More than half of auto dealers have customer loyalty or rewards programs in their dealerships, and another 20% plans to implement one soon or are “thinking about it,” according to the Auto/Mate Dealership Systems spring survey.
What’s more, the dealers surveyed indicated what they believe are the top factors that contribute towards building a loyal customer base.
“The vast majority (85%) of auto dealers believe that providing good customer service is the key to customer loyalty, but in my opinion the survey results reveal a lack of understanding as to how that excellence in customer service is achieved,” Mike Esposito, President and CEO of Auto/Mate, said in a press release.
Esposito believes that customer service training can only go so far, and that focusing on creating a great place to work and keeping employees happy is the most important factor in creating a loyal customer base.
“Employees are the front-line of your brand; they are responsible for all customer transactions,” Esposito added in a release. “Employees have to love your company before they love your customers. Yet, just over a third of survey respondents chose ‘Ensuring that our employees are happy and enjoy their jobs’ as a top contributing factor for customer loyalty.”
Auto/Mate’s spring survey was conducted in March and April and received more than 120 responses, the majority of which came from dealership principals and managers. The survey asked respondents the following two customer loyalty-related questions:
1) Do you have a customer loyalty or rewards program for your customers?
Yes (54%)
No (26%)
Thinking About It (14%)
We plan to implement very soon (5%)
2) What three factors do you believe contribute the most towards building customer loyalty?
Ensuring our employees give good customer service (85%)
Offer service discounts & coupons competitive with local repair shops (55%)
Keeping website content updated & useful (38%)
Ensuring that our employees are happy & enjoy their jobs (36%)
Good reputation management program (30%)
Marketing/salespeople outreach (26%)
Customer loyalty/points program (22%)
Offer the lowest price (17%)
Good social media program (11%)
Customer loyalty isn’t very important (0%)
According to a 2013 Forrester Research report, 70% of executives said that customer retention was the No. 1 goal for their customer loyalty programs. The study also found that while nearly half of customers do enroll in loyalty programs that are offered, just over a third of those customers redeem rewards, which means that only 16% of all customers take advantage of such programs. The research also suggests that the key to customer loyalty is the ability to keep customers engaged.