DAYTONA BEACH, Fla. — DMEautomotive’s latest white paper, “The Changing Service Loyalty Landscape,” revealed that the aging customer base is significantly favoring aftermarket chains' service profits while threatening those of new-car dealerships.

The white paper presents results from DMEautomotive’s study of the $215 billion U.S. auto service market and an analysis of consumer service loyalty rates at dealerships, independent stores and aftermarket chains, according to the company.  

Data in the report indicates that the dealership service center is becoming a "senior center,” as younger consumer segments are significantly gravitating toward aftermarket chains. The report also provides evidence that the record age of the U.S. vehicle fleet is significantly benefiting independent stores and aftermarket chains while taking its toll on dealerships.

Produced by the company’s Strategy & Analytics division, the white paper is based on a recent survey of 4,000 U.S. vehicle owners. It identifies three levels of loyalty for service center customers: "loyalists" who both visit and spend most at a store type; "swing loyalists" who either visit or spend most at a store type, but not both; and "disloyalists" who neither visit nor spend most at that store type.

Data from the paper analyzed also loyalty, spend and service selection motivators by age, and revealed that dealership "loyalists" represent the oldest service customer. Aftermarket chains — which are poaching the largest share of business from both dealerships and independent shops — are best capturing the younger wave of shoppers.

The report also showed that dealership loyalists are more likely to be 60 or older. Roughly half (47 percent) of aftermarket loyalists are less than 34 years old, while nearly half (46 percent) of dealer loyalists are 50 years old or older.

More than one third of those most likely to be disloyal to a dealership service center are only 25 to 34 years old, according to DMEautomotive. With a significant percentage of a dealership's loyalists poised to exit the market as young aftermarket loyalists enter, the company said its findings have troubling implications for dealerships service centers.

"If dealerships don't replace their aging loyalists, and aftermarket stores are successful in retaining their loyalists as they charge towards their prime spending years, a share-of-wallet sea change is looming that would greatly favor aftermarket stores," said Doug Van Sach, vice president, Strategy & Analytics, DMEautomotive.

The company’s data revealed that loyalists drive 62 percent of the $78 billion dealership service market. If dealerships lost and did not replace loyalists over the age 75, it would represent a loss of $310 million. If loyalists in the over 70 age bracket exited the market un-replaced, it would represent a hit of $3.4 billion.

Additionally, DMEautomotive's data indicated also that an aging, out-of-warranty vehicle fleet favors the aftermarket, while it takes a toll on dealerships. Consumers reported on their service center preferences for five "bread-and-butter" services across their vehicles' lifespan, and the company identified major dealership defection points around brakes, battery and tires.

Less than half (45 percent) reported they're likely to visit the dealership for these core services even within the first two years of ownership — when the in-warranty dealership relationship is still strong. As vehicles hit three to six years, dealerships lose on average 47 percent of that initial business, with only 31 percent reporting they would use dealerships for these services, the report concluded.

By seven years or more, only 13 percent of customers will select dealerships for these services. The survey also revealed that independents and aftermarket stores grab significantly more "core" service business at vehicle age three, much earlier than many dealerships may imagine.

"This white paper explores many serious, often surprising, shifts underway in the U.S. service market where more than three in four customers and 42 percent of dollars are currently in play. And the 'graying' dealer loyalist base and vehicle population are two distinct forces poised to further color the market-share picture," Van Sach said. "Our next white paper will help every service category develop smarter communications and marketing programs to retain their loyalists, convert more of the ‘swing’ and ‘disloyalist’ customers, and reach entirely new shoppers."

To view “The Changing Service Loyalty Landscape” in full, click here. For more information, visit