has affected businesses across the globe and car washes have been far from immune. One of the biggest reasons is that, while consumers are still shopping, they are doing so less frequently. The key then, is to attack that specific problem and make sure you are doing everything possible to improve customer frequency.To illustrate the importance of this let’s do some math. Let’s assume Acme Car Wash is washing about 50,000 cars a year at an average of $10 per car. Let’s also assume that the average customer comes in once every 12 weeks, or 4.33 times per year. If Acme Car Wash can reduce that average time between visits from 12 weeks to 10 weeks (or to 5.2 visits per year), they just added another $100,000 in sales. I think we would all like to find an extra $100,000 in sales. Therefore an effort to increase customer frequency should be on every operators priority list.
LOYALTY VS. FREQUENCY
In this discussion though, we need to recognize the important difference between frequency and loyalty. Often, people will talk about “loyalty” programs and “loyalty” promotion. However, what they are really talking about is frequency programs and frequency promotion. Frequency is the number of times a customer visits over a period of time. Loyalty is a person’s conviction to remain firm in support of someone or something. Another dictionary defines it as, “feelings of allegiance”. While it is important to pursue both frequency and loyalty, it is important to realize that it requires separate tactics to accomplish each.
This was illustrated perfectly in a Seinfeld episode where Elaine loses a sandwich “punch card”. She had gotten 23 punches on her card and the next one would entitle her to a free sub. Frustrated that she lost the card, she laments, “I've eaten 23 bad subs, I just need 1 more!” While that card worked for frequency, it certainly didn’t create any loyalty. This was funny because we’ve all had those kinds of punch cards that accumulated in our wallets. In the vast majority of cases, once we get the reward or if we realize it’s not likely we’re going to get it, we stop going to that store or business.
This is in stark contrast to customers that are loyal to a company. Customers that are loyal will go out of their way and usually pay more simply because of their loyalty. People don’t buy Apple computers because it’s the cheapest computer or because the fifth computer is free. They buy Apple because they are loyal to the brand. People don’t buy Starbucks coffee because it’s the cheapest coffee around or because it’s the closest. They buy Starbucks because they’re loyal to the brand. This is hugely important for car washes because loyal customers visit more often and spend more per visit.
HOW TO CREATE LOYALTY
How though, does a car wash go about creating loyalty? The same way all loyalty is created- by sharing and relating. Think about the people in your life that you would say you’re loyal to. In every case it’s because you share something with that person. Maybe it’s a shared bloodline, or a shared commitment. Maybe it’s a shared childhood, a shared employer, or some other shared experience. And while sharing you got to know that individuals personality and you related to them. Because of that shared experience and the discovery of that person’s personality, loyalty was created. You became firm in your support of that person and you had feelings of allegiance.
So the first step in creating loyal customers is expressing the personality of your car wash. This is essentially what branding is. It’s the effective communication with your market about the unique personality of your business in a way that highlights the valuable differences between you and the competition. The problem for most car washes is that, even if they have a clean site with effective equipment, there is usually little personality shining through- they are just a car wash. Apple isn’t just a computer company. They clearly have a personality- a style, a value set, a way of looking at the world, and it comes across in everything they do. It’s the same with Starbucks. When that personality is shared, there are certain people who relate to that personality and want to enter a loyal relationship. As long as that personality is proven to be authentic over time, that customer will be loyal.
Loyalty is critical in this economy because car washes that successfully build a brand and establish a personality will not experience the same declines in sales and decrease in customer frequency that others will. This is because customers visit that wash, not because it’s the cheapest in town, but because they relate to the brand.
Of course, this is easier said than done. However, it is vital since consumers are changing and demanding strong brands. Gone are the days where you could simply open a business, do a decent job and rely on the continued patronage of your market. Building a brand that attracts loyal customers basically follows these steps:
- Figure out who your target customer is or who you want it to be. Understanding your customers and the people in your community is vital.
- Determine what your values are. This is the foundation of your car washes personality. Do you support the community through fundraisers, special events? Do you believe in the environmental advantages of professional car washing? Do you love cars? Do you value speed of service in an increasingly busy society?
- Communicate through your marketing the personality of your car wash. Don’t be afraid to show it. It should weave its way into every aspect of your business.
- Create a style based on that personality. This includes logo, standard fonts, sign template, design aesthetics, etc.
- Tell the world about your personality through promotional vehicles.
- And don’t forget to be authentic. Nothing destroys loyalty like a company that claims to be one thing and then acts in a different way.
HOW TO IMPROVE FREQUENCY
While creating a strong brand, with a clear personality will definitely improve frequency, it’s not the only way. Even without a strong brand there are ways to get your customers to visit more often.
One of the most important tools to improve frequency is a Membership Club (These are also called Loyalty Clubs, but for reasons already explained I call them Membership Clubs). The premise of a membership club is that you’ve done something to “belong” and this is a powerful motivational tool, even if there is no actual cost to join. It is important to give the club a high perceived value by adding good features, discounts or even a free wash upon signup. I also like giving it its own logo and signage. In exchange for that value it is imperative that you get as much information as possible from the customer. Ideally you can get name, home address and email. If the club has a high enough perceived value, it should be possible. This is essential because the biggest advantage to having a club is having a way to communicate with your customers whether it’s via direct mail or email. If you have a POS with a customer tracking option it will also allow you to analyze customer behavior over time- a tremendous asset. I strongly believe that having an active opt-in list of your customers is an absolutely vital tool for a car wash that expects to be successful in today’s market.
The punch card satirized on Seinfeld may be old-school, but it still works. The important part is to make it simple enough to understand and to make the reward reachable. If you have a POS that can keep track then great, if not the old punch card will work.
A frequency discount is a great tool to get people in more often. I like deep discounts with short expiration dates. For example, on the receipt or with the receipt you can offer a discount for 25%-50% off if they bring in another car within 24-48 hours. This might be enough of an incentive for that customer to bring in their second car that they weren’t planning on washing. Or, they might give it to a friend who can’t pass up the discount. Either way you’re washing another car that you probably wouldn’t have washed without that promotion.
Prepaid wash books or cards are another way to increase frequency. For example, a card with 4 washes for the price of 3. Really, this is a different pricing model not a promotion, but it often increases the frequency. They key is to make sure you’re not rewarding customers who would have come in anyway. In other words, if you have a customer that comes in once a week, they would obviously be interested in a prepaid card. While you would get the money up front you might be hurting yourself by discounting a customer who was already planning on spending full price. The key is to track your dollar per car report and make sure the prepaid card is not lowering your average. If it is, simply decrease the discount- instead of buy 3, get 4, increase it to buy 4, get 5.
Unlimited Plans are another growing trend that helps increase frequency. Again, this is more of a pricing model than a promotion but they work. They key is to get a system to manage the plans and promote, promote, promote.
A rain guarantee will also help customers come in more often because it removes a common reason to wait to get their car washed. They key is that it is well promoted so that they remember the guarantee when they’re home deciding whether or not to visit you.
Finally, keep in mind that marketing should be as quantifiable as possible so that you know what’s working and what’s not. When it comes to customer frequency, we are talking about something measurable even though it’s easier said than done. If you have a POS that can keep track of license plates, use it. Then analyze it and compare it to different promotions you run to see what the effect is. Even if you just track your membership club, it should help you determine what’s working and what’s not.
No one in this economy can afford to ignore customer frequency. Give it some thought and come up with a plan to improve it. Your efforts will be well worth it.
This article was written for the March, 2010 issue of Modern Car Care.
