Published: July 2024

Our latest analysis has shown that the gap between older and younger cars in terms of the average aftersales invoice value continues to widen.

We examined the difference in the average invoice value of aftersales work carried out by franchise retailers across the UK for cars in different age brackets and found that, during 2023, the average invoice value was £480 for vehicles in the six- to 10-year-old age bracket, compared to £327 for those under three years old – a difference of 47%. Notably, this percentage gap has been increasing year-on-year; in 2022, the difference was 45%, while in 2021, it was 34%.

We also identified that the average workshop invoice value in the first half of 2024 for vehicles in the six- to 10-year-old age bracket was £496, a 45% rise over the same category of work undertaken in 2021.

Recalls help retailers resist discounting

Many retailers use discounted labour rates and reduced cost-per-job pricing as a strategy to retain older-car business. However, safety recalls can be used to maximise engagement and loyalty at all age brackets without eroding margins.

Implementing a recall campaign, which is proven to increase workshop utilisation and boost average invoice value while at the same time protecting the customer’s interests, couldn’t be easier.

Automation allows us to quickly and easily cross-reference clients’ databases with the SMMT outstanding safety recall database to identify appropriate lapsed customers and automatically issue personalised alerts regarding any required work. This can be done tactically, for example, when workshops are quiet or on an ongoing basis, as part of a customer retention and reactivation strategy.

The nature of recalls provides a ‘legitimate interest’ for reaching out to former customers who might not have had any contact with the business for several years. Once customers are re-engaged for a recall, it’s then over to the workshop to implement a good VHC process to identify legitimate additional work.

While warranty renewal plays a fundamental role in the aftersales retention strategy, it’s important to remember that warranty work comes with constraints set out by the OEM. The retailer is also responsible for processing the claim, which eats into the profit. By contrast, cars at four-years-plus typically require maintenance work outside of warranty, resulting in a smoother, more efficient transaction and greater profit opportunity.

Client Case Study: Sandown recall campaign achieves re-engagement rate of over 35%

In a recall campaign conducted for Sandown Mercedes-Benz between March 2023 and May 2024, we supported Sandown in contacting 4,595 lapsed customers (those they had not had contact with during the previous 24 months).

Using a combination of emails and SMS, 1,614 aftersales bookings were secured – a re-engagement rate of 35.1% – generating £447,860 in additional revenue. Thanks to a robust VHC process, over two-thirds (69%) of each invoice was comprised of additional upsell work.

Sandown also used the campaign to support its new and used car marketing efforts, encouraging re-engaged aftersales customers to seek a valuation and look at their current stock. The recall campaign directly prompted 130 vehicle enquiries, both new and used, of which 26 went on to purchase a car.

For more information on our Safety Recall programme, contact us today.

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