Now more than ever, businesses need to prioritize customer experience. Whereas companies in the past spent most of their time and energy promoting the products they were selling, organizations today understand the critical value consumer experience plays regarding their overall performance. According to a survey conducted by Forrester, 72% of businesses say customer experience is their top priority. Organizations understand that shoppers today have more options (and higher expectations) than ever before — which means that teams need to go above and beyond to create a positive customer experience.
The automotive industry has had an especially difficult time adapting to the wants and needs of the modern-day customer. According to the American Customer Satisfaction Index (ACSI)’s 2021-2022 Automobile Study, customer satisfaction with the auto industry is at an all-time low. However, dealers and original equipment manufacturers (OEMs) can find their way back into customers’ good graces. As Gerent’s Automotive Practice Lead, Nikhil Bhatia, noted in a recent white paper, adopting a customer-centric approach to sales and service can do wonders for an organization’s satisfaction rates.
"By moving to a customer-centric model, we are ensuring that the auto dealers are up to date with what the customers want out of the brand," Bhatia explained. "That also makes the OEM happy because it helps them sell more cars."
The Value of a Customer-Centric Approach
By adopting a customer-centric sales model, automotive organizations can provide a more seamless and convenient customer experience. Hybridized shopping experiences offer a perfect example of a high-potential opportunity area; today, nearly 60% of car buyers conduct research online before purchasing a vehicle; they spend, on average, six months researching before making their purchase.
Using technology, organizations can digitalize processes that previously had to be conducted manually. For example, customers can now browse a dealership’s inventory online, whereas, in the past, they had to go to the dealership and be shown around by a salesperson. Being able to do more from the comfort of their homes instead of going to dealerships is a plus for many customers, as convenience is king in the modern world; 43% of consumers say they’re willing to pay more for a product if a shopping experience is more convenient to them.
That said, applying a customer-centric approach isn’t just beneficial to customers — it can also improve company performance. According to research by Deloitte, organizations that implement a customer-centric approach are 60% more profitable than organizations using a product-centric approach. Once the transition to a customer-centric approach begins, customers will take notice and, statistically speaking, will be more likely to return for future purchases. Per communications company Twilio, 60% of consumers say they will likely become repeat buyers after a personalized shopping experience with a retailer.
A customer-centric approach provides many more benefits for organizations, including:
- Increasing customer lifetime value (CLTV): Customer lifetime value as the total worth of a customer's business over the whole period of their relationship. The happier a customer is with a company's service, the more likely they are to become loyal (and thus more profitable) patrons.
- Building relationships with customers: Customers take notice when a company prioritizes them. In a world where experiences are everything, building a positive relationship with customers and letting them know their wants and needs are being acknowledged is a game-changer.
- Understanding customer behavior through data: A customer-centric approach requires customer data, which can be collected through various means. When businesses leverage this data to determine customers’ unique preferences and pain points, they can deliver more personalized — and satisfying — experiences.
Given these value-adds, it's clear that adopting a customer-centric approach could be enormously beneficial to experience-mindful organizations in the automotive sector. While adopting a customer-centric approach isn’t an easy feat, it’s worth it to automotive organizations in the long run.
Making the Switch to Customer Centricity
The transition from product-centric to customer-centric won’t happen overnight. It requires a total mindset shift for an organization and everyone on board, investment in new technology, and a total reimagining of how the organization handles interactions with its customers.
To begin the transition from a product-centric to a customer-centric approach, an organization must switch its focus from selling merchandise to forming relationships with consumers. By diverting its attention to the customer, organizations can expect an increase in repeat customers and, ultimately, CLTV. Two major actions define the practices of a customer-centric organization:
- Implementing a centralized CRM like Salesforce Automotive Cloud. With the help of a Customer Relationship Management (CRM) platform, customer-centric organizations can store important customer information in a centralized location accessible to all employees. This data can be used for everything from predicting buyer behavior, as mentioned before, to identifying pain points and areas for improvement in the customer experience.
- Leveraging data to facilitate more personalized and timely outreach. CRM platforms empower customer-centric organizations to gather data and conduct analysis. Salesforce’s Automotive Cloud, for instance, allows teams to predict market trends and foresee the needs of individual customers based on their previous interactions. For example, if an organization sees that a customer hasn’t had an oil change in six months, they can send out a reminder to notify the customer that they may need to come in for service.
To learn more about how a customer-centric approach can help automotive organizations increase performance, customer satisfaction and CLTV, download Gerent’s white paper or contact us today!