Presentation on theme: "A Service Retention and Customer Loyalty Program for Your Dealership"— Presentation transcript:
1A Service Retention and Customer Loyalty Program for Your Dealership
2What is Loyalty Trac? Loyalty Trac is A Customer Loyalty program Built for car dealersCombines points reward & redemption system with CRM/customer communications enablerComprehensive, practical and affordableIn use at hundreds of dealerships in the USALoyalty Trac encourages and rewards your customers to:Service their current vehicle at your storeGive you 100% of their service businessBuy their next car at your storeParticipate in marketing your store to others
3Dealership Branding Car brand loyalty is important but Dealership branding and loyalty is what we’re all aboutLoyaltyTrac builds loyalty to your store and your services, one customer at a timeMillions are spent on car brand loyalty often without huge effect.It’s time to invest in building Loyalty to what really matters……Your Store
4Who’s behind LoyaltyTrac? In the USAMediaTrac LLP (2001)…a media measurement and retail marketing company in California created the productNow in 500 (+/-) US dealerships & 6 Canadian dealershipsHigh dealer satisfaction (DSI) with the product and supportIn CanadaOSL a leading Canadian marketing and loyalty enterprise (120+ employees, Montreal and Toronto offices, clients eg’s National Bank MasterCard, Aeroplan over 19+ years.OSL “discovered” LoyaltyTrac, did due diligence and has formed a company (IQ 7/24) to license and sell LoyaltyTrac to Canadian dealers.A growing team with solid loyalty, CRM and auto retail experience
5Customer Satisfaction does not mean Customer Loyalty 90% of customers are satisfied with vehicle purchase…butonly 50-65% return for service during warranty…andonly 20% do so after the warranty expires!Regardless of how you measure service retention, there are opportunities to get more customers coming back more often and spending more money on at least some of their visits…You do that by making your customers want to be loyal to you…Sources: NADA and Harvard Business Review
6We all know that Service Loyalty has a large Multiplier Effect on Profits % Revenue% ProfitService & parts *16%New vehicle sales31%Service & parts *55%New vehicle sales63%Used vehicle sales20%Usedvehicle sales13%Increase parts and service by 5% would return ?% in revenues.Even though Service represents 16% of total revenues in a dealership… it accounts for over 55% of a dealership’s profit!* Including F& I and Body Shop…Source : Desrosiers Automotive Consultants
7But Service Loyalty also leads to more sales Initial Service Loyalty Ongoing Service LoyaltyCustomers who spend their first service dollar with a dealer are 65% more likely to use the dealer for ongoing service.Ongoing Service Loyalty Repeat Vehicle Sales70% of customers who use a dealer for service on a regular basis will purchase another vehicle from that dealer.Ongoing Loyalty Less Ad & Marketing expenseIt is cheaper to retain a customer than attract a new oneLoyaltyTrac will help you get more of your customers coming to your store more often to do more things at less cost to youSources: NADA and Harvard Business Review
8Let’s be Really Clear about Customer Loyalty Customers EXPECT to be satisfied, butthey need to be ENCOURAGED to stay with youLoyaltyTrac allows you to encourage your customers to stay with you by communicating with them and rewarding them to do soService and parts growth is declining as a direct result of increased competition from independent service station and quick lube centers.The most profitable part of your business is slowing down.
