Building Post-Sale Automotive Customer Loyalty
The stakes are high for automotive brands to retain customers post-sale. Keeping customers in the brand ecosystem is vital to increasing customer lifetime value (CLV) through post-sale transactions like maintenance, parts and services–areas that typically have higher profit margins than new vehicle sales. Maintaining customers also reduces acquisition costs, as acquiring new customers is more expensive.
Automotive customer loyalty rates range from 57.5% to 65.1%1, depending on the vehicle type, demonstrating room for improvement. With the average length of vehicle ownership spanning beyond eight years, brands have time and opportunities to build customer loyalty before the next purchase. How can automotive brands find success in this undertaking?
Integrated commerce and marketing automation platforms can transform the post-sale experience with ongoing personalized engagement and seamless post-sale experiences, building brand authority and trust in the automotive industry.
Post-Sale Customer Loyalty is Vital for Automotive Brands
Increased time between new vehicle purchases highlights the need to increase revenue opportunities in the interim. Brands can increase revenue from existing customers through maintenance, services, parts and accessories and in-vehicle connectivity subscriptions. Continuous engagement of existing customers with relevant communications builds long-term loyalty, reduces churn and encourages customers to return when ready for their next vehicle purchase.
Acquiring a new customer is five to seven times more expensive2 than retaining existing customers. By focusing on loyalty, brands reduce marketing and sales costs while boosting customer lifetime value (CLV) and brand advocacy, contributing to long-term growth. Not only is it cost-effective to retain customers, but happy customers are more likely to provide word-of-mouth referrals. Customers referred by loyal customers have a 37% higher retention rate3 and a 16% to 25% higher lifetime value4.
The benefits of increasing revenue and decreasing customer acquisition costs highlight the importance of continuous actions to increase customer loyalty, which automotive brands can achieve using information already at their fingertips. To build long-term loyalty, which is vital for automotive brands, leveraging customer data for personalized experiences is critical.
Leveraging Data for Personalization Strategies
Delivering personalized customer experiences in the automotive industry requires a comprehensive, data-driven approach. Brands can better understand customers' needs and preferences by building 360-degree customer profiles through data gathered across multiple touchpoints—from dealership interactions to app usage and in-vehicle connectivity. Centralizing data on an integrated platform allows brands to deliver consistent, personalized experiences across every customer touchpoint, ensuring that each online or offline interaction is relevant to the individual.
This personalization strategy extends beyond adapting messaging for each channel. Robust customer engagement uses real-time data to deliver contextually relevant content across various digital channels, from websites and mobile apps to social media and email. An integrated platform that links online and offline interactions allows for frictionless transitions, providing customers with a unified experience as they move between channels.
The future of automotive customer engagement lies in predictive capabilities, leveraging AI to anticipate customer needs before they arise. These AI-powered systems can identify potential churn risks by analyzing behavioral patterns and proactively offering solutions, such as timely maintenance reminders or personalized accessory recommendations. This shift from reactive to proactive engagement transforms automotive brands into trusted partners in the ownership journey, driving loyalty and additional revenue through valuable interactions.
Scenario: A Post-Sale Customer Journey
Integrating commerce and marketing automation platforms eases customer transactions. Let’s consider a potential post-sale purchase scenario.
Step 1: Maintenance and Service Reminder
An automotive brand mobile app notifies a customer that their truck needs an oil change. The telematics in the truck track average daily miles driven and activate a notification based on data collected. A click on the notification launches an appointment scheduler, which allows them to book with their local dealership in a few taps.
Providing service reminders and easy scheduling demonstrates that the brand values customer time and maintaining vehicle health, which fosters trust and loyalty.
Step 2: Rewards Integration
The app recognizes the customer’s loyalty points gained by purchasing accessories or services post-sale. The customer sees an option to apply the discount points toward the service.
Breaking down data silos ensures customers receive the best recommendations based on their interactions across the brand ecosystem.
Step 3: Accessory Purchase Journey
The customer browses the showroom while waiting for the service department to complete their oil change. They notice new accessories on some vehicles. A truck bed liner on a model similar to theirs catches their eye. They scan a QR code, which directs them to a product page within the app.
The smooth transition from showroom browsing to digital engagement meets the customer’s needs in real time, encouraging further exploration of brand offerings.
Step 4: Omnichannel Follow-Up
The customer decided to do more research before purchasing the bed liner. However, the platform recognizes that the customer scanned a product QR code and initiates the accessories marketing campaign. The platform sends targeted ads and reminders about the accessory through the web, app and social media, keeping the item top of mind.
Targeted reminders across channels keep the accessory in mind without being intrusive, reinforcing brand presence and encouraging future purchases.
Step 5: Seamless Checkout and Installation
When the customer decides to purchase the liner, they open the app to find the product highlighted on the home page. At checkout, they select a third-party installer they’ve used previously to install the liner. The app facilitates the purchase and coordinates with a third-party installer, making the transaction and installation seamless and convenient.
Streamlined checkout with third-party installer options simplifies the purchase experience, boosting satisfaction and making the brand a convenient, trusted choice.
This data-driven, personalized interaction powered by platform integration enabled a seamless transaction by building upon previous interactions. As a result, the brand provided an exceptional customer experience that strengthened brand loyalty and highlighted the value of staying within the brand ecosystem.
Solidify Post-Sale Customer Loyalty
With only 1% of customers5 fully satisfied with their vehicle purchasing experience, automotive brands have a significant opportunity to improve customer satisfaction, trust and loyalty through the post-sale journey.
- Maintenance packages: Brands can segment customers by usage or vehicle type to offer customized maintenance packages. Options that are easy to manage through the web or app interfaces and tailored to customer needs are more appealing to vehicle owners.
- Accessories: Tailored recommendations based on the vehicle, customer preferences and other factors (i.e., recommending all-weather mats in snowy regions close to winter). Brands can make the transaction seamless by linking recommendations to the product description page for an easy purchase.
- Connected Services: Free trials offer insight into customer preferences, forming a solid basis for personalized service offers, such as satellite radio, advanced navigation, or safety features. Monthly subscriptions beyond the free trial enable brands to collect more data about owner preferences, which they can use to inform future offerings.
Enabling a seamless post-sale experience through integrated platforms reflects the value and support brands extend to their customers. Approximately 38% of customers6 prioritize good service when making new vehicle purchase decisions, highlighting the connection between post-sale support and future sales.
The automotive industry is evolving from a singular focus on selling to a comprehensive approach to relationship-building. By leveraging commerce and marketing automation platforms, such as HCLSoftware’s business and industry solutions, to create personalized, data-driven and seamless experiences, brands can ensure that their customers stay loyal, engaged and ready for their next purchase.
Source:
- https://www.jdpower.com/business/press-releases/2024-us-automotive-brand-loyalty-study
- https://www.forbes.com/councils/forbesbusinesscouncil/2022/12/12/customer-retention-versus-customer-acquisition/
- https://www.slideshare.net/brandonmurphy/brand-advocacy-and-social-media-2009-gma-conference#11
- https://knowledge.wharton.upenn.edu/article/turning-social-capital-into-economic-capital-straight-talk-about-word-of-mouth-marketing/
- https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/a-future-beyond-brick-and-mortar-disruption-in-automotive-retail
- https://www.statista.com/chart/13075/most-important-factors-when-buying-a-car/
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