The service drive has become a key profit center for dealerships in recent years.
In 2023, U.S. new-vehicle dealerships wrote 264.3 million repair orders, slightly down from 265.8 million in 2022, according to the National Automobile Dealers Association (NADA) data. However, service parts and sales revenue reached $142.62 billion, a 3.73% increase from the previous year.
Meanwhile, the cost of new vehicle ownership is up 30% since 2019, according to S&P Global Mobility, contributing to the average age of vehicles on the road reaching a new record of 12.6 years this year.
With customers waiting longer than ever between new vehicle purchases, refining your dealership’s service department process to generate more revenue can make a critical difference in your dealership’s bottom line.
The Growing Role of the Service Drive
As vehicles get older, they require more maintenance, representing a growing opportunity to engage prospective service-to-sales customers before they re-enter the market.
Instead of waiting for customers to come to them, proactively engaging prospective service-to-sales customers enables dealers to meet people where they are in their buying journey – effectively converting and closing customers before they even re-enter the market.
But successfully mining the service drive for new and used car sales requires buy-in from service, sales and F&I to ensure a consistent and collaborative effort.
By equipping their sales and service teams with the skills needed to capitalize on the rapport built through regular service interactions, dealers can turn these connections into profitable sales conversations while simultaneously nurturing customer relationships.
Effective Sales and Service Training
To maximize every customer interaction, creating a cohesive environment between service and sales departments is crucial. Cross-departmental training helps ensure sales and service teams’ efforts are working together, helping improve overall performance and creating a seamless customer journey that can lead to increased sales opportunities.
Often in a dealership, there is a disconnect between service and sales. By learning how to break down those barriers, dealers can more effectively transform service-not-sold customers into qualified leads. This starts with every member of the team understanding their role in the service-to-sales transition.
Joint dealership training sessions can bridge the gap between these two critical departments, ensuring all team members understand their interconnected roles in the sales process, from greeting customers in the service drive to closing deals in the showroom.
Creating a Seamless Service-to-Sales Experience
While the approach may vary based on a variety of factors, including dealership size and staffing, a seamless and profitable service-to-sales process comes down to knowing service customers’ history and buying motivations and presenting the right offer, at the right time, in the right way.
To support an effective process, dealership sales and service training should help teams proactively identify prospective service-to-sales customers and engage buyers with personalized interactions tailored to their unique needs and preferences.
Dealers need to train their sales and service teams on how to leverage a combination of first and third-party data from their CRM, DMS and any other tools/platforms to identify and pre-qualify service-to-sales prospects.
Knowing in advance which customers are likely to be receptive based on these insights, service advisors can take a targeted and personalized approach to sales conversations, subtly introducing the idea of purchasing new vehicles with messaging that aligns with a customer’s known preferences and service history.
To integrate sales conversations into their normal service interactions without being too forceful or opportunistic, service advisors need to develop effective communications skills.
Role-playing exercises are crucial for this training, allowing staff to practice smoothly transitioning from service topics to potential vehicle purchases. By scheduling regular training sessions, dealers can keep the team informed about new vehicle features and financing options, making sure conversations with customers remain relevant and engaging.
The service drive will continue playing a pivotal role in dealership profitability as vehicles age and require more frequent maintenance, offering dealers invaluable opportunities to connect with buyers.
Leveraging data to bridge the gap between service and sales enables dealers to transform routine maintenance visits into potential sales leads. By taking a proactive approach, dealers can increase the profitability of their service department while setting the stage for continued success.