9Let’s Talk ProductLoyaltyTrac combines a customer points/rewards program that you design and evolve+effective, inexpensive, targeted communication program that is as automated or self-initiated as you want
10Generate Revenue with Multiple Member Levels Many dealerships offer a free base-level card and fee-based Silver, Gold and Platinum up-sell cards.Dealers can view the service reward program as a revenue generating asset.Base CardGold CardHere’s how we recommend how this works.Premium card upsellWhat’s their warranty penetration?Drive success across all aspects or departments of your business by having specialized cards and rewards.Some dealers use it as a closing tool. Price comparison buyer….buy from us and you’ll get valuable points in our rewards program…Each card “type” may have a different rewards package.Unlimited number of different card types.Can you see how this helps you stay in contact with your customersService PlatinumCardPlatinum Card
11A Rewards HierarchyEach customer fits into a “loyalty demographic” based on past spending habits and frequency of visits.The LoyaltyTrac system builds customer relationships over a period of time through unique, targeted marketing communications.The end result is upward movement of customers to higher loyalty levels.Clients are already in these groups.Need to identify where they are and motivate clients to move up the ladder systematically.Traditional mass mailing aims at everyone and is not an effective way to generate incremental $ of revenue.Want to spend on the clients that have the greatest potential to respond.
12Chose/Design your offers and rewards You decide on the benefits you want to offer…and when…and to whom…Each card type will offer Points based on the customer’s spending at the store over time. Customers accumulate points which they can redeem towards a vehicle purchase or selected service jobs (your choice). These are called Earned Rewards. Points can also be given for completing a CSI survey, providing a referral or simply attending a dealer event. These are called Bonus Rewards.You can attach any number of (complimentary) Privileges to any membership category (e.g. Washes, Service Shuttle, Loaner Car, invitations to a dealership event (theatre or golf)You could chose to offer Discount Rewards either “all the time” or at particular times on frequently used dealer servicesYou can provide a credit on an F&I product or a Pre-Paid Service to members who select a premium (fee) card.And you can always offer Cross Promotions from your local partners (e.g. free coffee at Tim Hortons)They LoyaltyTrac system is flexible and incorporates the best proven loyalty principles.Complementary – they assume you do it: car washes, shuttle rides, loaners etc.Allows you to track the # of freebies you do and monetize them for taxesDiscount - Just because they’re a member they get a discountEarned - need to keep coming in to get moreBonus- fill out a survey, come in on a slow day etc.Again, this will change the psychology to get them to come back because the make a conscious decision to come back to you to earn and use points.A Benefit Package design expert will consult with the dealer and design a package that drives future business and is economical.
13E.G. a Basic and Gold Reward Structure $20 Gold CardEarn 1 point per dollar spent50 bonus points for purchasing the card100 bonus points for setting first semi annual inspection appointment at time of delivery100 bonus points for attending new owner clinic400 bonus points for a customer referralComplimentary 2-way shuttle serviceFree car wash with every purchase$199 Platinum CardEarn 2 points for every dollar spent100 bonus points when card is purchased100 bonus points for setting first semi annual inspection appointment at time of delivery100 bonus points for attending new owner clinic400 bonus points for a customer referralComplimentary 2-way shuttleFree car wash with every purchase$100 discount with the purchase of an extended warranty$100 discount on any complete chemical packagePoints are transferable to another family member.Is it working…….well let’s see what some of our customers are sayingThese are measurable results, not fluff!In 2004 the average dealer spent $384,000 in advertising or $32,000 per month.LoyaltyTrac can:Improve Service RetentionReduce advertising expenseImprove Service Contract salesIdentify dealers most loyalty and profitable customersIncrease car sales (not the primary focus of what we’re selling)Rewardspoints exchanged$100 spend = 100 points$25 Dealer Dollars600 points25/6004.2%$50 Dealer Dollars1000 points50/10005.0%$75 Dealer Dollars1400 points75/14005.4%$100 Dealer Dollars1750 points100/17505.7%$200 Dealer Dollars3000 points200/30006.7%$300 Dealer Dollars4000 points300/40007.5%Bonus RewardsPoints earnedValue: 1 point = 0.05Fuel Injection Service50$ 2.50Safety Inspection100$ 5.00Completed SurveyEngine /Transmission replacement200$ 10.00Referral for service500$ 25.00Referral for new car purchase3000$
