Building brand loyalty is an ongoing struggle for auto dealers.
Once a customer drives off the lot in their new car, getting them to come back for regular service and maintenance (much less their next vehicle purchase) is tricky, to say the least. While manufacturer and make-level loyalty hovers around 60%, dealers lag behind at 25%. And now, with auto sales growth stagnating and slipping for the first time since 2009, generating revenue from existing customers is becoming more important than ever.
One study by DMEautomotive found that customers who habitually maintain their vehicle at your dealership are 86 times more likely to get their next vehicle from you. Of course, creating the kind of post-purchase customer relationship that lasts through the entire vehicle lifecycle isn’t something that just happens. Your dealership has to invest time and resources into maintaining existing customer relationships, just the same as you do with new customers. So, what can you do to build a more loyal customer base?
Now that shoppers spend so much of their car buying journey online, dealers have a unique opportunity to engage them with highly personalized campaigns. Google found that digital influences 60% of vehicle purchases, and that only increases for post-purchase service decisions.
Search and video in particular play integral roles in building and maintaining customer loyalty. Right now, 25% of all online searches are related to service and maintenance. On top of that, 65% of service visits are directly influenced by video.
To begin building loyalty, you have to make sure that your dealership is getting in front of new and existing customers online and keeping them engaged through major life events and everything in between. Google found that life events are the top reason why consumers search for a new vehicle so you need to develop targeted campaigns that engage customers who recently graduated from college, got married or had a child.
There is another benefit to running customer retention or brand loyalty campaigns online. These campaigns can also serve as “win-back” opportunities to re-engage buyers you lost with service offers, putting you back in the running for their next vehicle purchase.
Make Every In-Person Experience Positive and Memorable
It comes as no surprise, but how your dealership engages with customers has a major impact on customer loyalty and retention. Recent studies show that the sales experience at the dealership is the top influencer of post-purchase brand loyalty, followed by maintenance and service.
If you don’t provide the best possible sales experience or incentivize customers to come back to your dealership for post-purchase service, they won’t feel motivated to stay loyal. In fact, even when customers are loyal, 90% still consider at least one other auto brand when beginning the search for a new car. Meaning, that you always run the risk of losing even your most loyal customers to the competition at any time.
So, what makes a positive and memorable experience? There are obviously a lot of things you can do to boost satisfaction — some easier than others. Fortunately, there are a couple of simple things you can do from the moment customers arrive to help build loyalty. By having an advisor greet customers within the first two minutes you can increase satisfaction rates by more than 40%. Similarly, satisfaction rates with first-visit service appointments can reach 90% when the sales-to-service handoff is seamless and smooth.
Offer Exclusive Benefits and Incentives
To build a loyal customer base, your dealership needs to offer exclusive benefits and unrivaled customer service. Even for loyal auto buyers, price is the number one reason they buy from another dealership. Thus, any way your dealership can save customers money is going to help you retain their loyalty. You get extra bonus points for everything you do on top of that to save them time and make the sales or service experience more convenient for them.
Some dealers have started offering loyalty programs with rebates or special service offers to increase customer retention. Many dealers have launched digital campaigns through search and apps like Waze to reach customers when they are on the road and searching for service or maintenance services. One dealer even created an app where customers can get service and repairs done without ever having to visit the dealership. All they have to do schedule an appointment and someone from the dealership will pick up their car, have it serviced and return it — all within 24 hours.
A positive customer support experience on and off the lot can be the difference between a lifetime of loyalty and shoppers taking their business to competitors. Overall, car buyers are looking for instant gratification and seamless experiences from start to finish – as is now true with ecommerce generally. To meet this expectation, dealers must pay more attention to what their customers want from sales and service experiences. It also helps to look outside the automotive industry to identify initiatives that you can adopt as part of your dealership experience.
Because in today’s world, car buyers expect more from every brand experience. And when they don’t have a positive, memorable experience with a dealership, all it takes is a few clicks to shuffle their loyalty elsewhere.
Author: Sam Mylrea
A serial entrepreneur, Sam Mylrea brought seven years of high-tech venture capital and investing experience to PureCars. Since graduating from University of Michigan’s Ross School of Business, Mylrea has developed an extensive portfolio of entrepreneurial achievement and strategic business expansion. When Mylrea joined the PureCars leadership team he immediately became an integral part of the company’s success. As COO, Mylrea took PureCars from startup to the acquisition by Raycom Media, one of the nation’s largest privately-held media companies in 2015. 2017 led to a promotion to CEO and the subsequent acquisition of the Miami-based competitor Showroom Logic in October.