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Growing driver loyalty

With new auto brands outperforming established players on affordability, staying competitive is crucial. But what is the key to customer loyalty in the automotive industry?

Julian Hochgesang, Unsplash

New challengers are entering the market every day and, more often than not, they are beating the ‘big’ auto brands on affordability.

With five new brands due to enter the UK auto market for the first time in 2023 alone, competition for customers has intensified, especially when it comes to electric vehicles.

Think they won’t have an effect on your customer loyalty? Think again. 

Autotrader reports that “new entrants will likely capture market share, from 6% today, to approximately 18% market share by 2032.” 

But with loyalty in the car industry already being so complex and a large number of competitors gearing up on the horizon, how can companies maintain a competitive edge, win new custom, and grow customer loyalty?

Racers, start your engines 

As a start, to thrive amidst new challengers, brands must prioritise providing customers with an exceptional digital experience that supports and enhances their car purchase journey. 

Investing in user-friendly websites, interactive mobile apps, and immersive virtual showrooms that allow customers to explore vehicle models, configure options, and schedule test drives online are a must for future-proofing and securing new and continued business. 

Leveraging cutting-edge technologies such as augmented reality (AR) and virtual reality (VR) to create engaging and immersive digital experiences that captivate potential customers could see you outmanoeuvring the competition, if done well. 

This omni-channel, personalised approach to customer service is going to be a key driver for automotive consumers and will see loyalties lie with those who make the purchase experience convenient, trustworthy and simple to navigate.

Driving revenue 

But remaining competitive doesn’t just mean striving for revenue from brand new business. 

Driving revenue from existing products and incentivising customers to spend more, can be achieved by enhancing the value of your existing loyalty programme. 

Oni Leach, our Senior Strategist, raises important questions to ask yourself if you want to drive ROI from loyalty programmes; “If your goal is to drive more revenue from your existing products, what could incentivise your customers to spend more than they usually do? What could incentivise them to buy products that they do not usually purchase?”

Identify opportunities to encourage customers to increase their spending beyond their usual levels, and consider offering exclusive rewards or benefits for higher spending tiers.

Introducing limited-time promotions, discounts, partnerships that offer discounts at a complementary brand, or loyalty points, means it is easier to incentivise customers to make additional purchases or upgrade their current purchase. 

Similarly, using customer data to identify preferences and buying patterns to personalise offers and recommendations can encourage customers to explore products they may not typically purchase. 

Rewards they won’t tyre of 

When consumers do show their loyalty, there should be a reward for doing so. 

Gen Z - the here and now of the modern car consumer - are highly motivated by the gamification of purchasing. 

According to BCG, “65% of Gen Z customers have spent money on a virtual item. That’s why applying game-like elements to your rewards can help to hook your customers and keep them engaged.”

But interestingly, and conveniently, for Gen Z, the rewards don’t have to be of high value to be appreciated. 

As Antavo explains, “Gen Z customers want to be recognised for every action they take with your brand. They are willing to complete brand-valuable activities including filling out surveys, writing reviews, and playing games in return for rewards. To target this generation, brands must maximise engagement opportunities available to keep members active between purchases.”

The surprise-and-delight moments of offering simple rewards after engagement go a long way to cementing customer loyalty. 

And offer rewards to current customers that new customers won’t be privy to, to stop them going elsewhere. Often it is easier to work on what can be offered to acquire customers, but not what can be offered to retain the ones we worked so hard to get. 

Rev up your community 

Maximising engagement in this way also helps foster a strong community around your auto brand. 

By providing platforms for customers to connect, share experiences, complete activities, and interact with each other, brands can encourage customers to become advocates with minimal effort. 

Leveraging social media channels, online forums, apps, and customer feedback platforms supports loyalty by engaging and being active with your community. 

This opens up opportunities to respond to enquiries, address concerns promptly, and act on intel gathered from these areas.  

White Label Loyalty say it’s crucial that automotive brands collect enough, “insightful customer data that can uncover customer needs, wants, values, and preferences.”

One of the best ways to gather this customer data, aside from doing a thorough journey mapping or user research exercise, is by building a community and encouraging advocacy. Using the first hand data collected from the community means OEMs can tap into the power of the data and build a loyal customer base. 

Remember, that each time a user interacts with your brand, you gather data that helps gain a deeper understanding of consumer behaviour, that you can use to enhance loyalty. 

Your MOT & service 

Growing customer loyalty doesn’t have to feel like driving an 0.8l engine car up a 20% gradient hill. 

Luckily, at 383 we have bags of experience helping automotive companies find new strategic solutions and initiatives to maximise their customer loyalty, and, in turn, lifetime value.

For one particular luxury car manufacturer 383 worked with, one of their biggest issues was that a lot of customers felt ‘ghosted’ between the initial agreement to buy and car delivery. Sometimes, the work needed to foster loyalty is as simple as better communication and a little more customer service. 

With our experience in understanding user journeys , rapid ideation and validation, UX design, and app and web platform development, 383 are able to help automotive companies support customers, with a little TLC, that goes a really long way with customer loyalty. 

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