This common saying is certainly one that everyone knows. And, whether it’s true or not, has endured time. Why? Because someone cooking for you is an intimate act that is satisfying and elicits fond memories. In essence, this act accomplished on a regular basis is supposed to be the recipe (pun intended) to win the love of a man, or woman. The gender of a person has little to do with what it takes to win their hearts.
That being said, this simple saying can easily be transferred from the realm of interpersonal relationships to the world of business. How? Every time a customer visits or interacts with your dealership, you are essentially feeding them.
Customers have appetites for quality products and excellent service. Just look at the hoards that stand in line for hours (or sometimes days) for every new Apple product. With each commercial, tease, leak or ad, Apple caters to that appetite. But why do consumers do this? Well, Apple has created a brand trusted by the masses. Consumers believe the product(s) Apple develop will be of exceptional quality and that they will receive an excellent customer experience while using them. The food in this equation is multi-dimensional.
Let me explain:
Apple is, by nature, a very secretive company when it comes to product releases. However, there are usually numerous “leaks” for any product offering, which culminate with a very short period of time between the customer entering the restaurant (the official announcement) and the main course (product release). These leaks serve as teases to their customers and whet their appetites for the product or service. Without these, customers would be left in mystery, with little information to help in the buying decision, and a rather short period to decide whether they want to plop down the typically premium price, or perhaps wait.
Once the main course is served, all preconceived notions, hopes, wishes, dreams and speculation end and reality sets in. Either the product or service lives up to the expectations of the customer – or they do not.
Customers are constantly fed either the appetizers (your marketing) or main courses (the actual customer experience). How they perceive or experience both can weaken, or strengthen their loyalty. If the experience is everything that it was hyped up to be, and the product fulfilled their expectations, they will probably get in line a little earlier the next time and be less skeptical or trigger-shy.
All dealerships advertise. The messages that you put out there whether it is about price, experience, or other unique selling propositions, whet the consumer’s appetite and get them to visit your dealership. Once there, their actual experience can either reinforce your marketing messages or convince the customer that you made false promises and are insincere.
Make sure that the food you are feeding customers – whether it’s the appetizer of the main course – fulfills all of your customer’s expectations and you’ll find that with each visit, they love your restaurant that much more.
And when the food is great, people tell their friends. Which is exactly what you want.
The intention of a loyalty program is to show your customers that they are appreciated and encourage them to choose your business over any competition. These programs can create value and generate lifetime relationships with customers — as long as the experience remains consistently pleasant.
However, a trend currently rearing its head in the loyalty program space, while seemingly grounded in fiscal common sense, is alienating customers and actually making previously loyal customers less loyal.
An excellent article on Forbes.com discusses a trend in travel, hospitality and retail, where businesses revamp their loyalty programs to favor customers that spend the most money – not necessarily in total — but with each transaction.
Airlines are an excellent example of this trend. In the past, most major airlines’ loyalty programs rewarded customers with points based on the number of miles flown, flights taken, or both. The recent trend delivers a double whammy to customers as these airlines have shifted their loyalty programs towards money spent on airfare, which favors business travelers that tend to book flights last minute, paying premium fares for their flights. A traveler that booked their ticket in advance, or took advantage of a sale, could even be seated right next to the business traveler who paid a premium price, but that customer would earn less points for the same travel.
The second change involves how many points it takes to redeem rewards. Airlines have increased the number of points needed to earn free flights and made it more difficult for “normal” travelers to earn rewards.
While on the surface these changes make economic sense for the airlines – reward those who spend more per transaction – this strategy might just be backfiring. It would seem reasonable to project that the majority of travelers are NOT business travelers who book at the last minute and pay higher rates. But rather those “less-important” customers who plan ahead and take advantage of fare sales. If that’s the case, doesn’t this strategy of making it more difficult for the majority of your customers to earn rewards and, by default, making them feel less appreciated, mean that, in the long run, airlines could find that they’re actually losing money?
And don’t feel like this phenomenon is limited to the travel and hospitality industry. Just research the recent backlash that Starbucks encountered when it revamped its loyalty program in the exact same way. Rather than rewarding customers for visits, now their loyalty program points are earned by dollars spent. And consumers did not take it well — at all.
Every customer is valuable. While it is certainly understandable that businesses want to reward their best customers, it may be a bad move to do so at the expense of others. That normal (or frugal) traveler today, may just get a new job and become that business traveler airlines so covet. Yet, when they were a normal traveler, they were treated as somewhat less desirable customers… at least that’s what the airlines loyalty program communicates to them. Because of that, they now base their travel decisions on convenience and price, rather than loyalty to the airline.
Consistency in how appreciation is shown to your loyalty program customers is imperative. Designed correctly, your loyalty program should reward customers who spend and visit more by default. Those customers will find it easier to earn rewards simply because they’re doing more business with you. And that’s exactly what a loyalty program is designed to accomplish.
