In today’s environment, consumers demand more personal attention and expect tangible appreciation for their business. Loyalty programs, great customer experiences and expedient solutions to problems are no longer luxuries, but expectations.
Every loyal customer seems to have a different reason for why they’ve chosen to be loyal. Perhaps one had a memorable moment, while another simply had an employee go above and beyond for them. Well, because loyalty is given on such a personal level, it must also be earned that way. There is no magical formula for earning everyone’s loyalty. Just like everyone in your dealership is motivated in different ways, so are your customers. The trick is finding out what motivates each one.
So, how do you discover the “thing” that shifts someone from being a customer to being a loyal customer? The one thing that’s great about loyal customers is that you can always count on them to weigh in when you ask questions, such as formal surveys, or responses to social media posts. They respond for one simple reason: they care about your business and want it to succeed. Perhaps not every response is positive. That’s OK. The simple fact that they responded is their way of trying to help your business become better for them individually. Think of your loyal customers as a built in focus group. They are the ones you can count on when you really need feedback. Many customers are simply indifferent and are not very likely to respond. But, those that do, and do so with meaningful and thoughtful responses, are the people you should be listening to.
Another way is to make things personal. I heard this great story about a salesperson that, through the suggestion of a sales trainer, started calling 5 unsold prospects daily – people that visited the dealership, spent time with the salesperson, but ultimately left without purchasing. He called and invited them to lunch.
What did this accomplish for the dealership and salesperson? Two things: It instantly made the salesperson memorable in the customer’s mind. And, it made the dealership stand out as one that valued and wanted to earn that customer’s business. When the General Manager of the dealership got wind of this, he informed the salesperson that, should anyone take him up on the offer, the dealership would pay for it. In this salesperson’s whole time at that dealership, calling 5 people every day, only one customer actually accepted the offer and went to lunch with the salesperson.
However, think about it this way — How many people did the salesman effectively take to lunch? Every one he called! Each of those customers got invited to lunch, it was only because they declined that they didn’t get a free lunch. In the customers’ minds, the salesman effectively took over 1,000 people to lunch. He helped make himself and his dealership stand out. And, in the end, it only cost the dealership $30. I only wish he had kept track of how many of those invitees actually returned and bought a car from him. That would be an interesting statistic.
The point is that this outreach wasn’t an e-mail blast. It wasn’t a “thank you for coming in” phone call. Nor was it a greeting card. It was a genuine human engagement, personalized to a single individual. There is absolutely no reason why this technique couldn’t be applied to existing customers in service or sales. It had very little to do with the fact that he invited them to lunch. And had nothing to do with buying or servicing a car But, more to do with the fact that there was a personal outreach to a customer, with an offer personalized to them.
Want to boost your sales 24% and add $106,000 per year to your bottom line? Well, here’s the deal: It’s all about the customer experience.
A lot has been written about how industry disrupters are currently threatening market share. These online auto buying sites provide consumers with an easier, friendlier way to buy a car. This isn’t, however, something proprietary to them. The simple fact that they leverage technology to facilitate these transactions is nothing new. AutoNation, itself, has spent millions of dollars to provide customers with a similar buying process. But what, exactly, is truly being sold here? It’s the customer experience. Think of Amazon, Apple, Disney and Nordstroms. In fact, most businesses in other industries have jumped on this phenomenon in a big way – so much so that consumers now expect this top-of-the line customer experience in every business transaction.
A recent article on Loyalty360.org provides some very interesting data on this, including the 2015 DrivingSales Consumer Experience Study, which estimates that dealerships could sell 24% more vehicles simply by improving the car buying experience. And, a study by MaritzCX went a step farther and actually quantified the additional revenue a dealership would see at $106,000; simply by focusing on the customer experience. I highly doubt there is any dealer that wouldn’t enjoy a 24% lift in unit sales and an extra $106,000 per year added to their bottom line.
The customer experience is all encompassing. In many cases, whether or not that customer returns, is simply determined by how the customer feels at the end of the sales transaction. You see, it’s not all about crossing the “T’s” and dotting the “I’s.” But, more about how the customer FEELS at the end of the transaction. Your process could be smooth as silk, negotiations handled smoothly, the customer in and out of finance, with the salesperson doing a complete delivery on a pristinely detailed car, and yet the customer could still leave the dealership feeling they had a less then great experience. The fact is that the customer experience in your dealership needs to encompass anything that affects a customer — from ensuring that your website has all the information they are searching for, to providing good, fresh coffee, to making sure the showroom is clean and that you have adequate staffing to ensure an efficient and attentive experience for each and every customer, every time.
Of course, if your dealership is stuck using outdated computers, sharpies on foursquares and skimps on amenities for customers, it will be extremely difficult to achieve the experience that most consumers desire.
A great way to begin to transform and improve the experience for your customer is simple – invest in new technology! I know. The thought of outfitting your sales staff with iPads may not seem like it would provide any ROI. That being said, would it surprise you to learn that in the J.D. Power 2015 U.S. Sales Satisfaction Index Study, it was revealed that consumers reported a higher customer satisfaction rate when tablets were used in the sales process?
Today’s consumers are digitally savvy and expect the same from businesses. Whether we’re talking about providing information online so the consumer to get a head start on their vehicle purchase prior to coming into your dealership, or ensuring that your receptionist provides a good welcome over the phone and in person, it’s time to embrace any technology that enhances the buying experience for customers – both in the dealership or online. Don’t be afraid of these changes, or balk at the investment. An additional $106,000 per year in revenue should quickly return any initial investment and deliver dividends for years to come. Of course, you could continue to do things the same way as you always have — then watch while your customers start gravitating to either these disrupters or, perhaps even worse, your competitors.
