Lang Aftermarket iReport: 2020 Virus Impact – social contact is the new aftermarket friction

“The 2020 Virus has abruptly introduced a new ‘friction’ into business interactions: social contact. Americans are changing their expectations of how business should be conducted. Repair outlets must adapt to the new normal of social distancing.

“How well repair outlets meet the challenges of effectively operating in this world of evolving consumer expectations will determine their viability in what will be a rapidly changing aftermarket.”

— Jim Lang, publisher, Lang Aftermarket iReport

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Aftermarket Impact of the Virus to 2023 and Beyond: In-Depth Report coming in June
“This iReport, along with more special iReports focusing on the 2020 Virus through May, will provide a preview of the comprehensive and detailed report to be published in June by Lang Marketing, with six monthly updates of key developments to be issued from July through December.”

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Customer Friction in Vehicle Repair

Well before the 2020 Virus struck, reducing “friction” (hurdles and obstacles) for consumers has been a major focus across most business sectors.

The 2020 Virus, a “Black Swan” event, has abruptly created a new normal of social distancing that will accelerate the development of a number of initiatives, many of which are already underway, to reduce the friction of social contact in the consumer’s vehicle repair experience.

How well Service market (DIFM) participants meet these changing customer expectations involving vehicle repair (along with most other purchasing experiences) will determine winners and losers in what will be a rapidly changing automotive repair market.

Eliminating Customer Friction

A number of initiatives aim to reduce friction in each of three major phases of the vehicle repair process: selecting where and when the repair is done, conducting the repair, and vehicle pickup/payment.

Two factors will be leading determinants of winners and losers in reducing the new friction of social contact in the vehicle repair experience.

First, the repair process phases must be integrated into a seamless experience for consumers.

Second, friction solutions must deal effectively with the underlying expectations of American consumers regarding rapid vehicle repair.

o2o Solutions

Online to Offline (o2o) auto repair provides a way of reducing friction at key points of the automotive repair experience and addresses the problem of having the right parts available at the point of repair on a timely basis.

An o2o system can provide consumers with an online selection of repair outlets and appointment times when their vehicle can be serviced. Millennials have shown a preference for online repair outlet selection.

By offering repair within a day or two of making the online appointment, the o2o system can arrange for the necessary parts to be available at the repair outlet when needed.

Complications can arise in diagnosing what must be repaired on the vehicle and the need for collateral repairs once the job is underway. Nevertheless, a large percentage of repairs can be handled successfully by o2o systems that facilitate the repair process from beginning to end.

Repair Site Challenges

A major challenge to remove the friction of social contact from the vehicle repair experience occurs at the site of repair.

Solutions must be found for reducing social contact in waiting rooms, maintaining social distance between consumers and repair shop personal, etc. Returning repaired cars to owners in a sanitized condition and payment processing are also key elements in eliminating the friction of social contact.

Winners and Losers

Actions to reduce social contact can disrupt the traditional conduct of vehicle repair.

A big jump in o2o auto repair would mean that buying platforms (like Amazon) would gain increasing control over where and when vehicle repair is conducted and how parts are supplied to repair outlets.

In such o2o transactions, repair outlets could be precluded from securing customers for their service bays and from earning profits from the repair parts they install.

These o2o changes also have significant implications for the Distribution Channels supplying automotive parts as well as the Manufacturers selling through these Channels.

Finally, it will take significant financial and facility resources to reduce social contact friction at the site of repair. Generally, this will favor larger operations (repair chains and Dealers), which have the resources to meet the new challenges.

Six Major Takeaways

• The 2020 Virus will dramatically change customer expectations regarding social contact in the vehicle repair experience.
• Strategies to reduce social contact “friction” must integrate the various phases of the repair process into a seamless experience for consumers and must do so in ways that satisfy the American consumer’s expectations of rapid vehicle repair.
• Online to offline (o2o) auto repair can reduce social contact friction at key points of the automotive repair experience while meeting other consumer expectations regarding the repair process. A surge in o2o auto repair would mean that buying platforms (like Amazon) would gain increasing control over where and when auto repair is conducted and how parts are supplied to repair outlets.
• A major challenge for removing social contact friction from vehicle repair involves removing friction at the site of repair. This will take significant financial and facility resources, which will favor larger auto repair operations.
• Reducing the friction of social contact will disrupt how vehicle repair has traditionally been conducted. Repair outlets could be marginalized in securing customers for their service bays and earning profits from the parts they install.
• In-depth analysis of these and many other key issues will be covered by Lang Marketing’s must-have June report: Aftermarket Impact of the Virus to 2023 and Beyond. Analyzing winners and losers in the vehicle repair market of the future will be a major focus of this report.

Copyright 2020 by Lang Marketing Resources, Inc.

NOTE: Special thanks to publisher Jim Lang for granting us permission to publish the Lang Aftermarket iReport.