Warranties - High Integrity Enhances CRM

Date: Tue 16th October 2012   |   Author: Natalie Ridgwell | Google+

Motor Trader - October 2012

Selling a used car warranty can help long-term retention, increasing aftersales activity, not just through warranty work, but also by creating a platform for a deeper dealer/customer relationship. This is the conclusion of leading warranty specialist AutoProtect.
“Classically, we see work bays dominated by new to three year old cars in the franchised arena. Much of this is linked to both a classic vehicle change cycle of three years and a link to warranties, which themselves often ran to three years. But the situation is changing.
“The link between warranty and service work has changed in light of Block Exemption regulation. Consumer awareness of this change has grown as major independent chains work to promote this reality. Rather than fight this tide of change, itself accelerated by the on-going austerity climate, we encourage dealers to adjust the used car warranty message, building value in the warranty and in the dealer’s aftersales experience”. Notes AutoProtect Corporate Development Manager Mike Macaulay
AutoProtect are championing a high integrity, ethical approach to the sale of warranties, as a way of encouraging used car buyers to use all of the facilities their dealer has to offer.
The goal is to provide the customer with  higher quality experience, ensuring that the seeds are sown to maximise customer lifetime value and enhance customer retention. The benefits of a better and wider introduction to the dealer’s services provide a platform that should not be missed. This is something that AutoProtect see as being particularly relevant to used car sales.
By ensuring customers know the detail of their proposed warranty, provided with a clear explanation of exactly what is covered and given the choice about the level of cover (and associated risks) in a way that really lives up to treating customers fairly (TCF) principles, the dealer is changing the whole emphasis of the sale from transactional to value creation. With the car sale completed, a new sale begins, that of the dealer’s wider portfolio of services.
“The improvement in car reliability has in part accounted for a fall in absorption levels, but the greater falls have come from not creating value in the wider dealer proposition. We are working alongside dealers to change this situation. The car dealer profit model has to change, to take a longer term view, with greater cross business co-operation between sales and aftersales”. Adds Macaulay, concluding; “Selling a used car should not be the end of the sales process, the warranty can be the bridge to a longer more rewarding relationship, where the customer looks to ‘their’ dealer to ensure their car is safe, reliable and economical”. 
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