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Ammo to Fight Steering

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Jason Stahl has 28 years of experience as an editor, and has been editor of BodyShop Business for the past 16 years. He currently is a gold pin member of the Collision Industry Conference. Jason, who hails from Cleveland, Ohio, earned a bachelor of arts degree in English from John Carroll University and started his career in journalism at a weekly newspaper, doing everything from delivering newspapers to selling advertising space to writing articles.

I don’t know if you noticed (and I hope you did because that would mean you’re an avid reader of our weekly e-newsletter, BodyShop News, which is e-mailed to over 24,000 shop owners and managers every Thursday), but steering took the spotlight in the August 26 edition.

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The lead story concerned a new anti-steering law that passed in New York that prohibits insurance companies from requiring that consumers use specific rental car companies. The second story was about a TV station in Maine that profiled a consumer who was “bullied” into taking her vehicle to a shop in the insurer’s network. The third story noted that the Texas Department of Insurance recently issued a bulletin to insurers reminding them of the state’s anti-steering law.

What does this all add up to? What we already know: that steering is one of the biggest challenges facing body shop owners.
I wanted to address one person’s comment online that sounded as if she was accepting steering as a fact of life and throwing up her hands, saying, “What can you do?” Actually, there are some things that shops can do.

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First, shops should be devoting as much energy to combatting steering as they are to anything else they’re doing: training, advertising, fixing vehicles, etc. They need to declare war on illegal steering by coming up with a comprehensive action plan that will minimize the damage it causes to their businesses.

First, let’s address legislation. Realize that most anti-steering legislation has so far been worthless. Because it’s often unenforced and carries no significant fines (and what is a significant fine to a multi-billion dollar insurance company?), insurers ignore it and blatantly violate it or cleverly work around it. With that said, I think it’s still worth pursuing in conjunction with your local state association because even if getting an anti-steering law passed only amounts to a “warm fuzzy” in your belly, you’ve at least educated local lawmakers on what steering is and why it destroys the free market.

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Short-term, you need to educate the heck out of your customers. Why not devote your monthly customer newsletters (you do have these, right?) entirely to conveying the message that they have the right to choose the shop of their choice? Why not provide them with a word track of their own they can use when they file a claim and the insurer tries to steer them? Here’s an example:

INSURER: If you take your vehicle to ABC Body Shop, the work won’t be guaranteed.

CUSTOMER: Actually, ABC guarantees all their work.

INSURER: You may also have out-of-pocket expenses if you take it to ABC.

CUSTOMER: I don’t anticipate that. After all, you as my insurer are obliged to pay the reasonable costs of repair.

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INSURER: We may not be able to get an appraiser out there for another week.

CUSTOMER: If you value my business, you’ll get an appraiser out there ASAP, otherwise I may go insurance shopping.

It’s your job to educate your customers. No one else is going to do it for you. They need to have their hands held and be told exactly what to say – and they need to be communicated with constantly. Why not send a monthly text message to all of them restating their right to choose the shop of their choice?

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You also need to give your customers reasons to come back to your shop. If insurers are telling them why they should go to a shop on their preferred lists, you need to tell them why they need to come to you. One shop I know offers rewards points that customers can redeem on their next visit. Another promotes a free detail. You don’t necessarily have to offer freebies, but you get the picture.

The key here is that you really have to roll up your sleeves and constantly work at the customer education process. Insurers are not going to stop steering anytime soon, so you need to meet with your team pronto if you haven’t already and discuss a strategy to combat it. It’s just as important as doing a quality repair. After all, if steering gets the best of you, you won’t have any repairs to do.

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