How to build auto dealership loyalty (with loyalty program ideas)
Published: April 9, 2024
Buying a new car has the potential to be an exciting experience. In a customer sentiment study from CarEdge, 70% of consumers said they enjoy the experience of shopping for a vehicle. While that should work to an auto dealership’s advantage, there’s a catch: 44% of people in the same survey said they’d prefer to avoid dealerships completely. Yet 18% of people reported having a specific dealership they’re loyal to, suggesting that dealerships that create a good enough customer experience can overcome negative associations with the overall industry.
Indeed, 92% of dealers in an Accenture study agree that managing the customer experience is extremely important to their future growth. Delivering an experience that will drive customer loyalty requires considering every touchpoint of the buyer’s journey and working to achieve customer satisfaction at each stage.
Challenges in automotive customer loyalty
Earning customer loyalty requires addressing some common challenges, including:
Market competition: According to a midyear 2023 report from NADA, 16,839 new dealerships opened during the year, making it that much harder for individual dealerships to stand out and earn new business.
Shifting consumer preferences: The way customers shop is evolving. They increasingly prefer for at least part of the process to be digital and want sustainable vehicle options.
Lack of post-purchase engagement: Not following up after the sale can result in customers feeling neglected, making them less likely to return.
Expense of courtesy shuttles: Helping customers get to and from the dealership can improve their experience. But if you rely on shuttles to do so, the costs can be high.
Why customer loyalty in the auto industry matters
NADA reports that dealerships spent $692 in advertising for every vehicle sold in 2023. Winning customer loyalty can mean making a much higher return on that investment over time than you earn from the initial sale itself. While customers don’t purchase vehicles very often—around once every 8 years—if they always come straight back to you, their lifetime value can balloon over time.
In addition to vehicle sales, Cox Automotive reports that 30% of consumers turn to dealerships for service visits. NADA found that service and parts sales accounted for over $73 billion by midyear in 2023. To earn a customer’s continued service business, they have to be happy with each experience they have with you.
Strategies for your auto dealership loyalty program
Auto dealership loyalty programs don’t have to look like the kind of points-based rewards programs you associate with airlines or retail brands. A good automotive loyalty program can be focused on creating an exceptional customer experience throughout the entire customer life cycle—from when customers are in research mode to when they make a purchase, through to the post-sales experience.
Improve the dealership pre-purchase experience
For a big purchase like a car, customers will generally do research before they make a decision. What they’re able to learn about your dealership and inventory before they’re at the point of purchase affects whether they’ll choose you and how they’ll feel about their overall experience. To help customers before they purchase a vehicle, consider these ways to improve their dealership experience.
Focus on CSI score and overall reputation
Your CSI (Customer Service Index) score is a good way to gauge how customers feel about you. And your reputation with past and current customers has a direct impact on what prospective customers will learn when researching what dealership to go with.
As Gayatri Sakhuja, Product Marketing Manager at Uber for Business, explains: “Customers generally have access to more information and options. They look at reviews of the dealership, and they expect good service when they walk through the door.”
Invest in your digital presence
While most purchases still happen in person, many consumers like to complete much of their pre-purchase research online. Making sure they can find accurate, thorough information on your website is now an important part of delivering a solid customer experience. In a study from Cox Automotive, 81% of shoppers in 2022 said online tools improve the automotive buying experience.
Create a better auto purchasing process
The purchase itself has the potential to be either exciting or stressful. You want to do your best to make it the former as often as possible. Below are some ways to do that.
Train sales staff to provide a personalized experience
Your salespeople have a crucial role to play in the auto purchasing experience. Training them to provide knowledgeable, helpful information with a personal touch is key to ensuring that customers leave satisfied. If you do it right, customers will feel like they’ve gotten a luxury experience.
Arrange a ride for the customer to your dealership
Many consumers needing a car face a conundrum: how to get to the dealership. If they have to jump through hoops to arrange a ride from a friend or navigate public transportation, they could already be stressed when they arrive. You can make them feel pampered and elevate their experience by offering to arrange a ride for them.
If you want to go a step further in delivering a luxury experience for customers, have their new car delivered straight to their door. They’ll feel like they’re getting special valet treatment and associate that feeling with your brand.
Invest in the post-sale customer experience
The customer experience doesn’t stop after the sale. In an Accenture survey, 71% of consumers reported that they’re willing to increase their annual spending on aftersales if the experience improved. You can capture that money with a post-sale customer experience strategy.
Stay in touch with customers after their purchase
You don’t want to fall off a customer’s radar once the purchase is done. Keep reaching out to them to stay top of mind. Let them know about service promotions you offer. Send maintenance reminders so they think to come to you. And alert them to any recalls, so they know you care about their safety.
Offer rides or loaner vehicles during repairs
One of the most stressful aspects of needing a car repaired or serviced is figuring out how to get around in the meantime. Help solve that problem for customers. A familiar strategy is offering loaner vehicles for them to drive until the repair is complete. But it can be tricky to keep enough loaner vehicles in your fleet to satisfy every customer, and a loaner fleet can be expensive to maintain.
Another option (or a supplementary one) is to offer courtesy rides or ride vouchers to help customers get around while their car is in the shop. Offering courtesy rides helped a BMW dealership in New Jersey maintain high CSI scores and a 4.5-star rating on Google Reviews.
Elevate the customer experience with Central by Uber for Business
Using Central through Uber for Business’s intuitive dashboard makes it easy to provide customers with convenient rides to and from the dealership. Central can help you replace expensive shuttles and loaner vehicles, while helping customers get where they need to go. One Honda dealership in Washington saved 47% by replacing its shuttle service with Uber rides.
In addition, using Central to arrange for courtesy rides or providing vouchers when their car is in the shop can turn a potentially stressful situation into a much more convenient one. Partnering with Uber for Business provides opportunities throughout the customer life cycle to create exceptional experiences that inspire customer loyalty.
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