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Jared Hamilton
From: Jared Hamilton
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TK Carsites

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Customer Loyalty Isn't Dead. It Can't Be. It Simply Needs a Revival.

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There is doom and gloom in the statistics. Fewer people are staying loyal to a single brand of vehicle. Fewer people are staying loyal to a particular dealership. We've been hearing about it since the rise of the digital age and it can push dealers to focus on generating new sales and service customers at all costs.

Since we're a vendor that specializes in search and social marketing, one might think that this is the type of shift in the industry that we would embrace. The reality is that our roots as car people and our focus on being a partner for our dealers supersedes the benefits we receive from the trend. We want our clients to succeed and the lowest hanging fruit - customer retention - is the one measure that we see slipping through the fingers of so many dealers out there.

One of the things that we've been investigating is the (seemingly) lost art of turning the one-time sales mentality that has been growing in our industry into the good ol' "customer for life" paradigm that has helped some of the most successful dealers we know to stay on top despite the trends. We know it's possible. We've seen some decent results. Now, it's time to learn how to improve on them, consolidate, collaborate, and enhance the strategies.

We Need Your Help, Dealers and Vendors

Over the last couple of months I've had a couple of research side projects that I took on myself. I didn't include my team nor did I ask for assistance from the community. I explored dealership chat and I am finishing up my investigation into gift card incentive programs. This new project is beyond me. I need help. I've gotten my team involved - Subi Ghosh has given me a world of insight from her recent work at her last dealership that has been outstanding. I need more.

What is out there? We need to get a better understanding of:

  • Loyalty-building strategies at the dealership
  • Current and past customer communication techniques
  • Services that harness data to drive loyalty
  • Products that give customers incentives to work with a single dealer
  • Software (stand-alone or embedded) that can assist dealers bring past customers back

This is important and we need your input.

We are going to put effort into bringing all of the best practices, products, and strategies together to present to dealers here. Our CEO pointed out that we are biting off quite a bit more than we have in previous explorations but he's on board with the concept because, again, our focus is on improving the overall experience for our clients even if it's not directly through our own products.

What You Can Do

Dealers, please let us know in the comments what has worked for your dealership. Vendors, please let us know what products or services you have that can improve customer loyalty. This is a very broad topic but one that can be consolidated with the help of the ADM community.

I saw a statistic yesterday that at most dealers, less than 30% of the vehicles in their service drive were purchased at the dealership. This would have been an absurd statistic to comprehend a decade ago but the numbers don't lie. We already know that so many customers are "dealership hopping" when it comes to sales, demonstrating no loyalty to the dealership that sold them their last vehicle.

The internet and the general shift in consumer sentiment has made this a reality in recent years but there's also blame that can be turned to dealers and vendors. Are we so focused on expensive conquest sales that we're missing out on retention? I believe the answer is "yes" and that needs to change. We can find the right solutions. We simply need your help.

Ben Wilcox
As a buyer I will tell you this, I bought my Two Chevy's from the same dealer. When it came to servicing the vehicles I was extremely disappointed. On a side note, I referred my best friend to this dealership prior to my service visit. He told me he would never buy there, here is the reason... My friend had a linkage issue, (a simple nut) would fix the issue. long story short he went in after making an appointment, the day of the appointment he was told that no one was available to fix the car, also it would cost approximately $150. The nut was less than $1 and a simple fix. Here is my opinion, there is a huge disparity between the sales side and service side. When did making a buck take over for taking care of our people and giving them a great experience. My personal experience was that the service was horribly run and took approximately 3 hours for an oil change. When I made an appointment for my Silverado to have recalls fixed, the truck was dropped off at 0800... The truck wasn't touched until I came in to check on it at around 4pm... Needless to say my truck wasn't available when I was told it would be. Bottom line, I will never use this dealer and most importantly I will never refer a friend or family member to them. If I was offered any amount of money for referral I would tell them to shove their money. It is my opinion that the GM needs to be on the pulse of reviews, both sales and service related. Continuity goes a long way, what do you do with negative feedback? Thanks! I hope this helps in some way.... Ben
Robert Karbaum
If you look at other industries, loyalty has to be bought. Earning it simply isn't enough. Take Starbucks for example. I personally, and see people daily, go out of their way to buy Starbucks when competiting coffee shops are closer, and less expensive. The reason: Starbucks points. People do really silly things for a great points program. I say "Great" points program, as you can't scrape the bare minimum. A loyalty points program actually has to be worth enough to the consumer to change their habits. If an OEM, or Large Group came out with a killer loyalty program I bet dollars to doughnuts you would see a significant spike in their loyalty. Take an OEM for example, imagine for every repeat purchase your loyalty incentive doubled. $1000 > $2000 > $4000 > $8000. This is a REALLY simplified and 100% not researched approach, but something like this would drastically shift loyalty. We as an industry treat loyalty programs like magic beans. Throw a few in the dirt an expect a magical vine to the clouds. Just a thought.
Grant Gooley
Hey JD, great post as per usual! We have been using a fantastic Loyalty program called Bumper that concentrates on bringing the 1% back into the dealership each month to buy. It works really well. I bet if a study was done across North America on all dealers, we could all get better at retention.
Richard-Dean James
I don't know how many people will admit to it or even check this out, but how many people want to be able to make extra money so they can afford that extra luxury on their new car or even simply buy a new car instead of a second hand one. I use to be a chef and when I found this new business idea I did it on the side for a few months and finally resigned from my day job and just had fun every day. I meet new people everyday and make amazing friends thanks to my new business and I do it all knowing I don't have to go home and still get my paper work done. I don't even have to be in the same country and I'll make my money. Naturally I started this not knowing how to sell something like this, but I stopped worrying about how to sell it and focused on just helping people make a life change that would greatly improve their way of living. I thought I would just post this here as many car sales man and car buyers would do great in this business, as all of you know the value of being to drive away in a new car and the satisfaction of selling an amazing car to a deserving new owner. So think about it! Its very simple and it has all the information you need. Check out my website www.rdj333.goyobsn.com if you think you might want to sign up, or just check out www.smartmediatechnologies.com for loads of PDFs and videos on what this offer is. It is a really amazing investment and I'm looking to becoming a millionaire before I'm 30! Lastly... I do advise that this is not a scam. I'm not sending you to a site that will ask you for private details or even spam you if you are not interested. The two sites I gave here are just for information purposes and you only need to enter details if you wish to buy your own business. If you read it and feel I'm scamming you, please feel free to email me at rdjames333@gmail.com I'll be very happy to answer any questions. Not that I would need to, as everything you need is at the smart media technologies website. Good luck Richard-Dean
Grant Gooley
@Richard, this is a community to chat about and share automotive marketing ideas and many other strategies. I suggest you join the conversation. If you are interested in advertising (like you have blatantly here in a random comment) Contact Driving Sales. Scam or not, the etiquette is poor. I also sent you an email in case you didn't see this post. Sincerely, Driving Sales Advocate and Protective Community Member :)

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