Your customers are receiving unsolicited Vehicle Service Contract offers daily from companies. They don’t follow any rules, principles, or values. And they will use your dealership’s name, advertising lower prices, and using tactics to prey on your customers. In fact, many of your customers expect the hard-sell will eventually come from your dealership.
So what does that mean for your dealership?
While your dealership has nothing to do with these odious extended warranty providers, you may receive much of the blame. When a customer purchases a warranty from a random solicitor, we’ve seen:
- Denied claims to misinformed customers who thought they were covered
- Loss of service revenue because your customers are being going to alternate service/repair facilities
- Damaged reputation because customers with negative experiences are unlikely to purchase again
It’s important for your dealership to set up a program informing your customer when the expiration of their contract is approaching, it’s you who they need to hear from. By interacting with your customers at a critical decision point, you’re informing them about the difference between a credible service contract and a deceitful one.
4 Tips to Promote Vehicle Service Contract Penetration
- Communicate the Value: Buyers who are better informed about the value they can provide are more likely to purchase them.
- Have a Consistent Follow-Up Process: Every dealership and F&I professional needs to have a consistent follow-up process for those customers who choose not to purchase the service contract. There’s no reason to not keep trying if you miss at the point of sale.
- Clarify the Benefits: Make sure that the consumer understands exactly what they are buying, the range of coverages available.
- Tailor Your Offer to the Needs of the Consumer: It will allow you to know what selling points to drive home, as well as what term, miles or coverage tier will best suit those needs.
Customers are susceptible to scammers who may pose as representatives of your dealership. Keeping your customers aware of these improper tactics is extremely important to your dealership’s reputation and maintaining your customers for life. Consider how you’re engaging with your customers to educate them on these practices.