER MAGAZINE: What can
service managers do to help remedy
this situation?
JASON: First, there is a price
perception floating out there that
independent shops are cheaper than
dealerships, and that's not the case
anymore. In a study that interviewed
3,500 service customers who went
outside the dealership they found that

most people were actually paying more
for their oil change than what their
local dealership was charging. They
go to these independents because they
think they're cheaper, but they end up
paying more.
We don't do a good enough job of
creating value with the customer. Not
only are we better trained, and we
have OEM parts and more amenities
to offer, we still are cheaper in a lot of
areas.
We're definitely falling short on
the marketing side of it. Most service
managers don't attend marketing and
advertising meetings. Most service
managers are not familiar with digital
marketing techniques, such as SEO
(search engine optimization) or SEM
(search engine marketing), or anything
about Google Analytics. They don't
even know what these terms mean
and that's where they're losing out.
Fixed ops keywords make up 25% of
all automotive searches, and most
dealerships are barely going after that
business.
DEALER MAGAZINE: As we see
new vehicle sales begin to weaken, how
can service fill that gap and ensure the
dealership continues to be profitable?
JASON: Good question. We all know
the SAAR estimates are trending down
this year. Interest rates keep going up,
and as that happens more people are
holding on to their cars longer rather
than trading in or buying a new car.
In order to make up for that potential
loss of profit in the sales center, it's
really important that we retain service
customers and not lose them to
independents. Currently, only 33% of
service customers go to a dealership;
the other two-thirds are going to
independents.
It's really important we do a good
job at not only retaining but winning
back service customers. As we lose
profitability in sales, we should
be gaining it in service. There's a
huge market for service right now,

D I G I TA L D E A L E R . C O M

Continued on pg. 26

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