Author: Richard Robinson
Halford’s recent high-profile ‘Dealer or No Dealer’ campaign, which attacks franchised retailers by highlighting that cheaper repairs using OEM-verified parts, which do not invalidate warranties, are available, has come under sharp criticism from the franchised retailer community.
From a legal perspective, it has also seen Iain Larkins, director of Radius Law, suggesting that Halfords could face action if it turns out that the campaign breached advertising rules, which are in place to ensure advertisers fulfil their legal obligation to ensure that they do not mislead consumers – and that includes an obligation not to omit material information.
While we have yet to see if the campaign does come under scrutiny, I think it is important that dealers take the time to challenge themselves in terms of their customer value proposition, ensuring customers recognise and value it.
Halfords’ campaign comes at the same time as it reported a 14.1% increase in revenue for the 20 weeks to 18 August. That sales growth was predominantly driven by its Autocentre, service, maintenance and repair business.
While announcing its growth in revenue, Halfords also warned that first-half underlying profits were set to be lower but be higher year-on-year in the following six months. At this time, it anticipates seeing the majority of benefits from its £30 million cost savings programme.
All parts of aftersales are feeling the pressure arising from the cost of living crisis, but how are they reacting?
Whether it is cost savings, efficiencies, productivity gains or improvements in customer approval levels, Halfords’ campaign should have all franchised dealers reassessing their model. Right at the top of this review should be a challenge to assess current pricing and price transparency and to look closely at the customer journey.
Expert technicians, OEM training, parts and resources, and a congenial atmosphere are all potential positives, but do they more than offset cost, convenience, travel time and other potential negatives that may exist to win customers’ hearts, minds and wallets?
We cannot afford to take anything for granted. From a positive perspective, Halfords’ campaign could be a springboard to enhance the customer experience.