It’s a jungle out there and we’re in an economic battle for survival! The equipment and machinery dealer who gets and keeps the most profitable customers survives and prospers. But, how does he win? Fortunately, there is an elusive but highly- effective winning strategy available.
There is a far more powerful and effective business development force working for you today beyond the dealer’s new machinery sales rep. The typical new equipment sales rep pales in comparison to this customer-building powerhouse.
I’m referring to a neglected, orphaned stepchild – that ignored, scorned, despicable and painful aspect of your business called dealer aftermarket support. Our extensive field research clearly documents that “no other dealer activity has greater influence over long-term success with valued customers.” Nothing else can “BUILD or DESTROY” equipment business potential more quickly. And, nothing else can more efficiently and permanently “DAMAGE” your customer’s confidence and trust in your products, your reputation and your people.
Over the years, The McDonald Group, Inc. conducted numerous projects to help dealers set up effective prospecting and market assessment capabilities. These programs assisted dealers survey large numbers of prospective buyers to identify, early on, purchase intentions as well as deals in progress. The assumption was, the sooner you were in on the deal, the better your negotiating position, ability to build relationships and the brighter your prospects for profitable, long-term success in that account.
Because of my sales and marketing management background, I once believed the equipment dealer’s NEW equipment sales rep was the driving force behind sold retail end-user account relationships. The equipment sales rep surely has the most to gain by creating and nurturing customers.
However, after dozens and dozens of market research studies, thousands of retail customer interviews and literally hundreds of face-to-face field discussions with YOUR retail customer types, overwhelming evidence forced me to change my mind.
I have spent the last three decades interviewing dealer customers. I have seen aftermarket product support either bring prosperity or disaster. Clearly, aftermarket product support is the essential driving force behind Customer ACQUISITION as well as Customer RETENTION. Product support will determine the success or failure of many dealer organizations.
Remember: You must do BOTH well: Territory Sales and Aftermarket Marketing to WIN!
Here are “21 Gorilla Marketing Ideas” that will surely help your Aftermarket Marketing.
1. DON’T SEEK INSTANT SUCCESS.
You must be patient. There are many steps leading to parts and service marketing success. Your efforts are cumulative, no one source gets all the credit, i.e., CRM customer profiles with contact schedules and account fleet data, aggressive and effective machine inspection programs, e-mail and direct mail service and parts specials, field customer support reps selling “fix-before-fail” maintenance programs.
Consider telemarketing to monitor service levels and customer perceptions for all repair orders over a certain value, personal “thank you” notes and a great dealer product support brochure featuring each technical support area are extremely helpful. (See my book Strategies, Tactics, Operations for Achieving Dealer Excellence, pages 142 – 145 for excellent samples). Team visitations by parts and service manager to key accounts, scheduled maintenance reminders, open house and customer appreciation events could all be highly attractive and effective elements of your program.
Remember, however, you must have the basics in place: excellent off-shelf parts fill rate to service, a record of accurate repair order estimates and demonstrated ability to fix it right the first time in the shop and on the road.
2. THE MORE YOU KNOW ABOUT YOUR CUSTOMER, THE MORE EFFECTIVE YOU CAN BE.
How does your customer get product and application information? On the internet? Trade shows? What type of vendor communications does he like and best responds to? What does he know about you? How does he feel about your capabilities and resources? Why does he continue to trust you with his equipment and buy from you? What really TURNS HIM OFF? This crucial customer information can be easily obtained from executive interviews with your best current customers.
Next, learn about his service and parts consumption potential for the fleet under his ownership and management. Utilize the service and parts “consumption factor” data illustrated in my new text, Achieving Excellence in Dealer/Distributor Performance (pages 78, 146-158) to help project aftermarket purchase potential for each of your major accounts. This is a dynamite aftermarket marketing tool.
3. AFTERMARKET MARKETING WORKS BECAUSE IT HELPS PEOPLE REALIZE THE MERITS OF OWNING THE EQUIPMENT YOU SELL.
Find out WHAT your equipment customers really buy. Productivity? Up time? Solutions? Guarantees? Peace of mind? Expectations? Believable claims? Hope for economic success with your production tools? Convenience? Freedom from risk? Honesty? WHAT?
4. MAINTAIN ACCURATE PROFILES.
Your own customer list may be the best in the world, but only if it “bulges” with account and detailed fleet information. What do you really know about the personal preferences of the account’s management team and key purchase influencers? How do they like and want to be sold? What are their hobbies? What do they really expect? How old is their fleet? What is their replacement cycle? How often do they do PM’s? What is their financial situation? How do they finance their business, their equipment and their growth? What is your account development strategy? Account retention strategy? (See my Strategies, Tactics, Operations for Achieving Dealer Excellence text, Chapter 17, “How to Manage Key Accounts” for a really useful approach to key account profiling and management.)
