Dealerships with the most effective loyalty programs drive results in five key areas: marketing responsiveness, sales-to-service conversion, service visitation, retail member spend and member repurchase intent.

This is the second blog in a five-part series where I explain how loyalty programs improve each of these metrics. Last week I touched on marketing responsiveness. This week’s topic is sales-to-service conversion.

Sales-to-service conversion measures first-time service visits that are retail in nature (warranty transactions excluded). This metric looks at customers who enrolled in a loyalty program after a vehicle purchase and returned for a customer-pay service visit. These results were for first-time visits only:

• Average percentage of customers who visited service within 60 days of vehicle purchase: 11.44%
• Average percentage of customers who visited service within 61-90 days of vehicle purchase: 12.73%
• Average percentage of customers who visited service within 91-120 days of vehicle purchase: 6.75%
• Average percentage of customers who visited service within 121-270 days of vehicle purchase: 14.54%
• Average percentage of customers who visited service within 271-365 days of vehicle purchase: 4.01%

In summary, enrolling customers into a loyalty-based rewards program results in an average 49% sales-to-service conversion rate in the first year. What do you think of these conversion rates? Do you track your dealership’s sales-to-service conversion rates and how do they compare to these percentages?

More information on this topic can be found in our free ebook, “The Hard Facts and Financial Impact Report: Auto Dealership Loyalty Programs & The Effects They Have on Profitability.”

Dealerships with the most effective loyalty programs drive results in five key areas: marketing responsiveness, sales-to-service conversion, service visitation, retail member spend and member repurchase intent.

This is the second blog in a five-part series where I explain how loyalty programs improve each of these metrics. Last week I touched on marketing responsiveness. This week’s topic is sales-to-service conversion.

Sales-to-service conversion measures first-time service visits that are retail in nature (warranty transactions excluded). This metric looks at customers who enrolled in a loyalty program after a vehicle purchase and returned for a customer-pay service visit. These results were for first-time visits only:

• Average percentage of customers who visited service within 60 days of vehicle purchase: 11.44%
• Average percentage of customers who visited service within 61-90 days of vehicle purchase: 12.73%
• Average percentage of customers who visited service within 91-120 days of vehicle purchase: 6.75%
• Average percentage of customers who visited service within 121-270 days of vehicle purchase: 14.54%
• Average percentage of customers who visited service within 271-365 days of vehicle purchase: 4.01%

In summary, enrolling customers into a loyalty-based rewards program results in an average 49% sales-to-service conversion rate in the first year. What do you think of these conversion rates? Do you track your dealership’s sales-to-service conversion rates and how do they compare to these percentages?

More information on this topic can be found in our free ebook, “The Hard Facts and Financial Impact Report: Auto Dealership Loyalty Programs & The Effects They Have on Profitability.”

Do customer loyalty programs work? A popular national chicken franchise spends more money on its loyalty program to retain customers for its $2 sandwiches than most dealerships spend to retain customers for $60,000 vehicles purchased from them. Does this make any sense?

Yet I hear all the time from dealers who are unsure about the benefits of customer loyalty programs and want to see hard facts about the ROI.

Well, now they can. In our newly released, free ebook titled “The Hard Facts and Financial Impact Report: Auto Dealership Loyalty Programs & The Effects They Have on Profitability,” we analyzed results from 72 dealerships using loyalty programs, along with over 6 million repair order transactions over a period of 26 months.

Here are some of the findings. Members of loyalty programs in dealerships:

- Visit their service department every 4.26 months versus every 6.82 months for non-members

- Visit their service department more often: 2.82 times per year compared to 1.76 annual visits for non-members

- Spend an average of $662.01 annually compared to $336.63

- On average, dealerships enrolling customers in loyalty programs sell an additional 15 vehicles a month to customers redeeming rewards points/dollars toward those purchases.

The ebook also profiles several dealers who talk candidly about their experiences and success with loyalty programs. Are you convinced yet? Want more facts? Download our free ebook here http://www.media-trac.com/resources/whitepapers.shtml

Do customer loyalty programs work? A popular national chicken franchise spends more money on its loyalty program to retain customers for its $2 sandwiches than most dealerships spend to retain customers for $60,000 vehicles purchased from them. Does this make any sense?

Yet I hear all the time from dealers who are unsure about the benefits of customer loyalty programs and want to see hard facts about the ROI.

Well, now they can. In our newly released, free ebook titled “The Hard Facts and Financial Impact Report: Auto Dealership Loyalty Programs & The Effects They Have on Profitability,” we analyzed results from 72 dealerships using loyalty programs, along with over 6 million repair order transactions over a period of 26 months.

Here are some of the findings. Members of loyalty programs in dealerships:

- Visit their service department every 4.26 months versus every 6.82 months for non-members

- Visit their service department more often: 2.82 times per year compared to 1.76 annual visits for non-members

- Spend an average of $662.01 annually compared to $336.63

- On average, dealerships enrolling customers in loyalty programs sell an additional 15 vehicles a month to customers redeeming rewards points/dollars toward those purchases.

The ebook also profiles several dealers who talk candidly about their experiences and success with loyalty programs. Are you convinced yet? Want more facts? Download our free ebook here http://www.media-trac.com/resources/whitepapers.shtml

Email and snail mail promotions are great methods for creating customer loyalty. However, you need to make sure that the information customers include during the signup process is accurately addressed in the marketing. There’s no greater feeling than receiving an unexpected coupon or discount on something you want to purchase. It’s a completely different story when the promotion is for something random that doesn’t remotely pique your interest.

