Omnichannel Messaging Advantage for Customers

How to Increase Customer Retention as an Automotive Dealer

Written By Eric Schlesinger

Brand loyalty is exactly what it sounds like- a customer’s loyalty to a brand. But, there’s more to it. “Acceptance” is level one, “preference” is level two, and finally, “allegiance” is level three, and by far the most important level of loyalty, where we give all of our trust to a brand, to the extent that we aren’t willing to accept similar substitutes by other brands.

When we apply this to the massive and intricate automotive world, it’s plain to see the intense competition between large organizations with long histories. And the market is only getting more competitive- those who rise above have mastered the concept of customer retention. When you also factor in the reality that it costs seven times more to acquire new customers than it does to keep existing ones, you can begin to realize how crucial customer retention strategies are.

Also, keep in mind that cars are not like other purchases- the time between purchases is more long term than other goods. Cars become an integral part of the consumer’s daily life, often for years, thus further informing the intense customer loyalty in this sector. The right combination of communication and personalized content to target customers new and old will keep your dealership at the forefront of their mind the next time your loyal customers are in the market for a vehicle. With that in mind, here are four major keys to build your dealership’s customer retention strategy in the automotive industry.

4 Keys to Increase Customer Retention in the Automotive Industry

Wondering what the best customer retention strategies are that many dealers and brands utilize to increase long term customer loyalty and drive sales? Although there’s not one single, perfect recipe, there are several important factors to consider.

The Starting Point: Brand Image

To cultivate the necessary brand loyalty and customer retention, your dealership first needs a good, solid brand. Your brand needs to be recognizable, coherent, and memorable. Your dealership’s brand should also inspire customers to engage and feel like a part of it. So now, you’re probably wondering- how do I even start building this kind of brand image?

Although there are several deciding factors, each one centers around storytelling. Telling a story that fascinates and includes the customer is one of the oldest, most synthesized, and trusted advertising and communication techniques as a whole. Stories pull on the emotions of the listener, which makes it an unrivaled tactic when it comes to effectiveness.

Digital transformation has given a new life to storytelling and the way customers interact with these stories. Thanks to new digital technologies, you can utilize different media channels to share your brand’s narrative. From simple text posts to impactful videos or from social media to virtual reality, your brand’s story can take shape in several different ways. But not only has digitization created alternative avenues for storytelling, but it’s also given immense insight into who the stories are being told to. Never before have brands had such a clear understanding of their audience members and their interests. Accessible, detailed data that is widely available in the digital age allows brands to tailor stories to their audiences, expand the brand further to new customers, achieve successful customer retention, and drive sales.

Get to Know and Segment your Audience

Some stories or messages have more impact than others. But, as mentioned, a message that everyone can identify with does not exist, so it comes down to targeting. Everyone is different, and everyone has different preferences, sensibilities, behaviors, and needs. But thanks to the rise of digital transformation, brands have unprecedented access to understanding the individuals who make up their audiences. Learning to hone in on your target by collecting as much customer data as possible across all digital touch points is crucial. In the Automotive sector, in particular, many touch points are often very notable. By gathering data in a functional, omnichannel manner, combing through the abundance of “Big Data” to select the most significant pieces and then interpreting it, you can paint a pretty clear picture of what your dealership’s customers are really doing when they interact with your content online. It can allow you to divide your audience into coherent segments and thus, create content tailored for them to further your brand and the way customers interface with it. Even with a simple email marketing campaign, revenue can increase by 760% through correctly done segmentation. Targeted actions spread over time are imperative when it comes to boosting engagement and in turn, dealership customer retention, brand loyalty, and overall sales.

One-to-One Dialog: Personalization

When you look beyond the groups of people with similar characteristics, you start to see the individuals it consists of. In this digital age, there are methods to create a personalized dialogue with each individual customer. The resulting effectiveness and loyalty that comes from personalization is both exciting and tangible. There are businesses that specialize in this exact area and are able to utilize marketing strategy and customer care operations that are geared towards individuals in one-on-one settings. From interactive videos that adapt to the user, to personalized app interfaces, there are several opportunities to utilize the power of personalizing your dealership’s brand.

The Decisive Role of Customer Service

As previously mentioned, personalization is evidently the key tool to achieve maximum brand loyalty. When you work to build personalized relationships, the customer is able to sense their value to the brand and in turn, choose to support it further. One of the best ways to contact and fully engage with individuals is in the realm of customer service.

  • 54% of customers are ready to buy a car from a dealer who offers the best customer experience, regardless of price.
  • 56% of dealers would buy more vehicles from the manufacturer if the sales process was faster and easier.
  • Only 10% of customers who walk away dissatisfied with their dealership experience will return for another vehicle purchase. On the other hand, 87% of highly satisfied customers will buy cars from the same brand, and 85% will buy from the same dealer.
  • According to a survey conducted in 2017 by Gartner, up to 81% of marketers anticipate the Customer Experience and methods to improve brand loyalty to be the primary areas where marketing challenges will be played out over the next three years.

Overall, your customers want to feel acknowledged and engaged. From getting them emotionally involved in your brand’s story to personalized pipelines of communication, recognizing individuality and humanity is key. If you do it right, you’ll have customers for years to come.


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