Retention and loyalty are essential in the automotive industry today as they never have been. 

The digital transformation has brought a wave of competition to auto dealerships. It’s now easy for consumers to buy a vehicle from far away, even across the country, and have it shipped directly to their home. In such an environment, customers need compelling reasons to repeatedly choose your dealership.

Loyalty Programs: The Foundation of Retention

To retain customers, dealerships can offer attractive loyalty programs. These programs should reward customers for their continued business, whether they are buying their first, second, fourth or even sixth vehicle from you. The question is what customers get for being loyal.

Dealer programs can encompass various benefits, such as maintenance programs, special discounts, and key tags for priority services. These key tags could offer perks like priority pickups and drop-offs or access to the front of the service line. The goal is to make your customers feel special and valued. A well-structured loyalty program not only encourages repeat business but also fosters a sense of community and belonging among your customers.

As an example, you could implement a dealership-specific maintenance program with a tangible discount or a reward toward a trade-in allowance that can be transferable within the same household. 

Enhancing Customer Service

In many dealerships, customer service is falling flat. Salespeople need to refocus on delivering exceptional customer service. A loyalty program can significantly enhance this aspect. For instance, tying loyalty points to a maintenance program can offer discounts and loaner vehicles for basic services like oil changes. This ensures customers can get in and out quickly without inconvenience.

Providing dealer-specific loyalty rewards tailored to complement OEM incentives, can also differentiate your dealership. Think creatively—for example, add a $500 gift card as a reward. This could be a discount voucher or any benefit aligned with OEM agreements. Such incentives not only retain customers but also attract new ones looking for added value.

The Importance of Follow-Up

Follow-up surveys and telephone calls are a great way to show customers that you care about their experience. A simple call from the dealership to check if the person is satisfied with recent service or a purchase can go a long way. It communicates that you value feedback and are committed to improving the experience. This level of care can make customers feel respected and valued, which is key to building long-term loyalty.

Training Employees for Consistent Excellence

Training employees across all levels of the dealership cannot be overlooked. From the moment a customer walks in the door to interactions in the service area, with salespeople, and even with management, every touchpoint should convey respect and value. Employees should be trained to make customers feel special and appreciated. This approach not only retains customers but also turns them into brand advocates who will promote your dealership to others.

In today's competitive automotive market, improving customer experiences is a top priority for enhancing loyalty and retention. Implementing robust loyalty programs, refocusing on customer service, maintaining consistent follow-ups, and training employees to deliver excellence are key strategies. By making customers feel special and valued, dealerships can build lasting relationships and stand out in a crowded marketplace. It’s not just about selling cars; it’s about creating a community of loyal customers who are excited to return to your dealership time and again.

Louis Nitti is district manager of Vanguard Dealer Services.

EDITOR’S NOTE: This article was authored and edited according to F&I and Showroom editorial standards and style. Opinions expressed may not reflect that of the publication.