When consumers think of car dealers and their profits, most believe that the sale of new cars that can be $30,000 or more is where the money is made, but nothing could be further from the truth. It’s in used car sales and the service drive that the profits are truly driven at most franchise dealerships.
Even though consumers don’t usually know this, most dealers know it. This is why it’s a conundrum that the majority of their advertising dollars are spent on selling cars rather than driving customers to their service bays. For many, the argument is that the majority of their service business comes from people who bought their car at the dealership, so marketing for more sales will also help them increase the fixed operational side. Things are different now thanks to the internet and the drop in brand loyalty, so dealers should be investing more into filling their service bays.
It isn’t completely on the dealers. There are many more automotive marketing and advertising vendors that focus on sales rather than service. One website vendor, DealerOn, does have a strong focus on filling the gap for the service side. Their Service Sites are designed to give a separate web presence dedicated to the service and parts wings of the dealership.
The newest batch of drivers, those who have grown up with the internet at their fingertips, are used to shopping online. They rely on digital rather than loyalty to a particular dealership to make decisions about automotive servicing. As a result, many do not see the advantage of working directly with a manufacturer’s approved technicians rather than the service chains or a local mechanic shop.
Even those who did not grow up with the internet have a stigma that must be overcome. They believe that a dealership’s services are dramatically more expensive than having the word done outside of the dealership world. This is true in some respects and there was a time when it was okay to get work done outside of the dealership, but the modern technology that goes into newer models makes it more important than ever to have the services done by those who are receiving ongoing training, namely the technicians at franchise dealerships.
Beyond the money and the stigmas in place, there’s another important reason that dealerships should be investing into marketing their service departments. Reputation and trust are bigger factors today than ever before when it comes to working with dealerships. Those who have demonstrated that they’re doing business the right way and making consumers happy are the places that people are most willing to buy a car. By making them understand the importance of the service department to the dealership, they can have an extremely positive effect on the sentiment that can drive future sales.
The service and parts departments at a dealership are often the lifeblood that keeps the operation going strong. When dealers put the right attention to those departments with their marketing, they’re able to influence their market share as a whole.
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