Knowing me, knowing you

Barnaby Donohew asks if by understanding its customers better, a garage can see itself more clearly and provide a better service as a result

By Barnaby Donohew | Published:  15 February, 2018

Since retirement, I’ve found my Dad reflecting on his time in the motor trade; all the memories, good days, bad days and everything in between.

The one thing he misses is the customers. Not the work, the vehicles, or any other aspects of the business – okay, maybe he misses some of the trade contacts, but this article isn’t about them. We were lucky, we had more than our fair share of fantastic customers, but we also had others that would make your blood boil. And the problem with the latter is that they breed feelings of ambivalence towards customers in general. I’m fairly confident in guessing that you will know what
I mean.
Why is it then that a proportion of the people that we deliberately lure towards our businesses provoke these mixed feelings? Well, I think it’s all about expectation. More specifically, the conflicts that arise when there is a difference between what we expect to happen and what actually happens. Some of these conflicts might be avoided by different approaches to communication. Sometimes there are more fundamental issues at stake; maybe the fit between the business and the customer just isn’t right?
We’ll return to this idea of fit in a subsequent article as it cuts straight to the heart of our respective business propositions but before we do that, it will help if we understand better both ourselves and our customers. We’ll begin with the troublemakers…
our customers.
Is everyone going to be a suitable customer for our business? No, so we need to identify those who could be. For those of us with workshops, it should go without saying that our customers should be vehicle owners (which we’ll loosely take to mean as anyone that has an interest in the successful functioning and care of a vehicle). We can subdivide this group in to private vehicle owners, fleet owners, leasing companies, etc. (note how these groups will have their own more specific interests). Other subgroups might be created using assumed-wealth (poor or rich), make of vehicle (as might be relevant to manufacturer dealerships or independent specialists), or customer and workshop locations (rural or urban) etc. Selecting parameters for such breaking up is never easy; however, once segmented in this way, we are better able to characterise specific customers. On that path lies the understanding
we seek.

How then do we characterise, or profile, each of our chosen customer segments? One technique is to describe what they are trying to accomplish in their day-to-day lives by writing down their functional, social or emotional jobs. These jobs will have associated concrete benefits and positive outcomes (gains) or negative outcomes, risks and obstacles related to their undertaking or failure (pains).
Listing all the jobs, pains and gains for a given customer segment really allows us to see what makes them tick. Furthermore, ranking the items in each list will emphasise the things that really count; jobs should be ranked according their importance to the customer, pains according to their severity and gains according to their relevance. Figure 1 shows these lists for a ‘private vehicle owner’. This segment is very broadly defined, however, you can see that it still provides a reasonably nuanced overview of the things that might matter to our customers. Note, no profile will provide the ‘perfect answer.’ In fact, your customer profiles should constantly evolve, i) as you learn more about your customers, and ii) because our customers’ priorities will change with time.

Job importance
Look carefully at the jobs in Figure 1. Can you see the job ‘take car to workshop’? No, you can’t. This is because people don’t own cars for the pleasure of taking them to your workshop. Think about that for a bit. If a vehicle owner happens to be in your workshop to ‘meet statutory obligations’ (i.e get an MOT) or ‘protect and maintain assets’ (get their car serviced), they don’t want to be there, they’ve a million other things they’d rather be getting on with. Now, ask anyone how important it is to them to ‘feel safe and secure’  particularly if their children are involved and without hesitation they would answer that it is their number one priority. It seems to me that the actions and wilful ignorance of many of our customers betray their words. Even as a small workshop, we encountered cases on a daily basis where a vehicle’s state of repair would render it unsafe. That being said, insecurity and fears arising from actual, perceived or imagined risks of harm are incredibly powerful motivators (and manipulators) for many, so this particular emotional job merits its position toward the top of the pile. The same cannot be said for getting an MOT, despite its employment as the safety test of last resort. Given the number of customers that miss their MOT expiry dates, it is clear that the risks of being without an MOT are insufficient to raise it from its lowly ranking.

Pain severity
I have to have a car. Even today, the apparent sense of entitlement with which the preceding phrase is loaded still gets right under my skin -my fists clench as I read it. However, we just have to face it, having a car is a necessity for many, particularly in rural areas and anything that is a barrier to the access or use of a vehicle is a major headache, or worse (see the pains in Figure 1). If we can ease or remove these customer pains, then that creates opportunities for us, not problems.
As indicated above, a ‘lack of automotive know-how’ does not appear to be a concern for many customers, given the general lack of basic maintenance we observe. Come on-  topping-up levels and tyre pressures is not rocket science. A little more knowledge, not necessarily obtained from Google, would surely help them make more informed decisions about when, where and how they should get their vehicles maintained. But no, they still prefer to try to get things done on the cheap, or in the wrong establishments, then wonder why they get ripped off. Hence, a lack of automotive know-how cannot be considered an extreme pain. It is still relevant to us though as it provides an opportunity for us to differentiate our workshops by providing them with sound advice and a bit of education that should help them to minimise their other pains.
In many ways, the gains listed in Figure 1 do not seem hugely significant, not in the way that winning the lottery might be, nonetheless, they are positive outcomes – it is a bonus when ‘things just work’ hence it is an oft-quoted selling point of Apple products. The magnitude of the gains might seem underwhelming because they are skewed by our expectations; we expect things to work, so it is no big deal when they do.
You may be wondering whether profiling can help us, as it is likely you will already chew over similar thoughts within your day-to-day business life? Apart from making explicit all our assumptions, thoughts, and experiences which gives us the opportunity to thoroughly review them, it allows us to better anticipate or respond to change. For example, we can use it to map out possible changes in an existing customer segment or the expected characteristics of a new segment. In every case, it allows us to see if our businesses are able to offer things of value to potential customers. This will be the subject of the next article, where we will examine the flip-side of the coin, i.e., what we bring to the table. The bottom line is that if we want our businesses to succeed, we need to understand our customers, and although they might drive us mad at times, that requires empathy, not antipathy. Profiling helps us develop that by the bucket load, so, surely, it's the best we can do?