Many dealer owners know little about their most important accounts. And, the best records, if available at all, are often in the trunk of the sales rep’s vehicle. Unfortunately, if the sales rep parts company, he leaves very few tracks in the woods.
5. MAKE IT EASY TO DO BUSINESS WITH YOU.
Design your business to operate for the convenience of your customers. Make it very easy to do business with you. What does “Rock Star” customer service in your industry look like? The more you can truthfully say “YES,” “YES,” “YES,” to customer questions about your capabilities and willingness to work with them, the better off you are. Another example: How much does a customer need to know about his equipment to order a part, successfully, from you? Do you have a record at your fingertip of his fleet, by model and component serial numbers based on HIS simplistic unit identification? Or, must the customer be smart enough to talk to you? How often do your parts countermen laugh at how “stupid” a customer is?
6. FOCUS ON INVESTMENT PAY-OFF.
The key to economical parts and service marketing is not saving money but in making each promotional investment pay off handsomely. Structure performance evaluation criteria in each promotional activity. Create an historical annual scrapbook/catalog of every promotion with hard copy samples. Evaluate strengths and weaknesses after each activity with notes you can refer to next time. Schedule at least four major seasonal aftermarket promotions each year. With the internet, you can now do them monthly, even bi-weekly at minimal cost. (For excellent examples, sign up for the email promotions at www.krafttank.com.)
7. CREATE A UNIQUE NICHE.
Market your aftermarket capabilities by capitalizing on the BOUNTIFUL opportunities to create a unique niche – e.g., can you become the compact construction equipment “KING”? The LOW-MAINTENANCE – HIGH PERFORMANCE counterbalance forklift “DOMINATOR”? Remember, direct mail and email must earn 2.2x cost. Your prospects FORGET 90% of what they see in two weeks. This is why repeated contacts and mailings are essential. Find ways to send reminders of your aftermarket service, like your dentist does. No one likes to visit the dentist, but his reminder really gets you there. It works! Pick a niche in which you can really build and establish an outstanding reputation.
8. SENIOR MANAGEMENT SUPPORT AND FOCUS IS ESSENTIAL.
Parts and service marketing will only succeed if time and money are devoted to it by you, the business owner, or someone you designate AND reviewed regularly.
9. BUILD STRATEGIC ALLIANCES.
To ensure future market success, become more oriented to strategic alliances with other non-competing vendors selling into the same large accounts. These could be manufacturers, suppliers, other businesses with the same customers, etc. For example, in Hokkaido, Japan, one business may combine, for convenience, a pool hall, bookstore, bowling alley, small engine repair and a noodle restaurant. In New Orleans, you’ll see a po-boy sandwich shop that also services used cars, offers Creole books and voodoo paraphernalia and does your laundry – all under one roof. All of these operations are servicing the same customer that walks in the door.
10. CREATE COMPETITIVE ADVANTAGES.
Identify and create competitive advantages by offering better values. It may require extra work. For example, having 24/7 emergency service in the major road construction season when road contractors are busy between 9:00 pm and 5:00 am. Can you utilize telematics to monitor and report on utilization, equipment performance and suggest ways to reduce operating costs?
11. BUILD HUMAN BONDS BEFORE BUSINESS BONDS.
You must build human bonds before lasting business bonds take hold. At the parts counter, do customers get an instant welcome, warm smile, clear eye contact and hear their name? Would you recognize your top 25-30 aftermarket customers if you met them away from familiar surroundings? Is your phone customer service just as friendly? How do you know?
12. WEAPONS MUST BE USED IN COMBINATION.
Many parts and service marketing weapons attain maximum effectiveness only when combined with other marketing tools. For example, in compact construction equipment, local RADIO spots “pre- sell.” Direct mail, e-mails and FAX promotions make “initial offers.” Then, telemarketing gets the “close.” Or, the three step: 1) Soften with a brochure, 2) Titillate with a special, 3) go directly for the PM contract with your field customer support rep.
You must learn the combinations that work best for your industry and your aftermarket business. Once you learn them, don’t spread the word. Another “combination” example in a local market: in-season billboards, country western radio, e-mail fliers, telemarketing, trained field customer support sales reps.
13. SOMETIMES YOU NEED A GIMMICK.
Free hat with every order over $100 this month. Free oil change and lube “today only” on a lighted marquee road sign. Free lunch coupon when you bring in your equipment for shop service. (Really! One heavy duty truck dealer swears by it for his owner/operator accounts.) Call attention to your dealership. Create interest with fresh ideas.
