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A recent study by Barclays Bank revealed interesting statistics about consumer behavior as it relates to small and medium-sized businesses. The study included the retail behavior of 2,006 consumers and also surveyed loyalty business practices of 1,216 decision makers from small to medium sized businesses. It found that 59% of consumers stated that loyalty to a business began with a smile. More interestingly, only 54% of the decision makers said that they practiced this in their businesses.
Other notable statistics from this study are that only 36% of consumers attributed their loyalty to great customer service, 22% said that the business remembering and recording previous transactions influenced them and 60% said that they are “always, often or sometimes willing to pay more” for those services.
Customer retention is important not only for company growth but increased profitability. “Cutting customer losses by 5 percent can boost profits by 25 to 125 percent,” according to an article in the Houston Chronicle.
This survey was done for Barclays Bank, (the seventh largest bank in the world; with over 48 million customers in 50 countries), to determine whether a loyalty program was a wise investment. They’ve since begun implementation of a customer loyalty program that rewards their most loyal customers with decreased fees.
It amazes me that only a little over half of these decision makers reported that smiling at their customers was a practice they employed. Humans are, by nature, emotionally driven. If your dealership isn’t training your employees to smile and be friendly, no automotive loyalty program will be able to help you. My guess is that while you expect your employees to smile and be friendly to your customers, it is probably not a policy.
And a smile is just the start of a great customer loyalty program. When a repeat customer comes into your dealership, do your employees have the ability to see all of that customer’s transactions? Take service for example; many customers patronize a single place for all their service needs for the simple fact that all of their vehicle’s service records are maintained there. Automotive loyalty programs can help you extend this into all departments of your store making your loyal customers easily identifiable by your service, sales and parts departments.
Don’t forget that personal touches are imperative to your dealership’s long-term success. When you go into a business and are greeted by name by an employee who smiles at you and has knowledge of your history with their business, you are impressed and in turn, keep coming back.
Efforts in increasing customer retention and loyalty today will help your business grow and increase your dealership’s profitability. Smiling at a customer is only the start, however. Customer retention isn’t easy in today’s hyper-competitive world, especially in the automotive industry. If a smile, great customer service, recording previous transactions and a dealership loyalty program are all aligned, you can increase customer retention and develop life-long loyalty.