Car Dealers Win the Retention Game
Winning the Retention Game
Do you know your numbers? What is your Dealership Retention number in Sales and Service? How do you stack up against the market?
The average loyalty according to IHS/RL Polk is 51.5% and the top 3 performers are:
1. Ford 64%
2. Mercedes 57.8%
3. Toyota 57.8%
Sales and Service should be your hyper focus in the retention game. You need to have a strategy in place not only to acquire new customers but to keep them and maintain your market share. The ones who don’t have a strategy will lose to dealers like the ones I worked for.
Jim Roche Xtime had a great presentation at NADA check out his full deck here:https://www.nadaconvention.org/NADA2018/Custom/Handout/Speaker0_Session3282_1.pdf
Every 1% increase in sales retention translates to $150,000 per dealer. Want to understand why the dealership I was at was 6% to 7% higher than the market and why we outperformed them? We focused on Sales and Service retention!
I keep hearing overwhelmingly by dealers that they have so much service business they can’t keep up or facilitate creating more traffic here. This is why the Jiffy Lubes and Pep Boys of the world are in business. If you focus on expanding in this area and taking care of your customers, you are automatically generating future Sales customers.
Feed the machine. Service is by far the machine that keeps your Sales departments in business long term and vice versa. They work together and if you have a strong sales team then you’re going to naturally increase your service business and if you have a strong service business you will naturally increase your sales.
In order to win in the retention game, have the following in place:
1. Have your People beating to the same drum.
2. Have the right Process and strategy in place.
3. Make sure your Product and Parts game is tight.
If you can focus on these 3 key factors, you will win in the game of retention.