Jiffy Lube | Mike McRitchie | Resume and LinkedIn Profile Writer

Marketing Lessons from Jiffy Lube – Part III – Upsells

May 20, 2015 by Mike McRitchie Leave a Comment

So today we’re going to talk about the final point in this case study.

The Upsell Board

This is “Jiffy Lube Select Services.” Just sounds exclusive doesn’t it.

Nice clean layout with the red, white and black that ties into their logo and color scheme. How might you integrate all that in your business?

So we have three categories again (remember the rule of three choices from the first post? If not re-read that now).

Run Safe
Run Clean
Run Long

Run Safe

Let’s start with Run Safe

Windshield Wiper Replacement – $10.99

If you go to an auto parts store you could get the same thing…and they’d install it too…for the cost of the wiper blades. Probably for half the price. But that is the great thing about upsells. They can be a win-win. If you had to drive somewhere else after getting your oil change to replace your wiper blades, wouldn’t it be worth it to get both done here and be done with it? Saves time…and time is money.

So what is the other Run Safe upsell?

Light Bulb Replacement – $10.99

Same thing here. I’ve had light bulbs replaced at the dealership for the cost of the bulb. This one probably isn’t a huge margin but it is worth asking. And the other thing about this is the fact that often people don’t realize their lights are out. Especially tail lights. So if you didn’t know before, you can’t plan ahead and get it replaced somewhere else. And now that you’re already here, why not get it replaced. Only $11 more, right?

Run Clean

Now on to the Run Clean section.

This is the mid tier of upsells.

Fuel Filter Replacement – $59.99
Fuel System Cleaning – $59.99
Cabin Air Filter Replacement – $39.99
Engine Air Filter Replacement – $14.99

These are harder sells. Here they ask you how long since you’ve last had these replaced. Or they show you a dirty filter when they ask you. How dirty are they supposed to be? If it doesn’t look clean it probably needs to be replaced, right?

No comment. I do know I go several times before replacing. Even though it looks dirty. But most people don’t have their maintenance book handy when they’re going in for an oil change. So upsell opportunity with few facts to counter with.

Run Long

So the last section, Run Long

Who wouldn’t want their car to run long?

This one starts at the top and works down in price generally.

A/C Evacuation & Recharge – $119.99 (a great upsell in the summer when your A/C stops working)
Automatic Transmission Fluid Exchange – $119.99 (a tough one to sell)
Automatic Transmission Drain & Fill – $59.99 (same issue as above)
Manual Transmission Service – $49.99
Differential Service – $74.99
Transfer Case Service – $49.99
Radiator Antifreeze Coolant Service – $89.99 (this could be a good one, particularly if the car has a habit of overheating)
Serpentine Belt Replacement – $89.99 (maybe if it is cracked and ready to break)
Engine Flush – $59.99 (this is a good one and more reasonably priced than the Radiator one)
Tire Rotation Service – $24.99 (they always say you should rotate your tires but most places you buy tires will rotate for free)
Battery Terminal Cleaning – $9.99 (I should probably get this done since my terminals are always corroded and when my battery dies because I left my lights on they always comment about the corrosion)

Now Go Make Some Money

So there you have it. Three groups of upsells – low, medium, and high. Well grouped. As long as the sales team understands how and when to present those, you have a decent chance at having a $38 oil change turn into a $100-$200 project.

Now isn’t that worth spending some time evaluating with your business? Imagine spending 10% to 25% more time but getting 2 to 10 times the revenue and profit from the same transaction.

Shouldn’t you take an hour to investigate? Until next time…

Marketing Lessons from Jiffy Lube – Part II – Education

May 19, 2015 by Mike McRitchie Leave a Comment

In yesterday’s post we looked at the three price points and the psychology behind how someone would evaluate the options. And how you might profit from that by redesigning your price point options in your business.

So today lets look at another aspect of Jiffy Lube’s marketing approach.

Educating the customer.

On the left side of the “Jiffy Lube Signature Service Oil Change” they list out the inclusions.

So what does this do?

Pictures and Headers

First off they have headers with pictures next to them:

“Change” with a drip picture for oil
“Inspect” with a magnifying glass
“Check/Fill” with a checkmark
“Clean” with a sparkle shape

These give you a quick, at a glance sense of what is going to happen when you get an oil change at Jiffy Lube. They’ll change your oil and oil filter, inspect the major operating fluids and components, check and fill your tire pressure and fluids, and finally clean your windows and vacuum your floors.

Headline and Bullet Points

Below each headline they give you a bullet point list of what is included under that headline. Easy to ready and understand quickly.

The other nice thing about this is when you drop your car off, they walk you inside the building, offer you water or coffee, point out where you can take a seat until they’re ready for you. This gives you a chance to look at the sign, absorb what the services are, and review the offering before you’re called up to write up the estimate and make those service choices.

Fine Print and Addressing Objections

We covered what’s included. But there is more as well. If you check out the fine print at the bottom of the first board, you’ll see,

“As an added value, between service visits up to 3,000 miles, customers receive free top-offs on motor oil with same type of oil purchased originally and on any of the vital fluids, with a maximum of 2 quarts per fluid.”

So what’s this about?

It does several things.