14E.G. a Basic and Gold Reward Structure Basic CardComplimentary Rewardscomplimentary 1st oil changecomplimentary exterior wash with every servicecomplimentary coffee in waiting areacomplimentary shuttlecomplimentary recall checkcomplimentary windshield stone chip repaircomplimentary rentals on repairs over $300.Discounts$5.00 discount off all oil changesno charge to mount and balance with the purchase of two or more tires$25.00 off all brake pad or shoe replacement5% off accessories & warrantees purchased in the F&I office.Gold CardComplimentary Rewardscomplimentary oil change (max 5)complimentary exterior wash with every servicecomplimentary coffee in waiting areacomplimentary shuttlecomplimentary recall checkcomplimentary windshield stone chip repaircomplimentary rentals on repairs over $300.1 complete vehicle detailcomplimentary annual wiper blade replacement for 1st three yearscomplimentary spring and fall inspections with tire rotations for the life of the carcomplimentary winter/summer tire storageDiscounts$5.00 discount off all oil changesno charge to mount and balance with the purchase of two or more tires$25.00 off all brake pad or shoe replacement10% off accessories & warrantees purchased in the F&I office.Is it working…….well let’s see what some of our customers are sayingThese are measurable results, not fluff!In 2004 the average dealer spent $384,000 in advertising or $32,000 per month.LoyaltyTrac can:Improve Service RetentionReduce advertising expenseImprove Service Contract salesIdentify dealers most loyalty and profitable customersIncrease car sales (not the primary focus of what we’re selling)Rewardspoints exchanged$100 spend = 100 points$25 Dealer Dollars600 points25/6004.2%$50 Dealer Dollars1000 points50/10005.0%$75 Dealer Dollars1400 points75/14005.4%$100 Dealer Dollars1750 points100/17505.7%$200 Dealer Dollars3000 points200/30006.7%$300 Dealer Dollars4000 points300/40007.5%Bonus RewardsPoints earnedValue: 1 point = 0.05Fuel Injection Service50$ 2.50Safety Inspection100$ 5.00Completed SurveyEngine /Transmission replacement200$ 10.00Referral for service500$ 25.00Referral for new car purchase3000$
15Getting Your Customers enrolled…1 In the “normal course of events” buyers of new and used cars and customers of your Service Department will be enrolled into the LoyaltyTrac system database via InternetIssuance of a readable membership card with an unique number follows enrollmentFrequency of contact is key to building loyalty with members…out of site/out of mind.Contacts are a blend of offers, birthday greetings, activity statements, satisfaction surveys, and added value correspondence.Think of us as your Marketing department…everything we do is to support your sales and service objectives.With Loyaltytrac, you have no administrative responsibility…we do! It’s all automated!Remember, customers that spend their first $ with you are 65% more likely to return for service.
16Dealership Point of Sale Materials You’ll get proven POS materials to help program marketing and enrollment.Your in store visitors and customers will quickly come to know about your rewards programMaterials directly help build service retention by reminding customers to use your dealership for ongoing service.Its included! You need to let your customers know you have a program. You want thousands of customers walking around with your card in their wallet or purse. A constant reminder of your program. Hand them out like candy!Custom designed and supporting your dealer brand, these professional posters and point of sale materials will help sell the program for you.Drive repeat service by making the loyalty program a required ‘sales’ pitch with the service writers.
17Customers Like LoyaltyTrac In our experience*90%+ of customers choose to join a dealer’s LoyaltyTrac Program70%+ opt in to receive communicationsPeople generally like Rewards Programs and will alter their behaviour to allow them to accumulate points towards rewardsUnlike some programs, the rewards that can be provided by a dealership are very tangible and seen to be significant by consumers…People will want to join your program and that will give you the mechanism to ask for and get their address.*Primarily LoyaltyTrac USProgram is based on communicating to clients on a regular basis with offers, invitation to events.Make them feel special, privilege members.To do this affordably…you need to use to communicate.
