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Customer Loyalty Programs for Auto Service Providers: Do They Work?

You see customer loyalty programs in many businesses across just about every different kind of industry.


Because, yes, they do work.

As you might suspect, customer loyalty programs work very well within the auto service industry. In fact, we’d wager that they’re doubly important in an industry like ours because there’s so much competition.

However, the customer experience you’re offering is still more important than any of these bells and whistles…

Customer Loyalty Programs Are Important; Customer Service is More Important

It’s worth noting that customer loyalty programs are all well and good, but if your client doesn’t feel like you delivered on customer service in the first place, then what’s the point of participating in the program?

The customer experience itself—totally aside from any loyalty rewards, discounts, sales, or other special offers—is what’s going to bring a customer back to your service center month after month, year after year. The purpose of a customer loyalty program is to cement the relationship that you’ve already established.

Having said that, let’s explore why customer loyalty programs are a good idea even if your customer service is already top-notch.

Customer Loyalty Programs Are Proven to Stimulate Growth & Sales

Merchant network Access Development publishes a compilation of market studies intended to determine how consumers react to loyalty programs (among a host of other brand loyalty related statistics). Their findings are interesting, to say the least—and very pro-loyalty-program.

Here’s some of the more interesting takeaways:

  • Customers spend 37% more with companies if they’re a member of a loyalty program with that brand
  • Over 60% of consumers consider loyalty programs to be important parts of their relationship with a business
  • 75% of consumers prefer businesses that offer loyalty programs
  • 85% of loyalty program members find that using their mobile phone to view and redeem rewards has been a positive experience

If you’re looking to differentiate yourself from other service providers who have customer loyalty programs, here’s a few noteworthy statistics that illustrate how to go about it:

  • A scant 21% of customer loyalty program members were prompted (reminded/encouraged) to actually use the program
  • Only 20% of customer loyalty program members get the help they need to get the most out of the program

The big thing to notice here is that about 80% of consumers not only aren’t reminded to use their customer loyalty program, they might not fully understand it—and they can’t get the help they need to use it.

This is where customer service comes into play. If you’ve got that down pat and you offer a killer customer loyalty program, why would your customers take their vehicles anywhere else? You’d be way ahead of the game.

Customer Loyalty Programs Improve Your Reputation

The best form of advertising, even today in the digital world, is still word-of-mouth recommendations. Customer loyalty programs will improve the odds that a customer will recommend your services to a friend or family member.

Why? Because the purpose of a customer loyalty program isn’t just to “hook” new customers—it’s to show genuine appreciation for your long-time customers that likely form the bedrock of your business.

Keys to a Successful Customer Loyalty Program

We’ve established that customer loyalty programs are effective. So how do you implement one?

That’s going to be different depending on what area of the auto service industry you’re in and what kind of managerial style you have, but generally speaking, there are a few rules of thumb you can go by:

  1. Business volume should play a determining role in the level of reward offered to a customer. That is to say, their rewards are determined based on how much they spend, which may be a percentage of labor or parts. Tiered reward systems are a great way to do this.
  2. Rewards are applied on future repairs. When the customer brings their vehicle back for a return visit, their rewards can be used to reduce the amount they owe.
  3. Regulate rewards and encourage the customer to use them. By limiting the amount of rewards/discounts the customer can apply in a single visit, you won’t get “hit” by a larger-than-expected discount. Encourage your customers to use their rewards as soon as possible to keep things manageable.

Furthermore, it may be wise to implement a referral reward program. If a customer brings you additional business, thank them with a discount!

Keep Your Customers Loyal With BG Products

You’re already ahead of the game if you’re offering your customers BG products!

If you don’t currently offer a customer loyalty program or if you think your current program could be improved, we hope that this post got your creative juices flowing. Our goal at BG is to provide the best in training and quality products. Please feel free to contact us today if you have any questions.