By Earl Asbill, National Director of Marketing for Vehicle Solutions, Solera

Owner retention programs (ORPs) are nothing new, but every so often it is beneficial to review your dealership’s service marketing efforts and returns. Are you getting the most out of your ORP program? Doing the same old thing yields the same old results.

When it comes to service retention, there is always room for improvement. The more customers you keep, the more customer pay revenue you will generate, and the more vehicles you sell down the road. If your ORP isn’t yielding high service retention rates, it may be time to try new strategies designed to maximize its effectiveness. All good strategies begin with good data so let’s start with data hygiene.

1) Data Hygiene

Everyone has heard the term “garbage in, garbage out.” This is especially true when it comes to marketing. According to Solera data, 30 percent of vehicles in the average DMS are no longer owned by the original purchaser. This means that out of every 100 communications being sent, 30 percent are going to the wrong person. Removing these bad contacts from your list results in an instant 30 percent savings and greater ROI. If you can successfully implement best data hygiene practices, you can spend that 30 percent of savings on a digital/omnichannel approach, further maximizing returns.

The most effective way to improve data hygiene is to boost email collection rates. In the service department, the national average for email collection is below 60 percent, and even the best dealers fall between the 60 to 70 percent range. The target should be 100 percent for sales and service transactions. You may never get there, but if you don’t set the bar high you are guaranteed to keep email collection rates low.

2) Data Modeling

Other terms for this include predictive analytics or propensity modeling. Rather than having just “clean” data in your Dealer Management System (DMS), data modeling relies on machine learning to analyze your data and identify opportunities. This allows you to create hyper-targeted campaigns to reach the right people at the right time.

For example, how many customers in your database will need new brakes or new tires in the next six months? How many customers are in the market for a new vehicle, or will be in the next six months? Data modeling identifies high-probability candidates so that you can send custom messaging that appeals to individual needs.

3) Omnichannel Approach

Every ORP utilizes email and direct mail, but these methods do not maximize your reach as portions of your audience are not reachable via email and mail. According to Solera data, up to six percent of customers in the average dealer’s database don’t have an email or mailing address. However, it’s possible to identify and reach these people on Facebook, Instagram or through display ads. In addition to expanding reach, an omnichannel approach increases frequency, or how many times your customers see your dealership’s marketing message. This strategy can result in a substantial marketing lift.

4) Marketing Expertise

Every dealer sets specific goals every year. Is your goal to grow your customer pay business, increase the volume of ROs, boost service retention or service absorption rates, or acquire a number of net new customers?

Every goal warrants its own unique marketing strategy, which is why it is so important to partner with a vendor that offers marketing expertise and recommendations. Your marketing partner should be able to measure and interpret ORP results and make recommendations or adjustments as needed.

Another advantage of partnering with a vendor that offers marketing expertise is benchmarking. Do you know how your ORP performance stacks up against your competition? Should you be happy with a response rate of eight percent or 12 percent? If your average revenue per RO is $350 is that good, mediocre or poor compared to other dealerships of your brand, or in your local area?

If your ORP efforts have stalled lately, it may be time to ramp things up with new strategies. Using data hygiene, data modeling, omnichannel approach and marketing expertise will help your dealership to maximize its ORP.

About the Contributor

Earl Asbill is National Director, Marketing for Vehicle Solutions at Solera. Earl is a proven leader and team builder with more than 20 years of experience driving marketing strategies and results for dealerships.

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This article was originally published in the May/June 2022 Issue of Dealer Magazine. You can view the latest digital edition as well as past issues of Dealer Magazine here.

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