Recently at the DIGITAL COMMERCE SUMMIT automotive & industry, automotive experts exchanged ideas on the digitalization of the aftermarket. An important factor in this discussion was customer centricity and its role for the industry. The digitalization of repair shops is advancing, and offers differ only minimally. To successfully differentiate themselves from the competition, companies must take new approaches and make customer centricity their success factor. Discover how customer centricity can make the difference in the digital aftermarket here.
In the automotive aftermarket, customer-centric service delivery is critical. According to a survey by McKInsey & Company (2019), more than half of industry experts see significant value in the service segment, as customers spend up to 50 hours servicing their vehicle during their ownership period. The SME sector still has room for improvement when it comes to meeting customer needs in the best possible way. A strong focus on customer centricity in the service segment can thus become a decisive competitive advantage.
“Customer centricity is the basic prerequisite for sustainable economic success. The customer and his or her needs must be at the centre of business activity in order to solve problems for the customer in the best possible way. In combination with an optimal customer journey, you achieve real customer loyalty and a lock-in effect, so that the customer has no desire to go anywhere else.”
But how exactly can a customer-centric service offer be achieved, and thus differentiate from the competition?
Customer Centricity – often heard and rarely understood. Behind the term is the goal of taking the customer and his or her needs into account in every – yes, every – corporate decision and thereby placing him or her at the center. To achieve this, a comprehensive digital transformation is required that meets the (increasing) demands of digitalisation, automation, mobility and personalisation. This requires companies to align their management and employee levels, vision and culture as well as their performance and services with the customer.
According to Gartner (2019), comprehensive information, fast and competent problem resolution and prevention of future complications are key needs of customers. Unfortunately, customers are often faced with high costs and unpredictable obligations. A survey by McKinsey & Company, (2018b) shows that the service experience is more crucial for customer retention than a positive purchase experience. Companies should therefore ensure that they provide an excellent service experience in order to retain customers in the long term.
So, what might a service look like today that meets these requirements?
Among customer journeys, service experience is more influential than purchase experience.
Importance of customer experience by journey %
The megatrend Auto Repair 4.0 has long since arrived in the sector and is not only changing entire industries, but also society. A new generation of customers is confronting the automotive aftermarket: the digital natives. This generation has had completely different experiences than previous user groups and projects their needs onto all areas of life – including the automotive sector. Fast fulfillment, mobile accessibility and personalisation are just some of the new requirements.
However, these needs are still faced with realities in many garages that affect customer service. According to McKinsey & Company (2019), the biggest pain points in service are limited mobility offerings and lack of transparency in service progress. If nothing changes here, there is a risk that the new generation will turn away from car ownership because the disadvantages might outweigh the advantages. Companies should therefore ensure that they meet the needs of digital natives in order to remain competitive in the long term and attract this new generation of customers.
Repair shops should know their target group exactly and understand what their needs are. In order to meet these, the connectivity and automation of processes are indispensable.
What does this look like in detail?
Thanks to increased digitalisation and connectivity, the vehicle sends a message to the repair shop that maintenance is due soon. With a created vehicle profile, the repair shop has all the necessary information about past and future maintenance at a glance.
Based on this, the repair shop proactively sends the customer appointment proposals and gives him the opportunity to adjust the order according to his wishes.
In order to provide the customer with sufficient information and to ensure transparency, he is provided with photo and video material of the repair. In this way, he can be directly involved in decision-making questions without delay.
So there are already existing ways to meet new needs and thus satisfy the customer in the long term. They just have to be used. It should not be forgotten that customer centricity not only benefits the customer, but also the repair shops themselves. The biggest advantage for the latter: they come more to the fore and establish themselves as an important partner for the customer. In this way, the repair shop image is evolving away from slow processes, lack of transparency and unexpected costs towards becoming a model service provider.
INA ROGALEV
assistant corporate development
McKinsey & Company (2018a):Ready for Inspection – The Automotive Aftermarket in 2030.
McKinsey & Company (2019):Driving the automotive customer experience toward the age of mobility.
Gartner (2019):Create Powerful Customer Experiences
McKinsey & Company (2018b): Future of Automotive Retail Survey
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