14. TO SPY IS TO KNOW.
The more you SPY on competitors, your industry and yourself, the more opportunities you find to improve. Visit “best in class,” most successful dealers carrying your lines when you travel on vacation. Buy something from competition. Visit, phone them.
I personally met a Bobcat dealer who knew what common maintenance items were not available from the Case dealer across the street. I asked him how did he know their inventory? He said his strategy every Monday was to call this Case dealer and ask if they had a hydraulic pump or that component. Then, when a skid steer loader or mini excavator prospect came into his office, he said, “Let’s call those Case guys and see if they have any ____ in inventory.” This was one of the reasons our Bobcat dealer had over 90% market share.
15. SHOW YOU CARE.
Many more businesses fail than succeed. Ones that succeed are the ones that prove they care for customers and employees. Make genuine commitments. And, LISTEN!
16. GIVE NOT TAKE.
Dealers who think about what they can GIVE customers out-prosper those who think about what they can TAKE. Free tune-up? Free steam cleaning? Free safety training. Free delivery. Some are givers that breed loyalty and some are takers that foster defection and competition.
17. PREPARE FOR APATHY AND FEAR.
If you are introducing a NEW PRODUCT, perhaps with new technology, prepare for chasms of APATHY and FEAR. For every delight, there are 15 horror stories.
Dealer pioneers must be able to hold their breath for a long time. Only 2% of your customers want to be first, the guinea pigs. 12% will move after the first year. Only 22% the after the 2nd year. And, it will be into the third year before 37% even consider your new product. Even if there is proven ANTI-AGING drug, it would be 5-10 years before 50% of the aging population would accept it. Don’t under-promote excellent new products. 2% can be a very large payoff.
18. IN TOUGH TIMES, FOCUS ON CURRENT CUSTOMERS.
In an economic recession or anytime in this mature North American market, focus on current customers and larger transactions. In “dog-eat-dog, the Doberman is boss. Profit must come from current customers. Worship at the shrine of customer follow-up. It reduces the cost of marketing and reinforces relationships.
Follow-up within 48 hours of the significant parts or service transaction, thanking for patronage. Two or three weeks later follow up with a short survey questionnaire, a post- paid bounce back report card. Follow-up in three months or sooner for referrals with a “thank you” coupon. This intensity proves you really care and, that you will be there when the customer needs you. Customer stroking programs are great, but WHO will do it in your dealership? Can you hire a part time high school or college student to help? When will it happen?
19. ESPECIALLY IMPORTANT CUSTOMERS TAKE AN ESPECIALLY IMPORTANT APPROACH.
Your especially important customers must be taken care of in an especially important way. This is called “luxury box marketing.” Sports, opera, symphony, rodeo, theater, luxury week-ends in the wilderness, elegant dinner at the very best restaurant, luxury cruise. Customers may go to sporting events, but rarely in a luxury box. Reserve this for your most important, most profitable customers.
20. USE YOUR GORILLA MARKETING CALENDAR.
When planning, producing and evaluating your marketing campaign, a gorilla marketing calendar is indispensable. It builds quality, economy and the opportunity to fine-tune. Isn’t this better than the knee jerk, haphazard, ad hoc approach? Planning programs in advance gives you all the benefits of time to get co-op money, make sure the editing is done properly and have the printing done at reasonable cost. There is nothing worse than receiving a flier full of spelling errors, typos and grammatical errors.
21. IF YOU DON’T TAKE CONTROL, YOUR COMPETITORS WILL.
If you don’t take control of your parts and service marketing,
your dealer’s future will be in the hands of your competitors. Despite external negative forces, your internal circumstances can compensate for things you CANNOT control. Gorilla aftermarketers take control. Their management is not there merely to put out fires. They manage events proactively to achieve results:
- Have employees set goals.
- Set quantitative and time-line goals for yourself.
- Be a coach AND a trainer, not a commander.
- Give extra attention to those who perform well.
- Hire based on attitude more than aptitude.
Gorilla aftermarket marketing is only for equipment dealers who want to survive and prosper in this very competitive market. We all know it isn’t the new equipment sales rep that brings customers back for a second visit, or who can generate the most positive referrals. Your parts and service aftermarket product support performs these vital functions. Yet, we often hide our aftermarket capabilities upstairs under a blanket. This is your most powerful business development resource. Isn’t it about time you gave it the attention it needs and deserves?
For comprehensive Product Support Marketing and Aftermarket Management resources, ideas, tools, please see Walter McDonald’s new six-book series, The Master’s Program in Dealer Management at www.mcdonaldgroupinc.com. Since 1975, Walter has conducted over 2,650 dealer management workshops all over the world. The six-volume set is available at www.mcdonaldgroupinc.com with individual volumes available on Amazon.com. Contact Walter. He’d be happy to visit with you on any topic. firstname.lastname@example.org.