Man offering store credit card

Recession-Proof Your Store

-by Sally Whitesell for Fixed Ops Magazine.

The biggest topic in our industry right now is Customer Retention. How do we get people who walked in our door to keep coming back and become loyal long-term clients? There are many reasons our customers defect: poor customer service, frequent employee turnover or even poor communication with our clients. These can be corrected through proper training. (I know you expected that since I’m a trainer!) But what about other solutions?

First let me share a couple of important facts provided by the NADA 2016 Service Retention Report. It states that 76% of customers that have regular maintenance performed at the selling dealership, purchase another vehicle from that store. This is a staggering number to consider with the average cost to acquire a new customer in 2016 being $635.00. Imagine the effect that keeping your service clients coming back to your store could have on your advertising budget and car sales.

At this point, you have probably tried everything from free services to pre-paid maintenance plans and complimentary loaner cars. These are all good plans, yet we still find the majority of your clients stop coming to your store once their prepaid maintenance plans and warranty have expired.  

I am going to give you a simple solution to increasing your customer retention and your customer paid revenue that is recession-proof!

Look inside your wallet. How many store-specific credit cards do you have? says the average American has 3. Why did you get them in the first place? It probably happened at the checkout counter where you were offered a discount, reward points, or an interest-free period for opening an account. You thought, “Why not?” Now think about how many times you’ve decided to shop at that store because you had their store credit card.

Let me share a personal story to illustrate my point. Recently I went to a mattress store. I went in with a budget and cash in hand. They wisely used their seductive selling skills to lure me over to a top-of-the-line mattress, which felt like a little slice of heaven. Then they brilliantly offered their store credit card with 0% interest. Just like you I said, “Why not?” Small payments are much more convenient than paying one lump sum. Because of my new account, I proceeded to add on very expensive pillows and a top of the line mattress pad, because well, why not? Bye-bye budget! But here is another important point; since then I have been back to that store to use my card to buy more items. Before I had that account I would have never thought to shop at a mattress store for bedding or a wedding gift. Are you getting my point?

Why aren’t we all using a similar method on our service drives to help our customers pay for repairs, maintenance, parts and even accessories? Imagine the increase in sales if you could get your customers to walk in the door every time they need windshield washer fluid, wiper blades or a detail. The key line there is “walk in the door” without you spending a dime to get them there.

Now you may be saying, “But Sally we have a store credit card option and a reward system from our manufacturer.” Great! But how is being used? I work with advisors all over the country and consistently see applications only being offered after a customer has declined work because they cannot afford to have it done. Advisors don’t even consider the convenience or incentives as way to build customer retention. Often they cannot see beyond the RO right in front of them.

Now let’s look at how this new marketing stagey could be critical in an upcoming recession

According to a Google Consumer Survey, most Americans are living on a financial edge. Approximately 62% have less than $1000 in savings and 21% don’t have any savings at all. When faced with an emergency situation such as an unexpected car repair, most said they would have to reduce spending somewhere else, borrow money from friends and family or use a credit card. Keep in mind; this is without a recession.

Offering a store credit card with an incentive attached to every service will make you the only auto repair facility your clients will ever consider. Consider a discount on the first purchase, points towards future purchases, or a low introductory rate. Be sure to train your advisors and cashiers to offer this card to every single guest by highlighting the benefits of your program. Building loyal, long-term clients is the key to increasing revenue in every department. Now I just have one more question for you. Will you be using your 12 month interest free sw Service Solutions card today?  Building long-term loyal clients is the key to increasing revenue and growth in every department!

Sally Whitesell is President of sw Service Solutions, which offers in-store training nationwide and Fixed Ops University; engaging online training for managers and service advisors. Sally brings over 21 years of on-the-drive experience to her training, seminars and books, which include her highly sought after “What Drives Women?” program and her book, “Words That Sell Service.”


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