While car dealerships aren’t necessarily held in high regards by consumers, there are many dealers out there that are pillars of their community. Big hearted philanthropists who understand the sense of community and the importance of being involved. A great example of this – and the impact it has had on the community – is the story of a dealership in Victorville, CA, featured in a recent article in Automotive News.
Victorville Motors decided to create a promotion: “It’s a Gas to Go to School,” to encourage local high school students to attend class. This promotion, in cooperation with the local school district, offers students the chance to win a free car if they achieve perfect attendance throughout the school year. Students with perfect attendance records receive a golden ticket and access to a day-long celebration event which culminates in a vehicle presented to one deserving student.
Since inception, the promotion has expanded to include teacher attendance. It is now a bi-annual event with more districts and schools participating. Now, more than 100 local businesses also donate prizes, which increases the number of winners. According to the article, this contest has created more than $10 million in additional state funding to the districts involved, as California schools are funded by average daily attendance. In addition, it has saved these districts over $600,000 in teacher pay that would have been paid to substitutes had teachers taken their sick days.
And what does the dealership get? The vehicles given away are wrapped with advertising for a year, so in effect the dealership gets mobile advertising around the local area for a whole year. In addition, they have the attention and appreciation of the staff, parents and students of all of the school in all of the districts that participate.
But, you ask, did it help them sell more cars? According to dealer principal, Tim Watts, he “stopped counting at 300.” Do you feel two free cars a year is a lot of money? Would you spend $40,000 to sell 300 cars? I think most dealers would.
This is a great example of how dealership involvement in their local area impacts the community and captures the hearts, souls and attention of… well… just about everyone. It’s hard to believe that all of those included and/or affected by this bi-annual contest wouldn’t give Victorville Motors first shot at their business. It is one thing to SAY you love your community, but this type of community involvement PROVES it to the people that matter most… your customers.
And, all of the high school kids in Victorville will eventually need to buy a car. If the contest continues, (which is likely as it keeps growing) it’s very possible that it will continue to influence consumer buying behavior in the local market across even more generations.
And, when you have positive word-of-mouth locally – well, you can’t buy any more effective advertising than that.
All humans have feelings and those feelings can absolutely affect their decisions in life, including any products purchased, where they buy them and to which companies they are loyal. Large companies know this and realize that corporate social responsibility programs are important to brand image, customer sentiment and loyalty. And these programs can also motivate and inspire employees to become brand advocates.
Who wouldn’t want to do business with a company that shares its values? And, who wouldn’t want to work for a company that is loved? These two things are an important part of transforming a business from one that’s simply a place to transact, to one with personality.
An excellent example of this, and how one small good deed reaped huge benefits, is the story of Jake Nelson and a Ford dealership in Apple Valley, Minnesota. Jake is a special needs boy who loved cars, but was told he could never drive. Because of his passion for cars, his parents took him to dealerships just to wander and look at all of the objects he so loved. Upon visiting Apple Ford Lincoln, a salesperson took the time to talk with the boy and introduced him to others at the dealership. He soon became a fixture at the store, helping in the many ways that he could on the lot, making sure the cars are all locked and well presented. It has brought great joy into his life and acts as an inspiration both to customers and other employees at the dealership.
This story garnered wonderful national media attention for Ford and highlighted the dealership in this great video:
This act positively affected a young life and is a wonderful example of how one car dealership’s image transformed in the eyes of its employees, community and the world. And ultimately that’s exactly what social responsibility is all about.
Ford has now announced the launch of its FordInclusiveWorks program. This pilot program, starting June 1st, is designed to provide meaningful employment to adults with autism. With a national unemployment rate of 75-90 percent, Ford recognized an opportunity to make an impact on these adult’s lives.And, while this pilot may only involve 5 people for now, there’s no telling what the future holds should it succeed. Felicia Fields, Ford group VP of human resources and corporate services, couldn’t have said it any better when she said; “We recognize that having a diverse and inclusive workforce allows us to leverage a wider range of innovative ideas to make our customers’ lives better.” [emphasis added]
While Ford may dominate this blog, there are many other automakers and dealers that make an impact in our world. Dealers are well known for being a huge support to their local communities.
Automakers typically have individual charities they choose to assist (such as Chevrolet and the American Heart Association), but also quickly render aid in times of crisis — as was the case in the Hurricane Sandy disaster, for example.
With each and every one of these; whether a huge expensive campaign by OEMs; or simply a dealer seeing someone in need and choosing to help; it helps to humanize our industry – to show consumers that car dealerships aren’t places filled with people looking to take advantage of them, but rather businesses employing people who care about other people.
So whatever your passion – rescuing animals, helping the homeless or countless others – know that social responsibility, being involved in and part of your community and taking action when others are in need is not only something you could do…
…but something you should.