Automotive Customer Loyalty Programs

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Why Your Dealership needs a reward program?

Now more than ever, your dealership needs to stand out from the competition and deliver the very best value to your customers to earn their business.

 

Having a loyalty program is the best way to do both, and here’s why:

  • 63% of prospective buyers compare prices and incentives across competing dealerships.
  • Two thirds of customers will modify where and when they make a purchase to maximize points.
  • 7 out of 10 consumers say their choice retailer is influenced by earning loyalty program points.

 

Rewarding your customers helps you:

  • Differentiate your dealership from the competition
  • Stand out online
  • Boost vehicles and F&I sales
  • Increase service transactions and average spend
  • Attract and retain customers
  • And more…

 

Request a free no-obligation assessment of your Dealership

AUTO dealERS GET RESULTS WITH AIR MILES

39%

more transactions

A Dealership had a 39% increase in service transactions.

15%

sales increase

An Auto Partner sold 15% more units year over year.

14%

more spend

Collectors on average spent 14% more than non-Collectors.

38%

new customers

38% of buyers from a test drive offer had never purchased the brand before.

Don't just take our word for it

Listen to this top Canadian Dealer share how the program has worked for them.

Contact us for more Partner success stories.

The Value of An Automotive Loyalty Program

In today’s competitive automotive marketplace, customer retention is more important than it’s ever been. Yet, we still hear many auto dealers focusing solely on acquiring new customers. Whereas, when you build an automotive loyalty program, you can get more value out of your current customers too. We believe the best way to encourage customer retention at your dealership, is to create a customer loyalty program.

 

Why is customer retention so important?

It’s not just a fluffy business term. Did you know that It can cost a dealership up to 7x more to acquire a new customer than it does to retain a customer it already has? It just makes sense to put more emphasis on retention.

To clarify, it’s also not just the vehicle sales that you should seek to retain. One of the most helpful areas to use a loyalty program in your car dealership is in your service department.

 

Service department sales can improve when you implement an automotive loyalty program.

A survey by Loyalty One found that only 55 per cent of vehicle owners go to their dealership for non-warranty service and maintenance! Imagine if your dealership could retain just a little more of that lost revenue potential?

According to ICDP, selling a service package with a car leads to a 50 per cent higher retained margin over the customer lifetime.

Performance Loyalty Group found that loyalty program members will visit a dealership’s service department almost twice as often. Plus, they spend twice as much as those who are not members of the loyalty program. To be specific, the numbers showed $662.01 per year for program members and $336.63 for non-members. That’s quite a big difference!

When you give a service customer an incentive for keeping the work in-house, you make their decision easier. Many people trust their dealership more than third-party service stations. If you encourage them to keep their service work at your dealership, it’s a win-win for all.

Studies show that 50 per cent of loyalty program members are willing to pay more for convenience. While only 36 per cent of consumers who do not participate in a loyalty program feel the same way.

Winning the preference of where they service their vehicle is just one of the ways a dealership can retain their customers. Another huge benefit in customer retention is in the increased customer lifetime value.

 

Focus on your customer lifetime value.

Shopify defines customer lifetime value (CLV), as the total amount of money a customer is expected to spend in your business, or on your products, during their lifetime.

Customer retention results in increased customer lifetime value and results in higher profits.

Bain & Co reported that businesses can grow their profits by nearly 100 per cent by retaining just 5 per cent more of their customers. Undeniable proof that a customer loyalty program can be your dealership’s best weapon.

 

A better experience builds trust.

When you can improve a customer’s experience, it increases their trust. When you give them something back for their loyalty it shows them that they are valued and improves the relationship even more.

With an automotive loyalty program, it could not only mean your customers coming back to you for each new sale or lease. It could also mean that they keep their service and maintenance in-house — plus, choosing dealership financing.

Not only is retention a key area to focus on. We believe that retention could be even more important than new customer acquisition. According to the Gartner Group, 80 per cent of your future profits will come from just 20 per cent of your existing customers.

 

The cost of new customer acquisition is high.

And, we aren’t saying don’t seek to acquire new customers. Just know that 80% of your future profits will come from just 20% of your existing customers.

Cost is another big factor when deciding where to place emphasis. Kissmetrics reports that it costs a dealership up to 7x more to gain a new customer than it does to keep a present customer.

If all these reasons aren’t enough, loyal customers are also more likely to refer new customers. Loyalty programs really do impact value at all stages of the customer journey.

 

Our automotive Partners drive results through the AIR MILES® Reward Program.

