From Data to Loyalty: How AI and Hospitality Are Redefining Shop Growth [THA 488]

0:00This is the Automotive Repair Podcast Network. Hey everybody, Carm Capriato, Remarkable Results Radio, another Town Hall Academy. Hey, look, Carm's gonna do another episode on marketing and AI. Oh, we won't hang around. We won't listen. Ah, wrong. That would be a huge mistake because I do episodes, maybe the same kind of topics, but the themes and the people we have on, We've got Mike De La Cruz and Michelle Tansey here, so that's all the more reason to wait around.

0:31Thank you so much to our great partners who've been with us for so long. Hey, let's face it, your shop management system is the most critical tool in your shop, and NapaTrax will move your shop into the SMS fast lane with on-site training, 6 days a week support, and local representation. Find Napa Tracks on the web at napatracks.com. Hey, how well does your team know their stuff?

1:00Test their automotive skills with the Today's Class basic, advanced, or service advisor quizzes. It's a quick, effective way to spot gaps and grow stronger teams. Take the quizzes now at todaysclass.com/tcquiz. Shop owners, stop juggling multiple marketing tools. Kukui's integrated platform? They deliver 4 times better website conversions, automated follow-up, and real-time ROI tracking. Get industry-leading customer support with Kukui. That's K-U-K-U-I dot com.

1:33You're probably tired of chasing new customers who never return. We understand. Pit Crew Loyalty ends the one-and-done cycle, turning first visits into lasting, reliable revenue. On the web at pitcrewloyalty.com. Hey, look, I want to tell everybody, please get our listening app. It is the coolest thing ever for your smartphone. Yeah, you can listen on Spotify and Apple. I get that. But this is a tool for you, for your smartphone, the ultimate professional automotive repair playlist.

2:06Read the show notes, see links to our sponsors, and get all the shows in our network on one app, ARPn.app. Hey, welcome aboard to my friends, Mike De La Cruz and Michelle Tanzi. Mike and Michelle, glad to have you here. Michelle is co-founder of Euro Clinic in Santa Clara, California. How are things in the Euro world? It was a rough start, but I think that, I mean, I love the cars that we work on.

2:36The whole business is based on that luxury Euro kind of world. And I'm in the center of Silicon Valley, so there is so much potential. That's pretty much a lot of what we see, especially in my area. It's a good area to be in the euro business. I am curious. I'm going to ask you a question. You don't have to answer it.

2:56What's your labor rate? My base labor rate is $295. For exotics, it's $395. I want you to keep in mind, and for all the listeners, because, you know, when I'm in a room with shop owners and they hear what the labor rates are, I want you to know, like, so my shop is right in the middle of a U and I have 3 major dealership strips.

3:183 miles away from me, Porsche dealer's $450 an hour. Wow. Wow. Mercedes is $400, Audi's $385, and Volkswagen and BMW come at about like $350 to $365. But let me just guess that the average wage in Silicon Valley is $300,000. I'm just guessing. Yes. It's super interesting. Like, when I do all this research on, like, these households, this is the crazy part, and everybody always thinks it's super crazy.

3:48A $150K household is considered low income in our area. Yeah. Yeah. That's my point. Yeah. Wow. So, like, my customer base is a lot of, like, professional females and a lot of tech. Like, those are our clients. So— When I say it's a good way for me to be a shop owner, innovation should always be my mindset, right? How can we innovate to cater to these consumers?

4:15Because those are the drivers that drive the cars where I'm at. I love what I do. Like, I don't work on cars, but I love what I do, constantly working with, like, the whole team that we work with on how can we serve this consumer better due to what they do for a living, what they drive. A lot of them, like my clientele in my area, is time is money, right?

4:37So taking in your car for service, it costs you more than them being where they need to be. Well, I think she's pretty much nicely set up, Mike, all the things that we want to talk about with marketing and AI. Mike De La Cruz is here, co-founder and CEO of overdrive marketing.com. And when you want to type that in, you have to spell O-V-E-R-D-R-Y-V-E overdrive.com.

5:02And Mike, you've been in the industry for years. You've traveled the country for, with other companies. You are embedded and you are there. And was a few years ago you had this off the charts idea? Yeah, absolutely. Yeah. It's, I mean, it was January 11th, 2023 where I launched OverDrive and here we are over 3 years later. And just a quick plug for Michelle.

5:24She's actually my shop. I bring all my family's cars to her. She's like less than 10 minutes or so, right, Michelle? Like 8 minutes or something like that from my house. So I'm in Silicon Valley. I don't meet those. I'm at the minimum threshold, but thankfully my wife makes way more money than I do. So just for context, but yeah, best shop here in Silicon Valley for sure.

5:43So very grateful to have Michelle, you know, service all my cars. That's just great, great news. Now, Michelle, I wanna start this entire episode about how AI and marketing, they integrate. We're hearing so much. Are shop owners, Michelle, just getting the wrong AI impression right now? I think so. And I think it's also like, it depends, right? Where demographics has a lot to do how you embrace technology.

6:12We sit on all these different boards with all these shop owners or different places in the industry all over the United States. And I think a lot of them fear it. Some think it's BS. In my shop, we're trying to embrace it completely, like, in everything that we do from— we're looking for our vendors to start embracing it as well. We're looking for the best technology to get information the fastest.

6:36I know Bernard is starting to implement it with the technicians, you know, using ChatGPT. The company has one. We taught it, we made it learn everything that we possibly can. And a lot of this, a lot of people start having negative comments on it. For me is you have to look how to embrace it, and you have to pick technology and then say, hmm, how can this improve us to be way better?

7:00For example, B's using it with the technicians in a sense where if you tell it, I already did this, this, this, this, this is the issue I'm having, what am I not seeing? And it's like instant, right? Instead of calling tech line and waiting and It's how can we get information faster? And it's utilizing it to the ability to say, hey, how am I having tunnel vision?

