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.
Companies increasingly invent new and creative ways to earn loyalty from their customers. Every year we hear of companies pulling off interesting and creative ways to gain exposure and foster loyalty through acts of kindness, goodwill or just being fun. For the fourth consecutive year, Uber became the ice cream man. It seems that every year for the past four years, Uber holds what it calls an “ice cream social.” On this day, the Uber app opens up a new feature – rather than simply being able to choose which type of Uber you want, on that day you can order up some ice cream. For $25, Uber will send one of its drivers to your house, workplace or wherever you wish and hand deliver five ice cream treats in a goodie bag all from an “Uber Ice Cream” branded vehicle. Needless to say, people went crazy over this on social media. Just search the hashtag #UberIceCream on Twitter and you’ll see what I mean. This annual event has been an excellent way for Uber to engage its customers in a fun way while reinforcing its branding and generating buzz.
Car dealers can use the same idea to engage their community. No, I’m not talking about delivering ice cream for $25 but rather finding creative and fun ways with which to provide an unexpected surprise for a customer. A dealer in North Carolina holds “Free Gas Friday” every week. This amounts to no more than a sales manager and second employee (to film) driving around town armed with balloons, a goodie bag filled with a dealership shirt and hat and a gift card for $25 in gas until they find a vehicle bearing their dealership’s license plate or sticker. When they find somebody, they cause a big scene thanking the customer for their business and awarding their loyalty with the prizes. Since they make sure that they start this quest at lunchtime, more often than not the person they find is in the midst of eating lunch at a restaurant or other food establishment. Simply by being in public and raising a little ruckus, they gain positive exposure for the dealership and return to the dealership armed with some excellent video content for social media use. This content is by far the most engaged with on their social media accounts and adds some fun into their dealership’s personality.
There are many paths to earn customer loyalty. They are, however, becoming harder to navigate as customer loyalty becomes more fragile through new technologies centered around price or convenience. Dealerships should look for unique ways in which they can engage their customers and their communities. Small things like this can generate buzz and exposure while not only directly affecting a single customer but also indirectly affecting many others. And a little ice cream on a hot day or some free gas will almost certainly score your dealership some brownie points.
In a recent press release, Amazon announced that, in celebration of its 20th birthday, July 15 will be “Prime Day” – a day on which Amazon claims it will offer more deals to its loyal Prime members than Black Friday. Amazon promises, “new deals starting as often as every ten minutes,” with the ultimate goal to make this a global shopping event. For non-members, Amazon is offering free 30-day trials of its paid loyalty program.
Amazon has steadily increased the value of its Prime membership by adding movie and music streaming services, in addition to its free 2-day air shipping. And, that’s not all — to increase the buzz and introduce the new Prime Photo service, social media contests are being held, with a rather enticing $10,000 gift card as the prize. The hype surrounding Amazon’s announcement, along with its offer to non-members of free trials, will almost certainly result in a membership enrollment spike.
Well … this is all very interesting, but how does it apply to the auto industry?
Dealers who use loyalty programs gain two valuable assets:
- A customer that enrolls in your loyalty program is telling you that they will be returning. This mental commitment in the customer’s mind increases with each visit, as they progress towards a reward, or use the membership for savings. As long as you consistently provide a good customer experience, the chances of defection by that consumer decrease. In addition, members of loyalty programs tend to visit more often and, on average, spend more when they do, which increases revenue in all departments.
- These programs usually have robust reporting tools. As such, you gain access to valuable data that can be used to market better. You can also identify customers who are likely to defect through such data as time between visits, or decreased spending. Loyalty programs also help identify – and reward – those customers that are the most loyal. These customers are the most likely to refer friends and family, as well as to become brand advocates.
Innovative dealers that think outside-the-box usually trump the competition. Perhaps it’s worth taking a page out of one of the most successful retailers on the planet – Amazon. Consider holding loyalty events, or days similar to the one Amazon is employing. These events don’t have to be costly. It could be something as simple as “Free Member Car Wash Day,” or an additional savings day in service. This could help to keep your loyalty members loyal AND drive in more members.
Amazon’s “Prime Day” sale is likely to be a success. Whether or not it trumps Black Friday in the eyes of consumers is yet to be seen. One thing it will probably accomplish, however, is to add a whole new group of consumers to their membership base, anxiously awaiting the next deal – and there is no business that wouldn’t want that.
