The conventional wisdom in the industry is that 50 percent (or more) of OEM profitability occurs after the sale of the vehicle. The dealer plays a critical role in this process as the primary customer interface. Unfortunately, dealers and OEMs have never been on the best of terms. And when it comes to leveraging service opportunities to crank up profits there remains much room for improvement.
The good news for dealers is that there are a proliferating range of suppliers and solutions to make the connections between car buyers and their dealers more “sticky” and more profitable. These solutions are focused on either vehicle diagnostics or service scheduling or both. This is not a new challenge for the industry, but new technology is altering industry relationships and changing the customer experience.
The increased interest is actually supported by recent findings published by JD Power and Associates in its 2011 U.S. Automotive Emerging Technologies study. According to the results of a survey of nearly 18,000 vehicle owners, remote diagnostics was the feature with the highest degree of interest after the market cost was revealed.
Interest after market price is revealed
Remote vehicle diagnostics – 55%
Non-branded premium sound system – 52%
Wireless connectivity system – 50%
Rear-vision camera system – 46%
Blind spot detection – 45%
SOURCE: JD Power & Associates
A handful of companies are leading the way in closing the diagnostics/service gap. Xtime, is the market leader in what it calls ServiceCRM. GoPoint Technology has an iPhone app and OBDII connection to allow dealers or consumers to diagnose vehicle problems. And Vinvox has an OBDII plug-in to allow dealers to manage and monitor customer vehicles needing repairs or maintenance.
GoPoint and Vinvox are new to the market, with Vinvox in the very earliest start-up stages. Xtime, on the other hand, already boasts a robust following among OEMs. In fact, Xtime is unique among these three companies in pursuing relationships with OEMs, while GoPoint and Vinvox are designed to be offered directly to dealers – and GoPoint as the only direct to consumer play.
Xtime says its ServiceCRM automates and integrates electronic service menus as well as online/dealership/call center/smartphone/telematics scheduling, online bill pay, electronic service notifications, comprehensive shop control, greeter boards, management reporting and certified DMS connectivity into a unified, web-based platform.
Xtime says it delivers its ServiceCRM product via the Internet to over 3,200 dealers today. This “Software as a Service” or SaaS business model empowers the dealer to schedule customer service visits and promotional campaigns.
The company is also piloting a Mobile Service Advisor (Q3) to enable a full check-in solution. Xtime says its MSA includes electronic inspections, advisor appointment views, trim-level menus, vin scan, photo/video capture, automated customer signatures and electronic notifications, for fast customer check-in. All functions are delivered on a tablet computer.
Xtime says it is the exclusive provider of these functions for car companies such as Infiniti, Nissan, Lexus, Toyota Canada, Southeast Toyota, Chrysler and Hyundai and is the preferred provider at BMW, Toyota USA and Audi. Xtime is also the exclusive provider for many of the industry's leading dealership groups, including AutoNation, Group 1 Automotive, Sonic Automotive, West Herr, Luther, Ferman and Checkered Flag. CustomerTraac, The Market Store, DME (owned by JM Solutions), Aspen Marketing and Dealer’s Greatest Assets (DGA) all use Xtime to power their centralized call centers for service scheduling.
Xtime is actually an important element of Hyundai's Blue Link telematics eco-system providing a critical link between Hyundai, the customer and the dealer. The ability exists within the Xtime implementation with BlueLink for automatic notifications to go to dealers in the event of a vehicle DTC (diagnostic trouble code) occurrence. If the consumer opts in - to share vehicle information - and if the feature is enabled dealers will be notified of the DTC and can then reach out to notify the customer.
This capability is an industry first when and if it is enabled at the launch of Hyundai's Blue Link solution. The Hyundai implementation stops short, however, of providing dealers a proactive view of the status all customer cars. Privacy concerns are likely impeding this next step. But privacy is not interfering with advances in the aftermarket.
GoPoint’s iPhone-based solution is unique in putting diagnostic capabilities in the hands of the consumer or the service manager. Unlike a competing solution from CarMD, which is a dedicated device, GoPoint combines a free downloadable app for the iPhone with a diagnostic cable for the OBDII connection to tap into the vehicle codes on the Can bus.
But there is more to the GoPoint solution than meets the eye. The solution is also being used in four U.S. states by SpeedEmissions as a certified emissions testing application called Carbonga. And for car servicers or car dealers there is a cloud based solution, FuzzyLuke, which puts the application in the hands of customers to enable them to diagnose vehicle problem codes and upload them to a Web-based application for service scheduling. FuzzyLuke claims the iPhone application and OBDII connection cable help car dealers and service operations tap into the $60B market in unperformed maintenance.
Vinvox also integrates with smartphones and offers Web-based means for both consumers and dealers to view vehicle history and warranty and repair status along with vehicle codes, but Vinvox dispenses with the cable in favor of an OBDII plug-in with a cellular connection. VinVox’s Retriever provides real-time notifications of required service or maintenance to the dealer and driver giving the dealer a powerful customer relationship management tool.
What is clear is that OEM telematics systems have failed to fulfill the promise of customer/vehicle relationship management. Aftermarket providers are diving into this yawning gap with clever solutions intended to empower dealers to better manage their fixed servicing assets while also enabling consumers to better understand that functional status of their vehicles.
How the OEMs could have missed this opportunity is hard to comprehend. There is no doubt they see the money being left on the table now, though. Within a few years, car makers will have refined their dealer service integration solutions and, maybe, they will win dealers back.
The goal is a centralized CRM/VRM model that gives the OEM a view to global vehicle servicing activities while giving the dealer the tools he or she needs to manage and measure customer service opportunities and, at the same time, creates a Web-based window for the consumer to better understand the service and maintenance status of their own car.
The vision has been at least partially described in the past by telematics service suppliers such as Hughes Telematics. And Yamei Electronics has a fully realized solution in use with 1,800 car dealers in China. (http://bit.ly/mSEUsB - #Yamei Puts Dealers in the Telematics Driver’s Seat – Insight) It’s time for OEMs to plug into the customer’s interest in their own vehicle and the value of the dealer interface.