Steering in the right direction
Next to visiting the dentist, taking a car in for service likely ranks among a consumer’s least-favorite tasks. You know it will probably cost a lot more than you want it to; you likely won’t understand everything that gets done to your car; and the second you drive away you’ll start dreading the time you have to do it all over again.
Itasca, Ill.-based Midas Inc. is one of the best-known providers of automotive services, offering brakes, maintenance, tires, exhaust, steering and suspension repairs at nearly 2,400 franchised, licensed and company-owned Midas shops in 16 countries, including more than 1,600 in the United States and Canada. Though he works for Midas Inc., Garry Rosenfeldt is the first to admit that some of his company’s customers could have the same uneasy feelings about visiting a Midas shop. “As an industry, we are typically not known for warm and fuzzy customer service,” says Rosenfeldt, the firm’s director of marketing research.
But car owners may soon begin looking at Midas in a different way.
Since 2008, Rosenfeldt has used two large-scale qualitative research projects to help show the company’s franchisees how bad things are in the auto service realm and, more importantly, how good things could get if shop managers started adhering to a set of basic service guidelines and behaviors that have now become a fundamental component of a broader retail operating model called the Midas Way.
Better received
When initial discussions were held about undertaking a project to research and document the state of customer service in the car repair business, Rosenfeldt knew that the edicts to improve service would perhaps be better received internally if they were in the consumers’ own words rather those of Midas corporate. “It occurred to me that the best way to get franchisees on board is to have somebody else basically say what they should be doing and hey, wouldn’t it be great if that ‘somebody else’ happened to be real, live customers?”
Qualitative was naturally a first thought for getting in-person feedback from customers but Rosenfeldt says that previous efforts to convene customer focus groups for franchisees didn’t go well, as many shop owners don’t have the luxury of being away from their businesses for extended periods of time.
Instead, a better way was to enable consumers to do the talking to video cameras in the privacy of their own homes. For the first project, Rosenfeldt recruited all of the respondents himself. He went to an electronics retailer and bought 150 video cameras and sent them out with instruction packets.
The goal was to learn about the ideal car repair service, not just at a Midas location but anywhere, so respondents had to complete a handful of tasks. For the first assignment, they were asked to look at scores of photos that represented many of the things that could happen in an auto service experience and express their thoughts - have they experienced the same thing, what did they think about it, etc.
Next they were asked to make an appointment for some kind of car service - an oil change, new brakes, etc. - at any service provider of their choosing and explain why they chose the shop they did, whether they had been there before, what they expected to happen, how they expected to be treated, etc. After the service, the consumers gave a wrap-up of how things went, including what was good, what was bad, what could have been better.
Rosenfeldt edited the hundreds of hours of videotape down to the most important, impactful responses and set about distributing the video to franchisees over the Midas corporate Web portal, on DVDs in the mail and via various road shows to explore and explain the results to internal audiences.
The franchisees’ response? “We found that it was among the best, most effective research projects we’ve ever done, for two reasons. One, we learned a lot more than we typically have about what the ideal customer experience should be. And two, the success we had in actually converting and convincing our franchisees was so beyond our expectations as to be almost unbelievable. It spawned a complete reassessment of our corporate strategy and what direction we were going, where we were spending our resources and how we were operating as an organization,” Rosenfeldt says.
The bad news was, there weren’t a lot of positive feelings about the auto repair experience. The good news? Lots of opportunity to move ahead of the competition. There was nowhere to go but up, and Midas wasn’t alone in underachieving. “It was eye-opening to realize just how low the bar was, how bad the industry was perceived and how much upside there was if we made even the smallest changes. The bar is not just low for us but for the entire category. Even if we did the most minor things it would make us so much better than everybody else,” Rosenfeldt says.
Test its effectiveness
With the first batch of customer video diaries having been a smashing success, leading to the development of a more focused service model (more on that later), the next step was to implement the model and test its effectiveness, Rosenfeldt says. “We needed to go back to the customers and say, ‘We heard what you said. Here is what we have done. Is it correct? Are we doing the right things?’ ”
A group of Midas shops in the Northeast had begun executing the new service model, so the setting was perfect for a new round of video data-gathering in which respondents would visit these shops and report on their experiences. But, with fresh memories of the massive undertaking that was the first project, Rosenfeldt was a bit, er, hesitant. “The thought of going through that same procedure and process and hassle as the first time was so nauseating to me that we almost didn’t do it,” he says.