7:25What am I not seeing? But you have to train it. I always say you have to train this. This is not replacing humans. It's helping us think faster. It's— imagine like a machine that's helping you think faster, narrowing your thoughts. But you still have to tell it. It's not going to know, if I can explain it better. Mike, I know you wanna jump in and you should because you're smarter than I will ever be.

7:50But that whole thing about being able to teach it, Mike, one of the key pieces that people are forgetting is that you could tell it what you want, how you want it, what tone you want, don't do this. And it remembers. Yeah. Well, think about this shift, right? If you go back 25 years or so when websites first came out, We were a little hesitant.

8:11We had to learn this new WWW, right? Then social media came out. And I remember 15 years ago teaching classes on social media, and I used to have to convince shop owners to open up a Facebook page. It was just, you know, they were reluctant. Hey, my grandkids are on Facebook. It's not my thing. Those same people you talk to today, you can't even pry them off Facebook because they've embraced it, right?

8:33So as we kind of entered this shift, and what's interesting is AI has been around for 50 years. Right? It started with McCarthy 50 years ago, but it only became mainstream in November 2022 when Sam Altman, the founder of OpenAI, when he started to talk about these behavioral things that you could actually— these learning behaviors that you could actually implement as small business owners, we sort of embraced it.

8:55There's still a lot to learn from it because you think it became mainstream the end of 2022. We've seen some drawbacks, different things like that. So let me, let me add a little bit more context if it's okay. So OverDrive offices are Sunnyvale, California, and our offices, it's kind of this shared space with plug and play. There's over 200 startups within our building.

9:15And every day for the past year, I would see, no exaggeration, robots delivering food to kiosks. I would see, there's a company called Shield that has literally, it's a demo in their booth where it's AI detected disease detection. In hospital rooms, right? So I'm thinking for the past year, I'm like, and what's cool is recently we've started to kind of embrace this stuff, but as an industry, we are highly underutilizing it.

9:42Um, a year and a half ago, it was limited to pretty much scoring calls. You know, they would listen to calls and score calls to, you know, figure out missed opportunities, things like that, and then review responses. But now I'm starting to see more companies out there starting to add more features, including OverDrive. Lastly, Google had a big conference here in Silicon Valley last week.

10:03Michelle, I don't know if you heard of it or, or went to it, but they talked about token usage. And the token usage from Q1 2025 to Q1 2026, so just in a year's time frame, it shot up to 3.2 quadrillion. I didn't even know that was a real number. Token usage, right? And then back then, 6% of consumers surveyed said that they utilize some form of AI, only 6%.

10:29That same period in Q1 of 2026, 46%. So even though technically, you know, Google still owns the market share in search, we very, very quickly embrace this stuff. So I would anticipate a very quick adoption in the next few months. From a shop owner standpoint, if I can add on to that, we started hearing a lot when you ask, or the front counter asks, how did you find us for new clients?

10:57ChatGPT, ChatGPT. Then we said, okay, we got to train our ChatGPT. Those senses where you got to teach it. And, you know, BE was super reluctant on bringing it into operations, but a lot of it was— it's the thought that it's replacing humans, or you're hindering the ability for them to learn. I think my AI has made me smarter, faster than I could ever be.

11:24When I think of AI and I think of us trying to mentally figure it out, I always go back to an early Star Trek episode. And I believe the character had this huge brain and didn't speak, and they could telepath their thoughts to the people in the room. And that's what I think when I think of AI, it's just big brain stuff.

11:53So, you know, if you've ever wanted a really big brain, teach AI how to be your big brain. It's funny you use that analogy. Like, I look at it almost like, uh, you have an assistant, right? And you're going to spend time training them how to be the best assistant that you need for your needs as to why you brought them on board.

12:13And that takes time and effort and SOPs and leadership and all this other stuff. Imagine having an assistant that you tell— like, when I got onto ChatGPT and we bought it for the company, I basically told it, this is our company, this is me, learn everything about it. This is my market, this is our clientele, this is what we do. So much that I'll tell you something funny.

12:36I was typing an email and I drop it in there for tone because she already— I called her Pepper. We're big Iron Man fans because we're mechanics and stuff like that. So my AI, her name is Pepper, and I tell her, Pepper, can you check the tone on my email? I don't have her type my email for me. That's the misuse, Reg, with the new generation.

12:57Don't do the email for me. I type in the email and I say, can you throw it in there for tone? She told me and checked me and said that I was being aggressive and that was not my normal tone on how I like to be perceived. This is how embedded I am with it, right, that she's telling me I think you should bring it down a notch because I know that you don't like to be perceived this way.

13:20I told her everything I like, what I don't dislike, how I carry myself, everything possible. That it's almost like your assistant, right? She's checking you, like, check your tone. Okay, so the softer side of Michelle, I get that. Okay. When you heard that back, did you take exception to that? You know, at first I was like, are you freaking kidding me? Like, what?

13:42But I'm big on curiosity. Like, it's funny. Like, to me, when I get feedback, even if it's from like Google machine or even like vendors, friends, family, I don't look at it as, hey, they're talking down to me. I look for it. I get curious. It's like I was curious as to— and I reread it, right? And I reread it. And then you realize, oh crap, yeah, this might be perceived as something aggressive.

14:07I will challenge any consumer in any industry that you in, it is happening. It's already happened. It's been around. We have to embrace it. And I feel like as an industry, we're kind of a little bit behind. Yeah. Last week I taught a class in Northern Virginia on AI and marketing. And then 2 days later, I taught a class in Northern California in the Santa Rosa area for one of the associations out here.

