Artificial intelligence (AI) is transforming the way many industries do business – including collision repair -- and Ryan Taylor, founder and CEO of BodyShop Booster, knows how body shop operators can use it to gain an advantage.
Taylor presented “AI is Here: How Others are Leveraging AI Interactions with Automotive Consumers” during the 2024 SEMA Show, with tips on how AI can help shops capture more business, reduce staff’s administrative burden and improve the customer experience to increase repeats and referrals.
Taylor quoted Rupert Murdoch, who said, “The world is changing very fast. Big will not beat small anymore. It will be the fast beating the slow.”
“Nothing is faster than AI,” Taylor said. “I have never seen anything move this quickly, proliferate into different industries quicker or allow companies to speed up faster.”
Taylor, who previously owned a network of eight body shops and a mobile hail damage repair business, told the story of a customer who claimed one of Taylor’s shops had incorrectly repaired the front passenger seat belt in her car, and her 11-year-old daughter went through the windshield when the customer had to hit the brakes suddenly.
When Taylor saw the car, the windshield wasn’t even cracked, and the seat belt was only twisted.
Relieved, Taylor asked the customer what was going on. She told him she’d had a terrible experience with his shop, which her insurance company had directed her to use. She felt like the staff didn’t care and didn’t communicate. She said Taylor’s shop would never touch her car again and she was going to switch insurance companies.
“What if 5%, 15%, 50% or God forbid, 100% of our customers are also being asked for their claim number, not their name? This is the silent killer of business right here,” Taylor said.
Getting repeat business and referrals is key, Taylor said. In 2011, when that customer vowed to never use Taylor’s shop again, his average severity was $3,300, meaning that customer had only brought in $3,300 to his business. But if the shop had been able to get repeat jobs or referrals, the customer’s “lifetime value” would have been $147,000.
With average severity significantly higher now, a single customer’s potential “lifetime value” is now also much higher.
“If we unlock this, things will change for us in a big way,” Taylor said. “I'm going to show you three secrets of how AI is going to help you unlock these areas better than ever before.”
AI is currently moving from the “innovator” stage, as new tools and technology are developed, to the “early adopter” stage. Taylor encouraged the audience be one of those early adopters, as customer experience is going to be the “major differentiator” in capturing business.
“Everything we’re talking about today, in AI world, is the worst it will ever be,” Taylor said. “It’s only getting better.”
'To the Door'
The first secret is to use AI to bring customers to a shop’s door.
Taylor said there is a national drop-off in shops’ backlogs, and several are coming to his business asking for marketing help.
“You need to fix this first,” he said.
Taylor said for every 100 customers who make contact with a shop after a crash, on average, only 57% get an estimate. The other 43% drop off.
The “tip of the spear” at the shop are the service advisors or customer service representatives who answer that first phone call, Taylor said. If they are doing their job effectively, there shouldn’t be any drop off.
He said whoever first speaks to the customer needs to get their personal information and vehicle information -- which can be used to leverage any relevant shop certifications -- while using a tone of voice that shows empathy for what the customer is going through.
“The drop off is cut in half if you get that info [in the first call],” Taylor said.
Taylor said he once worked with an OEM to call its certified shops, posing as a potential customer, to rate their first contact. He played one of those calls, in which the employee who answered the phone only asked what insurance company the customer was with.
Taylor then called a New York body shop’s existing AI assistant, which answers the phone if an employee is unavailable. The AI assistant expressed empathy for Taylor’s made-up accident in a 2022 Toyota Corolla, told him the shop was certified by Toyota, got his name and phone number and then sent him a link so he could upload images of the damage to get an estimate started.
“It gets better on a weekly basis,” Taylor said. “Every conversation it has, it gets smarter.”
AI can also help streamline communication between employees within the shop, and between the shop and the customer, which saves everyone time and makes the customer feel better because the repair process is happening faster.
Dealerships can use AI to scan the vehicles in their service lane that have some degree of damage -- which, on average, is 41% -- and generate a simple estimate, to get the customer into the collision repair center’s system.
AI is now at a point where shops can grab an assignment from an insurance company via its estimating system and make first contact with the customer via email, text or voicemail, providing them with the next steps to file a claim.
“We know that when a customer is dealt with quickly, their consideration set shrinks,” Taylor said. “It doesn’t take any people. AI can do all that for you.”
'Through the Door'
Once the customer is through the door, AI can reduce the administrative burden on shop staff.
Taylor said in a survey, 63% of employees said they were afraid to ask their superiors for help or advice, but they love to chat with AI because they don’t feel judgement. AI can be used by loading shop procedures and letting staff ask it questions.
On average, shops capture about 56% of estimates they write. AI can be used to “tighten that gap” before spending on money on marketing, Taylor said.
He gave a hypothetical example of a shop that writes 100 estimates and gets 56 jobs. If management spends money on marketing and gets 200 estimates, it increases the workload on staff. Typically, their work then suffers, and the shop’s capture rate shrinks -- say to 40%, which would be 80 jobs.
If that shop instead increased its capture rate on those 100 estimates to 80%, it would get 80 jobs without stressing out staff.
There are two ways AI can help sell more estimates, Taylor said.
The first is to sell to the “second buyer.” For example, a married couple may both be on an insurance policy, but only one person speaks with the shop about a claim. They then decide with their spouse which shop to choose. If all they have is estimates, they typically just pick the cheapest option.
Taylor said AI can be used to create a video explaining to the “second buyer” why a shop is the right one. One shop that implemented that practice found it increased capture rate by 5%.
The second is estimate follow-up. Taylor said 91% of shops reported they don’t do any estimate follow-up because it’s time consuming. AI can be used instead to send emails and texts to those potential customers.
AI can also let customers schedule their repairs, reserve a rental car and sign documentation.
'Out the Door'
It’s 70 times more expensive to get a new customer compared to getting repeat business or a referral from a current one, Taylor said. However, a survey by an insurance company showed only 1.56% of customers who’d had a car repaired had referred someone else to the body shop they used.
Taylor said in most customers’ minds, body shops are all the same.
The best way to stand out -- to make your customer remember you when they see someone else who needs your services -- is to be efficient and responsive.
“When you [quickly] take that pain away for your customer…they will never forget you,” Taylor said. “When they understand you’re different, they will remember and refer you.”
Use AI to reinforce that behavior, he said.
A shop owner in Illinois is doing just that, Taylor said. When a customer leaves his shop after a repair, they get recorded a pre-recorded voicemail from the owner, thanking them for choosing his shop and checking on how the drive home went. They then get a text asking for feedback in a Google review.
Thirty days later, the customer gets another pre-recorded voicemail from the shop’s painter, letting them know the paint is 100% cured and they can now wax or polish it. That voicemail also thanks them for choosing the shop.
“When you add value to your customer, they will add value to you through repeats and referrals,” Taylor said.
“When we look at AI and all the automation, think about all the tasks you’re doing manually,” he said. “It’s about four hours per customer, but when you use AI, it’s 30 seconds.”
Abby Andrews