girl driving brand loyaltyThe length of time someone owns a vehicle has a direct impact on his or her brand loyalty, according to a new study from Experian Automotive. Just because someone owns a vehicle for 10 years or more does not guarantee future customer loyalty to the same brand.

In the first quarter of 2014, the study revealed, the average length of ownership was 93 months, or 7.75 years, and the average brand loyalty rate was 49.5%. The analysis shows that as the number of months that a consumer owns a vehicle increases, he or she is less likely to return to market to purchase a vehicle of the same make.

“Leases with their fixed length ownership cycle are typically strong contributors to brand loyalty,” Brad Smith, director of automotive market statistics for Experian Automotive, said in the study. “Over the course of seven years of ownership, a lot of things change, including vehicle product offerings, vehicle budget, and credit score. Additionally, the increase in time between dealer interactions, whether they are for sales or service, increases the probability of a customer defecting to the competition.”

Consumers who owned their vehicle for 12 months would purchase their next vehicle in the same brand family 57.3% of the time, compared to 33.8% of consumers who owned a vehicle for 144 months (12 years). What’s more, the most significant drop in brand loyalty occurred after 36 months, decreasing by nearly 10 percentage points.

As part of the analysis, Experian Automotive also looked at which vehicle brands had the longest length of ownership. In the first quarter of 2014, Dodge and Buick led the industry in length of ownership with an average of 113 months. Despite similar ownership lengths, each manufacturer had different loyalty rates at 22.6% and 38.4%, respectively. Chevrolet, Ford, and Mitsubishi followed with 111 months, 110 months, and 109 months, respectively.


In terms of highest brand loyalty, Ford and Subaru held the top two spots at 61% and 59.4%, respectively. The average length of ownership for a Ford was 110 months, while the average length of ownership for a Subaru was 85 months. Toyota (58.9%), Kia (58.5%), and Lexus (55.8%) rounded out the top five.

Acura and Volvo led the luxury vehicle segment with the longest length of ownership in Q1 2014 at 99 months and 92 months, respectively.

Lexus and Mercedes-Benz led the luxury-vehicle segment with the highest brand loyalty in Q1 2014 at 55.8% and 52.7%, respectively.

“Understanding how long consumers hang onto vehicles, or how often they return to market and purchase the same brand, are critical pieces of information for automotive dealers, retailers, and manufacturers,” Smith added. “On the one hand, increased ownership lengths create greater opportunity for dealer and aftermarket service organizations. On the other hand, it underscores the importance for service centers to focus on customer service and retention. Dealers and manufacturers should continue to emphasize on keeping customers loyal to the service drive and using these customer interactions to highlight their new and soon to be released product offerings, as these efforts will aid in increasing service revenue and repurchase loyalty.”

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