Are Mobile Services the Next Big Thing for Auto Dealers

Consumers everywhere are growing accustomed to the convenience of home delivery. The pandemic accelerated the trend, sparking a “come-to-you” economy, led by the likes of Amazon and DoorDash. Now, many industries are sorting out how to accommodate consumer demand with the right come-to-you business models. This includes the auto industry.  

Online vehicle information-gathering and shopping has been rising for years. Now, spurred by expanded usage of e-commerce and expectations for greater levels of convenience, consumers and commercial fleets alike show a growing demand for mobile auto maintenance and repair services. 

From a purely practical standpoint, many consumers regard a trip to an auto dealership, whether for purchase or service, as an unpleasant, frustrating experience. They look forward to it as much as they do a root canal! When all they may need is an oil change and/or tire rotation, they may have to wait several hours for the completion of this kind of routine, simple maintenance work. Complicated schedule coordination and protracted wait times are annoyances customers can avoid when a certified technician comes directly to their home on their schedule. 

Challenge and Opportunity

MarketSource research in 2021 indicates that fleet and commercial customers REALLY want mobile service, as keeping their employees and vehicles on the road (uptime) is critical. However, offering it in a consistent, effective manner presents a host of challenges for dealerships and OEMs. Already strained by a shortage of trained auto techs that pre-dates, yet was exacerbated by the pandemic, dealerships are under severe pressure to staff their in-house service departments properly, let alone a mobile tech business. The lack of technicians is approaching critical levels. A recent TechForce Foundation report indicates that just under 800,000 auto/diesel/collision techs will be needed by 2025. As we explored in a prior blog, the huge gaps in filling auto tech jobs are due in part to the many professionals who are retiring, and in part by overarching, ill-conceived attitudes about a career as a technician.   

Many parents demand their high schoolers seek at least a four-year college degree, thinking it will lead to a better career and higher income. Yet the reality is that OEM-trained, ASE-Certified auto dealership techs can enjoy a very rewarding career with boundless opportunities for personal growth and advancement. According to Indeed, the average auto technician’s annual salary across the US is $64,421. Dealerships also can provide aspiring technicians an abundance of career enhancement opportunities, helping them to increase their skills, abilities, and income within the repair department, but also prepare them for other critical fixed operations roles, such as service advisor, shop foreperson, service director, and fixed operations director.

Just under 800,000 auto/diesel/collision techs will be needed by 2025. How will dealers and OEMs differentiate themselves to win the tech competition?

Another challenge lies with dealers needing to create and implement processes that are considerably different and more complex than the status quo. There are many areas to consider before embarking on a mobile service initiative, such as:

Will you target retail and/or commercial customers?

Which services will you offer?

Which hours and days will you offer customer appointments?

What geographical area will you serve?

How will you advertise your new mobile service offering? Outbound BDC? Website? At the vehicle delivery point?

Do you have qualified tech(s) on staff that enjoy interacting with customers and are focused on an exemplary customer experience?

Do you have access to the technologies you need to help you accomplish the mission? Specifically, mobile service scheduling, repair order, and inspection creation?

Are you and your team committed to enduring some “start-up pain” while working through this new and potentially complex process?

Do you have a way to track the effectiveness of the mobile van on a daily, weekly basis?

Mobile service presents significant short- and long-term profit opportunities for dealers. As the digital customer experience becomes the norm, mobile service may well become the default customer expectation. 

20%

Plan to Offer Mobile On-Site Service in the Future

A Loyalty Builder

Dealerships that are early adopters on the mobile repair bandwagon stand to establish a strong competitive stance with consumers. They can earn greater customer loyalty just by providing a more convenient way to provide routine maintenance and repairs and service recalls. 

A Cox Automotive Report indicated that once the manufacturer’s warranty has expired, approximately 72% of customers will have their vehicles serviced someplace other than a dealership. This often results in not only lost service revenue to the dealership but customer loyalty for future vehicle purchases. However, the study also indicated that if a dealership can provide service to vehicle owners three times within the first eighteen months, they can increase customer loyalty by approximately 46%. 

And Modera found that customers who have all their service work performed at their selling dealership are 86 times more likely to purchase their next vehicle from that store!

If a dealer offers service at a customer’s workplace or home at a conveniently scheduled time, while emphasizing the benefits of OEM parts and certified car care, it’s even more likely the customer will stay with that dealer. 

A Win-Win Proposition

For dealerships that focus on commercial business, mobile repair provides boundless opportunities for revenue growth and customer loyalty. The 2021 MarketSource study conducted with micro, small and medium fleets (those with less than 150 units in operation) indicated that, due to their need to maximize their “uptime,” 66% of commercial accounts are highly unlikely to use dealership service facilities. Most are not operating a fleet with spare vehicles, so if a vehicle requires maintenance or service during normal business hours, they are losing revenue. Think of businesses providing electrical, plumbing, HVAC, landscaping, and construction services. Given that many businesses are operating at maximum capacity, when time is their commodity, a lost day or half-day of revenue is gone forever. 

A dealer’s ability to provide these kinds of company’s maintenance, light repair, and recall services on-site via a mobile van is a sure-fire differentiator that will drive both customer loyalty and additional revenues. It also provides them with the opportunity to service multiple vehicles with one mobile visit, increasing both per-hour service van revenue and net profits. 

For dealerships at maximum service bay capacity, mobile service vans also provide the ability to turn additional hours outside of their facility, increasing their ability to meet customer servicing needs, along with revenues and gross profits! 

To create awareness among both your retail and commercial customers, your Business Development Center should proactively contact existing customers, outline your new mobile offering, and set appointments. Create marketing materials for both the service drive and the sales department. You may also want to create a QR code that outlines your mobile services available, along with a link or number to call to schedule an appointment. 

Many of the repairs mobile vans can complete are more aligned with very competitive, less profitable services, such as oil changes and tire rotations.  However, according to the 2021 Achieving Customer Amazement Survey reported in Forbes, 70% of consumers said they would be willing to pay more for convenience. I’d be very surprised if completing vehicle maintenance and repairs doesn’t show up on that list!

Future

What does daily life with mobile service look like? Soon, all cars will come standard with OEM telematics installed, enabling a new level of customer-dealership connection. Imagine a world where a customer can grant the dealership live access to their vehicle’s data. When the vehicle indicates service is needed, a dealership concierge can reach out to the owner, alert them as to what’s required, and schedule an appointment for mobile service, or, if required, service at the dealership.

About 30% to 40% of all U.S. fleets are using telematics systems to track and maintain their fleets, according to Forbes. Embedded telematics have been installed in some 77% of all new cars sold in North America.

This kind of attentive outreach fosters loyalty and shows consumers that the dealer cares. It also facilitates more personal interaction, with the dealer responding preventatively to each vehicle’s and driver’s individualized service needs. Overall, it helps establish a relationship with each customer in a way that is currently missing in our digitally driven culture. 

Market timing is important. The first auto dealership or manufacturer to roll out a mobile auto maintenance service on a broad basis has the potential to own the market. MarketSource can help. 

MarketSource offers scalable processes to integrate mobile auto maintenance and repair into a dealership’s operation. Our deep knowledge and experience in the auto industry, our keen understanding of practical and seamless software systems, and our ability to assemble outstanding sales, marketing, and technical teams, assures dealerships will have a successful program.