Guide to Car Dealership Customer Retention

4 min to read

Sporadic supply chain issues, increasing online competition, changing consumer behavior—clearly there are reasons why dealerships have put a greater focus on customer retention strategies. Securing loyalty to the brand and your dealership will be critical when consumers start actively searching for their next vehicle. 

In this article, we’ll cover the customer journey, customer retention strategies to consider in each stage, tactics and ideas for after the sale, and answer some frequently asked questions. 

Untapped opportunities in the customer journey

By understanding each stage in the customer journey, you’ll discover new opportunities to provide a personalized experience and uncover roadblocks obstructing conversions. Dealership owners and sales managers can use these insights to change tactics or improve operations to better meet customer needs and increase sales and customer loyalty. 

The customer journey in five main stages:

Tips during information gathering 

During the information gathering stage, prospective customers are conducting online research and asking for recommendations from friends and family. Car buyers spend 59% of their time conducting online research, according to Autotrader. 

To drive awareness, consider Google Ads to target prospective customers who are researching vehicles. Have information on your website to help answer potential questions about certain vehicle models, financing or your contactless delivery option.

Tips for the making contact stage

In the second stage, making contact, prospective customers are looking at specific dealerships and visiting either online or in person. Is it easy for shoppers to get in touch with your sales team? Is online chat available from your website? 

Make it as easy as possible for shoppers to get in touch with you. If you’re using a CRM be sure new leads are assigned quickly and that sales reps contact them in a timely manner. An invitation for a test drive is a common initial touchpoint. 

Tips while they explore financing

Prospects in the exploring financing stage are trying to figure out trade-in values and how to pay for the vehicle. Do you have special APRs to help customers lower their monthly payments? 

Email, call, text or use USPS to share information about your financing and any special offers. Being honest and helpful during the financing process is an excellent way to create trusting relationships with your prospective buyers. 

Tips for negotiating and purchasing

The negotiating and purchasing stage is exciting and frustrating for both customers and sales reps as it may take several hours to complete the purchase. Autotrader reports that more than half of this time is spent negotiating or doing paperwork, resulting in only a 56% satisfaction rate for the process. 

Have the buyer complete some of the paperwork before coming into the dealership to save time. Let the customer know what to expect during this stage so they’re prepared for the work and the timeframe. 

Tips for the vehicle delivery stage

Make the delivery a special experience for your customers. Dealer swag and congratulations from other staff can go a long way to making a positive and lasting impression. Schedule as many future maintenance appointments as you can to ensure the customer visits your service center to help secure a future vehicle purchase. Customers who service their vehicle regularly at the dealership are 86 times more likely to purchase again, according to Modera. 

The average time it takes a person to complete the car buying journey is 96 days, according to a car buyer’s study by Cox Automotive. That’s three months of time you can use to connect with your prospects and create a relationship that instills trust. 

Post-sale activities for customer retention

The moment you hand the car keys to the customer is not the end, it’s the beginning of laying the foundation for the next sale. This is the stage where you continue to demonstrate value and build your relationship. Here’s how: 

  • Ongoing multi-media communications. Stay connected to your customers with welcome email series, monthly newsletters, maintenance alerts, or an invitation to learn more about their new vehicle’s features. If you have a CRM, leverage the data to personalize your messages with the first name, vehicle information, etc. 
  • Reward and recognition programs. Acknowledging and rewarding your customers shows your appreciation for their business and is beneficial to your bottom line. According to Modera, just a 5% increase in your customer retention can increase your profits by 25%. 
  • Customer service management. Whether you get a compliment or a complaint, make it a standard process to respond. The longer a complaint goes without being acknowledged, the more frustrated the customer will become and the more likely they will take their business elsewhere. 
  • Social and reputation strategies. Your customers may be active on social media. Does your dealership have accounts on the major platforms? It’s important to monitor posts and engage with your customer base if that’s where they are. 

For a deeper dive into customer retention strategies for car dealerships, request, How To Defend Your Customer Base, by emailing Logistics@Montway.com.

Frequently Asked Questions in Car Dealership Customer Retention

What is customer retention?

Customer retention is a company’s ability to keep a customer after a sale. If a person buys another vehicle from your dealership or takes their car at your service center, you are retaining that customer. 

How do you retain customers in the car industry? 

To build loyalty be consistent with prospect and customer communications and always be genuine. Being helpful and not salesy builds trust which can lead to the sale. More specifically, be active in each stage of the customer journey.

How do I get more customers to my car dealership?

Leverage the five stages in the customer journey to their fullest potential with marketing communications. Remember to use channels frequented by prospective customers—that could be on Facebook, Instagram or other social platforms. 

What are the strategies of customer retention?

Post-sale communication is key to a successful customer retention strategy. Consider monthly email newsletters, mail cards for birthdays or special holidays, reward loyal customers and respond to all social media comments or reviews. 

What are the benefits of customer retention?

It’s more cost-effective to keep the customers you have rather than acquiring new ones. Successful customer retention helps you gain insights into your customers’ needs and buying behaviors, build loyalty, increase referrals and reduce customer churn. 

Improving customer retention with expert auto transport

If you don’t have cars in your inventory, you can’t sell them. Working with Montway Auto Transport gives you dependable pickup and delivery, safe transport to/from manufacturers, auctions or consumers and visibility into your auto supply chain. Montway focuses on innovation, technology and customer service to bring car dealerships the reliability and predictable pricing they need to move units faster. To learn more, visit our website, call 888- 997-8993 or email Logistics@Montway.com.