Here are just a few of the ways that the AIR MILES Reward Program has affected the bottom line of our automotive Partners:

– 23% more sales coming from test drive offers
– 15% more vehicles sold than prior years
– 39% more service department transactions
– 62% of new car buyers chose dealership financing
– 200% reduction in time spent on the lot

Our automotive dealership Partners are using the AIR MILES Reward Program to drive their own business goals.

Some of the Offers we see within the auto industry are:
– 100 AIR MILES Reward Miles for trade-Ins
– 250 Miles on new and used vehicle sales
– 250 Miles on defined F&I packages
– 1 Mile for every $20 spent in parts & service

Our partners also have the flexibility to drive results with limited time bonus offers. Here are just a few of the possibilities:

– Maintenance Mondays – reduce lost hours in bays, increase spend
– Win back – retain sales customers in service
– Model clear out
– Private sale events
– 25 Miles for test drives
– Contests

If you’d like to learn more about improving your own customer retention through an automotive loyalty program, drop us a note. Our team of loyalty experts can help your dealership drive the results you need.

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Car ride on road in sunny weather

LET'S GET YOU ON THE ROAD TO REWARDING YOUR CUSTOMERS

 

Getting Started is as Easy as 1.2.3.

1. We learn your goals and challenges and build a custom program together.

2. We train your staff and help you launch your program.

3. We provide the tools to promote and manage your program successfully.

 

Plus. We’ll be with you every step of the way.

When you become an AIR MILES INCENTIVES® Partner, you’ll receive ongoing counsel and support from a dedicated Partner Lead. From launch, program design, staff engagement, and more, we are here to guide you to ensure you get the most out of your AIR MILES® Reward Program.

 

Get Started Now!

 

Other Dealers Using the AIR MILES® Reward Program

Frequently Asked Questions

What is an automotive customer loyalty program?

An automotive customer loyalty program is the process of offering a meaningful added value to your customers as an incentive to take specific actions that are beneficial to your business and to build a relationship that will increase their loyalty (and profitability) to you over time.

An automotive customer loyalty program can be an invaluable part of your marketing and sales strategy. Savvy business owners have increasingly incorporated loyalty programs into their business model with positive results. These include increased sales and revenue, higher customer spending per transaction, selling off slow-moving units, increased repeat business and referrals, service customer retention, and more.

 

How can an automotive reward program help my dealership?

Modern consumers are always looking for the best value. Their search for a vehicle or a place to have their vehicle serviced almost always start online. There, they have access to innumerable options and the competition can be fierce. Even more so than in your own market.

An automotive reward program helps you stand apart from competitors by offering an added value that they can’t easily match. Plus, the reward incentive influences consumer behaviour to drive results for your dealership. You can close more deals, boost business office and service department revenue, get repeat customers and referrals, and more.

With AIR MILES INCENTIVES, you can customize reward offers to your specific needs and goals. Our team of experts will help you design offers to get the results you want. You can use AIR MILES Reward Miles offers to increase vehicle and service department sales, attract and retain customers, get more referrals and repeat business, stand out from your competition online and in your market, and more.

 

How can this help me beat my competition?

Consumers in search of a vehicle will frequently seek information online and look at dealerships in their geographic area. With so many choices, it’s critical to offer something more to those potential buyers that will help you get noticed and stand out online.

The same applies in your market. Competing on price can only go so far. AIR MILES is highly recognized as the top reward program in Canada, and consumers will instantly know that they can get rewarded for choosing your dealership.

 

How can this help me increase my revenue?

Energize your special events, contests, and promotions.
All promotions you currently employ can be adapted to include Miles. And because Miles cost less than straight cash, but still have a very high perceived value, you can either increase the prize or incentive at the same cost or reduce the cost of your promotions and boost your margins. Customers get particularly excited about and are highly motivated by, the high number of Miles they can get from a dealership, compared to what they get from everyday purchases.

Sell off slow-moving units and close more deals.
Many of our Auto Partners have shared with us how effective it has been for them to use a reward offer to move specific vehicles or older inventory. In the words of Doug McDougall of Sisley for Honda: “We put 5,000 Miles on it and, Boom, it sold!” You can also empower your sales team to sweeten the deal with nearly-there customers, by giving a few Bonus Miles and getting the deal done!

Boost add-on warranties, service packages, and financing.
Your dealership can secure valuable incremental revenue through business office add-ons. With AIR MILES, you have the flexibility to choose whether to reward customers on vehicle purchase and warranties, financing, and service packages, or simply one or the other, depending on your specific business model. Incremental sales of services packages, in particular, will ensure that you receive long-term benefit from continued patronage and optimize your customers’ lifetime value.

