Conventional wisdom is that when vehicle sales decline, dealers turn to other areas business to keep that revenue coming in. That's why the service department has become more important for dealers, as they look for ways to drive revenue.

The average dealership gets 30%-40% of its profit from its service department revenue.

That department is becoming more important to customers, too. Google says that, while the total number of searches for new vehicles in the U.S. has declined by 16 % between March 2007 and March 2008, there has been a 35% growth in people visiting parts and service sites in the same period.

High-volume stores appear to be capturing some of those customers, according to this year's Ward's Service 150, a ranking based on data from this year's Ward's Dealer 500.

Dealerships on the Ward's Service 150 generated 5.8% of their revenue from service departments in 2007, up from 5.3% in 2006. Those dealerships averaged $159 million in total revenue with $9.2 million from the service department. They also sold an average of 2,961 new vehicles in 2007.

Meanwhile, the percentage of revenue created by the service department declined from 4.6% to 4.3% for the rest of the Ward's Dealer 500 (350 stores) over the same period.

On the marketing side, dealerships are becoming more sophisticated in their use of e-mail advertising, says Chuck Tildon, product-marketing manager for the Cobalt Group's Onstation.

“We're seeing dealers target more to specific niches of customers,” he says. “They're limiting the number of attempts to each customer, but are running as many as six or seven campaigns to smaller niches.”

The quality of the creative content is improving, Tildon says. Dealers are learning they can tie all of their marketing programs together and see what their customers did and what transactions they made.

Another trend is automated phone calls to customers alerting them to service specials.

While most dealerships market only to customers who have purchased new vehicles, some dealers are seeing success by marketing their service departments to people who have bought used cars.

It's a way to increase customer pay business to offset declining warranty work most brands are seeing today because of improved vehicle quality.

Several experts advise dealers to advertise oil-change services using prices that compete with independent and chain shops. That also presents upsell opportunities if a vehicle is found to need additional work or maintenance.

But dealers have learned that driving too much quick oil-change business can backfire. One problem is that those customers rarely will spend more on additional services.

And many dealerships aren't equipped to be as fast as 15-minute shops. As a result, customer satisfaction scores drop.

Dealers also need to be careful of marketing free inspections in an effort to generate warranty work. If the affected auto maker finds out, it could lead to a factory audit of warranty work.

Dealers wanting to drive more business to the service department need to make sure they have the proper staffing levels. And having enough competent service technicians continues to be a problem that plagues a lot of stores.

Think creatively. Most dealers use community colleges as a pipeline for talent, but you're competing with other dealerships in that channel.

Many dealers avoid traditional help-wanted ads, saying the return on investment is not there. If you must advertise for help, creative spots on the radio might be a better idea. The trick is using methods your competition hasn't thought of yet.

Some dealers are using the Web site CraigsList.com to find technicians. Posting jobs is free, although, it can be time consuming, though.

The people on Craigslist generally are younger and are more trainable and willing to learn, according to dealers using it. Be prepared to conduct a lot of interviews.

Another trick for dealers is to take your vehicle to get work done at the local tire shops and quick oil-change shops. Give your business card to the employees that are working hard and conscientiously.

Other dealers pay their staff a “bird-dog” fee for referring potential employees to the dealership. Pay a bonus once the person is hired and a second bonus if the person lasts a year.

Also, have your service manager talk with representatives visiting the store to sell tools for technicians. You might want to pay them a bird-dog fee if they recommend employees working elsewhere who ultimately come to work for you.

Cobalt

As a leading provider of Owner Marketing services, Cobalt is proud to sponsor the Ward's Service 150.

