Customer Service Revolution
There are a lot of aspects of Motorcars Honda’s facility that exemplify why it’s arguably one of the most customer service–driven dealerships in the country. It could be the state-of-the-art 335 kW solar canopy that rendered the dealership the first carbon neutral dealership in the world. It could be the assembly line express service department that allows jobs that usually take two hours to be completed in 30 minutes. It could be the the gaming iteration chairs in the children’s play area—or “kid’s dealership,” as the staff prefers to call it. It could also be the sweet smells wafting from the recently opened gourmet donut shop attached to the body shop.
Sure, it could be all of those things that make the Cleveland Heights, Ohio, dealership stand out among the thousands of dealerships nationwide. But instead, look at the doors. And more specifically, what’s next to each door. It’s a shiny red phone—a “bat phone,” Trevor Gile says. Pick it up and it rings directly to Gile’s cell phone. Whether it’s 5:30 a.m. or 2 a.m., any employee or customer is instantly connected to the dealership’s managing partner, who welcomes those calls.
And while it may sound implausible that Gile’s cell phone would ring with a pressing customer service issue at 2 a.m., it’s a distinct possibility when your dealership’s regular service hours are 5:30-3:00 a.m.
“We want to be available to address those problems or opportunities,” Gile says. “No one has to dial a number.”
Those “bat phones” are emblematic of the dealership’s philosophy when it comes to not only exceeding customer expectations, but also providing service that customers didn’t even know they wanted—or could find at a car dealership.
“We look at it as the auto industry changes, we want to be able to diversify and find opportunities,” Gile says. “We’ve created a culture in ours that we’re able to adapt and change faster than most businesses can handle.”
Gile frequently references the four leading principles that pushed Seattle’s Pike Place Fish Market from a smelly and unenthusiastic fish market into a world-famous, bustling enterprise that tourists from all over the world seek out: play, choose your attitude, be there and make their day.
“That’s what we really look toward,” he says. “A typical dealership, to have a staff that knows they might come in one day and they’re an advisor and their desk is gone and they’re handed a tablet, they need to be able to feel comfortable and share that vision.”
That’s the key, he says; it’s not enough to have good ideas. To really excel, to really push what it means to be a business that serves its thousands of service customers every month, Gile implemented a number of solutions that successfully combined ideas, talent and execution.
The Differentiator: Rental Recorder
The customer advantage: Rental vehicles available more readily
The bottom line impact: Cut down on rental vehicle fleet costs
Twelve million. That’s the number of Honda vehicles in the U.S. subjected to the Takata airbag recall. And while on the bigger picture level, it was a PR nightmare for the OE, those consequences trickled down to even the most micro of levels. Here’s one example, Gile says: His rental vehicle fleet ballooned from 25 to more than 100 vehicles overnight.
“We had to supply the cars for them,” he says.
The problem, he says, is that it was costly and virtually unmanageable.
“The service manager was always saying, ‘I need more cars,’” he says. “I said, ‘How many cars do we have out right now? What’s your average?’ He said, ‘I’m not sure; I don’t have a way to tell.’ From there, we decided, let’s build the software to be able to track this.”
That’s how Rental Recorder was born. It’s an in-house software that helps manage the loaner vehicles along with checking the quality of the interior and exterior of the vehicles when they’re returned, all in an effort to turn inventory more quickly.
“It’s a great way to put cars in used car lots. The average dealer keeps them 12 months in the rental fleet. We’ve been able to get them around 7–9 months and generate over $200,000 in rental car sales,” Gile says. “It also helps us manage the size of our rental car fleet. Once we got back down to 25, we realized we could manage with 16 if it was managed properly by holding the advisors accountable.”
To the average person, it may sound excessive to build your own software system (one that he plans to go to market with in 2018) simply to solve a problem with your rental car fleet. But to Gile—who, along with his brother, owns several other businesses, including high-end car washes, a dealership focused on wheelchair accessible vehicles, that aforementioned donut shop and a marketing company (See sidebar: “A Day in the Life”)—he recognized it was an opportunity to continue diversifying his business by creating a simple, cloud-based system that anyone in his business could learn how to use in seven minutes and effectively save the dealership money (roughly $5,000 per month in rental expenses) while easily managing customers’ needs and skyrocketing rental fleet utilization.
The Differentiator: Extended service hours
The customer advantage: Business hours convenient to any schedule
The bottom line impact: Reach more customers who are frequently not catered to
Gile can anticipate the first question you might have upon hearing about his service department’s extended hours: How many customers can Motorcars possibly receive in the middle of the night to make a service department open until 3 a.m. worthwhile? Well, the answer might surprise you, he says.
"We’re right by hospitals and universities. People work third shifts or odd hours. That allows us to service those guests,” he says. “We can also do our internal cars and new car PDIs during that time frame.
