October is Car Care Month, and maintenance for the upcoming winter weather should be a priority for prudent customers who treat their vehicles as long-term investments. According to RLPolk*, a survey of U.S. consumers shows 64% said they were “very or extremely likely” to keep their current vehicle longer due to economic conditions. Also, 81% of the 713 interviewed said they intended to take better care of their vehicles. Since the average repair order for older vehicles is about twice that of vehicles three years-old or less, this provides an opportunity to reach a segment of the market that has traditionally been relinquished to the aftermarket — a segment that can be very profitable.
A recent review of 18 months of data for a large midwestern import dealership group (119 dealerships) showed that over a 12-month period, repair orders for vehicles with less than 60,000 miles had an average amount of $137.00. Vehicles with over 60,000 miles had an average repair order amount of $277.00.
Further review of the dealerships’ promotions revealed that the most successful dealers most often used coupons that featured an Oil Change and Filter, Free Alignment with Four Tires, and Coolant Service discounts. While these offers have proven very successful, but they will not grow the potentially lucrative older vehicle market segment. Why not include some coupons targeted directly at owners of older vehicles thereby bringing in additional customers who will spend more per repair order?
Service Managers need to frequently evaluate the direct mail coupons they offer to make sure they also include ones that match the consumer group with the highest growth potential. For your fall promotions, consider offers that target 60K, 90K and 120K maintenance packages. Offers for a percentage-off of all work done or an “older vehicle special” coupon are options that can attract new customers with older cars.
The “we only work on new vehicles” mentality no longer works in an industry that offers multiple years of free maintenance on new vehicles. By targeting the older vehicle segment of your market and pairing that with seasonal maintenance and preparation for winter weather, you have the potential to increase revenue and add new customers to your ranks.
*3/30/2009
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