Lost Sales in Aftersales

Dealers can hardly accept financial losses due to "disruptive" innovations, new Original Equipment Manufacturer (OEM) strategies, and megatrends in Aftersales Markets without finding new business "veins" to unlock revenue growth. Dealer Management System (DMS) providers must respond to it. They have started to look across the industry at those business models and products that can guarantee dealers' prosperity. New products, add-ons, and modules such as Aftersales Lead Management, Complaint Case Management, or Membership Programs give a unique perspective on enhancing traditional As-It-Is dealer operations. It becomes clear that there must be an intense focus on aftersales. 

Besides adding powerful DMS tools to refresh the aftersales processes, dealers must manage their sales and aftersales opportunities effectively, track their progress, and evaluate results. 

Sales Opportunity Management is typically part of dealers' Contact Relationship Management (CRM) tools as a component of existing DMS or integrated third-party applications (e.g., Salesforce Automotive CRM, DealerPeak, DealerSocket...). Due to a long tradition, CRM can immensely support vehicle sales, assisting salespersons in tracking opportunities for potential sales across the pipeline and converting them into recurring revenue.  

But how does it look in Aftersales? 

I researched available solutions on the market and got in touch with dealers and experts (SMEs) to collect as many details as possible to find the answer. Result: It is done "somehow." 

We clearly detected the considerable potential for improvement. What could be the reason for such an underestimated situation in Aftersales? Finding the answer made it apparent that "The devil lies in the details." 

Firstly, the diversity and complexity of service processes limit the application of uniform procedures like sales opportunity management. Secondly, dealers blindly and narrowly focus on sales, and thirdly, the missing DMS operational support limits the potential to implement Aftersales Opportunity Management in real life.

The support of DMS plays a vital role in Aftersales Opportunity Management, especially if we start discussing topics like Aftersales Lost Sales. The service process is a predictable "thing" divided into aftersales stages (scheduling, reception, work in progress, quality control, pick-up, follow-up, etc.), so could we somehow "learn" from Sales Opportunity Pipeline or not? 

Let's detail and summarize how one must consider the essential elements to apply them in reality.  

Five vital elements of Aftersales Lost Sales in DMS

  1. Automated creation and tracking of aftersales opportunities (for instance, by service booking, walk-ins, quotations, or by transferring aftersales leads from external applications).   
  2. Quickly identify an event and stage in service workflow when dealers lost the aftersales opportunity (Service appointment or orders cancelation, reducing the initial scope, refusing price offering...)
  3. Understand what caused the loss, (no-shows, missing parts, service or workshop capacity, the high price of the initial offer, competitive offer, or absent communication...). 
  4. Take measures and evaluations using valid KPIs. (Lost quantification, % lost revenue, assessing reasons, identifying trends and roles of seasonal aspects...) and finally 
  5. Improve the existing state to prevent it from happening again. 

Once dealers manage all elements profoundly AND get functional support from the DMS, things start to change.   

For a better illustration, see a screenshot related to incadea.dms solution on detecting, reporting, and evaluating lost parts sales. 

Indeed, in a broader context of the aftersales lead management functionality, dealers must count on additional details and factors. Primarily on how effectively they can manage and transfer aftersales leads received from diverse external channels (OEMs, WEB, Campaigns, etc.) into the sales. We can discuss this excellent topic next time if you are interested. 

I hope you were able to gain insight from the article and look forward to your feedback and am genuinely interested in your opinion of it.

 

Dr. Juraj Hanus

SME DMS | juraj.hanus@incadea.com

POSTED ON
11/2/2022 12:00:00 AM
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