Automotive Dealership Customer Brand Loyalty Program

How Automotive Dealerships Can Respond to Changes in Sales in the Industry

Automotive dealerships need repeat customers to stay in business. In 2017, however, according to The New York Times, there was a 1.8 percent decline in vehicle sales. The article also states that in 2018, the percent of car sales will drop farther. According to an analyst with Edmunds, Jessica Caldwell, there are too many cars on the market now. Automotive dealerships must respond to the current state of the industry by growing brand loyalty, not only to the brand of vehicles they sell, but also to their dealership.

Popular Vehicle Brands

According to the Edmunds Trade-In Loyalty Report of 2018, brands like Toyota, Honda, and Subaru, have the greatest customer loyalty profile in the mainstream part of the industry. It was noted that Toyota and Honda’s reputation attributed to quality and reliability. Subaru, on the other hand, gained its reputation providing customers with an ideal vehicle for performance, reliability, and its niche in the market.

On the list of luxury vehicles, the top brands were Lexus, Audi and Land Rover. It has however been reported that the luxury loyalty has had a steady drop since 2016.

Lexus has achieved the luxury loyalty award. Lexus’ brand attracted buyers because of the vehicles’ comfort and reliability. Audi took a different approach and focused on attracting buyers by offering a brand with a distinct design as well as good performance. Land Rover’s SUV meets most of their customers’ preferences, keeping it in the mainstream.

Causes of Change in Customer Loyalty

One of the effects of recession is that it causes changes in customers’ loyalty for automotive dealerships and other industries. There have been inconsistent fuel prices and issues in the economic climate, causing the industry to change their views on SUVs. SUVs have since transformed the market by moving from being a fuel guzzler to an efficient vehicle, replacing trucks in vehicle type loyalty during 2017. More efficient vehicles will save customers money in the long run, especially with fluctuations in fuel prices and financial markets. With these changes in the market, a customer will adapt and change in their vehicle choices.

Future demands will further change customers’ preferences. Other various factors also cause changes in a customer’s preference, including gas prices and income levels. For that reason, gaining the customer’s trust in the dealership and brands is important. Most automotive dealerships will focus on adequate pricing, customer relations, variety of vehicle sizes and numerous programs related to corporate social responsibility.

Building Lasting Customer Relationships with Auto Dealership Rewards

Each of these things will help a dealership’s customers, but a dealership could also make a lasting impression and relationship with customers through a dealership loyalty program.

When it comes to brand loyalty, you could have two categories of customers. The first is the group who is satisfied with their purchases and the other is committed customers. The satisfied category will always come back and make purchases because they are sure of the brand. The committed category is a group of customers who appreciate the people that work for the company, including sales staff and car maintenance staff. They form an emotional connection to the automotive dealership.

One of the ways a dealership can increase loyalty is through using a rewards program. AutoAwards’ customer loyalty rewards program ties in the service and maintenance department, the sales department, and even financial department. A customer can earn rewards with each purchase they make. It isn’t limited to buying an automotive vehicle, but also includes regular maintenance and parts purchases.

State of the Industry in the Future

The industry is moving into a period of transformation, with a possibility of short-term instability that would affect the automakers’ success later. Many dealerships could experience a drop in brand loyalty as the amount of brands in the industry increase. Nameplate loyalty may no longer suffice if vehicles target specific needs within customer groups.

Automotive dealership loyalty rewards programs are an effective tool to boost your revenue by creating lasting relationships with your customers. Contact AutoAwards to talk about how to start your dealership’s loyalty program.

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