The dynamics of selling cars are ever changing; as the customers dealers serve are more empowered it is no longer enough to use traditional selling tactics for a short term profit where the outcome leads to a non-loyal customer.
If you observe the methods used by high street retailers such as loyalty cards, 2 for 1 deals and the introduction of extra products not traditionally associated with them, it is clear that building brand loyalty has resulted in large profits and continuing growth.
The interesting conundrum for car manufacturers and their franchised dealers is how to establish this kind of brand loyalty, increase their customer base and grow market share accordingly.
The number 1 priority is the product range; if a car maker produces excellent cars which look great, are brilliantly functioning and competitively priced they will attract customers. However, to really ensure that they keep coming back these excellent products have to be backed up by the kind of showroom experience a customer would feel compelled to tell their friends and family about.
There is no doubt that the car industry has moved forward astonishingly in the last decade and customer centricity is now the overriding concern of car dealers. These dealers know how important it is for their future to continue growing their customer base by adopting some of the practices employed by other retail experts (and we don’t mean buy one get one free).
A personal example to me of just how powerful a brand can be was when I recently received a text from Marks and Spencer informing me that there was a new “eat for £10” deal being launched and I found myself wanting to down tools and head for my nearest store to take advantage.
The fact is that we all know that M&S food is top class and the deal is without question a bargain; a bottle of wine, main course and sweet for a tenner. Of course I always buy some extra accompaniments because I have had such a bargain so clearly end up spending more as a result.
The point is that somewhere along the line I have become a disciple of M&S food without even realising how important it was to me because I truly believe in them and have only had positive experiences and been met with fantastic staff.
Whilst I realise that the selling of Friday night’s dinner and a twenty grand car are completely different the customers remain the same and therefore the expectation is for a similar if not better experience. So how does the car dealer provide this and remain profitable?
While many car buyers will talk about safety or build quality as equally important, for the majority price is still the number 1 factor and still far outweighs the environmental credentials of a new car. Customer service or the buying experience never gets a mention.
So dealers and manufacturers still have a lot of work to do. Some people will call it the journey or the “service road to profit” but essentially it is about how a car dealer can affect a change in priorities of a customer so that price is not the number 1 driver for changing their car.
If, however, we look to what Jaguar Land Rover have achieved with the XJ over the last few years we may see a blueprint that other manufacturers and the dealer networks may wish to emulate.
While JLR may not have the slavering brand loyalty of Apple, where the product and design is everything to the devotees and the price almost irrelevant, they have a product that is so good that the rest does become a whole lot easier.
Product – Economy – Presentation – Preparation – Price – Add-ons – Follow up – Service plans – Referrals – Showroom comfort – New products – Staff.