Length of Ownership and Loyalty: How Long Is Too Long?
They’ve bought from your dealership before, so they’ll be back next time, right?
While this might have been true in decades past, a recent Experian Automotive study rained on that parade. The study showed that the longer a consumer owns a vehicle, the less likely they are to buy the same brand again.
According to Experian, the average length of ownership early in 2014 was 7.75 years, and the brand loyalty rate was 49.5%. The study found that brand loyalty declined as ownership lengthened. The largest change occurred after three years of ownership when brand loyalty dropped by 10 percentage points.
The drop in loyalty can be attributed to many factors – changes in a product line, changes in what the customer needs or can afford, even where they’ve been going for service.
What can you do about it?
The simplest answer is to keep them loyal to your dealership so you aren’t at the mercy of their loyalty to the brand.
Providing excellent customer service is a good start, and personalized follow-up throughout their ownership of the vehicle reduces the reasons they would have to shop around.
Your service marketing plan is critical to sales success. Bringing customers back to you for service makes you their first thought when it’s time to buy.
Not only that, but if you are ready to approach your service customers with precisely chosen new vehicle offers before they begin to shop for a new car, you are already a step ahead of defection.
You know customers are valuable. You spend money to earn them. Are you doing enough to protect your investment?