18Program Welcome KitDelivered via or traditional mail immediately after the vehicle sale or the member enrolment.Explains program benefits and guidelines.Serves as an incentive to entice customers back by utilizing a date sensitive offer.
19Regular contact with your customers You now have an infinite number of occasions on which to communicate with your member/customers. You may chose to have some pre-set and programmed…say, the sending of a monthly statement or a post-service survey.These contacts are automated and the dealership has no administrative responsibility in the deployment.Frequency of contact is key to building loyalty with members…out of site/out of mind.Contacts are a blend of offers, birthday greetings, activity statements, satisfaction surveys, and added value correspondence.Think of us as your Marketing department…everything we do is to support your sales and service objectives.With Loyaltytrac, you have no administrative responsibility…we do! It’s all automated!Remember, customers that spend their first $ with you are 65% more likely to return for service.
20Member Activity Statements Every month, every member will receive an activity statement.Dealers may elect to include a service offer, event announcement, safety tip or notice of a new product offering.**You don’t have to be offering discounts or “giving things away”You can be as creative and informative as you wish (or as you customer wishes!)Automatically sent out once a month, branded with your name and message. It looks like it is coming from you. It shows their transactions and activities for that period. It also reminds them of any awards they may have earned.Like your frequent flyer statement.We’ll custom design coupons for them and automatically include them with each statement.Can market sales or service promotions.We spend time with the dealer planning a promotions calendar and then we take care of the rest.
21Member Opinion Surveys..Automated or Special Surveys can be automatically triggered and ed to customers based on member activityOr, they can be designed and sent to gather opinion on special topicsIn either event, negative responses will automatically ed to key dealer personnel.2nd communication is an automatic deployment of a survey.You set the triggers…service, satisfaction, etcEnsures you can address customer service issues before the manufacturer’s survey. If anything scores below the standard you set…the system will automatically you with the customer info.Provides real time barometer on customer’s experienceRequires no dealership intervention…automatically sent.Do you do this now? Do you pay?Most dealerships have large $ tied up as a result of customer satisfaction surveys…wouldn’t it be nice to have the chance to rectify a situation with a member?
22Automotive Marketing Templates You are not stuck with Pre-set communications, although…LoyaltyTrac includes scores of marketing templates you can select and personalize in minutes in real time via the webTemplates for every major dealer service:Oil ChangeBrake ServiceScheduled MaintenanceParts and AccessoriesTransmission ServiceNew Model Introduction…50 Marketing Templates - covering nearly every service or sales promotion the dealer would want to send to their customers.All text is pre written by professional writers and provides the member with an easy understanding of why the service is needed.Dealers simply enter:PriceWhat is included in the specialCoupon expiration dateDisclaimerImagine sending a message that it’s time to do an oil change or tire rotation because the system tells me they have not done so in the past 3- 5 months!Coupon redemption is tracked.What would this cost them to build on their own/through a marketing agency?We sent out s on a 1x list and it cost us $1700! Your list is GOLD! With LoyaltyTrac, you can send as often as you like. It’s all automated, simple and easy to use.Most marketing pieces are all about price. The way we’ve built the system is that the message is written by automotive professionals & explains WHY they should rotate their tires, or check their brakes, AND it gives them a reason to come…points and discount. You are differentiating yourself in the marketplace yet again!Deploy them to your targeted lists anytime you like…..NO ADDITIONAL COST!
23Automated Owner Clinic or Event Invitations Special event invitations can be sent based on past purchases.Reward points and coupons can be offered as an incentive to attend.A great tool for inviting your best customers to see your newest models.Do you do new owner clinic’s now? How do you do them? Who’s responsible?Loyalty trac will do it for you automatically. Reward your customers with points and know who is coming before you order too much food and end up feeding the sales department…..again.Do you ever have special events?How about new model introductions. Like I mentioned before, send out new model introductions to owners of new model that are 3-5 years old.How would you do that now? How much would it cost?It’s all included, as a part of the service we provide.Let’s recap:In the 1st week we’ll have touched the customer 3x1. Welcome kit; 2. Survey; 3. New Owner Clinic – and you have done nothing! It’s all automated!
