Dealership Development, LLC Blog

Spend Monday, and Save Money, Making Your Customers Top Priority

An important concept to consider developing is putting more time and effort into keeping your current customers happy and satisfied. You may find your dealership saving money, targeted for marketing, if you consider how a Forbes article perfectly states it. "It costs more to get new customers than it does to keep the ones you have." 

There are a lot of things you can do to increase the bottom line of your dealership, but one of the most effective ways to consistently make more is to get the customers that you get to keep coming back for more. One customer is just one sale, but if you can convince them to like you enough to make you their primary dealership, then you'll find it paying off in dividends in the future.

Every business owner and manager is aware of how important it is to acquire customers, but we sometimes forget how important it is to retain them. Obtaining customers is one part of growing a solid customer base, which is essential to any company's success. When it comes to long-term success, organizations that learn how to retain customers have an edge. The estimated cost of getting a new customer is 5 to 25 times the cost of retaining an existing client once you have acquired one.

When it comes to gaining new customers, the costs can add up. You have numerous forms of advertising to get the word out about your company. You also have sales and promotions that get customers in the door. However, what if your existing customers are so thrilled with your service that they come back and invite their friends? These loyal customers cost substantially less to obtain which means higher profit margins. That is where you need to focus your dollars! So, what goes into a successful customer retention program?

Being a service manager for a car dealership can be both stressful and rewarding. But how often do you take a good look around? We want you to take a moment and help yourself. Here are some quick key things to watch out for to ensure your service drive is running smoothly.

1. How Does It Look?

Appearance is everything when it comes to your car dealership. If your customer sees that your dealership is dirty, disorganized, or just unappealing, they are unlikely to 

Consider how your customers are going to buy from you in the future. Pay attention to technologies coming down the pipeline and newly emerged e-commerce platforms. Having a customer-centric business is all about understanding how to give your customers a great experience now and in the future.

How do you plan to compete or outshine other businesses in the coming years? You may need to add additional services and products or open your business to a different market. For example, the cosmetic industry has experienced the merging of personal care products and makeup.

Customer retention is crucial to the success of any business. This is even more true in the automotive industry, where dealerships rely heavily on the constant revenue created by service plan subscriptions to supplement the somewhat unforeseeable revenue generated by auto sales.

Consider these facts. Marketing metrics show that it is 6-7 times more expensive to sell to a new customer than an existing one.  It is 50% easier to sell to an existing customer than to convince a prospective customer to choose your dealership. Marketing research proves that it is just as import to invest in customer retention as it is to invest in customer attraction.

As a car dealership that's succeeded with record sales this year, are you sure you can retain those customers for the future? With car sales being one of the most competitive industries, how can you be sure they'll keep coming back to buy cars from you, or refer their friends?

A customer retention program is a typical procedure all car dealerships use to assure that their customers keep coming back.

"Additional streams of revenue."

It’s the catch phrase for how a company or individual can profit even when the economy is down-turning or sales are weak. It’s the sign of an entrepreneur that understands they not only protect your business, but provide opportunities to meet more of your customer’s needs and develop a long-term relationship. A prepaid maintenance plan (PPM) offers both of these solutions--additional income through your service department and customer retention and loyalty, and yet, recent research shows that 65 percent of dealers are not providing PPMs and in so doing they are leaving millions of dollars on the service floor.