14:32And I always lead sort of I want to kind of get a temperature check of the room, right? So I ask with, you know, how many people use AI at least 5 days a week? Every day, right? So I kind of have these layered questions and then I ask like preferred platform and different things like that. What's interesting is everybody has different usages, right?

14:51How they use it. Like Michelle mentioned the tone. I'm the same way. I want to check myself. I want to make sure my email doesn't come across as arrogant. It's professional, right? So I don't have AI write emails for me, I write the email, cut and paste it, and then post it into my preferred platform. That being said, my biggest takeaway out of both of those classes last week was that people are still skeptical.

15:12Very, very skeptical. There's a lot that you can do with AI. You could have it write code. I mean, there's so many different things that you could do with it, but there's almost this defensive barrier of like, I'm not gonna cross this yet. Let's just kind of wait in the wings, which is highly respectable. Because again, it is new. We're still learning a lot about it.

15:32Whatever we upload, whether it's images, whether it's webhooks, like whatever we're uploading into Claude or ChatGPT, it goes out there to the ecosystem. We don't want to share customer information and those types of things. So I don't do it to that extent. It's just more kind of self-improvement, self-awareness. But that's, that was my biggest takeaway, Carm, was that people are still, still hesitant, understandably.

15:55I don't have a problem with being cautious, but I guess the message that the industry needs to hear and understand is you can't ignore it. You're gonna have to one day embrace it. Now it may be in a longer, you know, a longer curve to embrace it, but you cannot completely ignore it. And, and Mike, let's go back to all the, you know, when the SMSs came out and then DVIs and all this high-tech stuff that started to invade our business.

16:20And some people look the other way. They're not around here anymore. And I do believe that we can't look at AI as a toy. It's a tool. And like every one of our tools, we have to learn how to use it. Yeah. Is it going to replace humans? Absolutely not. Like, that is number one, because humans, we have empathy. We're in rooms, we're high-fiving, right?

16:42But if you think about, and I'll just use a broader context, any role in my world, it's marketing, right? If I take what a traditional marketing director does as a human, right, we're capable of a certain amount of performance, right? Maybe if you're David Goggins, you could extend beyond that. What does he say, 120% rule or something like that, right? Possible. But if you shifted at least 90 to 95% of what traditional marketing director does and then made it more predictable, meaning, okay, each individual customer in our world in auto aftermarket, Jane customer might come in, have one car come in once a year.

17:19A Joe customer might have 3 cars and, you know, maybe Michelle sees them 5 times a year, right? Why should they have the same communication, right? What triggers Jane customer to respond? AI, if you embed that, incorporate that in the process, it's able to tell you that. And the win is, you know, if Michelle sends out a campaign, what's gonna maximize our performance of the campaign, get high open rates and high conversion rates?

17:45That's the intelligence of AI. Mike is talking about stop, eliminate the hope that I think I'm doing things right and get AI, this erector set, if you will, to come in and do some of the lifting. You know, Mike, I think, is being humble right now. Like what OverDrive is building, I don't know if— can I touch on it? Sure, yeah. I mean, as a client, like what they're building is going to be a time saver.

18:12I'm talking to shop owners right now, if you guys are in here. Time saver, shit that we don't like to do. Sorry, pardon my French, but like all the stuff we don't want to do. Just leave it out. Right? It's what is SEO, SEO, and margins on this? Can we track that? Like, it's basically, he's building this system where it can anticipate issues.

18:35It can let us know, hey, you're on track. You're kind of not. This is what I think that you should do because of these type of clients, and this is your demographic, and this is what you do. So, imagine a software that customizes with data. It pulls data, and it's so smart that it can tell you, like he mentioned, hey, this 20A4 that's coming in with Jane Doe, and same car with John Doe, but they have different lifestyles, different usage for their vehicle.

19:07This is how you should market to them. Like, that's gangster. I don't want to spend time making more Excel sheets and tracking all this other stuff. Like, it will be in a software to tell you, hey, this is what you're tracking from margins to KPIs. And think about it, not just for a shop owner perspective, but for your whole staff. And, you know, shop owners that are scared to share data and reporting with your staff, This is where you need to evolve.

19:36Our mindset has to shift and we gotta think differently. Let's face it, your shop management system is the single most important tool in your shop, period. NapaTrax was built from the ground up to make your business more profitable and efficient. We provide an extensive set of tools to increase and track profitability in real time. NapaTrax offers the industry's best post-sale support hands down, and we train your people on-site.

20:04Yep, on-site. And we offer remote refresher training 10 times a week, and customer support is open 6 days a week. Give us a call, visit the website, or join our Facebook community today to learn more. We'll prove to you that TRAX is the single best shop management system in the business. NapaTrax is always customized and tailored for you, whether you're a one-man shop or a large multi-bay or multi-location company.

20:30After all, it's your shop, so it's your choice. Visit us on the web at NapaTracks— that's N-A-P-A-T-R-A-C-S— .com. Transform your team with today's class, where automotive training is easy, quick, and fun. Just 5 minutes a day on our app can eliminate hours of looking up forgotten information later. It's perfect for technicians, advisors, and managers alike. Keep critical knowledge fresh and top of mind, ensuring your team operates at peak efficiency.

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21:31Smart, innovative CRM with automated follow-up, 24/7 online booking, and real-time ROI tracking. With 900+ years of combined team experience, we fuel the growth of 2,200+ shops and have influenced $3 billion in revenue. Stop working harder, start working smarter. Get industry-leading customer support, and book a demo with Kukui. That's K-U-K-U-I.com. You know, most shop owners feel trapped spending on ads while half their first-time customers never come back.