Rank Dealership Owner/Principals City ST Service Revenue Total Revenue
1 Fletcher Jones Motorcars Fletcher Jones Jr. Newport Beach CA $35,146,410 $571,082,030
2 Braman Motorcars Norman Braman West Palm Beach FL $22,537,825 $430,388,387
3 Galpin Ford Herbert F. Boeckmann II North Hills CA $18,625,838 $331,329,932
4 Lexus of Tampa Bay AutoNation Inc. Tampa FL $17,388,968 $159,443,351
5 Crevier BMW Donald Crevier Santa Ana CA $16,535,371 $287,227,084
6 J M Lexus JM Family Enterprises Inc. Margate FL $16,496,853 $422,227,848
7 Fletcher Jones Imports Fletcher Jones Jr. Las Vegas NV $16,097,049 $201,455,476
8 Dobbs Honda on Covington Pike AutoNation Inc. Memphis TN $14,876,452 $94,058,966
9 Braman Motors Norman Braman Miami FL $14,189,210 $336,315,879
10 Desert Volkswagen AutoNation Inc. Las Vegas NV $13,601,218 $110,498,692
11 Mercedes Benz of San Diego Penske Automotive Group (Formerly United Auto Group) San Diego CA $13,598,239 $175,572,464
12 Bankston Ford of Frisco AutoNation Inc. Frisco TX $13,589,877 $124,032,958
13 Stevens Creek BMW Sonic Automotive Santa Clara CA $13,523,110 $202,768,124
14 WI Simonson Mercedes Sonic Automotive Santa Monica CA $13,128,337 $218,129,772
15 Global Imports Sonic Automotive Atlanta GA $13,126,572 $221,273,172
16 Autobahn Motors Sonic Automotive Belmont CA $12,950,652 $185,106,004
17 South Bay BMW/Mini Frederick E. Hitchcock Torrance CA $12,662,046 $240,915,461
18 BMW of San Diego Penske Automotive Group (Formerly United Auto Group) San Diego CA $12,569,191 $175,114,441
19 Mercedes-Benz of Walnut Creek Sonic Automotive Walnut Creek CA $12,434,901 $130,340,551
20 Chapman Scottsdale Autoplex, LLC J. Baxter Chapman Scottsdale AZ $12,417,475 $205,016,536
21 Ray Catena Mercedes Benz Raymond Catena Edison NJ $11,597,360 $285,750,160
22 Momentum BMW/Mini Sonic Automotive Houston TX $11,233,112 $207,390,741
23 Hendrick Lexus Hendrick Automotive Group Charlotte NC $11,192,105 $183,355,615
24 Roseville Toyota John L. Sullivan Roseville CA $11,179,987 $204,021,108
25 Dobbs Nissan AutoNation Inc. Memphis TN $11,160,565 $87,160,621
26 Midway Chevrolet John Cleaves Phoenix AZ $11,024,225 $221,407,047
27 AutoWest Chrysler Jeep Dodge Roseville AutoNation Inc. Roseville CA $10,986,258 $121,923,808
28 Desert Honda AutoNation Inc. Las Vegas NV $10,878,366 $100,274,824
29 Don Sanderson Ford Inc. David Kimmerle Glendale AZ $10,734,709 $271,971,733
30 Desert BMW of Las Vegas AutoNation Inc. Las Vegas NV $10,689,700 $97,132,675
31 Downtown LA Motors Mercedes-Benz Jeanette Shammas Los Angeles CA $10,669,157 $207,049,094
32 Mercedes-Benz of Tyson's Corner Penske Automotive Group (Formerly United Auto Group) Vienna VA $10,647,793 $122,167,420
33 Gaudin Motor Co Gary/Dan Ackerman Las Vegas NV $10,593,834 $207,571,279
34 Beverly Hills BMW Sonic Automotive Beverly Hills CA $10,466,669 $170,222,732
35 Earnhardt Ford Sales Company Hal J. Earnhardt III Tempe AZ $10,342,591 $170,072,631
36 BMW of Fairfax Sonic Automotive Fairfax VA $10,268,472 $159,833,761
37 Fred Haas Toyota World Fred Haas Spring TX $10,248,595 $286,789,507
38 Hendrick BMW MINI Hendrick Automotive Group Charlotte NC $9,959,201 $166,141,367
