Profit the reward for car dealer loyalty

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Car buyers should certainly start expecting some innovative enticements in the coming months and years as more car dealers employ loyalty schemes to encourage customers to keep coming back. We are already starting to see evidence of dealers ramping up their efforts to build long term relationships with their customers and many are set to introduce reward schemes which will give buyers added value products which will mean the more money they spend the more extras they’ll get.

It may not be universally known, and may even come as a surprise to some, but car dealerships derive far more profit from servicing and maintaining cars than they do by selling them and at least 70-80p in every pound gained in the service department is profit.

High street servicing outlets have gained a significant share of customers who would normally have taken their car back to the dealer they bought the car from, as they are seen as being far less expensive, when in reality that is not necessarily so.

Of course service departments within dealerships have become very blasé over the years and this has seen erosion in their customer loyalty. People have, quite rightly, become fed up with paying champagne prices for their cars to be fixed only to end up with a lemonade service, so to speak.

As most car dealerships budget each department to contribute towards the overall profitability it has become noticeable that whilst sales departments have really tried to up their game, give superior value and offer many more affordable products which will bring in added profit, service department income has declined dramatically. They have assumed that no matter how badly customers are treated they will always come back, and let’s face it when you take your car in for a service you may or may not get a courtesy car, you might get your car washed over but once you have handed over potentially several hundred pounds you will rarely if ever notice where your money has been spent.

So the least workshop employees can do is try to give you a fantastic experience. Many dealers are realising that to gain customers back and keep them, reward or loyalty schemes, not to mention trying to improve the service offered, will certainly take things in somewhere approaching the right direction.

You will probably see partnerships with car makers, dealers and supermarkets working towards reward points for products purchased and if you are buying and servicing a very expensive car, you never know it could work out to be enough to pay for the Christmas shopping.