22:02It's frustrating. It's exhausting. And it's not your fault. The industry average is 54% one-and-dones. We understand how discouraging that can be. Well, Pit Crew Loyalty changes the story. Our clients cut that rate by up to 38%, raising lifetime value by more than 50%. Loyalty members visit nearly 3 times more often, creating predictable revenue without extra ad spend. Pit Crew Loyalty, where customers stay and shops thrive.

22:32On the web at pitcrewloyalty.com. So much marketing, Mike, Michelle, that we've done in the past is what we see, what we hear, what we feel, what we're paying attention to. It all comes in our gut, and then we make a decision with our marketing company. Should we yin or should we yang? And I think what I heard from Michelle is that some of that gut, some of that emotion that we bring in needs to be more analytical and show us what's going on.

23:02And then maybe we apply a little emotion to the decision that we make, which way to go, but now we're more steeped in logic and objectivity. Is that right, Mike? Yeah. And predictable as well. I think that that's a key thing. And I'll give you an example. Let's say folks go to Google to find a repair shop, right? Which is kind of the common thing right now.

23:23I go to Google, I type in Euro repair near me, right? Google pulls up obviously the sponsored ads, like the LSAs, the map pack. And then if a consumer's not satisfied with what they see there, all they have to do is click more options or more businesses, and it's going to collapse a lot of other shops. Now there's a journey in that customer cadence, right?

23:42They find you online, they read a review, there's a call to action, they talk to an advisor, they come in. If you install APIs, for example, into Google Business Profile page— and I won't plug our platform, but it just generally speaking, like, is able to identify AI. Let's say AI is coming in, able to identify search trends on Google in your market.

24:04And let's say I have a Porsche, but I don't need repair right now. AI is going to tag that and then be able to predict what you're potentially going to land in terms of, from a shop perspective, car count, ARO, and total sales. Because everything's dependent on search trends. If people aren't searching for that type of repair that Michelle's offering, it's redundant.

24:26You could spend $1,000, $10,000 a month. If people are not searching for what her specialty is, what she's looking to target, you're dead in the water. Right? But we want to look at search trends. So when you combine the Google Business Profile page, as just as an example, and then combine that with what people are searching for, AI is able to predict, okay, well, based on search trends and all these other parameters, here's where you're going to end up.

24:53You're going to be 22 leads down on your Google Business Profile page by the end. I mean, that's how intelligent AI is. And like, who doesn't want to embrace that? I don't want to switch this discussion down any other highway, but what just came through my mind, and maybe work with me for a couple of minutes on this, is auto repair shop near me.

25:14Mike, you mentioned that. The immediate thing that I thought of is why, why do I need an auto repair shop near me? How come we as a professional industry haven't done enough to build the loyalty into people not having to search? Am I crazy or not? Not at all. Not at all. I preach this all day long, Karamet. Most of what we do happens at the counter.

25:40In marketing, we have a 75-25 ratio. So for example, if I pull Michelle's data last month and if I saw 75% of total customers were— had been there at least one time before and 25% were brand new, I would be happy as a marketer, right? Would I be over the moon? Not particularly, but I would be happy. I'd be content. Okay, great.

25:59Retention's doing its thing, the people at the counter, and then internet marketing is doing its thing. You know, I've been to over 2,000 shops around the country and in Canada. I have personally walked into over 2,000 shops. I'm an observer. I ask questions. I ask open-ended questions. I want to learn from shop owners, right? What's interesting, and I gave this analogy to you a couple of years ago, if you recall, the NASA shop.

26:23With NASA, and I know you love this, with NASA, This is for the audience. NASA, there's no cutting corners. We just seen people go to the moon, right? Like a couple months ago. There is no cutting corners with NASA. Every step of their process is fluid and they're not just checking boxes. It's really, they've built a process where it's second nature. There is a handful of NASA shops that I've personally walked into.

26:51And what's interesting at those is You know, in our industry, the biggest problem I see, we have a few concerns, right? But like inconsistency. One minute our bays are filled, the next minute they're slow. And then we do this knee-jerk sort of this panic marketing. It's like, okay, now I got to do all this, right? The NASA shops that I've personally walked into, to your point, Carm, are consistent with their process and their branding year-round.

27:15They're a week, say 7 to 10 days out. Booked up with their appointments. And the vast majority of those customers that they're booked up with had been in there at least one time before. So instead of that 75/25 ratio, they're more of a 90/10. So eventually new customers to them are just icing on the cake. Ultimately you need them because people move away, they die, you know, things happen.

27:38We need to constantly be looking for new. Mike, this whole build loyalty thing, I can't help but believe that all the tech that we have, CRMs and AIs and what you're doing at OverDrive, has got to help congeal it into a nice glowing ball. Am I right? You're right. And as a marketer, Carm, our primary responsibility is to drive quality leads to the shop, which are called MQLs, marketing qualified leads, that advisors are able to convert into visits, right?

28:12And then secondly, behind that is add appointments, fill their appointments. So quality leads, fill their calendar up with appointments. That is primarily what we're doing. But we're not picking up the phone. So sales and marketing go hand in hand. Advisors are sales professionals, okay? Their responsibility is to identify a good opportunity, convert it into the lead, but their work's not done after that because they have to do everything.

28:34I call it A to Z retention marketing. A to Z. They have to do everything to earn that long-term relationship. And we're not going to look at it like a $100 oil change. If you do all of these things right between A to Z, and earned that relationship, there's what's called LTV, lifetime value. It's tens of thousands of dollars in added revenue when you learn your customer.

28:58Lastly, I mean, I could talk about this till midnight, but I'll spare the audience. But my Starbucks story that I share in some of my classes, it's a true story. 2007, I was going to open up a coffee shop. I was working for Washington Mutual. We got bought by Chase. I wasn't happy. I would sit at Starbucks and I'm like, man, I'm going to open up a coffee shop.