24Reward Your Customers on Their Birthday Automated (car or personal) birthday greetings can be sent with or without a reward.(Send at the beginning of the month, with a thirty day expiration)
25Customize a special Communication &&& communications A number of custom marketing templates are included…butYou can have us design a special promo when neededMarketing activities are driven from filtered customer lists based on each customer’s actual buying habits.If you want something else a little more custom…Think of us as an extension of your marketing department. We have designers and copywriters on staff who will create as many custom campaigns as you like. All included in the service we provide.We build it, write it (you proof it) and we send it out!Filtered lists too! Pinpoint your marketing to where it is not a shotgun, but laser beam focused on the best customers for the message you want to send.Saves thousands on outside marketing costs, since the dealer can ask us to design and execute as many campaigns as they like.Customers are more likely to respond to the offers, since they are coming from the Service Reward program.
26Your Client-Members have Access to their Accounts through their Website Cardholders have a personal web interface to view their activity, rewards, and dealer offers…Your store and brand are up-front & prominent.Tell your customers to come back to you for service and you’ll automatically track their service history for them. No more need for a glove box full of receipts!!The customer may or may not move, and you may or may not know about it. But, they can and will log in and change their information so they don’t lose their points.Member site puts all the information your cardholders need in their hands 24/7.Allows for dealer instant messaging to member based upon their purchases and past visits.I’ve shown you a lot already and it looks like a lot of work. It’s all automated!!
27You have Real-Time Program Admin and Reporting The entire program is accessible by you and your staff (on a selective basis) from one, secure, easy-to-use website.360 degree view into their most loyal and profitable customers.Minimal overhead on the dealer’s part – maximum visibility. 1 hour a month for maintenance.You can see the whole system as a whole, or drill down to one customer etc. Simple and easy to use.
28Measuring Program Effectiveness is easy Comprehensive reporting measures movement against an established baseline to determine program performance in real time.Reporting measures three key metric groups: Program Utilization Member Contact Member BehaviorMetrics, reports, trends, results – data from summary down to the individual card member’s activity.Allows you to continuously adjust your marketing activities based on real results.# of cards issued,# of s capturedEtc.
29IQ 7/24 Client Relations Manager You are not left alone to make the program a success at your store…An IQ 7/24 Manager reviews program results and hosts monthly performance calls with dealership as required.Compensated based on a customer scorecard including:Capture RateCard Activation PercentageMarketing CampaignsFirst Visit ActivityReward Redemption…these are the very things you need to know to make sure your program is working!An investment by IQ in your success.The IQ Client Relations Manger has a global view of what programs are delivering results and can bring you best practices to help make your program a success.We didn’t need to do this, we wanted to ensure that your program is successful. I have skin in the game, our CM’s pay plan is directly tied to your success.You’ve probably bought things in the past and never seen anyone again. That is not the case here. I am here to help, your CM is here to help too! We want you to be successful in increasing your business!
30PricingPricing is based on number of vehicles sold per month at your dealership (new and used).If your average monthly vehicle sales are 100 , your monthly investment will be:Number of Months24 months36 months48 monthsTotal monthly cost:2 700 $2 600 $2 500 $
31Pricing NotesYou will be provided with all the cards you need to enroll all your new and used car buyers and your Service Department visitors over the period of the contract.In the example of a 100 car/store month up to 10,000 membership cards would be planned for allocation and delivered on an as-agreed schedule.Regular program performance reviews by LoyaltyTrac personnel to help you drive the program, access to all the marketing templates and unlimited deployments are included.