Free Sells

It is something free. People love free things. And if you have an older car that is leaking fluids, wouldn’t that be the place you want to take your car for oil changes? That gets you a customer for life. Because if you get your fluids filled there, would you take your car somewhere else next time for an oil change? Probably not.

And as we all know, it is significantly less expensive to resell to an existing customer than acquire a new one – particularly when you add advertising costs to the equation.

It also breeds confidence in your offering. “Why would they offer free top offs if they did shoddy work?”

And also for those who are wary and suspicious of the too-good-to-be-true-offering, they’ll check out the fine print. And you tackled their concerns and objections head on.

Go Implement

How might you do the same with your offering? Have you addressed everything up front? Pre-sold them to turn a sales situation into a more profitable order taking situation that is smoother to process (and achieve the sales results of using a salesman without the sales pressure…your marketing did that for you).

So that’s it for today’s edition. So how can you educate your customers with your headlines, bullet points, and fine print, along with addressing their concerns ? And make more sales?

In tomorrow’s edition we’ll check out board #2…the upsells.

Marketing Lessons from Jiffy Lube – Part I – 3 Choices

May 18, 2015 by Mike McRitchie Leave a Comment

Yesterday I was at Jiffy Lube getting my oil changed. Yes it was past the 7,000 mile point they told me I should get it changed at. I drive a lot and those miles just fly by. And I have a lot on my plate…

…sounds like a bunch of excuses right?

Well enough about my plight. Today let’s talk about the marketing elements at play here at Jiffy Lube. This is what I noticed while sitting in the waiting room for the 15 minutes while my car’s oil is being changed.

Three Choices/Price Points

The first rule to offering options is no more than three options should be offered. And they do a great job of that.

Conventional (for most vehicles) – $37.99
Specialty
- Synthetic Blend (Synthetic blend for enhanced performance) – $54.99
- High-Mileage (Specially designed for vehicles with 75,000+ miles) – $54.99
Full Synthetic (Full Synthetic for premium performance) – $75.99

Now it is true that there were four options, not three. But the two “Specialty” options were the same price.

So how does someone go about choosing?

Let’s start with the low end Conventional choice.

If you came to get your oil changed, not a car buff, have a typical car, and just want an oil change, you probably go with the Conventional oil.

Why? Well you went there because you didn’t want to go to the dealer and get charged a mint. Jiffy Lube is a well known brand so you felt like you wouldn’t get ripped off. You probably didn’t know the pricing before you came in but were thinking probably getting it for $29.99. You had a little sticker shock with the $37.99…but when you read the board and saw that you could be paying $50 or $75 you felt okay about sinking the $37.99.

I’m guessing this is the choice of 75% to 85% of the people. That is because people who will choose the high end oil are not likely to come to a Jiffy Lube. They’ll go to the BMW or Mercedes dealership for their oil change (also probably because it is a leased car and all service is covered for three years).

So on to the Specialty price point.

Here we have the Specialty oil. A synthetic blend. this is kind of like the middle grade gas at your gas station. It gives you a basis of comparison and probably makes the company better margins. Why? Because oil cost is very minimal compared to labor (i.e. $14.97 for conventional vs $22.97 for 5 qts of synthetic at Walmart – $8 more. And for a synthetic blend assume $4). And the labor cost doesn’t go up with a better grade of oil. So in this case Jiffy Lube at a minimum (since I’m looking at retail Walmart oil prices vs wholesale prices Jiffy Lube can get) is getting an additional $17 less $4 = $13 profit for basically providing the same service.

So does anyone buy that? And what is the purpose of having this option if people don’t buy?

First off, some people do buy. They buy it because it says “Specially designed for vehicles with 75,000 miles”. That is the hook. People with high mileage vehicles don’t want their car to break down on them. Spending $17 extra to avoid a major repair bill is probably a good idea. Is it justified? Is the oil that much better? Probably not but I’ll leave that to you mechanics to sort out.

The other “Synthetic Blend” option references “enhanced performance”. That is to help the people on the low end choose the “Conventional” rather than going to another shop down the street. It makes them feel like they’re getting a deal since they don’t have a performance car. Or if they have a performance car or want to think they do then that validates them.

Alright. Now to the last option.

The major upsell. Now we’re talking “Full Synthetic” for “Premium Performance”. This is for people with sports cars that really work hard with high RPM’s. The oil cost is another $4 more. But the price went up another $21. Sol $21 – $4 = another $17 profit (or $17 + $13 = $30 more profit for no extra work!)

Now it is true, as I indicated earlier, that not many high end car owners will go to Jiffy Lube. But there may be a few takers. And much more than that, it helps people justify their decision on the lower two price points. Because they can say, “At least I didn’t pay $75 for an oil change!”

And that’s how it works.

So how could you use this in your business?

How many options are you giving your customers? If more than three, cut it back to three. Test different price points and assess the results. You’ll want to see what percentage go with each option and weight that against the profit margins on that option. Look at the whole picture before making a final decision on prices. Also try changing up the wording. Change the order. Change the colors and layout.

And after each test version, assess the results.

As you can see from the exercise, profit margins differ dramatically. If you’re not testing you’re leaving a lot on the table.

Go check out your situation now…and then come back tomorrow for another piece of this interesting case study puzzle…educating your customer.