Customer Lifecycle Management for Automobile Industry – Key Challenges

Holding on to a customer is far easier and rewarding than trying to acquire a new customer, and marketers innovate on various schemes to retain engagement with the customer after the purchase. The automobile sector has it easy here, as after sales-service and repairs offer a ready-made way to hold on to customers, until the time they think in terms of upgrading their vehicle, or buying an additional vehicle.  However, marketers still have to work towards promoting brand affinity among their customers.

The High Stakes of CLM for Automobile Industry

The stakes of customer lifecycle management (CLM) is always high, and more so in the automobile industry, where the relationship with the customer is on a long-term basis. In most industries, the relationship between the customer and the brand for a specific purchase ends when the customer purchases and consumes the product. When it comes to automobiles, the relationship actually strengthens with the purchase. The vehicle requires periodic service, spares, maintenance, repairs, and regular updates. All these offer marketers the opportunity to remain engaged with the customer.

A customer passes through five key phases in their journey with an automobile company.

  • Stage 1: Product enquiry
  • Stage 2: Order and Purchase
  • Stage 3: Receive and Use
  • Stage 4: Service, Parts, and Warranty
  • Stage 5: Promoting Brand Loyalty and on-sell

The onus is on the marketer to deliver a consistent, pleasurable and beneficial experience through all these stages, keeping in mind the need to retain the customer for life, and in this, they face significant challenges. See how a $34.7 Billion global automotive giant that manufactures passenger vehicles, commercial vehicles, utility vehicles, auto components and supply chain solutions has achieved a higher rate of conversion while reducing the cost of customer service.

1. The Challenge of Integration

The automobile ecosystem is spread over manufacturers, spare part suppliers, dealers, service centers, and others. A key challenge is bringing all these loosely connected entities under a common platform, to exchange information seamlessly. An integrated platform allows the customer support of any entity in the ecosystem, at any point of contact. For instance, a service center may access previous service logs related to the vehicle, even when such service was done at another facility, allowing them to undertake follow up maintenance or look into any special complaints without the customer having to start all over again.

The digital landscape makes seamless integration possible, and to make this happen, automobile companies need to:

  • Establish an infrastructure that easily captures all relevant information from both the customer and internal systems, stores such information, and makes it available to everyone else in the value chain, as and when required.
  • Create a one-stop hassle-free sourcing process, to ensure that the customer gets the right product in time. This may require offering complete visibility of stock inventory cutting across distributors, dealers, and other entities, and sharing customers’ orders and production planning details.
  • Make changes in the internal systems and processes, so that capturing and sharing information becomes ingrained in the culture.

2. The Challenge of Variability

The marketing and service initiatives of the automobile sector lies scattered across the different entities in the ecosystem, with heavy dependency on sales and service dealers. Since customer experience in one location impacts treatment expectations everywhere else, ensuring a consistent experience across location and places, to offer a premium customer experience, is a crucial challenge in CLM for automobile industry.

Marketers need to:

  • Play a proactive role in establishing a culture of customer-centric approach rather than a vehicle-centric approach. For instance, the focus of all dealers during the first stage of enquiry should be to match a vehicle with what the customer needs, rather than try and push a vehicle to meet sales targets.
  • Devise a system to capture feedback from each customer, and convert the collected information into actionable insights. Sharing the feedback across the board also helps.
  • Monitor the quality of interactions across different touch points and channels, to take remedial action or policy changes as and when required.

3. The Challenge of Delivering Value

In the automobile industry, marketers get ready-made opportunities to continue their engagement with the customer. They can reach out to customers through various channels, including social media, to inform and educate them on aspects such as explanation of user manuals and warranty policies, maintenance schedule and pricings, and more. In addition, they can:

  • Enable online service reservations, technical enquiries and complaints, and warranty status checks.
  • Consolidate historical sales data and customer preferences, to calculate the customer lifetime value, and target customers for invitation to new product launches, test drives of new vehicles, loyalty program initiatives, and more.

The overriding focus of CLM/CRM for automobile industry should be to orchestrate a simple and compelling experience, across each customer moment. But that is not the end of the story.

“It is easier to reach the top than stay at the top.” This adage holds true for customer service in the automobile industry, who face the challenge of not just providing a consistent and uniform experience to the customer across diverse touch points, but sustaining the same over an extended period of time.

Do you have the experience to share or a point to make on this? Share your thoughts with Conneqt Business Solutions Customer Lifecycle Management Solutions.

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