Driving progress through excellent after-sales services

Customers are important intangible assets of every business. Thus, every firm must place ardent focus on customer service to maintain a competitive position in the market.

This is highly applicable in the automotive industry — whether during or after sales, car companies should pay more attention to the full spectrum of good services that they can provide to satisfy their clients, especially these days when word of mouth plays an important role in promoting brand products and services.

In the Philippines, given the decline in new vehicles sales as a result of the higher excise tax on automobiles due to the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN), having an excellent after-sales services not only helps automakers build a strong branding and long-term relationship with customers, but generate revenue as well.

“Today, after-sales revenue is becoming increasingly important for car dealerships, especially in mature markets. For many dealers, efficient after-sales management also offers untapped potential to increase revenue and profitability,” incadea, a global provider of automotive software solutions for the automotive retail industry, said in its Web site.

J.D. Power, a global market research company, revealed in its 2018 Philippines Customer Service Index (CSI) Study that the availability of express service was a key driver of customer satisfaction, particularly for customers who visit a dealer for routine maintenance.

Based on the said study, the proportion of customers who were offered express service during their most recent visit this year increased to 55% from the previous year’s 17%. This was equivalent to a significant increase of 38 percentage points year over year.

J.D. Power reported that nearly half or 44% of those who used the express service option had their vehicle returned within two hours. Overall satisfaction among these customers was higher than among those who did not select express service — or 820 points against 793 points, respectively, on a 1,000-point scale. More than half or 51% of customers who chose this option said that they “definitely would” recommend the service center to a friend or relative, compared with 42% of those who did not use the option.

“With an increasingly fast-paced lifestyle, customers in the Philippines are time-sensitive,” Sigfred M. Doloroso, country manager for the Philippines at J.D. Power, was quoted as saying in a statement. “Given the decline in new-vehicle sales this year, dealerships have been trying to maximize their service revenue and improve capacity utilization. The retention of existing customers through systematic service reminders, notifications for due service, faster service turnaround and improved customer experience is the key to business viability.”

One of the best practices in after-sales services in the local automotive sector that is also worth noting based on the 2018 CSI Study is the aggressive efforts of dealers in notifying their customers whose vehicles are due for service. The study found that more customers received such notifications at 87%, compared to 66% in 2017. Meanwhile, more customers who made an appointment for servicing their vehicle this year increased to 82% from 47% in the previous year.

J.D. Power also enumerated additional key findings that could help after-sales services team improve their operations.

This year’s study found that the number of customers who had the chance to observe their vehicle being serviced has more than doubled, or increased to 32% from last year’s 15%. This implies that customers preferred transparency on work carried out on their vehicles.

Engagement also builds trust, J.D. Power said, noting that speaking with a technician or mechanic during the service visit has a notable impact on a customer’s likelihood to follow recommendations offered by their service advisor.

“More than 4 in 10 (41%) customers who spoke with their technician agreed to additional work recommended by their service advisor. This is 10 percentage points higher than among customers who were not able to talk to their technician. Speaking with the technician also has a notable effect on satisfaction, compared to not speaking with the technician,” the global research market company said.

Making appointments to schedule service visits has increased across all age groups, but younger customers, or those who aged 29 and less, are more apt with using digital channels to schedule their next service visit than customers aged 30 years and above, J.D. Power said. Additionally, the study found that 42% of customers from this age group spoke with their technician, compared with 34% of those who are 30 years and older.

Meanwhile, among the 10 auto brands evaluated in this year’s CSI Study, Honda ranked highest in after-sales customer satisfaction with an overall score of 823, followed by Nissan with a score of 822, and Mitsubishi that scored 816.

According to J.D. Power, Honda performed particularly well in three of the five factors in the study, namely service initiation, service advisor, and service facility. This is the second straight year that Honda topped the CSI. — Mark Louis F. Ferrolino