You Can’t Improve What You Don’t Measure – How to Measure Aftersales Success?

William Barkawi 4 Mar 2024 7 mins read

Quick Summary:

In this article, you’ll read about:

  • The Goal of OEMs is Making Aftersales Success Measurable
  • Getting Familiar with Customer Expectations for Measurable Aftersales Success
  • Why Measuring Aftersales is Crucial
  • Using Data for Aftersales Success
  • A Deep Dive into Aftersales KPIs
  • Improving Aftersales KPIs
  • Data-Driven Decisions in Aftersales
  • Implementing Retail Inventory Management (RIM)
  • The Role of Technology in Aftersales
  • What are the Challenges in Measuring Aftersales Success?
Laptop with Aftersales Analytics

Delivering exceptional customer service is as critical as the quality of the products themselves, regardless of what industry you’re in. For Original Equipment Manufacturers (OEMs), dealers, and technicians, this has become more important than ever before. Many OEMs are struggling to understand and meet customer expectations in the aftersales area, which is costing them valuable follow-up sales and customer loyalty. Fortunately, it doesn’t have to be this way. Organizations can quit leaving money on the table when they decide to take matters into their own hands and begin measuring their aftersales success. In this article, we’ll take a look into the criticality of measuring aftersales success, exploring effective methodologies, and illustrating how data of aftersales success can catalyze enhanced customer relationships and business outcomes. 

The Goal of OEMs is Making Aftersales Success Measurable 

OEMs are not just product manufacturers—they’re service providers who must ensure customer satisfaction throughout the product life cycle. The goal is to not only efficiently sell machines, but to make customers happy before, during and after the sale. Especially after the sale, when it comes to making sure, that they truly expensive machines customers bought have everything they need to be kept up and running. 

There is a saying, that the first machine is sold from the store window, the second one by the technician. However, the challenge lies in the fact that the entire customer facing operations, from selling to servicing, is handled through independent dealer networks. And most OEMs are blind about what their dealers are doing, and ablut what they are not doing. This lack of transparency ends up resulting in inconsistencies in part and service availability and ultimately customer experiences. Fortunately, utilizing data to measure and improve aftersales success is one way to effectively address these challenges. 

Getting Familiar with Customer Expectations for Measurable Aftersales Success 

Contrary to what many believe, the aftersales experience is equally as important as the initial sale. Customers expect quick, reliable service and easy access to parts but they also want to see you supporting them should anything go awry. Furthermore, they want to know that your organization’s customer service is top-notch, otherwise they aren’t likely to recommend you to friends and family. For OEMs, understanding these expectations is the first step towards improving aftersales processes. And this requires a methodical approach to gathering and analyzing customer feedback and service data. 

Why Measuring Aftersales is So Important 

“If you can’t measure it, you can’t improve it” – whilst it was crucial to track relevant sales KPIs around customer acquisition, in this highly competitive world companey must start and collect KPIs around customer retention. For OEMs, collecting and analyzing data related to aftersales success has to be considered non-negotiable. And honestly, this data doesn’t even need to be super sophisticated. Historic Demand, Current Inventories and potentially even the serviced machine park by dealers would be sufficient for the beginning. With a comprehensive understanding of these areas, OEMs are far better equipped to make strategic decisions to support their dealers and optimize global parts availability, increase customer satisfaction, and improve sales performance sustainably. 

Tangibly Using Data for Aftersales Success 

There is a wide range of essential KPIs for OEMs (and dealers!) to track, to understand whether or not they service their end-customers in the right way. Initially, Machine Downtime Cost should be understood to have a feeling for what pain the customer is going through, when they are in need of a part or a service. In a daily basis though, Essential KPIs in aftersales include Fill rates (on time and in full), Mean time to repair, warranty claim rates, SLA compliance and even repeat business rate. These metrics offer a transparent view of the efficiency and effectiveness of aftersales services. Monitoring these KPIs over-time helps in identifying trends and areas needing improvement, thus making aftersales success measurable. One step further, OEMs could even start tracing dealer performance KPIs to be able to support their dealers become a more effective business, like inventory turnover rates or service revenue growth. 

A Deep Dive into Aftersales KPIs 

  • Fill Rates:  This indicates the percentage of customer orders fulfilled from stock on the first request. A high fill rate means fewer backorders and improved customer satisfaction. 
  • Repair Time (Mean Time to Repair – MTTR): The average time taken to repair machines. Reducing this time can significantly enhance customer satisfaction and machine uptime. 
  • Warranty Claim Rate: The frequency of warranty claims can indicate the quality of the machines and the effectiveness of initial servicing. 
  • Service Level Agreements (SLA) Compliance: The rate at which dealers adhere to SLAs for service times. This KPI tracks the efficiency and timeliness of your dealer network in servicing machines. 
  • Repeat Business Rates: The frequency with which customers return for additional services or parts. High rates signify strong customer loyalty and satisfaction. 