Here’s an example of a mail promotion gone wrong: A few weeks ago, I received a pamphlet ad from a loyalty program I belong to at a major drug store; the advertisement was primarily for cosmetics and other feminine products that I will never have a use for and it completely alienated me from their program.

Are you doing this in your dealership service department? For instance, if a customer has just purchased a brand new vehicle and you send them a coupon for a 30,000 or 60,000 mile maintenance service, the chances of that coupon being redeemed are slim to none. Not only are you wasting postage and/or time, but you may be making the customer wonder, “Why did they send this to me?” That customer would probably better appreciate a 10% discount on accessories to personalize their new vehicle.

When creating your marketing campaigns, do you check to make sure customers are receiving a relevant promotion? What promotions have you created recently that have resulted in high redemption rates and loyal customers?

Email and snail mail promotions are great methods for creating customer loyalty. However, you need to make sure that the information customers include during the signup process is accurately addressed in the marketing. There’s no greater feeling than receiving an unexpected coupon or discount on something you want to purchase. It’s a completely different story when the promotion is for something random that doesn’t remotely pique your interest.

Here’s an example of a mail promotion gone wrong: A few weeks ago, I received a pamphlet ad from a loyalty program I belong to at a major drug store; the advertisement was primarily for cosmetics and other feminine products that I will never have a use for and it completely alienated me from their program.

Are you doing this in your dealership service department? For instance, if a customer has just purchased a brand new vehicle and you send them a coupon for a 30,000 or 60,000 mile maintenance service, the chances of that coupon being redeemed are slim to none. Not only are you wasting postage and/or time, but you may be making the customer wonder, “Why did they send this to me?” That customer would probably better appreciate a 10% discount on accessories to personalize their new vehicle.

When creating your marketing campaigns, do you check to make sure customers are receiving a relevant promotion? What promotions have you created recently that have resulted in high redemption rates and loyal customers?

The National Business Research Institute has created a valuable infographic focused on customer loyalty. NBRI explains, “Customers are a business’ most important asset, without them the business wouldn’t exist. So it’s imperative to keep these customers happy and improve their loyalty to your business.” They add, “We created this customer loyalty infographic to help you not only understand it, but to help you cultivate that loyalty among your own customers.”

We found NPRI’s presentation of the importance of customer loyalty in today’s economic society not only helpful and insightful, but easy to digest with specific details that would apply in a variety of business settings.

When considering that the decision-making process is 30% logic and 70% emotion, how do you feel that affects your business?

Source: Driving Retention and NBRII.com, February, 2012.

The National Business Research Institute has created a valuable infographic focused on customer loyalty. NBRI explains, “Customers are a business’ most important asset, without them the business wouldn’t exist. So it’s imperative to keep these customers happy and improve their loyalty to your business.” They add, “We created this customer loyalty infographic to help you not only understand it, but to help you cultivate that loyalty among your own customers.”

We found NPRI’s presentation of the importance of customer loyalty in today’s economic society not only helpful and insightful, but easy to digest with specific details that would apply in a variety of business settings.

When considering that the decision-making process is 30% logic and 70% emotion, how do you feel that affects your business?

Source: Driving Retention and NBRII.com, February, 2012.

Everyone knows Valentine’s Day celebrates the ladies. That’s why Bristol Toyota Scion in Bristol RI, recently used LoyaltyTrac, their service rewards program, to conduct an email campaign centered on Valentine’s Day being “Ladies’ Day”. Colorful, Valentine’s-themed emails were sent to all of their service reward members, with the Subject Line: Be Our Valentine - View Your Gift Inside. The email included an offer: Ladies Receive $15 Off Any Service of $35 or More. The campaign ran on 2/10/12, with available redemption being from 2/10-2/18.

This was the first LoyaltyTrac promotion Bristol Toyota Scion had ever done to its service reward members and it resulted in a very heartening open rate of 58.33%, far surpassing the Direct Marketing Association’s (DMS) average of 12-14% for opt-in lists.

Other LoyaltyTrac auto dealerships have achieved similar results with this Valentine Day-themed email campaign.  Howdy Honda in Austin, Texas, ran the same campaign and enjoyed an open rate of over 30%. The campaign also resulted in 41 service appointments scheduled and a nice profit too: estimated campaign revenue to date of more than $8,700.

Specially designed email campaigns themed around holidays and events can boost return business throughout the year. It's key to engage users with content that is informative, easy to digest and adds value. Good Luck!

Everyone knows Valentine’s Day celebrates the ladies. That’s why Bristol Toyota Scion in Bristol RI, recently used LoyaltyTrac, their service rewards program, to conduct an email campaign centered on Valentine’s Day being “Ladies’ Day”. Colorful, Valentine’s-themed emails were sent to all of their service reward members, with the Subject Line: Be Our Valentine - View Your Gift Inside. The email included an offer: Ladies Receive $15 Off Any Service of $35 or More. The campaign ran on 2/10/12, with available redemption being from 2/10-2/18.

This was the first LoyaltyTrac promotion Bristol Toyota Scion had ever done to its service reward members and it resulted in a very heartening open rate of 58.33%, far surpassing the Direct Marketing Association’s (DMS) average of 12-14% for opt-in lists.

Other LoyaltyTrac auto dealerships have achieved similar results with this Valentine Day-themed email campaign.  Howdy Honda in Austin, Texas, ran the same campaign and enjoyed an open rate of over 30%. The campaign also resulted in 41 service appointments scheduled and a nice profit too: estimated campaign revenue to date of more than $8,700.

Specially designed email campaigns themed around holidays and events can boost return business throughout the year. It's key to engage users with content that is informative, easy to digest and adds value. Good Luck!