It’s getting more difficult to earn and keep loyal customers. Consumers these days have so many choices for their shopping needs that it only takes that deep discount, or shiny bauble, to lure them to your competition.
As businesses scramble to create positive customer experiences by ensuring superior customer service, consumers increasingly realize they are in control of that shopping experience. And, they aren’t afraid to flex that decision making control and take their business elsewhere.
So, what then do consumers want from businesses in exchange for their loyalty?
A recent article on Business2Community shed some light on that subject with a list of the 8 things that greatly influence what consumers want in exchange for their loyalty, based on a compilation of results from several studies. They are:
- 77% of customers want a great product.
- 73% of customers want kind customer support.
- 69% of customers want to be recognized by brands.
- 69% of customers would stay with a brand for loyalty rewards and points.
- 64% of customers want shared values with brands.
- 62% of customers want online content from brands.
- 48% of customers say that their first purchase is what determines their loyalty.
- 41% of customers want personalized emails based on their browsing and purchasing history.
Almost half of consumers surveyed stated that their first purchase experience will dictate whether they stay a customer. After their experience, they must feel that they received a great product, feel appreciated, get rewarded for their loyalty and feel that the brand shares their values. In continuing and strengthening the relationship, consumers want to see online content and receive personalized and relevant communications based on their purchasing history.
This customer lifecycle is no different regardless of if that business is a restaurant, or a car dealership. The fact is that we can get so focused on the next sale, or customer, that we forget about the one that we just purchased or serviced their vehicle. These customers can easily feel abandoned by the business if that attention is redirected away from them.
According to the article, 20% of your loyal customer base will comprise 80% of your revenue. Of course, if you aren’t actively trying to retain your customers, you’ll be continuously spending money in order to acquire new ones — who may or may not become loyal to your business. If there was a clear definitive report that showed that 80 percent of your revenue was coming from existing customers, and only 20 percent from new ones, wouldn’t it be unwise to just focus on the small piece of the pie?
There is a constant stream of advice from industry experts concerning customer loyalty and retention. While most of the advice is on point, a large piece is typically missing in the bigger picture. In order to increase market share, businesses must be aware of what their competition is doing. Turning a blind eye to pricing and marketing tactics of the dealership down the road can easily cost sales or service business. Savvy dealers check out what their competition is doing. But, these mystery shops or research data is usually limited to their franchised competitors, not independent repair facilities, which is a mistake.
A recent roundtable discussion published by Loyalty360 included key executives of some large independent repair franchises. It provides interesting insight into the mindsets and strategies they are using to build customer loyalty and keep customers coming back.
The roundtable included Robert Falconi, CEO and John Wiegand, SVP of Operations with Precision Tune Auto Care; along with Tom Tracy, SVP of Marketing for Monro Muffler Brake & Service; Ralph Yarusso, SVP of Operations and Business Development for Grease Monkey; and Ryan Rose, Director of Automotive Strategy for Clutch. In this roundtable, several questions were posed to the group including:
- What is your brand’s biggest strength with customer experience? Tracy indicated that they focus on thoroughness in their inspections in order to prevent further issues down the road. Yarusso stated that it was the consumer’s desire for quick service done right. Falconi recognized the bad reputation that repair shops have gained and stressed that ethics is their most important value proposition. While Rose indicated that using customer data to analyze consumer behavior is key to effective marketing.
- What’s the most significant customer challenge your brand faces? The group’s answers to this question revolved around providing a consistent customer experience across all of their facilities. Staffing the stores with the right people who understand the importance of providing an excellent customer experience is challenging for Precision. Monro focuses on being clear with their customers on what they should expect, then delivering on those promises. While Grease Monkey strives for chain-wide consistency in experience.
- How is technology impacting your brand’s customer experience? These groups are integrating and utilizing technology across the board to enhance their customer’s experience, including the use of tablets by advisors, digital menu boards and mobile friendly websites with appointment setting abilities. They recognize that consumers have access to more information and conduct research as to the best place to take their vehicle. So, they work to ensure that their information is easily accessible and helps convince consumers to choose them.
- What role does data play in your marketing strategy? These independents recognize that data is an incredibly effective tool when used to communicate with customers in relevant and personalized ways. Wiegand shared the importance of using data to lure back customers who haven’t come in for service in some time. While Rose shared the importance of integrating data from many sources, including POS systems, vehicle databases, and even social accounts.
It is a sad fact that in the eye of the consumer, these independent service departments still have the edge in their ability to provide a complete service experience. The 2015 annual survey of Consumer Reports subscribers found that independents outscored dealership service for overall satisfaction, price, quality, courteousness of the staff, and work being completed when promised.
However, most independents lack the ability to perform major service repairs, or recall work. That being said, it’s very easy to lose sight of just how important quick service type ROs are. These all provide these independents with the opportunity to interact with and touch a customer. Every service performed at an independent versus a dealership is a lost opportunity (and revenue) for a dealership.
So, take note of the strategies that independents are using to attract and retain customers and consider implementing similar strategies to help improve the customer experience at your dealership. Otherwise, you may find your customers visiting less frequently and miss out on a great deal of revenue and countless opportunities.