Improving Aftersales KPIs 

Improvement strategies vary depending on the specific KPIs, but they generally involve enhancing inventory management, streamlining logistics and supply chain processes, as well as upgrading dealer support and training programs. For example, reducing lead times may require revamping the logistics network, while improving fill rates could involve a more sophisticated end-to-end inventory forecasting and replenishment system. 

Data-Driven Decisions in Aftersales 

Data analytics plays a pivotal role in transforming aftersales services. By analyzing vast amounts of data, OEMs can uncover hidden patterns, predict future trends, and make more informed decisions. This includes identifying parts that are in high demand, understanding regional variations in service requirements, and tailoring services to meet specific customer needs. 

Implementing Retail Inventory Management (RIM) 

A practical example of data-driven aftersales improvement is the implementation of a Retail Inventory Management (RIM) solution. Adopting RIM will allow an OEM to gain real-time visibility into dealer inventory levels, streamline parts supply, and ensure that dealers are adequately stocked with the right parts, which all impact their bottom line. Specifically, it will lead to increased fill rates and increased customer satisfaction by drastically reducing wait times for parts and services. 

The Role of Technology in Aftersales 

The influence of modern technologies like the Cloud, IoT, and advancements in AI is undeniably transforming the possibilities to exceed aftersales expectations. A new era of virtual service assistance, real-time machine tracking, predictive maintenance and much more is unlocked. However, beyond these sophisticated and pretty buzz-wordy applications, the integration of these technologies also facilitates more fundamental but equally crucial tasks, such as sharing standard maintenance schedules with dealers based on usage hours. Surprisingly, many OEMs still find it challenging to effectively disseminate this essential service information. By combining technology and the usage of data in the right way, OEMs can finally step up their reactive operations towards a proactive way of working exceeding customer expectations. And the greatest thing is, that starting such endeavor doesn’t require much. In fact, it just needs someone to kick-off a connected dealers initiative. And here we go. 

What are the Challenges in Measuring Aftersales Success? 

While the benefits of measuring aftersales success are clear, several challenges still linger. To name a few, there is the need for the integration of data from various sources and interpreting the data to make meaningful decisions. OEMs must invest in the right tools and expertise to overcome these challenges and effectively make aftersales success measurable. Every optimization is only as good as its underlying data. Therefore, OEMs should choose wisely on how to aggregate global end-customer and dealer data. Fortunately, ClearOps has proven to be able to reliably connect thousands of stakeholders with different systems to form a global ecosystem for aftersales success, connecting OEMs, dealers and machines on one platform and harnessing the power of data as described above.  

Final Thoughts 

In order to make aftersales success measurable, there has to be proper systems in place. Measuring aftersales success isn’t merely a metric but rather a comprehensive strategy that encompasses understanding customer needs, leveraging data, and employing the right technology. For OEMs and dealers, this is the path to improving service and sales performance and building lasting relationships with customers. 

Next Steps with ClearOps

ClearOps is your ideal partner in your mission towards aftersales excellence. With our help, you’ll be able to unlock the full potential of your aftersales data, leading to improved service quality, decreased churn, higher customer satisfaction, and increased profitability. Contact us to learn more about how we can transform your aftersales strategy. 

FAQs 

What technological advancements are shaping aftersales services? 

Advancements like IoT, AI, and predictive analytics are revolutionizing aftersales by enabling more proactive and customer-centric service models. 

How can I ensure my data-driven aftersales strategy is effective? 

Regularly review and adjust your strategy based on ongoing data analysis and feedback. Stay adaptable to changing market conditions and customer needs. 

Is there a one-size-fits-all approach to improving aftersales? 

Absolutely not. Each OEM and dealership is unique, and strategies must be tailored to individual business models, customer bases, and market conditions. Aftersales Software Solutions, like ClearOps can help you find the right solution for your needs. 

How can I get my dealers on board with new aftersales strategies? 

Connect with dealers through training, provide clear communication about the benefits, and support them in the transition with the necessary tools and resources. It is crucial to not only get the dealers on board, but also to show them their individual advantages based on data. Data is the best foundation for making good decisions. 

How does ClearOps aggregate global customer and dealer data, and how does it utilize this data to enhance aftersales success?

ClearOps facilitates the aggregation of global end-customer and dealer data, enabling seamless communication and collaboration. With advanced data analytics capabilities, ClearOps empowers OEMs to identify trends, anticipate needs, and enhance aftersales strategies for improved service quality and customer satisfaction. 

 

Download The Free OEM How-To Guide “Boosting aftermarket performance in a decentralized dealer network”

In the whitepaper you’ll learn:

  • Why winning in the aftermarket is a crucial pillar, not just a nice-to-have
  • The untapped potential of parts planning among numerous OEMs
  • The tangible benefits of enhancing aftersales through a unified downstream supply chain
  • A case study: How AGCO supercharged their customer fill rates by a whopping 43% by transitioning from a blind spot in supply chain visibility to an interconnected dealer ecosystem
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