However, thanks to a certain research industry publication, he found an easier way to complete the second project by tapping QualVu, a Golden, Colo., provider of online video-based qualitative research services. “Around that time I was flipping through Quirk’s and saw a blurb on QualVu, and I’m like, wow, these guys do everything that we have done but they take it to the next level. Particularly, they have a platform that the consumer’s video is posted to and you can filter it and view it and respond to it. That was enough for me to call them and say, ‘We need to work together on this project.’ ”
QualVu recruited respondents and distributed cameras to them. Rosenfeldt kept internal audiences informed of the project’s progress using the Midas Web portal and relayed instructions on how to use the QualVu site to view customer videos. “The QualVu platform is very intuitive and open, not only to me but the franchise organization, which makes the whole process of research more transparent, more believable, more acceptable. [The franchisees] understand it more, they recognize why we say the kinds of things we say. The dealers and senior management were able to log into this system and see the customers’ comments. And the feedback that I got was even better than the first time around.
“Basically we are no longer going to be doing traditional focus groups for the most part, because the drawbacks are great. This new process will not replace them 100 percent of the time, but most of the projects that we do require franchisee buy-in, and you just can’t get it with a regular focus group so this is going to be our new default procedure.”
Huge difference
As for the findings, Midas learned that it got the service model correct. “Customers did in fact notice a huge difference in the way the stores operated. So much so that when we were at our annual convention in November, we presented these results there and people were floored. They couldn’t believe it. They completely bought into this process, which is testament to the power of listening to the voice of the consumer.”
Rosenfeldt says that Midas certainly could have learned the same things through traditional qualitative but the immediacy of the feedback afforded by the online platform, and the level of access that franchise owners and other interested parties had to the data, made securing the all-important buy-in much easier.
The franchisees who were selected to have access to the video generated from the customer diaries had seen the question guides and were familiar with the purpose of the research. In some cases they were able to view feedback from customers of the Midas shops under their control, which certainly enhanced the impact of what the respondents were saying.
“What QualVu brought to the table was the ability to get more people to buy into and participate in the research process. That just made all the difference in the world, particularly for our organization, which is probably unique in some respects to other, non-franchised companies where people will do what you tell them. In our case, they don’t. We have to convince them, so this is really the perfect service that they are offering that allows us to do that.
“That’s the biggest career challenge that I’ve had. Doing the research is easy. It’s getting the people to actually listen to it and react to it that’s the hard part.”
Best and worst
For the QualVu project, general-population consumers were recruited as were customers of Midas shops in the New England states that had adopted the new service model. They were sent Web cams and asked to answer a series of questions on topics such as their best and worst auto service experiences. Respondents were given a copy of the new service model (without the Midas name attached to it) and asked if they felt it was unique, how they would feel if their auto service provider executed the same service standards, etc., and if anything was missing from the current service model.
Once they had seen the new service model, they then were instructed to have their car serviced at a Midas shop that had adopted the new protocols and report back. (As a control, some respondents were also sent to shops that were still operating under the old standards.) Did the process match what was written in the service model? Was the experience different from what they had experienced at that Midas in the past?
One of the biggest outcomes of all of the research, Rosenfeldt says, is the discovery that the interaction with shop employees is the source of much of the fear surrounding car repair. “It’s about the actual human being standing behind the counter. All the power is on them and we actually went as far as to say that to franchisees: ‘We don’t care about you, we care about your employee, your manager, who is actually the one who will make or break this business going forward.’ It was a good choice because it’s absolutely true - when you walk into those stores, if you don’t like the guy behind the counter, we’re in trouble.”
The notion of treating each customer transaction as a unique, one-time event is long gone, Rosenfeldt says. For Midas, the focus is now on building long-term relationships, getting customers to come back and providing total car care. “We are now in the preventive maintenance business, such as oil changes, which people come in more frequently for. The problem is, the oil changes are $21; brake jobs are $300. The margin is significantly lower on oil changes. If you come in once for an oil change and we treat you poorly, and you don’t come back, we’re going to lose money on the proposition. So our whole model now is to get them in the door with an oil change, wow them with our customer experience and have them come back again and again for more oil changes and more expensive work. When the shops have adopted this model of service, to focus on the long-term relationships rather than the short-term profit, the shops make substantially more money over a longer period of time.”
