This is Part 3 of a 10-part series of Digital Customer Experience in the automotive industry. Use the links below to navigate between parts:
Are you pregnant? No? Are you sure? There is a probability that your supermarket or car dealer has a better knowledge of this than you do! A few years ago, a story regarding the American retailer ‘Target’ went viral across the globe: Target sent coupons for baby products to a pregnant teenage girl, even before she or the father knew about the pregnancy.
While this is not an example from the automobile industry and has been discussed ferociously by defenders of data-based customer care on the one hand, and data protectors on the other hand, it made it clear how the opportunities and requirements of modern customer care have changed significantly. Technological developments and increasing customer expectations are the drivers of this transformation.
How it all began: customer care of the past
In the past, automotive (direct) marketing measures were based on the product view (the vehicle). Campaigns were highly impersonal and distributed to a wide audience. In fact, this was the only way for Original Equipment Manufacturers (OEMs) to address their customers directly or on behalf of the dealers. But with the rise of new digital solutions and big data and analytics services, there are now many better ways for targeted and individualised customer care approaches.
However, customers are often still addressed via traditional offline-mailing campaigns. It is no surprise that those show low response rates and conversion rates. Moreover, it is difficult to determine KPIs and thus it is also very difficult to measure the effectiveness of these campaigns. Telephone marketing and email campaigns are used significantly less. On the one hand there are stricter data protection regulations and, on the other hand, databases and data quality are too poor.
Many manufacturers and dealers hardly own email addresses of their end customers. Thereby, 73% of all the customers in mature markets wish to receive communication via email whereas only 24% in printed form. Overall, customer care in the automobile industry is determined by a one-way campaign management without return channel from customers to OEMs and dealership.
The path forward: best practices for customer care in the future
But future customer care should be designed differently. Customers should be at the centre of all considerations and actions. Thus, the 4 Ps of the classical marketing mix must be superseded by a customer-centricity motto and replaced by a single P: “personalisation”. According to Capgemini’s Automotive Connect – Driving Digital study, customers always expect personalised responses that have been adapted to their individual needs across all customer lifecycle phases.
Customer care should be considered holistically: the customer should receive the right support at the right time via the right channel. Fortunately, digital technologies enable automotive companies to implement this approach. For this, it is essential to create a steady dialogue with the customer and enable them to obtain information 24/7 via appropriate channels independently. Different considerations are useful in this process, which are based on new technologies and existing challenges in the automobile industry:
1. Integrated customer care across all channels
To place the customer in the centre of all actions means to align customer care with the individual needs of the customer ("there is no one size fits it all...") and to implement an integrated, cross-channel customer care. Existing silos in marketing, sales, service and finance should be replaced for this purpose. According to Harvard Business Review Analytic Services, an independent research institute of the Harvard Business Review Group, isolated approaches represent the biggest obstacle:
“When it comes down to improving customer experience and becoming industry leaders, it can be assumed that companies with good financial results and positive customer experiences have abandoned this approach."
One implementation option for OEMs may be, for example, a cross-departmental customer care “toolbox”: customers should get suitable and orchestrated deals from sales, after-sales, financing etc. which are suitable for their individual life-cycle phases and preferences. The overarching goals would be to provide a customer, right from vehicle purchase up to repurchase, with a unique customer experience.
It should be adapted to the particular needs of the customer instead of driving inconsistent, often conflicting individual marketing measures that may ignore the interests of the customers. According to our study “Cars Online 2015”, a frequent customer interaction leads to higher customer satisfaction. Transparency and alignment are the core elements of any customer care since customers “…do not want to tell their story again and again.”
Additionally, higher customer satisfaction, higher response and conversion rates and thus higher profit margins are other benefits for OEMs. At the same time, marketing resources can be used much more efficiently.
2. Direct customer care using technological innovations
New digital solutions offer interesting potential for an improved, direct customer care. From systematic advertising through online customer portals or In-Car-Marketing via Connected Cars, digital marketing channels provide a more direct line to the customers and, at the same time they are also true data generators that teach more about behaviour, preferences and interests of the customers.
This offers completely new opportunities to OEMs to get to know and address their customers. And at least 47% of all customers can imagine using Connected Car features in their next vehicle plus they increase their willingness to share data significantly. Valuable information about customers can be gathered through a direct link to customers and through this, a steady customer dialogue can be ensured.
At the same time, digital customer care in the form of emails or apps for example, is usually cheaper and success can be measured more accurately. This allows for a better KPI-optimised mix of marketing measures in comparison with the existing traditional marketing campaigns. When customers get information, products and services provisions according to their needs, it not only decreases marketing costs but also increases revenue through a higher hit rate.
Additionally, digital channels also offer the perfect return channel from customers to the OEM. They enable customers to provide themselves with the right information (for example to determine necessary auto parts for individual vehicles on their own using an app or to book online appointments. This not only offers the potential for higher customer satisfaction but at the same time significant savings and profit potential for companies. A win-win situation!