Service – The new Sales
1st Dec 2016 8:00 am
Will aftersales no longer be the poor country cousin?
It is often debated that marketing sells the first car and service sells the rest, and while that debate may never quite settle down in the automotive board rooms, the important ‘sales’ role that aftersales plays is quite clear. Despite this seemingly obvious piece of knowledge, it’s shocking to see how many brands get the all-important service vertical so wrong.
In our market, brands like Maruti and Hyundai – regular sales chart-toppers – are well known for their excellent aftersales service, while brands like Fiat and Skoda with a poor service reputation find themselves at the bottom. Tata too has paid a heavy price for its low product quality and shoddy repair work. This despite having a massive line-up of cars, SUVs and MPVs.
Of course, this is not to say that auto makers are oblivious, they have constantly applied effort towards improving service quality. But aftersales has always been looked upon as the poor country cousin and budget allocations have reflected this accordingly. It is only now that the right level of priority is seemingly being applied. Manufacturer after manufacturer are all announcing mega spends for service initiatives and on advertising this as well. Service seems to be the flavour of the month.
At the beginning of this year, Ford released its new marketing campaign that centred heavily around a new aftersales experience. A highlight of this exercise is the new online service price calculator, where one can calculate their expected costs before booking a service. This August, Skoda too announced a massive turnaround plan, heavily rooted in service initiatives. It offers a four-year care plan that includes warranty, roadside assistance and a maintenance package. And it’s not just the volume players. Luxury brand Mercedes-Benz too, in July, introduced a raft of aftersales services that includes the service packs, extended warranties and also a service-at-your-doorstep option.
Common across all brands is the leveraging of technology. Virtually every company offers smartphone or web-based apps to access things like booking, service histories and more.
While service quality has numerous problem areas, service cost has been at the forefront. The brands mentioned all offer pre-fixed prices or service packages aimed at capping a car’s periodic service costs. But it will take more than just apps, packs and schemes; just ask Chevrolet who had a fixed price scheme for periodic services way back in 2010 and are still struggling with sales.
There are two major challenges. While everyone is focused on reducing prices of the frequently used parts, it’s the rarely replaced part, which when fails, seriously inconveniences an owner, as they are rarely in stock or are imported units. The solution to this is a high degree of localisation and local manufacturing which means any part can be locally ordered instead of imported.
And as for the service initiatives, what is needed is their strict on-ground implementation and monitoring and it’s only then that brands will find aftersales emerging to be their new super-salesman.