News: Collision Industry Icon Jeff Silver Passes Away
Insurers can steer customers to their preferred shops, but we can steer them too. Copy what they do and you’ll be well on your way to regaining control of your customers.
The collision industry is constantly changing, and we must pay attention to this evolution so we can move forward with as much information as possible and increase our chance of prospering. I use the word “prosper” because the reason we’re in business is to prosper, not just survive.
I’ve watched a movement among the insurance companies to take control of the consumer. They’re using well thought out marketing plans to take our customers from us. I’ve always paid close attention to what insurers do and try to mimic them when possible. They have “accident forgiveness,” the “Gecko” and other mascots, and the “concierge” program. They’re spending hundreds of millions of dollars to win over our customers. So for us to take those customers back and continue to build our customer base, we must mimic what insurers do.
This effort by insurers is built around offering the customer convenience and peace of mind, which is comforting in a time of uncertainty and trouble. Removing the hassle by giving the customer a quick and easy solution with a guarantee is a tough act to follow. Let me offer some ideas that we’ve implemented at our shop to keep our customers and win new ones in an increasingly difficult environment.
Create a Marketing Plan
The first thing you must do is find out where your customers are coming from and what brought them to you in the first place. Once you establish who your customers are and where they’re coming from, you’ll know how to direct your marketing dollars.
Yes, you must spend money, so it’s important to find out how much you can afford so you can then create a marketing budget. Word-of-mouth is no longer enough to match insurers’ clever advertising and marketing plans. Start small if you need to, but make sure you’re getting the most bang for your buck. A good number to spend is between 1 and 2 percent of your gross sales. We’re firm believers in advertising and have developed a strong marketing plan that includes cable television, radio and direct mail. However, this is still not enough.
We realize that it’s not a guarantee that many of our long-time customers will return, so we developed a plan that would keep them coming back and referring us for life. Most people keep their insurance companies for years – why not give them a reason to keep us at their collision repair facility of choice? Where did we get our ideas? From the insurers that were leading our customers away, of course.
Be a Copycat
We started a customer care program through a shop network of best-in-class shops that enabled us to track our customers and make them members of our shop. We tweaked the plan and added our own custom gift card so we could add money ($100 to $200) to it any time we wanted. Every customer gets one of these cards, and their information is recorded in our database. This is our version of accident forgiveness, except we allow customers to give their credit to family members or friends if they want. We encourage them to keep their card because we periodically reload it.
Our customers can use their gift cards for details, paintless dent repair, windshield repair or other things. We don’t allow them to use them toward their deductibles or anything related to the current repair. The cards are designed to make them return the next time without giving the impression that we’re offering a discount. Rather, we want to emphasize that we’re rewarding them for their loyalty.
Our database contains thousands of customers who have credit from us and are just waiting to redeem it with their next repair. We average one to two customers who return every week to redeem their credit.
We also have the ability to target a customer insured by a particular insurer through direct mail. If a particular insurance company is steering work away from us, we pull up everyone in our database who’s insured by that insurer and load their cards. This allows us to put our own accident forgiveness in place to encourage our customers to remain loyal and return to us no matter what their insurers offer.
Educate the Customer
Consumer education is the theme of our advertising. Through research, we’ve found that, as loyal as customers may seem, the majority of them will go where their insurers recommend. This is why we created a well thought out word track designed to answer key questions and prepare our customers so they’ll know what to expect when confronted by insurers that may try to direct them away from our shop.
We explain to our customers that the promise of a guarantee is not the same thing as a high quality, safe repair. We explain that insurers might tell them that if they don’t go to shops on their preferred lists, their repairs might be delayed, the repairs won’t be warrantied or there will be additional non-covered costs.
Our word track is the most important part of our sales pitch because we’ve watched too many potential sales go away after the insurer talked to the customer. Our sales are directed with the purpose of gaining a customer for life, so we always look beyond the initial repair and make sure we offer customers what they need.
We also try to spend a lot of time educating our customers on the proper repair procedures that OEMs recommend for their vehicles. We explain how many safety issues are overlooked because of the lack of training or equipment. We offer a shop tour and show them some work in progress and point out areas of the repair that are often overlooked by less experienced or less equipped shops. We explain in detail how most of the repair is hidden and that they won’t be able to see the quality that’s put into it.