39 Dave Smith Motors Ken Smith Kellogg ID $9,912,569 $486,359,607
40 Capitol Toyota AutoFocus, Inc. San Jose CA $9,828,562 $169,295,163
41 Crest Auto Group Van Tuyl Group Plano TX $9,791,855 $164,565,871
42 Galpin Jaguar Lincoln Mercury, Inc. Herbert F. Boeckmann II Van Nuys CA $9,755,564 $193,994,376
43 Lexus Kearny Mesa Penske Automotive Group (Formerly United Auto Group) San Diego CA $9,733,752 $131,053,256
44 BMW North Scottsdale Penske Automotive Group (Formerly United Auto Group) Phoenix AZ $9,726,870 $162,612,386
45 Bill Heard Chevrolet, LTD William T. Heard Sugarland TX $9,698,000 $219,131,000
46 Carr Chevrolet, Inc. Wallace Preble/Gene Bradshaw Beaverton OR $9,644,072 $181,277,032
47 East Bay BMW MINI Hendrick Automotive Group Pleasanton CA $9,597,238 $115,242,012
48 Mark Christopher Auto Center Mark/Christopher Leggio Ontario CA $9,548,569 $205,906,077
49 AutoWay Honda AutoNation Inc. Clearwater FL $9,470,967 $85,717,152
50 Lute Riley Honda Sonic Automotive Richardson TX $9,435,859 $173,228,826
51 AutoWest Mazda Subaru Roseville AutoNation Inc. Roseville CA $9,361,149 $75,535,723
52 Gwinnett Place Honda Hendrick Automotive Group Duluth GA $9,276,208 $183,257,527
53 Camelback Toyota John O'Malley Phoenix AZ $9,255,379 $195,188,754
54 AutoWay Chevrolet - Tampa AutoNation Inc. Tampa FL $9,153,812 $73,312,229
55 Autowest Honda Fremont AutoNation Inc. Fremont CA $9,148,573 $113,212,090
56 Pinnacle Nissan/Infiniti John Cleaves Scottsdale AZ $9,119,737 $152,101,456
57 Tustin Lexus David Wilson Tustin CA $9,112,113 $173,042,919
58 Mike Shad Nissan of Orange Park AutoNation Inc. Orange Park FL $9,010,584 $84,351,161
59 Ed Mullinax Ford AutoNation Inc. Amherst OH $8,975,509 $100,302,550
60 Mercedes-Benz of Chicago Fletcher Jones Jr. Chicago IL $8,971,900 $102,491,672
61 Prestige Automotive Group Gregory Jackson St Clair Shores MI $8,925,778 $186,953,353
62 Drew Ford William Drew La Mesa CA $8,810,106 $120,941,176
63 Lexus of Rockville Sonic Automotive Rockville MD $8,668,171 $122,850,182
64 BMW of Austin Penske Automotive Group (Formerly United Auto Group) Austin TX $8,634,602 $129,143,650
65 Braman Honda Norman Braman Miami FL $8,620,812 $206,772,487
66 Power Nissan Torrance AutoNation Inc. Torrance CA $8,602,382 $73,700,050
67 Appleway Chevrolet AutoNation Inc. Spokane WA $8,571,917 $142,392,247
68 Herb Chambers Honda Saab Infiniti Herbert G. Chambers Boston MA $8,535,167 $141,081,616
69 Showcase Honda Tom Buis Phoenix AZ $8,477,400 $147,643,269
70 AutoWay Chevrolet - Clearwater AutoNation Inc. Clearwater FL $8,441,997 $97,534,962
71 Rick Case Honda Rick Case Davie FL $8,388,355 $206,573,027
72 Kearny Mesa Toyota Scion Penske Automotive Group (Formerly United Auto Group) San Diego CA $8,348,954 $98,759,118
73 Power Honda Costa Mesa AutoNation Inc. Costa Mesa CA $8,341,467 $66,331,564
74 Maroone Ford of Ft. Lauderdale AutoNation Inc. Fort Lauderdale FL $8,334,434 $80,710,267
75 Magnussen's Lexus of Freemont Bernard L. Magnussen Fremont CA $8,326,478 $138,105,581
76 AutoWay Nissan Brandon AutoNation Inc. Tampa FL $8,326,312 $123,128,968
77 Stevens Creek Honda Sonic Automotive San Jose CA $8,321,678 $151,620,122
