Your business office can do more than deliver margin — it can improve customer loyalty
In the ultra competitive retail automotive world, where most dealers understand the importance of customer retention strategies, an often-overlooked powerhouse lies within the Financial Services Office.
As car manufacturers compete to outdo one another in innovation, buyers find themselves with a wide range of high-quality options, which has led to a decline in consumer brand loyalty over the years.
As OEMs and dealerships can’t rely on brand distinction alone to keep customers, they must concentrate on aspects within the dealership that they can influence. A key strategy for retaining customers is to maximize the potential of the financial services office by leveraging its various products and programs.
Financial service products drive retention
Almost every car buyer, whether choosing a new or used vehicle, passes through the financial services department to complete their purchase. These products provide tangible retention tools to drive customers back to the selling dealership.
Mechanical breakdown protection is one of the important financial services products that can foster customer loyalty.
When financial service providers offer retention tools that extend beyond standard coverage, they can improve customer experience, encourage repeat visits and provide a competitive edge in the market.
Consider the potential impact of a towing service that delivers vehicles directly to the original selling dealership, as opposed to the manufacturer’s standard practice of towing to the nearest like-brand dealership.
Moreover, reducing deductibles serves as a strong financial incentive for customers to choose their original dealer. When they realize that they will pay lower deductibles at the original selling dealer, it becomes a clear choice to return.
Let’s not overlook the convenience of rental car reimbursement. Many dealerships have on-site rental services or partner with nearby agencies, allowing customers to drop off their cars for warranty work and easily drive away in a rental. Trip interruption gives customers an enhanced experience, leading to better customer satisfaction.
Leveraging training programs from your financial services providers can also keep staff well-equipped to deliver quality customer experiences and navigate industry standards, driving customer retention.
Promoting the service department as an all-make repair facility attracts a diverse range of customers and retention. In situations that require manufacturer-specific repairs, the warranty will cover the cost for the dealer to sublet the work, maintaining retention and continuity of customer relationship regardless of the make or model of the vehicle.
Road hazard tire and rim protection has become increasingly popular among vehicle owners for its practical benefits.
Furthermore, chemical protection programs, such as interior protection for fabric and leather/vinyl and exterior protection against undercoating, rust, and paint damage, can also encourage customers to return to dealerships.
Appearance protection programs offer customers convenient solutions that enhance their ownership experience and increase the resale value of the vehicle.
Offering credit insurance and financing services increases additional touchpoints for dealerships, helping customers connect during claims and payouts.
The increase in auto thefts in Canada is alarming, but one way dealers can help address this concern is by offering co-payable vehicle etching services.
Dealers should ensure that their anti-theft providers make claims co-payable to both the dealership and the customer. This strategy encourages customers to return to the original selling dealer.
Offering Guaranteed Asset Protection (GAP) can serve as another effective retention tool.
Leveraging training programs from your financial services providers can also keep staff well-equipped to deliver quality customer experiences and navigate industry standards, driving customer retention.
Private labeling and reinsurance
Private labeling is a powerful strategy for dealerships. By offering branded protection programs, dealerships not only differentiate themselves but also encourage clients to return for services and parts to any dealership within their group.
This approach reinforces the dealership’s value proposition in the market. As a result, customers become more loyal to the dealer group than to any individual manufacturer.
Many dealers have embraced a dealer equity position program for years to manage retention, gain better control, and participate in underwriting profit. This approach builds customer confidence and strengthens loyalty and profitability.
The road ahead
By adopting these strategies, you can turn one-time buyers into lifelong customers, positioning your dealership as a trusted partner in their journey