32Start-Up & Other Potential Charges A Start-Up cost of $8,500Program planning support (card types, benefits, redemption etc)Administrative procedure development support (accounting, data entry etc)Membership card creative and productionPoint of sale creative & productionCard Reader and installationOn-site training for all key personnel ( 2 days + telephone/web as needed)License to use the technologyAs noted, all cards are included. Only other possible extras would be…our costs to do a direct traditional mail campaign for you or,Fees to provide additional (post-launch) marketing support and consulting at your request. These would be billed at an agreed rate.
33Guaranteed Satisfaction If not fully satisfied, you can choose to cancel your LoyaltyTrac program in the 13th month of our agreement.
34What LoyaltyTrac Can Do For You Improve your service retentionIdentify your best and most profitable customersHelp you compete against 3rd party service providersImprove your capture rateReduce your advertising spendIncrease your warranty and service contract penetrationServe as a closing tool for new and used vehicle salesImprove your bottom line
35Moving Forward Interested in moving forward? Letter of agreement and review program terms.Program designSchedule for launch and training sessionImplementationYour dealership can be up and running in weeks.
37Loyalty Benefits the Whole Dealership Sales differentiatorIncentive for future vehicle purchasesReduces mass-marketing spendDramatically improves capture ratesProvides an on-demand marketing platformPlatinum cards—a unique tool for selling F&I servicesIncreases service contract and warranty penetrationDrives back-end profitImproves CSI through automated surveysIncreases the number of ROs, spend, and profitDelivers automated customer marketingIdentifies and tracks your most profitable customersRetains a higher percentage of customersProvides an incentive for customers to return
38Loyalty Results“The LoyaltyTrac system is delivering an 87% service retention rate with ourService Rewards customers.”Ken Dent, Service ManagerStirling GMC-Pontiac, Washington“In the first year alone, our Service Rewards program has helped us increase sales in every department, reduce advertising by more than $120,000, and generate more than $1,000,000 from loyalty card members.”Jim Crutcher, General Manager Berge Ford, Arizona“We have increased our service retention by more than ten pointsin the first six months on the program.”Bess Wills, General ManagerGresham Ford, Gresham Oregon“We’ve been a LoyaltyTrac user for just over a year and it has beeninstrumental in helping us achieve our double-digit annual growth. It’s been one of the smartest business decisions we’ve ever made.”Rory Klein, General ManagerKlein Honda, Everett WashingtonIs it working…….well let’s see what some of our customers are sayingThese are measurable results, not fluff!In 2004 the average dealer spent $384,000 in advertising or $32,000 per month.LoyaltyTrac can:Improve Service RetentionReduce advertising expenseImprove Service Contract salesIdentify dealers most loyalty and profitable customersIncrease car sales (not the primary focus of what we’re selling)
39Optional Phone Response Tracking Provide your loyalty customers a VIP Service appointment lineReduce your call tracking costs by using Media Manager to track your advertising effectiveness:Toll free numbers for each advertising activityCall tracking and recordingWeb-based reportingBundled pricing for LoyaltyTrac customers
40Product Features…A Quick Summary LoyaltyTrac is a turn key points rewards program including:Program structure made to measure…points structure, reward structure, Tier level structureMembership cards customized for your dealershipPoint of sale material for your dealership(s)Powerful engine to allow effective communications with your customer/membersAdvanced member data base to allow precise targeting and easy analysis of customer behaviourProject manager to assist you throughout the contract periodAll creative and copy writingAll Admin set up, training and staff orientationsLet’s take a closer look at how it works….
41LoyaltyTrac gives you a Powerful E Mail Deployment system is the core communication vehicle for LoyaltyTrac. Using it, you can eliminate many traditional marketing costs.We capture on average 70%+ of client s!is a normal part of everyone’s lifeTraditional service marketing is expensive. Think of the costs of phone work, survey distribution and direct mail pieces…you might spend $11 or more per customer per year to keep in touch!5,000 customers = $55,000 every year!10,000 customers = $110,000 every year!An infinite number of deployments are included in any LoyaltyTrac contract