Key to improving customer retention is communicating soonerBack
Dealers need a consistent contact strategy for every customer from the point of sale to the point of resale to boost retention rates, that’s the message from Lyn Howdon, global head of academy and learning at Chrysalis Loyalty and host of the company’s masterclass session at this year’s Automotive Management Live.
Now in its fourth year and attracting more visitors year-on-year, Automotive Management Live brings together leading suppliers in the vast exhibition hall, expert speakers who will tackle some of the pressing topics facing the sector and best practice sessions which will provide guidance and insights into some of the vital areas of running a modern dealership. Taking place at Birmingham’s NEC on November 7th, the event is once again free to manufacturer and dealer delegates.
Grappling with the issue of customer loyalty and its on-going decline in a digital world where consumers can compare prices, check out reviews and find competitor businesses at the touch of a button, Howdon draws on the company’s data to identify when and how dealers should communicate with their customers to maximise repeat business.
She said: “As customers near the end of their finance agreements, loyalty rates decline even more rapidly yet the majority of dealers fail to keep in meaningful contact and when they do, it is often too late. Dealers need to start talking to customers much earlier in their agreement, if they are to raise retention rates.
“But customers have to be given the right message and accurate information. There is no point contacting someone about upgrading their vehicle if you haven’t done the sums and it transpires it a new agreement would be cost prohibitive, in fact, that would do more harm than good. Dealers need to be armed with the figures before they make contact and have a strategy for the call that suits the customer position at that time.”
The Chrysalis system continually creates offers for each individual customer based on current finance products in the dealer’s portfolio and on the customer’s vehicle choice. Working from the assumption that the customer is happy paying their current monthly figure, it means sales executives are confident they are making an appropriate offer that’s likely to be well received.
Chrysalis has found that between 12-months after the start of the finance agreement and six months before it ends, 50-65% of customers approached renew their agreement, making a new purchase at the same business, compared to an industry average of around 25% of people contacted in the last 12-months of the agreement.
“Most dealers have a robust ‘end-of-contract’ process and speak to customers when the finance agreement is in its final six months,” Howdon added. “It’s too late and many customers have already been shopping around or have even been wooed away from the brand or business. Earlier, consistent customer contact enables the dealer to be the first influence on the customer’s repurchase decision and ultimately increase renewal and retention outcomes.
“But dealers also need the right people with the right message at the right time to make that call even if they have the technology to tell them who to contact and with which offer.”
Click here to register your place for free.