“We just signed up the city cars. If you think about a police car or a city car, if they want to get their car fixed during those work hours, that car is out of the group. By doing them at night time, they can pick it up in the morning and it’s completely done. It can maximize new business opportunities.”
In fact, it’s been so successful that the dealership has held these hours for the past 20 years. One manager and three advisors are on call during those overnight hours, and the parts department stocks those lockers ahead of time so parts personnel isn’t needed. Finding employees to work those hours takes some digging, but for some people, Gile says it’s actually a benefit.
“One of the things is that they work Monday-Thursday. They get Friday, Saturday, Sunday off,” he says. “People with kids or a two-family household, they’re able have that time during the weekend. Or someone younger who likes to travel or has a long distance relationship, they accommodate it. Once you find the right ones, they love it and there’s little turnover.”
The Differentiator: Going carbon neutral
The customer advantage: Appeals more closely to millennial customer needs
The bottom line impact: Reduced energy costs to $3,000 monthly (down from $13,000)
It comes as little surprise that a facility built in 1903 might not exactly be the pillar of environmentalism. For years, the parking garage where 100 new vehicles were stored would become inundated with snow. Upon plowing, the snow plow would hit creases in the cracked pavement and cause damage to the vehicles below. It was a nuisance, Gile says, and it caused one of his salespeople such distress that he finally came to a manager’s meeting and said, “Let’s put solar panels up.”
"We originally wanted to do it because it was tied to financial benefits and would fix the problem we had with the parking lot,” he says. “We did research on doing the double-barrel style so we wouldn’t get snow on the lot and we wouldn’t have to get snow off cars. We looked at the 30 percent tax credit that was available. It would have a 10-year payback. If it helps address a problem and helps our employees become more efficient, then it seems like a good idea.”
Fast forward three years and the project took on a life of its own: Motorcars worked with Castrol and BP to install the largest solar array canopy of its kind at any dealership in the nation. An investment of $1.8 million, the 335 kW solar canopy was designed to reduce the dealership’s grid based energy needs by 50–75 percent, while producing 1.3 megawatt hours of electricity per day, enough to power 40 homes. The canopy stretches 32,000 square feet, features 1,240 solar panels and is made with steel from 80 percent recycled cars.
That means no more time spent plowing the parking garage, no more customers or employees falling on icy pavement, no more digging out vehicles to take on test drives.
The dealership also added a new heating and air conditioning system and LED lights that made the facility 26 percent more efficient.
“Where we’re located, it’s the top 10 worst air qualities in the country. There was a need for businesses to step up and be green,” Gile says. “The opportunity for a car dealership to be carbon neutral in Cleveland, Ohio, it almost seemed like an oxymoron. If we can do it, anyone could.”
Motorcars is now partnering with BP, which is trying to bring several carbon neutral car dealership in the United Kingdom. The company awarded Motorcars with its prestigious Carbon Neutral Award in 2016.
A project this size and scale is a huge investment. It’s millions of dollars and took months of construction. And the payback isn’t immediate. In fact, some of your customers might not even care (that’s where marketing comes in (See sidebar: “Marketing Green”)). But think of it this way, Gile says:
“It’s not going to be the No. 1 reason that someone is going to buy. Price and location are still going to be the common ones,” he says. “But it is the third or fourth reason. It’s a great way that resonates and we’re able to target certain people with social media. We were able to get a softer message across to them. Instead of doing a TV commercial, watching a video is an easy to learn about the experience of going green so that when it comes time to buy a car, they’re read an article about you and they have a different perspective on you.”
The Differentiator: Assembly line express service
The customer advantage: Quick service with more meaningful interaction
The bottom line impact: Get 60–70 vehicles through the express lane
Survey after survey has shown that dealers are losing service to independent service providers for routine maintenance. That’s the oil changes, the tire rotations, the fluid checks. To Gile, that trend was baffling.
“We wanted to find a way to recapture that business. We did research and found the three areas where the potential loss of customers were: speed, transparency and price,” he says.
That’s when the idea for the assembly line express service lane was born.
Two years later—after careful planning, visiting numerous independent shops and studying Firestone’s model—the line consists of six stations for light service work such as oil changes, tire rotations, tire balancing and express detailing. Vehicles move on a belt from stop to stop, where they spend roughly 2–4 minutes.
Each station is the equivalent of 3–4 service bays, he says, and has one or two technicians who rotate out with the pit crew valet when it gets busy in the morning. A senior tech then inspects all of the work (See sidebar: “Staffing the Express Lane”).
“If it’s slow, he’ll point different things out,” Gile says. “It’s a learning experience for everyone with it.”
