I have written several articles about loyalty, building customer bases and retaining customers. Most have followed the same old euphemisms, sayings and generally understood principles that, when properly applied, do yield some success. These small achievements lull us into doing the same things over and over, and any small progress gives us hope that one day we will be able to grasp the lofty goal of having happy, loyal customers that will come back. Why? Because, it is, after all, progress. Right? Then comes along January and February.
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In the automotive business, January and February act as our two months of Lent. We pretty much do without a lot — especially customers. When March rolls around, we feel revived and ready to live and prosper for the next 10 months before having to once again suffer.
With a dismal sales forecast in January and February, we always try to come up with a promotion or two to really show our customer base that we will work harder, smarter and faster. And coming from the old school mentality of automotive sales, we almost fell victim again to a promotion that would yield a few customers, many of which were not new, but did, however, reward the loyal base for buying something during the last two months of winter.
My wife and I, along with our store managers, brainstormed one evening, trying to come up with a clever advertising plan. My wife said something of genius: “The local Price Club seems busy all year long.” That’s it. We are going to start our own discount club! Dare we? Dare we not? We could offer a very simple discount card with a set discount rate and a simple set of rules available to all existing and new cash customers. Plus, we get to collect the customers’ phone numbers and email addresses. Using this, we could put social media and marketing to use to really promote other things that we are particularly good at. So I called up our local printing company and placed an order for the cards.
Most price clubs charge a membership fee, but we were going to offer the card as a value added bonus. If a customer purchased more than a certain amount, we’d throw the card in for free as a way of encouraging repeat business. The cards had arrived at the store, and our first such customer was at the counter. “Do you currently have one of our discount cards?” I asked and happily explained the process. He said, “Great, I’ll take one. How much?”
My customers were willing to pay for the right to get a pre-set discount. I was elated. I had entered into a realm in which the automotive business had only dabbled. Loyalty-rebate cards have just met their match. Rebate cards are great. Instant rebate cards are preferred and a very easy sell, as all you have to do is ask every customer that comes in the store or calls if they have a discount card. I’m telling you, if they don’t have one, they want one. It’s like going to a maximum-security prison and offering get-out-of-jail-free cards.
This discount program taught us a few things about our customers and ourselves that we did not know. Customers hate not getting a discount more than they like getting the best price. After 30 days offering the program, the repeat customers of the program might ask the total of the bill, but they also want to know how much they saved!
Sometimes when we are in price competition with another parts store, in order to beat the competition, we will drop the price, essentially costing ourselves needed gross profit. Sure we win, but what did we win? If you have a discount card, you can win the sale and the customer because this customer is always looking for a deal, and you can provide a fixed special deal for everything. Plus, did I mention all of that juicy information that you have in your possession? We just created a discount card coupon for an oil change special this week, emailed and text messaged cardholders and were overwhelmed by the response! Was it the card itself that worked this magic? No, not at all. But the card helped to isolate a magical customer, the one that’s actually buying something and likes to be rewarded for doing so. Preferably instantly.
Could it be all of those years of the study of marketing is for naught? No, but it sure has a tendency to make us all lemurs, following each other over the cliff. Cookie-cutter auto parts jobbers and warehouses? Try something like I did in your market. I’m sure it will surprise you, and don’t underestimate how well it will be received. As independents, our old mantra might have been, “We have the best brands; we have the best service; we have the smartest people, the best prices and the most experience.” I just added a little addendum: “And I’m going to save you 5 percent on everything and show your savings on every invoice. By the way, is this number your cell number?”
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