By Richard Ipsen
Fixed Ops Magazine, May 2007, Vol. 4, No. 5

In today's automotive market, Customer Relationship Management is not just a buzzword; it’s a way of life.

Customer service used to consist solely of a friendly handshake and a smile, without any systematic way of tracking customer satisfaction and disappointment. But in this age of technology, dealers have access to many more forms of communication – e-mail, phone and direct mail - that allow them to contact their customer base in a faster and more cost-efficient manner.

To be successful in ensuring that customer satisfaction becomes customer loyalty:

1. Maximize your customer database. Every dealer's customer database (DMS) is a literal gold mine just waiting to be tapped. Have a process in place to send: letters for recommended service, declined service, inactive/lost customers, first and second service reminders and auto recalls. Those who are most effective also send first time service welcome letters that include a survey, and implement online appointment setting and history.

2. Use the customer database to determine profitability and the lifetime value of each customer. Knowing your customers’ spending patterns and demographic profile can allow you to forecast when they will return for service and also estimate which services they will be interested in depending on price point.

3. Keep track of your customers’ opinions and systematically send focused retention letters and postcards with good reasons for customers to keep coming back. An effective process will download customer information directly from the DMS after each business day, calculate the next service due for each customer, and send letters on a daily basis to reduce peaks and valleys in the service drive.

Reminder letters and postcards are mailed to each customer 14 days prior to the next service due date, which is based on the dealership’s mileage and/or time recommendations. A good CRM provider will track and trend your return on investment by letter type, customer cycle and specific purchase order.

4. Respond immediately to customer complaints. Make it easy and comfortable for customers to express their complaints, concerns, dissatisfactions and recommendations. Keeping track of your customers’ opinions and resolving situations in which customers are dissatisfied is the foundation to the long-term relationship building that CRM is all about.

5. Survey customers on a consistent basis in order to truly understand customer wants, needs and disappointments. Dealers need to survey their customers after each service to correct complaints. When dealers neglect this vital component of CRM, dissatisfied customers may stop coming in for service, or worse, spread ill will about the dealer without giving them a chance to correct the problem. A good CRM provider will track and trend each survey response to pinpoint areas in need of improvement and hot alert the dealer of dissatisfied customers.

With these five easy points, dealers can successfully track customer satisfaction, improve customers’ experience and focus on what they do best: selling and servicing cars.

Richard Ipsen is president and CEO of DiversiForm Inc.; this article was submitted to and published in Fixed Ops Magazine, May 2007. This article has been edited to appear in DiversiForm’s InsideTRAX Newsletter.