FROM THE CEO
A Closer Look at the Dealer’s Customer List
where consumers take their cars when they have a transmission problem. We discovered that the number of consum- ers who would choose the dealer was almost equal to those who’d prefer an independent transmission repair shop. This is a valuable piece of infor-
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mation. It means that there’s an entire market out there — one that’s almost equal to the one you’re already serving — that’s choosing to bring their cars to someone else. If you could attract those consumers, you could potentially double your business. What’s more, these consum-
ers aren’t just an additional market: They’re a market that can afford to pay for repairs. This is an important aspect of your business: having customers that can afford to pay for your services. Going back to some of our earlier
findings from shop visits, we learned that the more profitable businesses we visited were generally pricing their work right. That is, they weren’t the ones offering cut-rate pricing. Their business models included offering qual- ity work at a fair price. They weren’t the cheapest shops
in town, but their customers got their money’s worth. This aspect alone sug- gests that these shops were reaching consumers who have the ability to pay for the services they provide. This doesn’t happen by accident.
These shop owners have created busi- ness models based on providing qual- ity service and building the trust that would attract their target customers. But who are these customers? Let’s see if we can learn a little more about this group.
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ast month we looked at some of the results from ATRA’s 2011 consumer study, specifically
In last
month’s From the CEO, I pointed out that the con- sumers who preferred the dealer com- prised 24.4% of the total transmission repair mar- ket, compared to 24.6% that preferred the independent transmission repair shop. That’s useful, but it isn’t the entire story. Let’s look at the consumers who took part in this study, and see who those consumers are that prefer the dealership. We surveyed 1000 consum-
ers; about half men and half women. Then we targeted five age groups. The accompanying chart provides the breakdown of those who preferred hav- ing their transmission repaired at the dealer. One thing you might notice right away is the total percentage in the chart is much greater than 100%. This chart doesn’t represent the percentage of each group that make up the total in the dealer-preferred group, but rather, the percentage of people in each group that prefer the dealer. For example, 46.8% of men 56
and older preferred having their trans- mission work performed at the dealer. The next group (and it was no surprise) were women in that same age bracket, at 35.5%. This means that almost half of men and over 1/3rd of women 56 and older prefer taking their cars to the dealer.
by Dennis Madden
members.atra.com www.atra.com
Another interesting fact is that
younger individuals (both men and women) prefer the independent trans- mission shop. The obvious question is, why? Why is it that younger individuals prefer the transmission shop while the older ones prefer the dealer? Is there a relationship between these groups and their ability to pay for repairs? Some of these questions may seem
obvious at first, but if the answers are so obvious, why are transmission shops less able to attract this more mature, more financially secure segment? And how would it affect their profitability if they could attract these consumers? Now would be a great time to
revisit your business plan; not just the services you provide but your target market. Just who is it you’re trying to attract to your shop? We’ve recently surveyed a group of people that pre- fer the dealer and the data’s coming in. We’ll use this data to find ways to attract these individuals into ATRA Member shops. ATRA: The Dealer Alternative… I still like the sound of it.
GEARS January/February 2012
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