78 Sam Galloway Ford Lincoln Mercury Sam M. Galloway Fort Myers FL $8,258,998 $165,059,380
79 Herb Chambers BMW Mini Herbert G. Chambers Boston MA $8,247,163 $161,799,106
80 Courtesy Honda AutoNation Inc. Sanford FL $8,246,582 $109,397,545
81 Bankston Honda AutoNation Inc. Lewisville TX $8,084,810 $181,003,228
82 Chambers Motorcars of Boston Herbert G. Chambers Somerville MA $8,036,047 $101,296,019
83 Courtesy Chevrolet Phoenix William Gruwell Phoenix AZ $8,014,291 $180,325,029
84 Michael Cadillac, Inc. Michael L. Rosvold Fresno CA $7,992,134 $202,055,918
85 Al Serra Auto Plaza Joseph O. Serra Grand Blanc MI $7,965,085 $221,353,722
86 Lauderdale Imports Ltd./BMW Joseph S. Holman Ft. Lauderdale FL $7,897,227 $140,436,042
87 AutoWest Acura of Stevens Creek AutoNation Inc. Santa Clara FL $7,891,136 $83,005,975
88 Big Two Toyota Scion of Chandler Chris Hoeye Chandler AZ $7,803,289 $153,279,684
89 Right Toyota David Wilson Scottsdale AZ $7,797,937 $203,853,652
90 Mercedes-Benz of Pompano AutoNation Inc. Pompano Beach FL $7,766,080 $147,425,484
91 David Maus Toyota David Maus Longwood FL $7,763,452 $190,101,934
92 Hudson Toyota Scion Penske Automotive Group (Formerly United Auto Group) Jersey City NJ $7,758,067 $195,763,748
93 AutoWay Ford - St. Petersburg AutoNation Inc. St. Petersburg FL $7,747,214 $78,541,798
94 Performance Automall Hendrick Automotive Group Chapel Hill NC $7,674,381 $108,187,881
95 Greenway Ford Carl Atkinson/Frank Rodriguez Orlando FL $7,649,908 $128,103,525
96 Herb Chambers Lexus Herbert G. Chambers Sharon MA $7,626,621 $185,928,147
97 Toyota of Orange David Wilson Orange CA $7,601,709 $207,152,636
98 Bill Heard Chevrolet Corp.-Las Vegas William T. Heard Las Vegas NV $7,576,000 $123,554,000
99 South Bay Toyota David Wilson Gardena CA $7,524,055 $153,900,129
100 Wilde Lexus of Sarasota Mark Wilde Sarasota FL $7,459,308 $145,981,183
101 AutoWay Nissan AutoNation Inc. Clearwater FL $7,454,044 $66,003,598
102 BMW of Pembroke Pines Joseph S. Holman Pembroke Pines FL $7,417,295 $159,557,258
103 North Hollywood Toyota Don Hankey/Chris Ashworth North Hollywood CA $7,349,756 $184,329,954
104 Hendrick Honda NC Hendrick Automotive Group Charlotte NC $7,243,776 $157,177,311
105 Rosenthal Fairfax Honda Robert Rosenthal Fairfax VA $7,220,615 $125,637,925
106 Lexus of Pleasanton Hendrick Automotive Group Pleasanton CA $7,183,775 $94,554,504
107 Capitol Honda Penske Automotive Group (Formerly United Auto Group) San Jose CA $7,176,855 $121,908,271
108 Folsom Lake Ford Chuck Peterson Folsom CA $7,137,973 $71,368,825
109 Fletcher Jones Motorcars of Fremont Fletcher Jones Jr. Fremont CA $7,120,466 $89,233,740
110 Ancira Winton Chevrolet Inc. Ernesto Ancira, Jr. San Antonio TX $7,064,612 $123,038,311
111 Lexus of Serramonte Sonic Automotive Colma CA $7,023,181 $128,268,597
112 Right Honda David Wilson Scottsdale AZ $7,002,262 $119,791,115
113 Rosenthal Fairfax Honda Robert Rosenthal Alexandria VA $7,001,431 $116,543,605
114 Classic Chevrolet, Ltd Tom Durant Grapevine TX $6,907,811 $281,404,736
115 Momentum Jag/Volvo Sonic Automotive Houston TX $6,906,283 $90,644,086
