CARFAX Canada Driving Insights

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How to Create Brand Loyal Customers

by Drew Harden, Wed, Jun 10, 2020

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Brand loyalty is beneficial to both dealerships and OEMs since a loyal group of car owners means ongoing sales and revenue for both. Used car buyers are very interested in staying with the same brand -  shortly after buying their vehicle, we found that 89% of them said they plan to stay within the brand for their next vehicle purchase. This sounds promising, but years later, when it’s time to make their next purchase, only 49% end up sticking with the same brand. What’s causing these potentially loyal customers to switch, and what can you do about it? 

What keeps customers with you?

Customers are going to stick with your brand because of how they feel about the brand itself and their experience with the vehicle they currently own. When a used car buyer decides to re-purchase the same brand of vehicle, 61% of them said that its because they really like the vehicle brand, 55% said they found their last vehicle reliable and 45% said their last vehicle was a good fit for their lifestyle. These loyalty drivers can’t be executed by just the OEM or dealership alone.

 
 

What drives customers away?

When a customer decides to switch brands it’s not necessarily because you’ve pushed them away. Yes, they have likely fallen out of love with their current vehicle, but so have most people getting rid of a car. The real driver is they’ve been pulled in by the opportunity to try something new and different. The primary reason to purchase a different brand of used vehicle is that 40% of used car buyers found something they like more, 31% were offered a great deal on something else and 31% just wanted to try out a different vehicle.

 

What can you do?

Building brand loyal customers is an activity that OEMs and dealerships both benefit from, so it’s an activity they need to work on together. Customers stick around because you have built and maintained a particular brand image, provided vehicle reliability and have vehicles that fit their needs; these benefits aren’t driven by either the OEM or dealership on their own.

There’s also an opportunity to pull customers back to you when they’re beginning to feel indifferent about their vehicle. Ensure that these customers are aware of the updated features and innovations that have gone into the newer generations of vehicles from your brand. That way, they know that if they want something different or something they like more, they can get it from you. By keeping current customers happy and pulling apathetic customers back to you, you can ensure all these car buyers who want to be brand loyal come back next time they need a car.  

Explore how our research can be applied at your dealership to help you win more business - request a consultation with a CARFAX Canada Rep:

Driving Insights
Driving Insights is an information series designed to help used car dealers better understand the motives and behaviours of Canadian used car buyers. The research, designed by CARFAX Canada and executed by Dynata, is based on the most pressing questions of dealership management and staff across Canada, answered through a national survey of 1,000 Canadians who recently bought a used car from a dealership. If there’s a question you’d like us to address, email insights@carfax.ca and we’ll get you some answers!

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