How to ensure customer retention and satisfaction and optimum cash flow within the automotive sector
“Battle over data splits motor sector,” was the headline from BNR last week. It was revealed the local garages and car manufacturers are engaged in a fierce battle over the data that cars contain. The question as to who owns that data is widely posed within the sector. And that’s no surprise. New cars are effectively computers on wheels and collect an awful lot of information. Think of location data or information regarding the driver’s activities and behaviour, for example. In other words, data is becoming ever more important within the automotive sector. And that does not just apply to the data that is collected in the car itself; customer data and payment data is also information that is used within the sector. By using this data organisations can communicate as personally as possible with customers at every level. An annual roadworthiness check reminder or a personal trade-in offer is something that benefits the customer directly. The automotive sector knows a lot about its customers, which enables it to provide personalised marketing. However, this data can also be used very effectively in the order-to-cash process. A personalised approach to communication results in optimum cash flow and high customer satisfaction. But how do you set it up?
The basis for customer retention and satisfaction and continuous cash flow
The automotive sector is in flux. Trends are succeeding one another rapidly, and it is important that finance departments develop alongside the business and constantly consider risks and the customer relationship. The order-to-cash process is one of the most important processes that the finance department has to deal with on a daily basis. The process is a collection of business processes for receiving and processing customer orders and the payment for them. The entire process consists of various stages: from risk assessment before accepting the customer through to payment of the invoice. And if the invoice is not paid, the process doesn’t stop. Credit managers and collectors monitor this and are ultimately responsible for getting the invoice paid, possibly by involving a collection agency. The process starts right at the first contact with the (potential) customer, and this is precisely the moment when you as an organisation within the automotive sector can already gather a lot of relevant data. In order to be able to serve the customer optimally, it is important to identify what their wishes and needs are.
Invoices are regularly left unpaid by customers. It may be that the supplied parts are incorrect, that the name on the invoice is wrong or because the customer is suffering payment problems. This is a difficult situation for both the organisation and customer. But it is the perfect opportunity to differentiate yourself as an organisation. The credit manager can get to know the customer quite well because of the full examination of the customer’s wishes and needs during the initial contact. This enables personalised communication. And since we know that today’s customers believe that a personal approach is crucial, this will enhance their experience of the organisation.
Personalisation and segmentation
The cause for non-payment differs from customer to customer and between situations. It is therefore also important to approach these customers differently according to the situation. Onguard’s software makes it possible to classify customers in segments and create a workflow for each segment. For example, customers who pay reliably, customers who occasionally overlook an invoice, and customers who regularly pay late. All these different customers require a separate yet personalised approach. You can carry out this segmentation by determining who the customer is, what they need, what the risks are and – for example – how they prefer to receive communications. The communication with a customer who regularly pays late will differ from the communication with a customer who has forgotten to pay a single invoice. Thanks to this segmentation the software ensures that the personal communication is sent to the right customer at the right time. This allows the customer’s expectations to be met in all cases.
A well-designed order-to-cash process is essential in order to remain distinctive within the automotive sector, to achieve continuous cash flow and bind and retain customers, even when things are financially less favourable. The right software and the collection of relevant data are important for this. Ultimately this will enable you as an organisation within automotive to constantly progress and lead the field when it comes to developments.