Dealerships face a difficult reality — there is a serious lack of loyalty in the car-buying market. Today, most buyers research online and simply look for the best deals rather than revisiting the last dealership they visited. Consumers are also hanging on to their vehicles longer than ever, cutting down on opportunities for dealerships to make a sale.
This lack of brand loyalty is problematic, as customer retention is a key to any business’s success. In fact, if you were to increase your customer retention by just 5% you could boost your profits by up to 95%.
This leaves dealerships in a difficult place. How do you combat a lack of loyalty and a decrease in car purchasing? While there is no single strategy that can guarantee 100% customer retention, your dealership can implement some key tactics to boost loyalty and increase your opportunity for making future sales.
Today, we’ll look at the dynamics of a disloyal customer, how a three-step digital strategy can help combat this problem, and the resulting power your loyal customer can bring.
There has never been a guarantee of a loyal customer. However, in today’s digital-first world, it's increasingly difficult to hold the attention and loyalty of a buyer.
While there was a time that a customer visited a dealership, made a purchase, and continued to come back to that dealership for every service needed as well as future car purchases, today’s buyer interacts much differently.
Now, customers might purchase a vehicle from your dealership and never return. They might instead find an online coupon for a maintenance service at a nearby independent repair shop and take their vehicle in for service there. Over the years, they might hop around from repair shop to repair shop, following ads and coupons to the next good deal. When it comes time to purchase a new vehicle, they will simply hop online, do some research, and pick where to go based on that experience.
This creates an extremely tricky market for dealerships. Without brand loyalty and with people hanging onto their cars for longer, how do you retain customers, ensuring you get the first chance at selling them a future car?
The answer is found by bringing in customers through your service department via a robust digital marketing strategy that is highly targeted and intelligent.
Digital marketing has a powerful influence on your customers' purchasing decisions. Digital marketing also acts as a critical touchpoint where you can reach customers long before they ever consider buying a new vehicle.
While customers do look to the internet to research new vehicle purchases, nearly 25% of all automotive searches are related to parts, services, and maintenance.
Within these searches is a remarkable amount of opportunity for dealerships. By capturing customers when they need an oil change or a tire rotation, you have a unique opportunity to create a loyal customer who is willing to trust you with future purchases.
It all begins with the first step, which is creating a highly targeted advertising strategy.
One of the powerful benefits of investing in digital marketing is the ability to create highly targetable ads. Unlike print and radio ads, digital ads can be customized to reach specific audience segments, and they can adjust in real time.
Through paid search and social media advertisements, you can be the answer to search engine requests, you can reach users on their own Facebook feeds, and you can consistently reach the same customer across channels.
Through the right use of existing data, you can begin by targeting existing customers from your database. Over time, you can then create similar look-alike audiences, reaching entirely new segments of potential customers.
Targeted ads can be specifically designed to reach current and potential customers who are seeking services that your dealership can provide.
For example, if a customer who purchased a vehicle with you is looking for an oil change near them, you can serve up an ad that showcases a customer-only special. Conversely, if the person searching for an oil change near them has never visited your dealership before, you could serve up an ad that promotes a first-time customer deal.
The goal of highly targeted advertising is to provide relevant, meaningful information to customers at the exact time they are searching for it.
While this level of data-driven marketing might feel invasive, the reality is that 87% of Americans are willing to have their activity online tracked in exchange for a more personalized brand experience.
The key then is to deliver value, which creates further loyalty to your brand.
A highly targeted ad campaign is only as good as the landing page to which you drive your traffic.
Once an ad is clicked or tapped, customers should be sent to a service landing page that matches their query and provides the same information as the ad.
Here, customers should be able to quickly locate your service hours, location, and directions to your dealership.
From the landing page, they should be able to ask a question, schedule services, or request further information.
In addition, your landing page should address common concerns that customers have in regard to scheduling services at a dealership. This is a unique opportunity to create loyalty with an existing or new customer.
Make sure your landing page touches on the following key points:
- The affordability of your services: Most customers hesitate to take their car to a dealership for services because they believe it will cost them more than visiting an independent repair shop. Whether it is through a promotion or through persuasive copy, be sure your landing page assuages this fear.
- The convenience of visiting you: Many customers believe that taking their car to a dealership is going to be more time-consuming than visiting a local mechanic. Highlight the speed of service and your commitment to getting them in and out in a timely fashion.
- The transparency in pricing: Often, customers believe that a dealership will overcharge for prices and labor. This needs to be addressed head-on. Let your customers know that your team is committed to transparent pricing, and be sure your service department follows through on this commitment.
You can deliver a compelling ad, drive traffic to a customized landing page, and even convince a customer to schedule services with your team, but loyalty will only be created if the follow-through is there.
Make sure that before you begin an ad campaign aimed at bringing in existing and new customers to your service department, you have built out a robust strategy for how your team will deliver on expectations and create long-term loyalty.
This should be done in two key areas:
1. The Day of the Visit
When customers show up for their oil change, tire rotation, or other services, your service department has to be on its A-game. The service staff has to provide outstanding customer service, going above and beyond the customer’s expectations. The pricing needs to match what the customer expected. Any discounts offered via the ad campaign should already be applied to the customer’s account.
This is also a great opportunity for your service department to demonstrate the added value a customer receives from visiting your dealership versus going to an independent repair shop. A great example of this would be if when your service department is doing an oil change, the advisor pulls up the vehicle’s make, model, and year and notices a safety recall for that vehicle. After quickly completing the oil change in the promised amount of time, staff can inform the customer of the recall, and ask if the service has yet been performed. If not, the customer can schedule a follow-up appointment to get the issue addressed.
2. Post-Visit Follow-Up
While scheduling a service with your dealership was the goal of your marketing campaign, the work should not end here.
Instead, your marketing team should have a strategy built around follow-up and further engagement with this customer.
Any information gathered by your service department should be connected to this customer. This data should then feed into future opportunities for marketing. For example, you might provide a follow-up email that asks your customer how the experience was. Or you might create a future ad campaign that provides a new oil change coupon in the timeframe you know the service will be due.
You might even gather data from customers from your service campaign and feed it into a future recall event.
Regardless of how you use this data, make sure you don’t simply run a campaign and then waste the information you gained from that campaign.
Creating loyal customers through your service department is an extremely powerful tool. After all, statistics show that the probability of selling to an existing customer is 60 to 70%.
Happy customers are more likely to share their experiences with other people in their life. One oil change can turn into 10 more new service department customers, each one another opportunity for a future sale.
While it is more difficult today to create loyalty with your customers, it can be done. By harnessing the power of digital marketing, you can reach your customers in more targeted ways, building a relationship of trust.
Over time, this will translate to an increase in new and used vehicle sales, as your customers learn to turn to you for every vehicle need.
If you are looking for ways to combat a lack of loyalty in your market, our team is here to help. At J&L Marketing, we have years of experience helping dealerships build better trust with their customers.
Through the use of highly targeted marketing, we can help you drive customers through your doors. Often, your service department is the key to your success. Our team can help you explore how to best harness this powerful department, homing in on some key best practices for hosting events, creating specialized offers, and more.Reach out today for a consultation with our team. We will be happy to assess your current marketing strategy and look for ways we can build upon what you are already doing and improve your success. We look forward to working with you soon.