Learn To Steer
Just like there are good and bad body shops, there also are good and bad insurers. There are many insurers that are better than others, and there are those that we would never recommend. Given that insurers often recommend shops on their preferred lists, we’ve mimicked them and created a list of insurers that we recommend. We’ve even taken this one step further and have created and posted on our wall a list of insurers that we don’t recommend.
We try to steer our customers to insurers that allow us to use OEM repair guidelines and also allow us to control the repair process. While every single insurance company will say it’s concerned about safety, the bottom line is that we carry the entire liability for the repair, and insurers are off the hook and they know it. So we have no problem letting our customers know which insurers show little concern for their families’ safety. We try to align ourselves with the best insurance companies and separate ourselves from the others.
Insurance companies are masters at steering customers, so we’ve become just as savvy with our steering. We’ve been able to get hundreds of customers to change insurance companies after having bad experiences with the way their claims were handled.
Another very important factor to succeeding in collision repair today is gauging customer satisfaction, so we make it a point after every repair to call every customer and a list of questions. Through tracking customer problems, we’ve found that all of our customers expect quality, yet none have the same expectations. One customer may complain about a dirty seat belt, while another may see a microscopic flaw in the paint.
Our research showed that the two issues that upset our customers and jeopardized our retention rate the most were communication and time delays. Above all else, our customers want to be contacted, and they want their cars back on time. That’s not to say that quality and cost aren’t valid concerns, but we found that communication and time delays were customers’ top two complaints. We also discovered that when customers call us, they don’t consider it contact. Only when we took the initiative to call them did they consider that they had been contacted.
We require that all vehicles be delivered back to the customer by the account manager who handled that particular customer’s file. Plus, we make sure that the customer, in most cases, is always contacted and updated by the same person. We want the customer to feel like he or she is important even after we’ve made our money. It’s during the reselling process that we “seal the deal” and work to get the customer resold on us to use us in the future. This is when we give them their gift cards, enter them in our database and reconfirm our word track that they’re our customers and we value them. This is very effective because at the end of the repair at some collision repair facilities, most customers are passed off and neglected. This is a big mistake in customer retention.
Put yourself in your customers’ shoes and ask yourself what you would think of the cleanliness and appearance of your shop. Take notes and make sure that your office reflects what you’re all about. Make sure that you have your mission statement on the wall and also hang up a few key items that reflect what you are about. Don’t make the mistake of hanging multiple plaques (like all the I-CAR plaques you have) because this just removes the focus from what you really want the customers to know about you. The customer will understand something like “lifetime warranty” much more than seeing 20 industry-related signs they don’t understand. If you really want them to understand what I-CAR Gold or ASE certified means, you can verbally explain it to them.
Make sure you have a hospitality area where your customers can watch TV and get refreshments. This will go a long way with customer retention because if they need to wait for anything, it won’t seem as long.
Dress Sharp for a Sharp Reputation
I took a lesson from Enterprise Rent-A-Car when it came to my staff’s appearance and customer service habits. Every time I traveled and went to the Enterprise office, their employees were dressed very nicely. I sent my customer service representatives to customer service classes, then I told them to visit the Enterprise office to observe how everyone was dressed. We really try to mimic how the Enterprise employees look and act.
My estimators and managers all wear white shirts and ties, and everyone wears name tags. I sent each one to all of the local car dealers to observe the appearance of the office staff, and told them also to go to the bank and pay attention to how they were treated and how everyone was dressed. I think it’s safe to say that you only have one chance to make a good impression, and your first impression is what the customer will remember. Remember to think outside of the box and put yourself in your customers’ place and ask what it would take to get you back if you were the customer.
I hope this helps and good luck with your mission of “keeping your customers yours.”
Writer Lee Amaradio Jr. is the president and founder of Faith Quality Auto Body Inc. in Murrieta, Calif. His 32,000-square-foot state-of-the-art facility employs 65 full-time employees and does $7 million in gross sales. In business since 1979, Lee attributes his success to having a great team of quality people supporting him. Lee says that he “sees the handwriting on the wall” and believes that “now is the time for us to reclaim our industry, before it’s too late.” He can be reached at [email protected].