Drive customer referrals.
Getting customers to refer you to friends and family or give your dealership a positive review and endorsement through people’s social networks, is invaluable. Customers who are satisfied and happy with their experience at your dealership are more likely to do this.

Keep loyal customers coming back for future purchases.
Car owners change vehicles on average every 6 years, which means that building loyalty to your dealership can turn a single-vehicle purchase into significantly more over time.

Customer Lifetime Value (CLV) is the net profit you stand to gain from the total future relationship with a customer.

Consider that an average automotive customer will buy an average of 7 vehicles during their lifetime. With additional upgrades, service and maintenance, this customer could spend closer to $55,000 per vehicle. A customer purchasing seven vehicles in their lifetime would result in a CLV of $385,000.

When you build loyalty to your dealership and motivate customers to come back to you again and again, you have an ongoing source of revenue that doesn’t require high acquisition costs. Repeat customers cost less to maintain than new ones and have greater potential for profit.

Collect contact information and more…
Whether a consumer is browsing your website or visiting your showroom, you are dealing with a buyer with intent and interest in your brand of vehicle. These are high quality, hot leads.

The next best thing to closing the deal with these browsers is to get them onto your email list so that you can communicate with them, share special offers and incentives, and increase your chances of converting them.

For the chance to get a few Miles, you can ask a few questions to help you understand what they’re looking for and gauge their level of interest and timing.

Regardless of what you find out, you want to stay connected to make sure you are top of mind when they are ready to act. You can also encourage them to send you referrals or send them exclusive deals.

 

How can an automotive customer rewards program help increase revenue in my service department?

Keep customers coming to you for service, instead of independents.
Ensuring that new car buyers and previous customers continue to come to their dealership for ongoing maintenance and service is one of the biggest challenges our Auto Partners face. Independents can draw a significant portion of this service revenue away. Rewarding your customers can help you retain more of their service business after a purchase and get customers to come back to your service department if they’ve gone elsewhere for a time.

Promote seasonal or other packaged service bundles.
Some of our Partners have seen a significant increase in service transactions year-over-year when offering customer AIR MILES® Reward Miles. You can choose to promote specific seasonal services or build offers to drive more business to slower periods. The program is flexible and can be easily adapted to help you achieve your long-term goals, such as driving revenue and profitability and short-term promotions. As one of our Partners stated: “They may not like getting the bill, but at least the Miles make them smile!”

 

What can I expect from an automotive reward program in terms of ROI?

AIR MILES Partners measure return in a number of ways: increase in traffic, email sign-ups, test drives, vehicle sales and add-ons, service department transactions and spend, and more.

It’s a revenue-driving investment

Giving AIR MILES® Reward Miles helps drive costs down (compared to cash incentives), appeals to the majority of your customers, and can be tied directly to revenue since you only give out Miles once the desired action is taken (after buying a car or service package for example).

Increase frequency of visits and spend per transaction

Customers who get rewarded are more likely to spend more, in order to get more Miles. Increasing the number of visits and/or average transaction amounts are simple ways to hit those monthly targets.

Liquidate slow-moving vehicles that cost you money

What about moving vehicles that cost you money every day that they’re sitting on your lot? Better to put a few Bonus Miles on a slow-moving vehicle and watch it drive away than continue to bear the cost of its maintenance as days and weeks go by.

No need for incremental marketing costs

AIR MILES® Reward Miles have a high perceived value across Canada and AIR MILES is recognized by 99% of Canadians, which means you don’t have to incur incremental marketing costs to promote your reward program. Just add the blue AIR MILES logo to what you already do. It’s that easy.

Our Auto Partners have seen the following results over the years

  • 39% increase in service transactions YOY
  • AIR MILES customers spent 63% more than non-AIR MILES customers
  • 62% of AIR MILES customer chose dealership financing
  • 14% more vehicles sold YOY
  • 11% of AIR MILES test drives converted to a sale, compared to a 4% industry benchmark
  • 30% buyers from test drive offer had never purchased the brand before – net new customers

 

How do I get started?

AIR MILES INCENTIVES is a simple and flexible way for qualified dealerships to have the AIR MILES Reward Program and reward their customers.

1. Contact us to book a discovery meeting. We will learn all about your dealership, your goals and challenges, and we will share our expertise to develop exactly the reward offers you need to drive the results you want.

2. We will train your staff, provide marketing assets and guidance, and give you access to our 24/7 online program management tool.

3. We will then be with you every step of the way – reporting, analyzing and adjusting your offers as needed – to make sure you get the most out of your AIR MILES® Reward Program.

The AIR MILES® Reward Program has been around for over 25 years and is proven to deliver results. Our team has over 60 years of combined experience in developing and managing successful client reward programs.