29:15I would be very particular. I would count customers. I would look at average ticket prices. And during that time, Jim Donald was the CEO of Starbucks. He was responsible for growing this chain from 5,000 stores to 30,000 stores worldwide. And he did it in record time. And I wanted to know, Carm and Michelle, why would people wait in these massive lines at Starbucks to spend $3, $4, $5 on or more on a cup of coffee and there would be a gourmet coffee cart or a small business right across the street for $0.99, and nobody's in that line.

29:49There's a lot of things that went into their process. Like, you walk into Starbucks, you know you're in a Starbucks. There's no sharp edges. Alanis Morissette in acoustic. It's very predictable. One of the things that resonated with me, and I encourage every shop to think about this, you were required to address people by first name. They actually had it in their employee handbook..

30:09It's called forming a complete customer connection. So you walk into Starbucks. I'm Carm. I want the triple grande nonfat white mocha. 9 times out of 10, if you went to that same Starbucks the next day, they would not only remember your name, but your drink of choice. You were not known as, hey, number 27, your order's ready. You were known as Carm, the guy who drinks a triple grande nonfat white mocha.

30:29And what happens immediately? We're drawn to that. We're connected because we feel part of something. All of our customers in the shop feel the same way when we learn customers. And sometimes I'll, in a very friendly, polite, delicate way, I'll challenge advisors because I observe and I see a customer going, hey, I found you guys on Google, it's my first time here.

30:51They walk away and I'll ask the advisor, what were two things that you just learned about that brand new customer? And sometimes they'll say, oh, they're from here in Denver or whatever, right? But No, I mean, really, what do they do on the weekend? Do they own a business? Do they have a family? Do they go to church? What are their hobbies?

31:08I wanna know outside of the box things because I'm trying to create the Starbucks process of it's predictably okay when people go there. I'm thinking of Euro Clinic, Michelle, as he's telling that story. And Mike, today in our meeting of 28 independent shop owners here in Buffalo, somebody walked in. With a cup of coffee with the Starbucks logo on it. That told me a whole hell of a lot about that person, period, right?

31:40That's where the brand is, the image, the logo, the brand. And I can imagine, you know, with Euro Coffee Cups out there, even if it was quick to have a cup of coffee while someone's waiting, but they're out there and they take it with them and they go to their work. Oh, you go to Uro Clinic. Isn't that cool? Or can you tell me about them?

32:01We have it. I spent a lot of money on this fancy espresso machine, and I'll tell you how we utilize it, right? Going to go get coffee is culture, part of society. Can I show him real quick? Yeah, there's for your audience. There's their latte right there. Oh my God, I love— oh my God, that is the coolest. And I have a great marketing team, you know, and I challenge every single shop owner to really learn their client base.

32:33If there's something that I am super, super thankful for Overdrive and the whole team, because I've been with you guys like almost 2 years, kind of, and I did a complete like revamp of like how we do business. Who is my ideal client? And what are we really going to offer? Like, what I offer is I save you time and convenience. And I looked at my consumer, and I looked at my ideal client, and I said, coffee is part of culture.

33:04Like, I had the fancy commercial Keurig that requires them to do something. That requires for them to walk over after they checked in, if they're in the waiting area, and make themselves a cup of coffee. I brought in my manager, and he's big on hospitality. And he said, "No, our sales team is going to be making these coffees as we have a conversation," right?

33:24It's so embedded in our day-to-day operations that when we valet cars, because I offer a valet and pickup service to the local engineers, we're embedded with, like, our tech companies around here to make it easier for them to get service here, we already know what their favorite drink is. You know, we serve as a VP of litigation for Google. She's not too far away.

33:46She drives a Land Rover and she loves cappuccinos, double shot cappuccino. It's in their profile. Ron already knows, and she doesn't even have to ask for it. If we're delivering her car in the morning, we're sending her a cappuccino. So she's getting her car and her cappuccino. Can I add to that real quick? So as I mentioned, Carm, I'm a client of EuroClinics, a proud client.

34:08And NASA shops, they don't cut corners. Remember I said that? Ron, who's a general manager, I walk in and I know— I mean, we— they've been clients for almost 2 years, right? Like, I know them. For me, I'm super loose. I'm like, high five, hug, whatever. Ron treats me the same exact way he would treat a customer. When I walk in, he'll ask me, hey, can I make your latte?

34:27Because I have a nonfat latte. He's like, can I make your nonfat latte? He knows what I drink, and he'll offer to make me my latte. They have this soundproof booth, which actually, to Michelle's point, being here in the thick of Silicon Valley, that is massive for waiters because it's tech. We're on the go. And if we need to do a Zoom call, they could literally do it in Michelle's lobby in a separate soundproof room.

34:51That's a huge selling point. So NASA shops, they don't cut corners. And Michelle and B are, are definitely a NASA shop. And when you think about it though, like If your operations are not solid, no amount of marketing is going to fix that, you know? And that's conversations that I've had with Mike De La Cruz as, like, the founder of the company that does my marketing, my marketing director.

35:14We, as shop owners, have to put our ego aside and understand that marketing is part of our ecosystem on, like, what we do to get new clients, retain them, and we have to listen. And Mike came to me a couple, like, months ago because I was like, hey, it's being the proactive stuff. Why are we being reactionary? What's happening. We were running low days here and there.

35:36And as a shop owner, you have to listen because our marketing team is data-driven. We're emotionally driven, right? And we have to kind of like train ourselves out of it. There's always a 50-50% chance that the marketing company is giving me BS and like stuff is not working, or my systems are not tight like we think we are. So, it's a constant evolution of you making sure that the systems are tight., right?

36:01Because I don't care if the phone only rings 5 times, that's 5 opportunities that day versus it ringing 30, that's still 30 opportunities. And we have to make sure— I don't know if you taught this, Mike came and spoke to my team for kickoff and it's like, you have a certain amount on the phone, like a certain amount of seconds to make an impression and basically brand yourselves that way.