116 Autowest Honda Roseville AutoNation Inc. Roseville CA $6,905,932 $143,246,369
117 John L. Sullivan Chevrolet John L. Sullivan Roseville CA $6,890,435 $131,120,367
118 Atlantic Toyota John Staluppi Sr. Amityville NY $6,889,489 $148,105,211
119 Motorwerks BMW Mini Penske Automotive Group (Formerly United Auto Group) Bloomington MN $6,887,211 $126,123,265
120 Westbury Toyota Scion Penske Automotive Group (Formerly United Auto Group) Westbury NJ $6,849,299 $136,186,439
121 Wilde Toyota Scion Mark Wilde West Allis WI $6,808,017 $157,133,247
122 Champion Chevrolet Gulf Freeway AutoNation Inc. Houston TX $6,790,947 $105,675,055
123 Champion Ford Gulf Freeway AutoNation Inc. Houston TX $6,756,703 $94,833,784
124 Burt Toyota Lloyd G. Chavez Englewood CO $6,712,318 $139,669,036
125 Warnock Dodge, Chrysler, Jeep Robert Warnock East Hanover NJ $6,699,954 $115,340,756
126 Bell Honda John Cleaves Phoenix AZ $6,685,227 $114,898,722
127 Schaumburg Honda Automobiles Robert V. Rohrman Schaumburg IL $6,664,801 $141,312,554
128 Flagship Motorcars Herbert G. Chambers Lynnfield MA $6,649,340 $86,084,491
129 Warnock Lexus Bethanie Warnock Livingston NJ $6,614,762 $108,324,617
130 Jim Click Ford/Lincoln/Mercury James H. Click Tucson AZ $6,570,560 $105,228,011
131 Toyota of Richardson Steve Grogean Richardson TX $6,563,557 $136,783,109
132 Lexus Bridgewater Penske Automotive Group (Formerly United Auto Group) Bound Brook NJ $6,542,197 $115,396,863
133 Van Chevrolet Chuck Mullins Scottsdale AZ $6,539,578 $163,001,901
134 Mile High Honda Acura Mitsubishi Norman Braman Denver CO $6,539,180 $99,006,858
135 Vandergriff Honda Charlie Evans Arlington TX $6,524,610 $128,253,797
136 Lexus of Cerritos AutoNation Inc. Cerritos CA $6,521,416 $162,784,055
137 AutoWay Lincoln-Mercury AutoNation Inc. Clearwater FL $6,519,090 $90,892,647
138 Tempe Honda Penske Automotive Group (Formerly United Auto Group) Tempe AZ $6,501,898 $123,031,221
139 Atlanta Toyota/Scion Penske Automotive Group (Formerly United Auto Group) Duluth GA $6,497,593 $152,777,658
140 Honda of Tyson's Corner Sonic Automotive Vienna VA $6,488,578 $98,103,996
141 Lone Star Chevrolet Sonic Automotive Houston TX $6,479,037 $178,598,044
142 Ray Catena Lexus of Monmouth Raymond Catena Oakhurst NJ $6,471,786 $193,475,746
143 Gillman Honda (South) Ramsay Gillman Houston TX $6,469,932 $137,113,408
144 Champion Chrysler Jeep Isuzu Hyundai Gulf Freeway AutoNation Inc. Houston TX $6,462,808 $85,108,690
145 Landmark Chevrolet, Ltd William T. Heard Houston TX $6,462,000 $224,877,000
146 Maroone Chevrolet of Greenacres AutoNation Inc. Greenacres FL $6,456,285 $111,961,825
147 Bill Heard Chevrolet at Town Center, LLC William T. Heard Kennesaw GA $6,433,000 $131,886,000
148 Lustine Toyota Scion Dodge Jeep Burton Lustine Woodbridge VA $6,426,000 $157,835,000
149 Hendrick Honda of Woodbridge Hendrick Automotive Group Woodbridge VA $6,419,754 $95,868,735
150 Stadium Toyota Jack W. Parks Tampa FL $6,408,063 $86,238,720
Based on 2008 Ward's Dealer 500 service revenue data. No advertising or other promotional use of the Ward's Service 150 may be used without the prior permission of the Ward's Automotive Group.