IS YOUR GARAGE BUSINESS SITTING ON A GOLDMINE?

Existing customers are the key to reaching that pot of gold, writes Andy Vickery

Andy Vickery is a consultant for the aftermarket

Andy Vickery is a consultant for the aftermarket

If you’re worrying about your garage’s declining MOT or servicing count, or the fact that you’re having to take more and more low value work from online referral sites, did you know that you could actually be sat on your own pot of gold that could be a solution to your worries?

This pot of gold is likely to be in your computer and contained within your garage management system – and it’s called ‘customers’. Obvious really, but in reality, existing customers are very often overlooked in terms of marketing or gaining more business in favour of chasing new customers.

Outside of the garage trade, marketing to existing customers seems to be a recognised and well-implemented method of maintaining and indeed increasing business. But for some reason, many garages are yet to take this on-board.

I know this to be true because I have talked to and worked with many garage owners who have databases of many thousands of previous customers and when I’ve asked them how often they contact them, they say ‘never’. They might send the odd MOT or service reminder, but that’s it. One garage owner I met, who’d been in business for 30+ years, who was recently struggling, and was clearly cynical about marketing in general, actually said to me: “why would we want to waste money contacting customers? They’ve used us before and know what we are like”. Not his fault for thinking this, you would kind of like it to be the case, but consumer buying procedures and habits are now changing, along with technology that is potentially disrupting what we once assumed or could rely on.

A strategy of marketing to your existing customers can be extremely beneficial to your business for many reasons, but before I go into those reasons, I’d like to rollback slightly to the importance of making sure you capture customer information in the first place.

ARE YOU CAPTURING YOUR CUSTOMERS’ DETAILS?

Making sure you have your customers’ ‘full’ contact details is extremely important for your business, but it still seems that many are uncomfortable with asking for this. Along with a customer’s physical address, you need to make sure you obtain an email address and mobile phone number.

This should become standard procedure when booking in a customer or at the point of handing back the car. It’s probably better at the outset as you can state that you may need to contact the customer. You can also make it a standard procedure to email receipts/ invoices to customers, a bit like some large retailers do. If the customer is reluctant to give details, tell them that they will be able to have a record they can file on their computer that will be handy when they come to sell the car. This is just an idea, but hopefully you get the picture – there are ways of gently getting this information, but you may have to counter a customer’s natural objection to disclosing personal info’ – tell them they will be entered into your monthly draw if it helps.

comped-pot-and-tree

EXISTING CUSTOMER DATA
So it is a great idea to implement a standard procedure for obtaining all customer information, but what about your existing customer information? Many businesses will have data that is incomplete or lacking email addresses or mobile phone numbers purely because they date back to pre- technology days.

In the first instance, it would be good to go through the data that you do have to try to categorise it somehow for future marketing. Obviously if you don’t have email addresses, you won’t be able to email those customers, but ‘lost’ customer letters and mailings are still a good technique of bringing business back in. You can then update the customer details when they come in.

WHY MARKET TO EXISTING CUSTOMERS?
Let’s try and answer the question raised by the garage owner who didn’t think it was necessary to market to existing customers. Customer long-term value: In the first instance, customers should be viewed in terms of their ‘long term value’ – not just a one-off sale. In terms of marketing, maximising the long- term value of a customer is much more cost-effective than trying to obtain new customers. If you consider the value of a customer over five or ten years, this will help you understand the value of investing in marketing to retain them.

Customer retention: Is there such a thing as brand or customer loyalty anymore? Yes, this is still alive and kicking, but it has to be worked at and earned. People have very short memories and can be easily tempted by other offers, especially if they are not shown that they are appreciated or important. Staying top of mind is extremely important if you want customers to return year-on-year, especially in this highly competitive and technologically disruptive age.

Upselling other services:
Making sure your customers are aware of your complete range of services is very important in terms of maximising their value. This will also make sure you don’t lose out when a customer goes elsewhere for a service that you could have otherwise provided. You may have recently added services; you may offer tyres, you may be air conditioning specialists – but you shouldn’t take for granted that your customers will know this.

Displaying your expertise:
Customers will often have questions in mind when they need help with their motors. They may have come to you for a service or MOT, but do you offer diesel diagnostics? Can you work on the brand or model of new car they’ve just purchased? Can you work on electric hybrids? It’s easy to assume that a customer would know this, but often it’s not the case. This sort of information must be given to existing customers on a regular basis, that way you will stop them going elsewhere for services you provide.

Justifying prices: When we did a survey a while back, although price was important to customers, it wasn’t the most important reason a garage retained their best customers. In terms of your ideal type of customer, you stand a better chance of justifying your particular level of pricing when you regularly communicate what you can do and your levels of expertise, that way, customers will understand the value of what they are getting and won’t question price.

Getting referral business: A key reason for marketing to existing customers is to stay top of mind when they need you, but a by-product of this is you also stand a much better chance of getting recommendations and referrals from your existing customers. You can even use this as a reason to contact existing customers, telling them that they will be rewarded for referrals.

TURNING YOUR EXISTING CUSTOMERS INTO GOLD
So whilst you might be sat on a goldmine, you will have to work at it and ‘mine it’ to convert its value. This can be achieved by regularly staying in contact with your database of existing customers. By doing this you will make sure they keep coming back to you year-on-year, buying more services from you, whilst also recommending you to others – that’s the gold!

This post was written by:

- who has written 1181 posts on CAT Magazine.


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