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How to Create Customer Loyalty Programs for the Auto Industry

Posted by BayIQ on March 28, 2019 | 1 Comment

Did you know that, across all industries, existing/returning customers spend 67% more at a business than first-time customers? There’s also less overhead associated with acquiring repeat business than there is with trying to bring in new patrons. In fact, did you know that it costs a business five times more to acquire a new customer than to keep the ones they have? Financially, it's just smart to put some of your focus into maintaining your repeat customer base as opposed to spending all of your time acquiring new ones.

So how do you keep your customer base loyal and returning for future services? A proven way to do this, that nearly all other industries have been leveraging for years, is an engaging and valuable customer loyalty program.

High quality customer loyalty programs should:

  • Encourage customers to work with you again
  • Improve customer satisfaction with your services
  • And, add value to the transaction for both parties

But when it comes to the auto repair industry, how do you create a customer loyalty program that keeps people coming back?

4 Key Elements in Successful Auto Repair Customer Loyalty Programs

While some industries have been operating successful loyalty programs for years (like airlines and hotel chains), good customer loyalty programs are a rare gem in the auto industry.

But the same philosophy applies: when your customer could go to anyone to get their car serviced, a loyalty reward can be used to encourage them to keep bringing you their business. And just like with airlines and hotel chains, this method has been proven to work.

As you’re thinking about designing and implementing your customer loyalty program, here are 4 key ingredients you should make sure to include.

1) Rewards Should Be Based on Business Volume

A punch card is a classic example of a volume-based customer loyalty program. Your program should reward people for spending more with you, or for bringing in repeat business. For example, you could calculate your rewards as a percentage of what each job costs you in labor or parts, or you could offer a free oil change after they’ve paid for three oil changes.

2) Rewards Should Be Accrued and Used For the Future

This is crucial: customer loyalty programs should only apply to future jobs, and not to same-day work. This encourages people to come back in to your shop the next time they need an auto service. They will remember that they can save if they bring their car back to you, which will instantly set you apart from your competitors and encourage loyalty.

3) Staff Should Always Notify Customers When They Earn a Reward

Implement this policy as soon as your reward program gets off the ground. When a customer achieves a new reward level, or is eligible for a discounted or free service, your employees should let them know immediately. This way, customers leave your shop knowing that they are getting value added when they return for their next car service. Don’t play guessing games; make it clear to your consumers that you value their business!

4) Rewards Should be Transferable

Don’t associate just one specific vehicle with your customer's rewards. Rather, associate it to the individual or their household. Most families have more than one car, and a customer may not need to service a specific car all the time. By making your customer loyalty program transferable between vehicles, you encourage your customer to bring in their spouse’s car or their children’s car the next time that they need work done. Bottom line? More cars = more business.

By implementing best practices, investing in competent and personable staff, and offering competitive pricing, you'll successfully encourage (and receive) repeat business. However, when you also add a good customer loyalty program, you'll set your shop apart from the competition and keep your customer base driving back to you every single time.

Our goal is to help businesses in the automotive industry find and retain customers with our business intelligence platform. This cloud-based data, marketing and rewards system makes growing your business easy. Schedule a demo to learn what BAYiQ can do for you today. 

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