Automotive Loyalty Programs

Automotive Loyalty Programs: A Full Guide (2024)

An automobile is a major purchase for any individual or family. Buyers are now spending an average of more than 5 hours researching before deciding to buy an automobile. Two interesting key points came out of McKinsey’s survey on car purchasing patterns that hugely benefit car dealers and automotive OEM organizations.

  • First, the purchase intent for cars, specifically EVs, has gone up post-pandemic, largely due to the incentives provided by the government.
  • Second, the outlook toward the after-sales service has improved as more and more customers are getting their automobile repairs done quickly rather than waiting.

This embodies the basic goal of customer loyalty, that their demands and expectations should be met and understood so that they come back for more.
Customer loyalty has replaced hardware engineering prowess as the critical aspect for automobile makers. Though superior driving performance and reliability still matter, next-gen automotive loyalty programs can drive KPIs for automobile industry companies. Satisfying and retaining customers is a guaranteed way to increase ROI. Also, the automotive and transportation industry has one of the highest customer retention rates with 83% of customers remaining loyal and returning to their preferred brand of automobile. This clearly gives a green signal to inject automotive loyalty programs to drive sales and for higher customer retention.

Automotive Loyalty Programs: Keep Your Drivers Engaged 

Automotive loyalty is a customer retention program that is geared toward all entities of the automotive industry. Be it automobile manufacturers, car dealers, rental service providers, or third-party original equipment manufacturers (OEM), the overarching goal is to increase the Customer Lifetime Value (CLV) for the business. Adding a great automotive loyalty program will help you stand out from the crowd of competitors. Let’s go through an easy guide to understand more about automotive loyalty programs.

Auto Loyalty Programs to Stand Out from the Crowd

1. Research buyer journeys and pain points

Car shoppers, both individual and car dealers go through various stages in the buying cycle. From online research to visiting the dealership, to test drives and negotiations, each customer’s journey is influenced by inventory, trust, information, price, and finance. Undertaking proper research and understanding their pain points will provide you with insights on how to develop a relevant loyalty program.
For example in your buyer journey, the retention rates drop when the potential business partner is not satisfied with the number of cars in the inventory. Taking this into consideration and adding incentives based on the number of cars bought would be a great rewards system for your customers.

2. Offer incentives for service retention

Every automobile purchase comes with a future cost for repairs and maintenance. Providing free and discounted servicing for your partners or subcontractors who are loyal will make your service centre run 24*7. These incentives can be marketed in different ways. After every sale, reminders can be sent to the customer through emails or app notifications for scheduled maintenance or offering loyal customers complimentary upgrades, such as advanced vehicle features, accessories, or extended warranties, as a token of appreciation for their continued loyalty.

3. Provide loyalty perks on future purchases

Upgrades are part of an automobile purchase. Safety has been the top purchasing criterion for cars in the United States. For example, your partner wants to add adaptive headlights to all the cars because modern customers want the safety to be upgraded. This offers you a chance to incentivize your business by adding discounts, free add-ons, and low APR financing options for loyal customers so that they always stick to your brand for future purchases.

4. Gamify the ownership experience

Loyalty programs can also benefit from adding some fun and engagement into the mix. When a customer purchases a car, provide features for gamified data collection with a dedicated loyalty application. Add criteria such as driving behavior or car maintenance so that the customers can earn loyalty points and feel a sense of ownership while having a car in their driveway.

5. Leverage data intelligence

Lack of customer data is a major challenge for any loyalty program. Data collection through automating your loyalty program with CRM can provide valuable insights into customer behavior and preferences allowing you to not only customize your marketing efforts based on their needs but also provide targeted incentives for high-value customers.

6. Build a referral program

A satisfied customer is the best brand advocate. So why not use them to get more customers? While a loyalty program rewards customers for repeated purchases, a referral program rewards them for recommending your brand to their friends and family. Whether it’s a royalty program or referral program, the result is an increased customer base and satisfied customers.

7. Partner with complementary brands

Loyalty programs can offer even more value by forming partnerships with other brands. For example, imagine being a member of a loyalty program for an automobile brand and gaining access to exclusive discounts and perks while purchasing accessories or booking maintenance and insurance through authorized service centres. Collaborations like this both enhance the customer experience and encourage loyalty to both brands.

8. Offer flexible redemption

Customer loyalty and personalization are two sides of the same coin. Based on the most prized asset of a loyalty program: Customer data, brands can allow customers to redeem their points for discounts, upgrades, or accessories. A flexible redemption offers more power to the consumer, helping the brands with higher customer engagement.

9. Focus on VIP tiers

Create a VIP Program with multiple tiers that incentivize your top customers to move to the next level based on purchases made or points spent. With exclusive perks and discounts such as reserved slots for test drives of the latest models, access to exclusive events, and sneak peeks of the latest news in the automobile world, you can drive brand loyalty by making top-tier customers feel special.

10. Surprise and delight

Imagine walking into your nearby car service centre and getting a push notification that since this is your birthday month, a special surprise is waiting for you. Unexpected perks such as surprise offers for upgrades, car washes, or coupons for purchasing accessories at discounted prices result in an emotional high that the customer wishes to experience time and time again. By adding surprise and delight elements to your loyalty program strategy, you can create a powerful bond with your customers and experience a boom in purchase frequency and customer loyalty.

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There are no speed limits on the path to customer success by adding a customer loyalty program to your automobile brand. Strategizing your loyalty program in 2024 is imperative for customer retention and loyalty. Research, engagement, data collection, personalization, and partnerships build effective automotive loyalty programs.
At LoyaltyXpert, we provide an excellent B2B loyalty program for your automobile business to help incentivize your business partners. Our customer loyalty programs fit all your needs and can be customized based on your goals. Built a robust automotive loyalty program in 2024. Click here for a demo.