April 2006
Notes from the Editor
Less than 10 years ago, few dealerships had a personal computer, digital camera, Web site or e-mail address. Nor did they have staff devoted to building their business from an online perspective. Times have changed, and today many successful dealerships have an entire department dedicated to Internet marketing.
For the past 30 years, the automotive industry has been dabbling in customer service and retention; from the simple idea of a business reply post cards to CSI surveys to a part-time BDC (Business Development Center). It is time to stop dabbling and make retention and loyalty a department in your dealership.
At the helm of this department sits your new Retention Manager (RM). The RM will be in charge of working with your department heads to develop a plan that works toward your dealership's most important goal: taking care of your existing customers. Having one person work with all of your managers not only provides economies of scale, but also provides a focal point for your loyalty strategy.
Dedicating someone to the task of making your customers loyal will provide your business with "outside the box" brainstorming every day. With an RM on staff you emphasize to your public and your entire staff that the dealership is making a serious commitment to keeping its customers.
Hiring an RM allows each of your department heads should be focused on what they do best. This allows your staff become specialists rather than generalists and is guaranteed to produce an increase in productivity.
The investment in hiring and developing an RM at your dealership has long- and short-term benefits. The average dealership spends 90 percent of their budget acquiring a customer, a process that takes a couple of weeks. This leaves only 10 percent of their budget on maintaining a relationship with a customer over the next 3-5 years of ownership.
Consider this: For every $100,000 you spend, $90,000 goes to acquiring and $10,000 goes to keeping them happy. I am not a math major, but is it any wonder why the average dealership loses 80 percent of their customer pay and than has to continue spending, according to NADA, nearly $400,000 on winning return customers? Here is where an RM is most valuable.
Next time you sit down for a company meeting, make sure you ask your Owner, GM, GSM, SM, PM, FM, FOD and CFO* to discuss the idea of adding a RM ASAP. Who knows, maybe the boss will give you a piece of the savings for coming up with such a cost saving and loyalty boosting idea.
Happy Servicing!
Andrew Wolfe and the rest of the Dealer Concepts, LLC. Family!
866.GET.IDEAS (438-4332) x117 or Email Me
Retaining Your Customers for Life.
What's New...
Direct Mail booster
Recently, 300,000 Punch-A-Deal® were delivered to a group of Chrysler customers as part of a direct mail piece. This tactic allowed the customer to have something reusable to bring back to the dealership. Keep this in mind the next time you need a little boost to your direct mail.
Success Stories
Even though Detroit is at the epicenter of the tough times taking place in the automotive industry, Rich has taken a proactive approach toward improving retention. He is arming his sales people, service writers and even his parts delivery driver with his Punch-A-Deal® Key Tags to encourage people to bring their cars in for service and increase wholesale parts sales.
Richard Castanos, Service and Parts Manager
Varsity Lincoln Mercury
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