FRIKINtech Customer frustration points for trading are getting lower and more frequent

[Alex Snyder]

In 2024, the average amount customers paid for service was $515. However, the frustration point at which customers decided to trade their cars for something newer was slightly higher at $518. This indicates that service customers have made multiple high-dollar visits and the threshold for their frustration is growing.

In contrast, 2023 saw a higher frustration point of $564. This discrepancy suggests that customers were more tolerant of service costs in 2023, possibly due to different market conditions or customer expectations at that time. Or they hadn’t yet paid multiple times at higher service costs. The decrease in frustration point dollars alongside an increase in average service costs in 2024 indicates that customers are becoming increasingly weary of repeated high service visits, leading to a lower threshold for trading in their vehicles.

As customers become more frustrated with the cumulative costs of service, it is essential for dealerships to have a service mining process. We can help.

 

[Carsten]

I took my Jeep in for a new water pump and other items and a nice hefty bill which is almost 4x that $518.

Nice Service:
I did get Uber back and forth. (probably included in my bill in some form)

Smart Idea:
I just got hit up by my Jeep dealer via test:
a survey,
then are you interested in a new/used car,
would you like a real value estimate for you vehicle,
and then for a review.

Need to improve Big time:
The biggest issue that irritated me was that I dropped it off early Thursday and the Service Dude make it sound like a big thing that they got it done today. I would probably have rather brought it back on Saturday or this morning and had the potential use of it instead of wondering when it would be done or if I should go get a rental.

 

[Chris Cachor]

Need to improve Big time:
The biggest issue that irritated me was that I dropped it off early Thursday and the Service Dude make it sound like a big thing that they got it done today. I would probably have rather brought it back on Saturday or this morning and had the potential use of it instead of wondering when it would be done or if I should go get a rental.

Do you consider that a failure by the service writer to manage your expectations? Or to clarify your expectations?

 

[BillVaughnAlWestNissan]

I’m honestly surprised this number is that low. I would have expected it to be higher. If that’s not a signal that dealers need to be engaging with your service customers then I don’t know what else it would take.

 

[Carsten]

Do you consider that a failure by the service writer to manage your expectations? Or to clarify your expectations?

I think this is an area that can be improved upon.

I am not talking about time it takes to complete since you don't know until you really start getting into it.

But the start time can be estimated like the cable guy showing up.
So, both in a way. Be clearer and don't drop a vague "few days" on the customer and this would help manage expectations and clarify at the same time.

Would a service department be worried about loosing a sale like the sales floor is?

I just remembered my past 3 times I dealt with them. The Service guy recognized my face. But I had a conversation those times about getting estimates for time to start/complete. Being 3 days to 2 weeks could be problematic and I would get a rental for the time but I would need that estimate to make scheduling a rental easier.

I drove 20 miles to go to that Jeep dealer.
I have a firestone and a Chevy dealer a nice brisk walk away. Knapp Chevy (I think that is the name) on Washington and Houston Ave in downtown Houston. Both shops are across the street from each other.


TLDR;
Failure at both managing and clarifying my exceptions.
Also, I should learn to shop better.

 

[Alex Snyder]

I’m honestly surprised this number is that low. I would have expected it to be higher. If that’s not a signal that dealers need to be engaging with your service customers then I don’t know what else it would take.

We are watching it. The average repair order was $521 in Q4. It was increasing all year, while the frustration point was decreasing.

I think this means dealers are going to have loyalty issues in service while we prices are high. Tariffs may spike that further on the parts side.

 

[AlexCaradonna]

I think this is an area that can be improved upon.

I am not talking about time it takes to complete since you don't know until you really start getting into it.

But the start time can be estimated like the cable guy showing up.
So, both in a way. Be clearer and don't drop a vague "few days" on the customer and this would help manage expectations and clarify at the same time.

Would a service department be worried about loosing a sale like the sales floor is?

I just remembered my past 3 times I dealt with them. The Service guy recognized my face. But I had a conversation those times about getting estimates for time to start/complete. Being 3 days to 2 weeks could be problematic and I would get a rental for the time but I would need that estimate to make scheduling a rental easier.

I drove 20 miles to go to that Jeep dealer.
I have a firestone and a Chevy dealer a nice brisk walk away. Knapp Chevy (I think that is the name) on Washington and Houston Ave in downtown Houston. Both shops are across the street from each other.


TLDR;
Failure at both managing and clarifying my exceptions.
Also, I should learn to shop better.

Maybe it is just the Amazonification of everything, but I am still waiting for the day when there are timely updates around the vehicle status when in service. For example, I got married a few months ago and when I bought the wedding ring I would get timely updates around what was going on: ring is in the design phase, ring is in production, ring is being polished, etc.

Majority of the data points needed to feed into an interface (or even a simple text) for the service customer to see the status are already there. Customers could ask questions, approve additional service recs, etc. you could bake in more organic opportunities for the customer to value their trade, etc. seems like that would remove friction while also providing transparency/helping CSI scores.

 

[Chris Cachor]

Maybe it is just the Amazonification of everything, but I am still waiting for the day when there are timely updates around the vehicle status when in service. For example, I got married a few months ago and when I bought the wedding ring I would get timely updates around what was going on: ring is in the design phase, ring is in production, ring is being polished, etc.

Majority of the data points needed to feed into an interface (or even a simple text) for the service customer to see the status are already there. Customers could ask questions, approve additional service recs, etc. you could bake in more organic opportunities for the customer to value their trade, etc. seems like that would remove friction while also providing transparency/helping CSI scores.

There's dealers with this today and I think it's pretty popular. For me personally, I always will request a loaner and they take all the time they need. If it's under a couple hours they'll tell me up front. Whenever I'm buying a car I make sure to buy from a dealer that is good with loaners and service.

 

[Carsten]

I lot of dealers I've visited don't offer a loaner.
A few in the past at least had a rental service as part of their dealership.

I think a lot of people just want to know what is going on and not have to wonder when the cable guy is going to show up.

 

[Jon Singo]

Or they hadn’t yet paid multiple times at higher service costs.

I think this is key. I'd also want to know what the average (I assume all-inclusive with quick lane etc) was before 2020 before inflation took off. 'Our service bill at the dealer was over $500 today!', for the first time is a much different conversation than 'Our service bill at the dealer today was over $500 AGAIN'.
Everything costs more and I think a lot of people are still adjusting. Trading into a new car will only alleviate those service costs if the new car comes with a maintenance plan, which could be a huge selling point if you're trying to buy out of the service drive. My thought is you need to be having these conversations in service along with plans in place to keep service retention up. Because we all know what happens when a customer feels like the dealer service bill is too high, hello independents!