Tuesday, October 18, 2011

We won't be feeding data to CARFAX. Here's why . . .


Yesterday I got a call from a CARFAX representative who wanted me to upload my repair database to their servers so it could be included in what CARFAX reports on cars we may have serviced.

I sought opinions about that on my blog and Facebook page, and thought about the matter at some length.  I’ve decided it’s not a good idea for my company, and indeed for most independents, for these reasons:

Customers have an expectation of privacy, especially in small business dealings.  They don’t expect us to sell their names to marketers.  While CARFAX is not collecting names in this example, anyone buying a car and following its trail to our shop necessarily makes a connection to our clients, who may or may not want to share that information.

While some of our clients might well embrace the CARFAX concept, I am sure others would be very troubled at this release of information that might be traced back to them. 

That alone is reason for independent shops to steer clear of this program, but there’s more.

CARFAX claims they are extracting or summarizing what shops write on their work orders using some kind of automated process.  The result, as shown in the sample area of their website, will look something like this:

12/10/10    ABC Garage    Electrical Repair
2/1/11   BBB Garage    Oil service

I have a number of serious concerns about this process.  One concern is that CARFAX will incorrectly “summarize” what is written in our repair orders, leading to a misleading or totally wrong CARFAX report.  For example, consider the fellow who brings his off-road Jeep in five times in five months to add driving lights, fit a bigger stereo, install a winch, upgrade the alternator, and fit more driving lights.

Will that show up as five “electrical repairs?” If it does, who does the owner blame for that wrong report?  CARFAX?  Us?  It’s a situation where we will be blamed and we have no control or recourse; indeed we can’t even know what’s happening because we have no access to the reports.

The problem is, if we hand someone our information, we have a responsibility to our clients, to be sure they use it correctly.  CARFAX is not offering us that ability, but even if they did, why would we want to do it for them?

You have a situation where our sharing of innocent repair data might create a false impression that a car is a lemon, or at least needs constant repairs.  That could turn off some buyers, and it’s easy to see how the vehicle owner would blame us if he lost a sale.  One such negative would outweigh a hundred customers who think “it’s ok,” in my experience.  That negative could cause us a lot of bad press.  “It’s okay,” is indifferent at best and counts for nothing in terms of our reputation in the community.

CAARFAX argues that the addition of service data enhances the value of a car, by proving it’s well cared for.  While that may be true, who does the data benefit?  They imply it benefits our clients but I don’t think that’s really so.  If our clients are selling a car, they already tell potential buyers that we care for it, and we are its reference.  CARFAX adds nothing to that situation.

If our client has not cared for his car faithfully, the existence of a spotty record is a minus.  Maybe that means he didn’t take good care of his car, but it may also mean he has a winter home in Florida and the shop that does the rest of the work down there does not report to CARFAX.  Once again, our contribution of data creates a false negative impression that could come back to bite us.

If anyone wants to know how our clients cars were cared for, all they have to do is ask . . .  In the latter example, we’d say, “Bob has some of his work done in Florida, so ask them too.”  The difference is obvious.

The true beneficiaries of the CARFAX data are dealers, who buy used cars at auction, and the CARFAX company itself.  Our clients are out of the picture once the car is traded in.

CARFAX says we benefit too, because a prospective buyer can look at the record and see we serviced the car.  That sounds true, but a large percentage of cars that get traded in are auctioned and resold out of the local market.  That negates any advertising advantage we might get by appearing in the listing.

Auto service is a local proposition.  Local people will refer us directly.  Distant people don’t matter in most cases.  It’s a tenuous proposition at best.

I’d be interested in other views on this topic.

5 comments:

Jeff said...

John... I cant agree with you more. I have every receipt and log the repair info on my vehicles. I am loyal to one mechanic shop and expect them to tell the truth as do I.I have nothing to hide and have never had any vehicle I have ever sold returned to me nor have I ever been sued. What about the backyard mechanics who don't report the work they do? Lord knows some of them are true nightmares!And your point about electrical repairs are right on! My friend bought a Cadillac CTS from a dealer with a carfax report that stated several electrical repairs. After the salesman fluffed it off as "changing bulbs" he bought the car and had nothing but problems with the ECM/PCM or whatever the hell it is. Your integrity and loyalty to your customers is impressive!

Sandy said...

In MY opinion, just the fact that service has been done at JE Robison Service speaks far better than CARFAX as to the care the car has gotten.
PERIOD.

OkieRover said...

Good job. That explanation makes total sense. Bully for you guys.

Paul Patterson said...

Great ideas. Anyways, I only use carfax report alternative and paid only $3 each report .

Brian Heckaman said...

A vast number (majority?) of used car buyers are unable to interpret maintenance history reports (as you might see on Carfax) and differentiate between "well maintained" or "lemon". Only mechanics/dealers can really mull over this information and form that sort of opinion (but it's still just an educated guess unless we are able to physically inspect the vehicle). These reports affect auction value more than anything, but at retail a "well maintained" car with lots of maintenance records on Carfax, to an average buyer, looks the same as "lots of problems". But you will get a few that can gleam the information knowledgably and it helps the sale... so in the end I would say it doesn't really matter either way. If Carfax (and other reporting agencies) were serious about "helping consumers" they'd come up with a better ways to do things. What they are serious about though: taking people's money and providing data that is (for most car buyers) of limited, sometimes misleading usefulness.