36:24So, for me, I kind of built the company After Conversations with a marketing company as I'm the avatar client. Right? What are the things that I like? Like, in my shop, we don't have too many waiters. A lot of the times when there is waiters, it's new clients because we want them to spend time. We bring them out to the shop, we introduce them.

36:43I want them to know how transparent we are. My clientele, 60%, is female, you know? And a lot of the times, I don't care what brands you're putting in my car. Like, that's not how you earn my business. My business, a lot of mine, normal actual concerns are how long is this going to take and how much is this going to cost me and what's the— how is it going to inconvenience my life?

37:07So, as a shop owner, I had to build systems and put people in places in those systems where though we're addressing those concerns, whether the client is telling us those are my concerns. It's like we almost anticipate those needs. I have a client that comes from me from Woodside. He passes, I want to say, hundreds of shawmz. He's about 25 miles away.

37:29The only reason he comes in is because we allow Mayo to come. And Mayo is this beautiful, big, old poodle. And we have treats for their dogs. We bring out the bowl. We get him an Uber Pet if the shuttle's not available. His dog is welcome in our shuttle. But I want you to listen to it. In our culture here in Silicon Valley, Mayo has his own car.

37:55This is the life we're living. Okay, this client has about €4,000, but Mayo's car is a Land Rover Discovery. It's his car. So my lounge is super luxury. Think of like Nordstrom's, you know, but the fact that Mayo's allowed in there, to him, it's like he comes to service his car because we found out that he loves his dog. And his dog is welcome to come whenever he wants.

38:22When he doesn't come, we ask, "How come Mayo didn't come?" And he goes, "Well, Mayo's not allowed in the GT4 RS." Mike, I gotta tell you, there's some real powerful lessons in the last 5 minutes. I couldn't be happier. We have done episodes over these last 11 years where stories just like yours about the love of the relationship and the You probably even have wonderful smells inside of your weight room, right?

38:48Oh yeah. We made our own scent. I want you to think like, okay, you walk into a Ritz-Carlton, they have their specific scent, right? You walk into Hotel W in New York, they have their specific scent. So, and this is stuff that people can do. It's like, you want to be remembered in marketing. It doesn't matter what industry you're in. You can do whatever you want, but people respond based on how you make them feel.

39:13How did I feel in that moment when I was in there? And I'm not saying, Carm, that I am the best shop for every consumer out there that drives Euro. It's no, I am the right consumer for specific drivers that are looking for this. If you like, Mike's super busy, you know, he's bringing his car in, I think today, and we already offered, like, I know you're busy, bro.

39:35Let us go pick it up. But sometimes, I mean, I think he wants to come in, he wants to get his latte. I was like, we'll bring you the latte. Like, that's not the problem, right? It's like, I'm busy, I can't get there, I need no work on my car, but I need a latte. Yeah, for us it's like this. I've done that sometimes, Karen, believe it or not.

39:53I've got— I've hung out with him. How can we be of service? All right, I'm so impressed with where you've taken this, and I need to ask a really difficult question to the industry. Michelle's, Michelle's Euro, and that's how Euro people are. And my challenge to that attitude is I don't care if you're all models, if you're EV hybrid, I don't care.

40:18What you've done is taken the client experience. Basically, you're the CXO, right? Client experience officer. You're the CXO. And I don't care what you work on. It could be at the highest level because The people that have Cadillacs and all those other high-end Lincoln Navigators and stuff, they want a high-end place to go, even if you're working on a Chevy in another bay.

40:42So why is it this professional industry of ours that's constantly being challenged by the dealership network? Why haven't we kicked it up about 42 notches in terms of adding additional like services? No, not the services, but to do the things that, yeah, the experience. Oh, I see what you mean. Yes. Sorry, I'm just— mindset that you can serve everything. I'm in a metropolitan area, there's shops all over me.

41:09I get mailers that say we fix everything. Do you? Do you fix everything? Like the way we look at marketing conversations I have with my marketing director is even when we look at competitors around us, I'm not looking at what they're really good at, because they're really good at that. That's what they do. I'm looking at what they're not good at, and how can I be good at that?

41:31Do you know what I mean? You have to shift your mindset. It's like Chick-fil-A. Popeyes has been around longer than Chick-fil-A. They both have great chicken. Chick-fil-A built their systems around hospitality. It is my pleasure to serve you. Have a blessed day. It's like I started telling my team a year ago, we're in the automotive repair industry. How come we don't tell our clients, Please drive safely.

41:57Have a great weekend and drive safely. Like, it's just certain things that you can insert. But again, I do disagree, and I completely agree, and I'm glad that you brought up this topic. And I'm interested to hear what Mike thinks of this as like a marketing perspective. But for me, it's like, you can't service all, you cannot fix all, because different people are looking for different things.

42:19And I have customers that found me with their Audi and later on moved on and now have like a Honda or have a Lexus and they still pay our rates. But they come because of how we make them feel and the trust and they know the value they're going to get. I mean, me servicing a Honda is really expensive. But then now we're talking, we're getting to value.

42:43Now the conversation is moving into added value. Like, are you a price shopper? Are you looking for value? You go to Target, you know what type of experience you're gonna get. You're probably gonna have to bag things yourself. You go to Nordstrom's and they package it up really nice. They walk over the counter, they give you a beautiful bag. You know what to expect when you walk into something because now we're getting into value.

43:08And then you log, come into the store and you let— well, you look at things that are important, right? Like Silicon Valley people, kids are expensive. Kids are really, really expensive. People sometimes get a dog first, you know, and it's their whole world. I'm a huge dog person. Now Mike knows that. And I love my dog. Like we have a Volkswagen T1 and that's for Kobe.