If you were to ask today’s consumers if they’d like to hang out at a car dealership, chances are that the majority would respond “no.” When consumers do visit a dealership to purchase a vehicle or get their vehicle serviced, many times the process can be longer than desired and is not always a great experience for the consumer. Dealerships have been attempting to streamline the sales and service process through the use of technology to make the entire process faster andmore efficient so as to be more consumer friendly.
Some dealerships are going a little bit further to make the customer experience more enjoyable with the addition of delis, Starbucks, movie theaters and hair salons, as permanent fixtures. And thinking even further outside the box, a recent Automotive News article highlighted a Fort Worth, Texas dealership that chose to open a 250 square foot wine store inside their dealership. It has been so popular with their customers that it has actually added $700,000 to the dealership’s annual bottom line.
Due to its popularity, the dealership then opened a full size retail wine bar in downtown Fort Worth… with a catch. Not only does the dealership display new Cadillacs inside (and outside) the bar, the bar also serves as a satellite service drive that allows wine bar customers to have their vehicles serviced while socializing and enjoying some wine. The wine bar is 20 miles from the dealership so there are employees on-site who transport customers’ vehicles to the dealership for service, then back to the wine bar upon service completion. This provides a very unique customer experience. It also makes service much more convenient for the many downtown Fort Worth employees who would otherwise have to drive 45-minutes to an hour to have their vehicle serviced at the dealership. In addition, the wine bar produces at least one vehicle sale per month, to say nothing about the increased service business.
Regardless of whether you decide that a wine bar within your dealership is a good idea, creating an excellent experience for your customers certainly is. If your customer experience is less than great, it won’t matter if you have an amusement park in the back lot, your customer could still leave. Customer loyalty is a fickle creature that can be lost much faster than it can be gained. Give your customers a reason to choose your dealership. Then ensure that the experience they have is one that they would want to repeat. Only then can you really build that relationship and transform your customers into loyal customers that will return because they want to – not because they have to.
I’ve written many articles about the different types of loyalty and how each can affect your business’ growth and revenue. However, I’ve never written an overview of how all these components fit together in a holistic manner. Hopefully, this blog article will help put the pieces together so that you better understand these concepts more globally.
Internal Service Quality:
It all begins with your internal service quality. Components of this include:
- Workplace design – A well-designed dealership will maximize space to create a more efficient environment for employees and customers.
- Job design – This doesn’t just include job descriptions but practicality. Ensure that the right employees are responsible for things that they have the knowledge and experience to handle effectively. And that all positions complement each other and generate the most efficient work-flow possible.
- Employee selection and training – By having a hiring process that enables the best selection of employees with the highest chances of success in a given position, you can create a team of people that are effective. Experience and knowledge must be considered along with a candidate’s ability to work well with others. Ongoing training also assists in maximizing employee efficiency and productivity.
- Recognition – By recognizing employees, you reinforce positive behavior and provide other employees with examples to follow. This also assists employees in better understanding your expectations of them, and it lets them know that they will be recognized for good work.
Paying attention and implementing programs and processes for these areas, can help increase employee satisfaction. Employees that are satisfied with their jobs tend to be more productive. This can then create a need for fewer employees, thus lowering your fixed expenses for staffing, reducing employee turnover and increasing employee retention.
External Service Value:
External service value should include a results-oriented service concept focused on providing an excellent customer experience through efficiency and communication. Customer recognition programs, such as loyalty programs, reinforce to the customer that you value their business.
If employees do their jobs in the most efficient manner possible, while the company rewards that hard work by providing a great work place, a positive environment is created. In this type of environment, employees care about customer service and experience which translates to higher customer satisfaction.
Higher customer satisfaction then leads to an increase in customer loyalty and customers become brand evangelists. Loyal customers are essential to any growth strategy. They generate revenue from repeat business in service and sales. They also lead to increased retention and generate customer acquisition through referrals. All of this, of course, leads to revenue growth and profitability for the dealer.
My goal has always been to help dealerships see value in each of these areas and assist them in improving through education. Every one of these components is equally important.
I’m sure you’ve heard the saying that you are only as strong as your weakest link. Usually this saying is in reference to a team. What I’ve outlined is no exception other than it is also applicable to your processes. A weak link in process can be just as damaging as a weak link in your team. Take a moment and do an honest assessment of these areas of your dealership. The pieces for the puzzle are all right in front of you. It’s up to you to complete it.
Have you accessed your dealership? What changes did you make?
How does your dealership recognize employees to promote employee retention?