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    Life is always changing and as we all get older we start to remember our younger days and reminisce about how ‘things ain’t what they used to be.’
    For example, a century ago, horses were still an everyday mode of transport and every village had a blacksmith to re-shoe them. As time moved on, getting to work was done on foot, by bus or by bike – which if you were lucky, may have had an engine. To service these two wheeled modes of transport, every village had a cycle shop who often covered both pedal and motorcycle versions.
        As the UK economy developed, many people aspired to owning a car for improved mobility. I recall how difficult it was for my father being able to afford to buy the family’s first car. It may have had leather seats, but there was no heater, so journeys in the winter were no fun. My father also conducted most of his own maintenance, as did many other vehicle owners, but this gradually started to be provided by the local garage and the aftermarket as we know it today was developed.

    For the last four or five decades, although the aftermarket has evolved, the basic business models have not fundamentally changed. People and businesses acquire vehicles and these vehicles get serviced and maintained by the main dealer or the independent workshop. Competitive choices exist for locations, labour rates and the spare parts. As vehicles have become more sophisticated with the introduction of electronically controlled systems, the ability to access the technical information needed to diagnose, service or repair the vehicle has become ever-more critical and legislation has been needed to ensure that competitive choices can still be offered.
    To be able to repair today’s vehicles has therefore been about the appropriate training and equipment, supported by local marketing to attract vehicle owners into your workshop. This is relatively straightforward and more of an education process than a revolution of the basic business model – but this is starting to change.
    The future is being seen as ‘mobility’ and ‘mobility services’ and the way that this is developing will fundamentally impact the Aftermarket as we know it today.
    There are a number of key reasons why the future will impose a change to today’s business models. The types of motive power are already evolving and this rate of change will increase. This in itself will change the type and volume of work that traditionally has been provided to vehicle owners. Vehicles may still have an internal combustion engine, but this will be part of a hybrid system, which is more likely to be petrol than diesel – but it will include some form of electric motor – either as a direct drive unit, or as a 48 volt ‘mild hybrid’, but in both cases with energy recovery functions that reduce the amount of braking and consequently the replacement of brake system components. This situation is further increased if the vehicle is fully electric, when there are far fewer service and maintenance requirements. However, these vehicle types will only create an evolution of today’s business models.

    The revolution comes when you consider the change of vehicle ownership that is increasingly happening and the rate of which it will increase. The ‘good old days’ of aspiring to own a vehicle is no longer the case for the younger generation and a whole new range of ‘mobility services’ are being developed – especially as fully autonomous vehicles are introduced in volume. In many cases this means that the vehicle owner changes from being an individual to become a corporate organisation or even remains the vehicle manufacturer themselves.
    This fundamentally changes the way that servicing and repairing the vehicle will take place. Firstly, the corporate owner of the vehicle will want to decide where and for how much their vehicles are being serviced and maintained. However, this may rapidly expand into a demand for lower hourly rates, together with a further demand of what parts are used. At best this creates a direct negative impact on your profitability, but it may go further.

    Further requirements
    There may be a further requirement for specific levels of both technical and management competence, which may require specific standards and management processes to be verified and maintained – increasing costs whilst margins are squeezed. Corporate organisations may also expect a national contact and administration function, which as an individual independent workshop it will be impossible to provide, so now you may need to consider how to be part of a coordinated national group with centralised facilities to be able to be ‘part of the game’. However, on the plus side, as part of a larger group you may also be in a stronger position to negotiate with the larger vehicle operator organisations, so it may not be all bad news.
    If the vehicle manufacturer remains the owner of the vehicle, then they may also require that you handle warranty work – at the lower warranty hourly rates, together with the specific contracts that the vehicle manufacturer will also expect to ensure that their ‘standards’ are maintained. Ultimately, as vehicle ownership models change and ‘mobility services’ become the norm, each element of your business is likely to be managed by the requirements of the corporate organisations. This is not a legislative issue, but a direct consequence of changes in mobility service models and their commercial impact.

    Significant impact
    The good news is that independent garages will still be needed, but the most significant impact will be the squeeze on your hourly rates and spare parts margins, in much the same way as insurance companies have controlled accident repair centres. Ultimately, this may also impact your ‘modus operandi’ by imposing technical, management and reporting requirements. This creates the simple question – you may still be the legal owner of your business, but in reality, who controls your actual day to day business – you or the mobility services vehicle owner?
    Now may be the time to start thinking about joining forces with other independent workshops – probably as part of a national soft franchise or an association – otherwise it may be a case of united we stand or divided we fall.                  

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