A number of trends are shaking up the after-sales market in the automotive industry, according to BearingPoint, a Dutch management consulting company. Unsurprisingly, some of them have to do with technology.
“Firstly, the connected features in today’s vehicles enable remote access to the OEM (original equipment manufacturer). This makes it easier for owners and drivers to plan maintenance and repair work, and means as well that the vehicle’s software can be updated over-the-air to enable remote repairs and new services,” BearingPoint says.
These same connected features have also provided channels, such as the human machine interface (HMI), through which OEMs and customers can stay in touch, as well as insights into customer driving habits that OEMs can use to deliver a more effective maintenance service.
But there’s another trend BearingPoint has identified that is different in nature from the connected features thought not totally unrelated: independent aftermarket (IAM). In its survey of 1,000 vehicle owners of several luxury brands in Spain, Germany and UK, 35% of the respondents preferred the IAM workshops. “This proportion rises to more than four in 10 (42%) if we look at drivers under the age of 35,” the firm adds. This may not sound like good news for OEMs.
BearingPoint suggests that OEMs look at the customer journey, which comprises of five stages, in a new way — breaking it down and understanding the opportunity the connected car creates at each stage in the process.
“At the first stage of the after-sales journey, the customer will be informed that it’s time for a service — either because a certain number of miles or time period has been clocked, or because the on-board software or a service expert has noted the car needs an (unexpected) service,” the firm says.
To ensure that the customers will choose the workshops affiliated with OEMs rather than the independent alternatives, BearingPoint says, “For the time being at least, OEMs have an advantage over IAMs, especially for the latest connected car models, because they receive vehicle diagnostic data and can follow-up directly with the driver — via the phone, app or HMI — to ask whether they would like to make a booking at a nearby workshop.” OEMs can also extend special offers that suit a driver’s needs.
At the second stage, transparency at booking is what OEMs need. In its survey, BearingPoint found that 71% of the respondents want a detailed estimate of costs before booking a service at a workshop. “It stands to reason that providing a full breakdown of service duration, price and costs upfront would improve the chances of them booking with an OEM over an IAM,” the firm says.
It adds, “Informed by the vehicle’s diagnostic and usage data, OEMs can provide a more accurate quote for the cost of a service, based on their knowledge of how and where the car has been used, and the wear and tear of its parts.”
The third stage is all about service experience. BearingPoint says customers — as anyone would have thought — expect a positive experience when they take their vehicle to the workshop. “In response, OEMs should increase their investment in their workshops’ physical environment and reception area to enable customer-centric retail processes, especially for their known customers. They should also ensure there is a well-informed service advisor to greet customers and access their details: more than six in 10 respondents (62%) say this is the most important part of the experience,” the firm says.
When it comes to the fourth stage, “anticipating and managing the out-of-the-ordinary,” BearingPoint suggests taking advantage of the connected car capabilities to prepare for the out-of-the-ordinary needs of their customers. It explains that there vehicles today capable of predicting maintenance requirements for parts at risk of declining by means of providing monthly health reports and remote diagnostics.
“By extension, OEMs can offer the driver faster and more efficient support in the event of a breakdown, by drawing on real-time diagnostics as well as recent workshop and customer data,” the firm says.
“At the final stage, when the service (whether routine or unexpected) is complete, there is still more work to be done to build loyalty and ensure a repeat appointment,” BearingPoint says. Based on the firm’s research, a follow-up communication by the workshop keeps the customer happy. This also allows the workshop to gather important feedback.
“The OEM can also leave the driver with a customized maintenance plan that combines driver-profile information with maintenance and workshop data, creating additional value and customer loyalty,” the firm adds.
“At present, OEMs still have a strategic advantage over independent operators in that they receive vehicle and driver data and can use this to provide a superior experience. While this arrangement is unlikely to last forever — as customers increasingly restrict who they share their data with — OEMs should consider how they can use the data, while they have it, to innovate around the customer experience, such as by integrating with insurers and other third parties to develop combined offerings.”
“Done well, customers will seek out these value-adding offerings in the future, especially if they are offered in combination with a seamless digital experience and a powerful SOTA (software-over-the-air) capability. By out-innovating the competition while they still have access to vehicle and driver data, OEMs can develop a compelling offering for the aftersales market of tomorrow,” BearingPoint concludes.