Why customer loyalty is essential for workshops with the rise of EV’s
In recent years consumer behavior has changed rapidly as people were seeking more sustainable ways of living. As a response, industries have to change and adapt, and the automotive industry is no exemption. As a consequence of the sustainability trend, the demand for electrical vehicles (EVs) is on a significant rise. EVs are changing the scene considering their technological differences; manufacturers are competing head to head to deliver the best product to the customers. Although the technology and quality of the cars are crucial, aftermarket service — an often overlooked component — is just as important.
Importers and dealers need to be ready for the changes
It is no question that those will win the EV race who not only focus on producing the best vehicle on the market but also pay attention to customer retention. Especially in car retailing, keeping a customer for a long period of time — and make significantly more revenue per car — is a tough nut to crack. Why? Dealers and workshops are lacking the digital tools and resources to establish a long-lasting customer relationship. Most of the customers buy their cars and simply leave their designated workshop after a while and service their cars elsewhere. Consequently, workshops lose a significant amount of potential revenue.
This pattern is no different from the EV car owners in fact it is even more critical. Switching from internal combustion to electric power fundamentally changes its maintenance. Oil changes and brake service — two of the top three maintenance items — are reduced or eliminated in EVs. With the total elimination of oil, a typical workshop will suffer a 35% decline in service and maintenance revenue over a five-year period. In general, EVs need less service but more tire replacements than regular cars.
Looking into the future, where more and more people will switch to EVs, it is crucial for workshops to keep any possible revenue that comes from the EV maintenance. But how to do it, if customers leave workshops? The answer is to connect cars to workshops and convert owners into loyal customers!
Connectivity and customer loyalty
Looking around at any forward-thinking company’s HR department, customer success roles are growing extremely fast. These companies recognized the immense importance of customer loyalty on long term revenue generation. And no wonder why. In the car retailing industry, workshops are able to make up to 78% more revenue on a car by simply keeping customers connected and loyal to them. This has been a huge untapped market, that we recognized at Connected Cars and created our software and hardware to connect customers to workshops. The good news is, that we are able to connect EVs to workshops and we too see the pattern: the number of connected EVs are rising.
We have seen in the past years the coming trend of EVs and we designed our product to be suitable for the electrical vehicles as well. We witnessed this trend in the workshops using Connected Cars, as they connect more and more EVs to ensure customer loyalty and efficient workload. says Martin Høgh, Director of Business Developement
More affordable EVs on the market — the new VW ID.3
The largest car producer in the world, Volkswagen has recognized also, that EVs are the future and has put a massive resource in this segment.(Until 2024, Volkswagen will invest 33 billion Euro into electric mobility) In September they came out with their very first purely electric vehicle, the ‘ID.3’. In the automotive industry, Volkswagen, the ‘people’s car’ has been revolutionary. First, the Beetle and then the Golf have been the most sold cars worldwide and now they came out with the ID.3 in hope of a third revolution. Electric cars for millionaires are already on the market, such as the Taycan from Porsche or the Tesla. Volkswagen wants to remain true to its name and with its new model aims to make EVs more available for a wider range of people. So far 10.000 ID.3’s have been manufactured and there will be 100.000 more until the end of the year.
Conclusion
To conclude, demand for EVs are on the rise and leading manufacturers are investing heavily into the segment to make it more available for a wider range of people. Since EVs need different maintenance and less spare parts, workshops will lose a part of their revenue which has been solid with the internal combustion cars. With this, workshops need to be fast movers and adaptors to the change and make customer loyalty key for their business. Connecting customers to the workshops has proven to strengthen customer loyalty and consequently resulted in a higher revenue.