43:32Everybody else, we drive sedans. But when we got the SUV for the dog, cause we wanted to bring him everywhere with us. Mike, I know you probably agree vehemently with Michelle and I kind of want to get back to the whole marketing piece here, but I'm loving this conversation because I think there's some great wisdom here. And you brought up the NASA shops, actually wrote a keynote and gave it in New York maybe a couple of years ago in trying to motivate people to look at what it took NASA to get where they are today.

44:02And it was, it was, let's say this, 99.9% of everything done right and done at the highest possible level. And then when you mentioned Nordstrom, so next week to all of our great Topshop operators that are here that are looking for another new advantage, Sit down with your people and say, you know what, we're gonna become a Nordstrom shop. What's that, boss?

44:23Maybe there's no Nordstrom in your town. Explain it. Yeah, it can't get any better. You can't have a better experience. You can't find better quality goods. You can't walk away and feel happy and proud. And are we doing enough of that? And so if we fail in any way, we could point to the person and say, Nordstrom, because we failed to live up to those expectations by just mentioning the word.

44:50I mean, I know Ron uses the Ritz-Carlton experience. That's how he trains our whole staff, even from technicians. And again, I want to stress, it's a whole ecosystem. You can't just have a very badass, like, front of the house, and then the back of the house doesn't believe in that. It's having their buy-in too. You have to bring up team members. That have buy-in.

45:13I'm gonna take it a step further because this is a really important topic to touch on. And this is mostly for the leadership in shops, whether you're owner or general manager. If you don't have a mission statement, create one. It starts there. The reason why it's so important is because as owners or leadership, we're faced with decisions all day long. But if your people don't understand your mission, what you're trying to accomplish, you're gonna get pushback all day long.

45:41So create a mission, make sure it's well thought out, and make sure it goes with your fundamental principles internally and what you're trying to accomplish as a team. So once you start to implement tech stacks, once you start to implement the Nordstrom strategy, if your team is bought into the mission, you're not gonna get pushback because they have a common goal, right?

45:59And then lastly to that is success is never gonna happen overnight.. You are not going to say, let's change it to this Nordstrom style. It's gonna happen overnight. We are creatures of habit. 60, 90, 120 days. You have to follow through. One of those actual foundational intro pieces I do in all my classes is you're gonna get a lot of nuggets out of this class, but the worst thing that you can do is not execute against it and not follow through.

46:27Because what happens is it's a Saturday, I teach a really awesome class. You walk away with nuggets. What happens Monday? The phone rings, somebody calls you, and then you're pulled in all these different directions. Monday turns into Tuesday, Tuesday turns into next week, next week turns into Monday, and all of a sudden you fall into these old behaviors, right? Again, we don't want to create a process where we're checking boxes.

46:49Create that mission, make sure the team has bought into the mission. And as you start to implement these new strategies internally, which are proven successful, right? I've been over 2,000 shops, I have seen this firsthand. You've got to execute, and it's got to be a marathon and not a sprint. Truly, truly, truly, it's something as simple as how we're picking up the phone.

47:10It'll be awkward at first. Your advisor's gonna be like, well, I don't really want to say that, right? But think about it like this: when somebody calls your shop, they're calling because they have a problem, they don't know how to fix it, and they know it's gonna be really expensive. So immediately, once they call your shop, there's already a form of anxiety when they call you.

47:31So a simple greeting— and I've listened to hundreds of phone calls in my life— a simple greeting of, 'It's a great day here at Joe's Garage. My name is Dan. Who do I have the pleasure of speaking with today?' People on the other end don't expect that. They expect pushback, these defensive barriers. They do not expect that in our industry. But you could almost feel— and I listened to so many calls— you could feel tension being lifted off of their shoulder from that simple greeting.

47:58It's so much more than that. I could probably talk till my face turns blue, but I'll spare your audience all the time here. And it's a lot of phone training with WordTrack. Like, there's certain stuff that are non-negotiable for us. We don't use the word "no worries." And even if we're using it because the client is apologizing and we want to say, "Hey, no worries, don't apologize," we don't because there is a freaking worry.

48:20Like, there's a reason why they called. They're either worried that time, because it's regular maintenance, check engine lights, the coolant. So, we remove words from our terminology that are going to make them feel more comfort. Like, hey, regardless if you pick us, whatever, we're going to do the best that we can to help you. Like, we're here to help. Like, when we text clients, we always put, "If you have any questions, we're happy to help."

48:44If there's a client that's asking too many questions and they keep apologizing, because it's human nature, right? They think they're being annoying because they're asking too many questions. We're like, we stop and we address that first. Hey, we're here to help. There's no amounts of questions that are like, this is our whole being. We exist because you have a problem, you know, so we're here to help.

49:04So again, I think it reverts back to the staff. And if I could just touch on something that Mike said about mission statements and stuff like that, like, I have built all of our systems for every individual to be able to make an executive decision without a person of leadership based on our core values. Like, if they think of all the core values and what the company stands for in our standards, they should be able to make a decision without me, B, or their general manager, because we have embedded our core values in that.

49:33For me, core values are not something that we just throw on the wall and in the break room and we all kind of just say, this is what we stand for. Core values is what we live and how we make decisions every day. In our daily operations. And if you're not doing that, first thing I think that shop owners should do if they're listening, if they can take anything away, is do your mission statement, do your core values, and they have to be embedded in the whole, like, way that you run from every single SOP.

50:03That's something that I spend a lot of time, and like Mike said, it's not something that just happens overnight. You also have to find the right people that believe in the same things that you're doing, or it doesn't sound genuine. You gotta have that foundation, Michelle, and you are right. I'm gonna make that your summarized discussion point. We're here to talk about AI and marketing, and we went to a million different places.

