5 Facts You Didn’t Know About Cost Of Repairs
In the interest of taking a fresh, new approach with the cost of repairs presentation, let’s take a step back from the price of a new transmission or the labor costs at the repair shop down the road. Let’s rather take a look at some supporting data and approaches that make the cost of repairs discussion more relatable and more effective.
Nearly half of all Americans can’t afford an unexpected $400 expense. The Federal Reserve just conducted research which found that 46 percent of Americans do not have enough money to cover an unexpected $400 expense. Chances are if you’re selling a used vehicle, or perhaps one with higher mileage to a subprime customer, that they would fall into this category. With this knowledge on hand, it should help justify a few extra dollars each month to have a service contract on a vehicle.
Age of ownership is changing rapidly. Edmunds research has discovered that trade-in volume will likely dip below six million this year. It’s the first time this has happened in five years. Why? Because drivers are hanging on to their cars longer. The same Edmunds report showed that 8- to 15-year-old vehicles had higher value retention than one year prior. If your customers plan on holding onto their cars longer and protecting the value these vehicles retain, a service contract becomes a much easier sell.
Expenses from a breakdown don’t stop at parts and labor. Anyone who has had a broken down vehicle knows the process. There’s a tow truck involved. If you’re away from home, you’ll need to find lodging. Parts and labor can be expensive on their own, but when you factor in hotel stays, roadside assistance and towing services, the cost from a breakdown starts to skyrocket. A service contract resolves these fears by covering more than just parts and labor.
Customers are basing their car-purchase decisions on parts costs. A recent AutoMD survey reported that 15 percent of car buyers factor in costs of repairs when buying a vehicle. It’s one of the leading considerations of recent car buyers – right behind price, longevity and utility. If this is such an important point of emphasis for customers, it would only make sense that they would be interested in protecting themselves from such out-of-pocket expenses.
Video can tell this story for you and bring it home. According to ComScore, a global media measurement company, after watching a video, 64 percent of customers are more likely to buy a product. After (or perhaps even before) you’ve made your case about cost of repairs being the reason a customer should buy a service contract, show them a video that tells the story in a succinct manner. It might just be the piece that brings your presentation together and gets your customers to their purchasing decision.