Of all the prized possessions of your average man, his wheels are often the most valued and cherished. Men and women alike equate the car they ride in with success in life. They hanker after the latest model and want to possess the best that money can buy. We see this phenomenon not just with cars but with all automobiles like bikes, trucks and SUVs. Every country has umpteen brands of automobiles suitable for every need and pocket. It is more of a buyer’s market with different brands going all out to woo customers.
When the going gets tough, the tough get going
With this intense competition and abundance of brands, the automotive industry is witnessing a potential decline in sales and many brands are struggling to stay afloat with very average sales figures. In this scenario, automotive brands are working really hard on attracting new customers and more importantly, retaining their existing customers through various customer retention strategies. It is estimated that it costs upwards of seven times more to acquire a new consumer than to safeguard and retain an existing one. So, it is very important to that equal attention is paid both to new and existing customers and it is said that the most successful automotive brand leaders are the ones who know how to keep their customers happy.
Keeping them happy – a secret wand?
Studies show that if customer retention is increased by even a small percentage, profits increase exponentially. Automotive brand leaders have marketing budgets and of late it is noticed that a sizable chunk is allocated for customer retention strategies. Now, what are these strategies and how do they work?
- The first step to curtail customer loss is to manage engagement with the customer at all stages of the customer lifecycle – right from the first enquiry to test drive, from sale to after sales service. Just as in any market, many things can go wrong and spoil the sale. There is so much choice available in the market that even if the customer seems happy and on the verge of committing to a purchase, there is no guarantee that it will go through. If the customer says he will come back, there is every chance that he may be tempted to change his mind and go with another brand or with a better offer from a competitor. So a crucial step in any of the customer retention strategies is to maintain a dialogue with the customer and continue it for a long time.
- The second step is to know your customer completely and understand how to make them return to you the next time they want to make a purchase. Ensure that the very first time they connect with the company, they fill in right online and offline behavioral data along with their contact details such as mobile number and email id and also a few other leading questions that will enable you to gauge their likes and financial potential. Armed with this information, you can take the help of machine learning which is the latest type of artificial intelligence that gleans the data and throws up relevant information based on the customer’s details and online behavior. This is a new trend in customer retention strategies.
- Another of the key customer retention strategies is to have an enticing loyalty programme with attractive benefits. This will give them a reason to come back to you for their next purchase or when they want to recommend a brand to their friends and family. The loyalty programme should be easy to use and gratification should be as instant as possible. Complicated rewards systems make customers skeptical. Loyalty points need not be given only at the time of purchase. It could be selectively doled out every time the customer makes use of any of your services, including purchase of automotive accessories. This will keep them hooked.
- Every now and then, contrary to our efforts, customers encounter bad service or have bitter experiences either in the vehicle or in the service. You can’t just wish it away. But one bitter experience would definitely cool their interest in revisiting your dealership. So it is necessary to have a robust reputation management wing. They should be alert, and at the first whiff of dissatisfaction, should engage with the customer, get feedback and sort out the problem at the earliest. In order to get feedback, one must have multiple channels open. Customer visits can be a perfect time to hand over a feedback form. Emails can be sent soliciting satisfaction feedback. Survey monkey is another of the great customer retention strategies where the customer is asked to spare a few minutes to fill in an online survey regarding experience with the company.
- Knowing how difficult it is to convert an interest into a sale, your best bet in customer retention strategies would be to personalize your interaction with each customer. Know them by name, understand when they would prefer to be called or if they prefer to be contacted by email. Barging in at an inconvenient time is the most frequent reasons why a customer is lost to a more sensitive competitor. Write them customized, individual emails and make them feel you know them and remember them. If the feel special, there is every chance that they will close the deal with your agency. Keep the communication alive even if they have already bought a vehicle or if they want to continue with their existing one for a while longer. One never knows when there will be a need for them to get a new vehicle. Keep sending them information about new arrivals, latest models and interesting offers. Keep the line of communication open.
Customer retention strategies have to play a key role in the planning and budgeting of an automotive dealer as retaining a customer and making them a frequent buyer will, in the long run, be more economical than identifying, targeting and closing the deal with new customers.