50:26Mike, help me come back to maybe the center of what we were talking about, and that the future of marketing with AI is probably gonna make us more proactive than reactive. Can you give us a summary comment on all that? Yeah, we talk heavy about retention, right? So I kind of touched on it earlier about learning each individual customer's driving habits, everybody, their frequency of visits, what triggers certain people to respond.

50:54Maybe I'm somebody who gets my oil change at Valvoline, but then for the bigger stuff, I like to use an independent. Maybe I'm somebody that likes to use my oil change only with you, but the bigger stuff I like to do myself, right? So every customer has a different pattern and a different footprint. Utilizing AI and embedding it in your process with that, it's learning each individual customer's behaviors, their frequency of visits, what triggers them to respond, and makes it highly more effective.

51:25In addition to that, from a shop owner's perspective, you could do, and I'll just high level here, you could do things like, you know, churn prediction. So incorporate AI in your process and say, by the end of the year, how many customers am I expected to lose? We talk about proactive and reactive. That term is gonna come around a lot throughout, has come around a lot, and it's gonna come around more proactive instead of reactive, right?

51:48That's saying, hey, you're gonna lose 3% of your business by the end of the year. Or, you know, based on these goals that you put forth, you're gonna be 15 cars shy by the end of the month. Think about the value in that and not only presenting the problem, but solution-based AI marketing, meaning you're down 30 cars, here's what you've gotta do to bounce back.

52:11And there's so much backend intelligence around it where you're located, seasonality, the type of customer you're looking to attract. This is how powerful AI is. And these are things that we need to adopt as an industry. It is not the future anymore. This is happening right now. Scary stuff, Mike. It really is that. I think it's scary stuff if you're not paying attention and you're sitting on the outside, says, wow, I don't have the car count or the ARO.

52:40And now you pick up the phone being proactive with your marketing people and says, we probably have to make a slight adjustment or we need to, you know, do some CRMing on any declined work. Again, I think today's successful shop has 8 or 9 things on the spinning wheel of marketing or opportunity. And we have to, again, we just can't say, stop it.

53:05Okay, let's do that. No, because let's do that is coming from, if I'm hearing you right, Mike, based on the fact that we've done the research and this is the area that we have to concentrate on. Correct. And I do wanna be clear. I mean, it, I mentioned it earlier, right? There is, you know, we are and we will always be fractional marketing, outsourced marketing, because there is such a massive need for this.

53:31Because as great as AI is and as predictable as it is, it's going to certainly help shops. It's a tool, like you're utilizing a tool that's going to help you be more successful. There's a lot of shops that I talk to that are like, great and everything, and I understand the value of that. I just don't want to manage this stuff. I don't want to have to learn something new.

53:49That's why our kind of traditional foundational piece of that fractional marketing agency and outsourced marketing, we're still going hot and heavy with that. But how can we incorporate for shops that maybe, you know, you hire a marketing director internal, it's like 6-figure salary or an agency, right? You're paying $30,000, $40,000, $50,000 a month, or I'm sorry, a year, right? That's not a drop in the bucket for many shops.

54:12But if you can shift 95% of that and willing to allow AI to walk you through successful campaigns, for 95% less cost for your marketing budget, the total addressable market for independent shops, it starts to expand because a shop may not have that budget to hire a marketing director. They may not have the budget to hire that outsourced marketing agency like OverDrive.

54:35But then there's a lot of shops that say, you know what, I can do this. There's shops that don't. So we want to be able to create a process where we're creating solutions for all. 15 years in this industry, I owe this industry so much. And you know, Carmen, Michelle, I'm on boards, Educational Foundation, Yang Mentor. I do so many things because I feel a responsibility.

54:56I feel that, you know, the up-and-comers that are wanting to learn about this industry— I'm not ready to go, so I'm not passing the baton. I just want to teach everybody that I've learned over 15 years the nuggets that I've been able to take away. That way we could build together. Competitors, doesn't matter. Look, there's so many people to serve here. Let's be nice.

55:16Let's play in the sandbox nicely. Let's help the industry grow, not just say we're gonna do it. Let's prove it through action. So again, I know it's super long-winded, but very, very proud of what we've been able to accomplish. And the work's not done. We have a lot more to do. Good for you, Mike. A great summary and, and a very passionate statement.

55:34Thank you so much. Uh, again, what people hear from me every time I do an episode is I'm so engaged in the dialogue and my mind doesn't stop. It goes, I'm a 7/24er, okay, on that. Notepad on the bed stand, okay, it's there. And what I was inspired by your final comments, Mike, if you're finding out that you're talking to yourself, talk to your AI buddy.

55:59You're a friend, right, Michelle? Yes. It'll keep you in check. If you're talking to yourself, where am I going? What am I doing? No, there's a tool out there that I think can help maybe ground you. Yeah, we gotta name the tool though. You gotta name them. Yeah, you gotta name her or him, her or him, whoever. Mine's a her, Bee's a he.

56:18But my wife has Claudia for Claude and then Charlie for ChatGPT. Yeah, chat, I love it. All right, well, Mike De La Cruz, co-founder and CEO of OverDrive— spell that, D-R-Y-V-E, overdrivemarketing.com— and Michelle Tanzi from Euro Clinic in Santa Clara in Silicon Valley there. Brilliant, brilliant stuff. Thank you both so much for coming on. Thank you, Carmen. Appreciate the opportunity, Carmen. Thank you everybody for listening.

56:50Thanks for being on board to listen and learn from the premier automotive repair business podcast, Remarkable Results Radio. Get your episodic education on the ARPN listening app at automotiverepairpodcastnetwork.com. Also enjoy the podcast on our Carm Capriato YouTube channel. Carm is all for advancing the professional automotive service industry. Until next time.