Gile eliminated the service advisor’s desks and instead has couches and hightop bar tables during the initial conversation. Then, the assembly line includes a sidelines walkway so customers can watch technicians service their vehicles and advisors can use tablets to walk and interact with the customers. In addition, there are cameras at each station where techs are able to throw up photos on giant TV screens if there are issues.
If technicians find the need for more involved repair work and customers consent to it, vehicles will go to the dealership’s back shop.
“It feeds cars to the main shop,” Gile says.
The operation relies on timely parts stocking. Using its own data and the Opentrack platform, the dealership created its own software to run a well-stocked assembly line.
“The software keeps things running,” Gile says “The assembly line is away from our parts department, so we had to find a way to keep it quickly stocked.”
To do that, he partnered with a company to create giant vending machines for the service department that stock fast-moving parts and communicate back to the parts department.
“We need to know precisely what parts are out there so the assembly line doesn’t slow down because we’re running out getting parts,” he says. “That would slow the whole process down, and back up other cars. We can account for every part that’s used in the express lane but also have the ability, when they get low, parts is able to grab them.”
He also found various pieces of equipment that allowed him to maximize technician efficiency. One of those that has made a particular impact is Engine Vac, which sucks the oil out of the top of the engine.
“When the cars were coming through, it was a constant mess of the oil when they’re draining, moving it, and it was slippery. We were worried about drain plugs getting stripped,” he says. “It allows us to suck the oil completely out of there and then have the overhead reel guns to load the oil in there.
“That’s what gives us the speed and the efficiency and the cleanliness because we want it to look as pristine as possible. When the guest is walking by, it’s what makes us special. We’re putting on a show, same way as if you go to Disney.”
The Differentiator: Adding retail space
The customer advantage: Access to a drive-thru coffee shop in the area
The bottom line impact: Bringing new customers to the dealership
For years, Gile drove past the abandoned 1950s Pontiac building on his way into work every day, a mere half-mile from his two dealerships. But it wasn’t until he decided to move his body shop in 2014 that the building became more than just an old car dealership; it became the location for his next great investment. In fact, the body shop was only the first investment he made on the property. After he and his brother equipped the shop with all new high-end equipment and solidified the workflow, he turned his attention to the extra space in the front of the building.
“The city wanted a retail shop in the front so we did a coffee and donut shop that’s open to the public,” he says. “We’re the largest employer in the city. We have strong relationships in the community. We wanted to make it tied to the level of the other businesses. It was a vacant building so everyone was excited to see something going in there. It’s probably one of the cleanest, nicest-looking ones in all of Cleveland.”
Beyond being a good neighbor, though, Daylight Donuts and Coffee (a franchise company with roughly 1,000 stores across the U.S.) is a pointedly strategic investment: It’s the only drive-thru coffee shop in the area, meaning it has the potential to attract customers who may be unfamiliar with the Motorcars brand. In addition, Gile plans to cross-market between the two businesses, allowing customers to pick the donut of the month and those named Employee of the Month to have a donut named after them.
The Differentiator: Customer amenities
The customer advantage: More comfortable waiting experience
The bottom line impact: Grassroots marketing opportunities
Take an elevator up to the top floor, where, upon exiting, you’re greeted by a personal attendant, who hands you a fresh baked cookie, the beverage of your choice and walks you over to a beautifully designed lounge area. You have the choice of hanging out in front of a roaring fireplace, getting some work done at the work table outfitted with mobile device chargers or enjoy the beautiful day on the patio—all far away from the bustling service department. Suffice it to say, it pays to be a loyal customer at Motorcars Honda.
“The platinum lounge above the express service lane was going to be an empty space and we said, ‘let’s do a nice area for guests that are our really good customers,” Gile says. “Here’s a little special something, you get access to our nice lounge.”
Gile worked with his former college roommate, who now owns a high-end furniture store, to lay out the furniture, create the patio and design a comfortable space for those customers. That’s also when his idea for the kid’s dealership came to be. He took ideas from the local natural history museum (even going so far as to meet with their staff to find out what was most popular) and created a dealership within a dealership for children: a selfie zone with a fun backdrop, a huge Lego area, gaming iteration chairs, an enormous aquarium, parts to play with, and a long race track. The exterior of the play area even looks like a Honda dealership.
Both areas serve as amenities for customers and ways to make the often unpleasant experience of getting your vehicle serviced or repaired more enjoyable. The platinum lounge, however, also has an unexpected secondary purpose: It serves as a community event space.
“It can hold over 100 people, so we make it available free to the community,” Gile says. “We’ve had meetings from Boy Scouts and anniversary parties to city council meetings and awards presentations. It’s a great way for us to bring people into our business that normally wouldn't be in there and they’re able to learn about it and it doesn’t cost us anything. It’s a different approach to bring people in.”