‘Ridiculously simple’
Three main components of the Midas service model are greet, explain and thank. “When you are a shop manager and a customer walks in the door, you need to do three things: greet them, explain what you are doing and thank them,” Rosenfeldt says. “It sounds ridiculously simple, but it almost never happens in this industry. We have found that when shops are able to execute those behaviors consistently, our customer satisfaction goes way up. Our customer retention goes way up and people come back and they purchase more services from us.”
To be sure, “greet,” for example, goes well beyond just saying hello. “There is a whole new process around what an exceptional greet looks like. It encompasses the way the whole shop looks, the amenities that you have available, the tone of the way you talk to the customer, how quickly you are acknowledged as a customer,” Rosenfeldt says.
For the “explain” portion, it’s all about listening and responding. The manager has to tell the customer what repairs were made and why, no matter how minor. “The customers appreciate when the manager actually says, ‘Here is what we did and here is why. Do you have any questions?’ Even if it’s just for an oil change - take them to the bay, show them the emptying out of the old oil, talk to them about the different types of oil there are. If you’ve been to a Jiffy Lube, they do a lot of this stuff but Midas is not a quick-lube place and we were not set up for that and so those behaviors were not ingrained in the employees’ brains but that is something we are getting better at and are working on now.”
In addition, there is a specific script in which managers ask if the customer is comfortable with what was done, if they need something re-explained, etc. “They are trained to not let the customer out of the door unless they completely understand what happened. The benchmark for success, when we do some quantitative customer research, is, would you be able to explain what happened at Midas to your mother? If they say yes, then we are happy that it was explained correctly. If they say no, then we haven’t done our jobs.”
The “thank” includes, of course, thanking them for coming to Midas, perhaps a coupon for a return visit, and a conversation about setting up the next appointment.
Effective video snippet
While a goal of this type of research is to build a big, wide-ranging picture of the problems that need to be addressed, it’s the small findings that can have the greatest impact. Rosenfeldt cites one particularly effective video snippet from a woman who had been a customer of a Midas shop that had been using the new service model but had switched back to the old ways after a managerial change. “She said, ‘Jack, the new manager, is nothing like the old manager Joe was. Joe used to really follow these procedures. Jack doesn’t and now I’m not going back.’ And she went on to describe all of the things that were missing and why she wasn’t going back. As I watched it I said to myself, ‘This is gold!’
“A lot of what you look for is the little tidbits that really drive a certain point home and this was a perfect example. We could use it to say to the shops, ‘Here is exactly why you need to do the things we’re suggesting because you’re going to get a bunch of Mildreds who are not going to come back!’ ”
Securing the participation, support and buy-in of the International Midas Dealers Association, the influential organization of Midas franchisees, was critical, Rosenfeldt says. “When it came time to develop the new service model, we had franchisees involved in the writing of it, so it wasn’t just Midas saying, ‘Here is the new service model, go do it!’ They were enthusiastic to be involved in this because of what they had seen from the research. They knew how important it was and they wanted to be a part of it.”
Sales improvements
While Midas is fighting the same economic headwinds as most businesses these days, Rosenfeldt says that shops that have adopted the new processes have seen marked sales improvements and also increased numbers of repeat customers. In particular in the Northeast - the focus of much of the research and the service improvement efforts - sales and customer counts are up after both had been trending down since 2005.
More than anything, the research results have helped focus the company’s attention on the value of earning and keeping each customer’s business, Rosenfeldt says. “For Midas, this research represents a deliberate and thoughtful process that has led to the ongoing development of an effective, measurable means of understanding what a differentiated customer experience is, how to train to it, how to measure its delivery and how to integrate it into our culture.
“Just as at any large organization, especially one that is largely franchise-based, there are differences of opinion on marketing and other operational issues. But when you have a central theme to rally around, it kind of focuses them on what is important. Do we agree on every single thing? We do not. But we know at the end of the day it’s about happy customers coming back. It’s as simple as that.”