Sean Kelley MOPAR Case Study on Customer Retention

A lot of us have heard this statement. It’s a quote from the famous Peter Drucker, an executive and he said “business goes where it’s valued and stays where it’s appreciated”. How many guys do agree with that statement? So I bolted on three words. So do employees.

Employees are no different. They also know where they’re valued and stay where they’re appreciated. But the word valued is so vague and nebulous. So I’m gonna help crystallize that with you guys later, this will be the overarching theme for today’s content. And I’ve got a real dealership group case study to share with you guys where you can see the impact of this. So I’ll start off with some staff.

So about two and a half years ago, we started working with the fixed apps department in a dealer group. And since then, they’ve had two consecutive, year over year 125% plus increases in their in their customer retention. And customer retention is kind of the bedrock for your business’s future. Without customer retention, what do we have other than segment sales, sell the first car and service all the rest? Because you guys, raise your hand if you agree with that same thought okay?

So retaining our customers is critical for us to be able to sell cars in the future. And what about customer retention? What’s the benefits to it? Like? Let’s see, we drive well, how does that affect the profit and things like that, (we’re going to talk about that as well). But this is the dealer groups case studies around this. And if you look at it, they’re above the region and everything every in every range. But when your customer retention, over 90% in this report, about three months ago, we saw a report where they’re at like 106% retention, which means they’re not only retaining 100% of their customers within the first year, but they’re also taking 6%  from their competition. And then look at this three to seven and eight to 10 year retention numbers. Keep in mind, one, two and a half years ago, these guys were bottom in every category in the region, and now they’re over 45% in the eight to 10 year customer retention mark, I think it’s the latest as a whole.

We’re (Stellantis) at about 8% which is where most of your customer pay tickets, your highest profit ROI tickets where they come in, (at 8-10 years). So if we can increase both the short term and the long term retention, what will happen to our profit? What you’re looking at here is their average profit (Car Motivator’s client), what we started coaching about two and a half years ago, they were just under $200 per RO. And now they are consistently over $400 per RO. So the money is real, and the impact is real. But moreover, everyone loves coming to work even more, because they have relationships with their customers, their customers trust them. They don’t get attacked by their customers all the time, which a lot of us service advisors we coach we hear they’re frustrated with the engagement, the type of engagement with their customers, and people that when you have a relationship with someone and you can’t deliver to a part or something along those lines, they’re kind of give you a little more leeway. And they’re gonna give you a little more latitude and they’ll be okay with things not going perfectly every time. And that’s what it’s all about. It’s not helping guys get his results and leverage to do even more