Big Opportunity for Dealer Service Lanes: Women Customers

Women car shoppers and service dept customers

SITUATION:
• Researchers at the Kellogg School of Management at Northwestern University tested out auto repair body shops for price quotes and found out something interesting for dealer service lanes – women are getting higher price quotes than men.

• Researchers had call center agents call auto repair shops across country to ask about getting a radiator replaced on a 2013 Toyota Camry, which researchers determined would be about $365.

• Shops were asked to quote price and on average, women callers were quoted higher prices than male callers were.

• Women who called in and said they had no idea with the price ought to be were quoted higher prices than men who called in and said they had no idea what the price ought to be.

• It might also be about taking advantage of potential customers these repair shops consider not very well informed. Men and women considered “poorly informed” – who didn’t know what the price quote would be – were getting price quotes much higher than call center researchers who called in and gave the expected price of $365.

SIGNIFICANCE:
• So the discrimination appears to be about gender and coming from “statistical discrimination.”

• This could a very bad idea for independent repair shops and a real opportunity for dealer service departments.

• There’s a lot of evidence that women car shoppers are closing the deal more than men these days – they’re in charge of the checkbook and are doing a lot more research on the internet before calling or visiting a shop.

• So, if this study gets a lot of media coverage, which is happening, they’ve got the public perception problem of playing this game and the loss-of-business problem of getting female consumers unhappy with them and telling their peers about it.

SOURCE: US News & World Report

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