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Where Your Dealership Customers are Going & How to Meet Them There

For dealers, customer retention is a crucial factor for sustained growth and success. Studies have shown that it’s generally more cost-effective to retain an existing customer than to acquire a new one. Plus, with the rise of “one-and-done” buyers, brand loyalty has diminished industry-wide.

In order to stay ahead of customer defection and build loyalty, dealerships must know where their customers are in their buying journey and understand their needs and preferences. This knowledge can help dealerships provide a personalized and exceptional experience, building customer loyalty and ultimately resulting in repeat business.

In this blog post, we’ll explore:

  • Why customer loyalty is diminishing 
  • Where your dealership’s customers are going – and how dealers can meet them there 
  • Tips and strategies to engage and retain nomad buyers

Changes in Loyalty from the Inventory Crisis

In today’s dynamic automotive market, customer loyalty is no longer guaranteed, even if a customer and their family have been loyal to your dealership for years.

After declining to its lowest rate in three years in 2022, industry-wide brand loyalty has recovered only slightly as dealership inventories are starting to stabilize, according to S&P Global Mobility reports. However, as inventory levels rebound, high prices and few incentives are pushing some customers to wait longer and drive further to purchase their next vehicle.

As inventory levels start to stabilize, and high prices and limited incentives persist, protecting dealership loyalty customers from competitors’ conquest attempts has become paramount. To ensure both immediate and long-term success, it is crucial for dealerships to proactively take intentional actions to safeguard their customer base against the competition’s efforts to win them over, especially with the rise of nomad buyers in recent years.

Who Are Nomad Buyers?

Also known as “one and done” buyers, nomad buyers are those who buy once from a brand. While Loyalists have a repeat purchase history, and Super Loyalists have multiple repeated purchases, Nomads show no distinct loyalty to any brand and are the most likely to defect.

With the inventory shortage pushing many buyers to switch brands in recent months, some brands are seeing higher than average numbers of Nomad buyers, especially those who offer numerous body styles. This poses significant challenges and risks of customer defection industry wide. According to S&P Global Mobility, about 58 percent of Nomads left their brand in the 12 months ending July 2022, the highest rate of defection for Nomads in the last decade.

While the impact of Nomad customers defecting poses serious challenges for some brands, by converting Nomads into Loyalists, dealers are presented the opportunity to fuel future success through sustainable sales and service revenue.

By nurturing previous sales and focusing on building customer loyalty, dealerships can benefit from the long-term value of repeat business and positive word-of-mouth marketing. Loyalists can become brand advocates, increasing brand awareness and potential new customers by promoting the dealership to their network of:

  • Friends 
  • Family 
  • Colleagues 

Additionally, loyalists are more likely to provide valuable feedback and insights, helping the dealership improve its operations and stay ahead of the competition.

How to Meet Your Customers Where They Are

Understanding your customers’ needs begins and ends with reaching them effectively. The best messaging in the world can fall flat iif it’s not delivered at the right time, the right way and at the right place.

3 Dealership Templates to Retain Loyalty Customers

The Right Time

You may think the right time to reach your customers is always right now, and in some cases you’d be correct. As buyers wait longer between purchases, engaging customers before they return to market is more important than ever. But how soon is too soon to engage buyers?

To increase your chances of connecting at the right time, it’s critical to understand how your customers are shopping today, and in the past, to effectively predict when they start planning their next purchase.

Leveraging platforms like Mastermind, dealers can take a comprehensive look at their customer data to identify and engage future buyers before they show signs of returning to market. This empowers dealers to engage Nomad buyers earlier in their buying journey, proactively preventing customer defection by staying a step ahead of the competition.

The Right Way

According to recent analysis by S&P Global Mobility, as of January 2023, 40% of inventory in the automotive market is being advertised with some form of discount. This is a significant increase compared to less than 20% just six months ago. It’s evident that customers now have more options and flexibility in terms of vehicle choices and pricing, which directly impacts their preferences for the brand and dealership they want to purchase from.

With a larger percentage of inventory being offered at discounted prices, customers are becoming more discerning in their purchasing decisions. They have the opportunity to be more selective about the brand and dealership they want to buy from, as they can now compare and evaluate different options based on:

  • Pricing 
  • Incentives 
  • Discounts

This shift in customer behavior highlights the increasing importance for dealerships to not only focus on the vehicles they offer, but also the overall brand perception and dealership experience they provide to attract and retain customers.

In the highly competitive automotive industry, connecting with the right messaging is crucial for success. With customers being bombarded with information and choices, dealerships need to ensure that their messaging is tailored and targeted to resonate with their specific audience.

This includes understanding the customer’s preferences, needs and pain points, and delivering relevant messages that address these factors. By using the right messaging, dealerships can:

  • Capture the attention of potential customers 
  • Build brand awareness 
  • Establish trust
  • Drive sales

The Right Place

The importance of pushing messaging in the right place, whether it’s in-store or online (through digital retailing), cannot be overstated. According to a survey by S&P Global Mobility, 70% of customers in the US were willing to consider dealerships located further away from their homes if they offered more online purchase and comparison options. 

This trend is especially pronounced among female shoppers. The survey also revealed that 60% of customers now expect their next vehicle purchase to be completed entirely online, which represents an eight-point increase compared to pre-COVID.

With the increasing reliance on digital channels for research, comparison and purchase decisions, dealerships need to adapt their messaging strategies to align with customer preferences. This includes having a strong online presence and providing robust digital retailing options that allow customers to explore and purchase vehicles from the comfort of their homes. If you haven’t yet, invest in digital tools that facilitate the car buying process, including:

  • User-friendly websites 
  • Online chat functionalities 
  • Virtual showrooms.

At the same time, it’s important for dealerships to continue delivering compelling messaging in-store as well. Many customers still prefer to visit the dealership in person for test drives, inspections and other interactions. Dealerships should ensure that their in-store messaging aligns with their online messaging and creates a seamless and consistent customer experience across all touchpoints. This includes:

  • Providing knowledgeable and attentive sales staff 
  • Offering personalized deals and incentives 
  • Showcasing the unique value propositions of the dealership and the vehicles

10-Point Checklist to Proactively Retain Loyalty Customers

How Can Mastermind Help?

Customer loyalty and retention have become paramount for dealerships. With increasing options and choices available to consumers, it’s crucial for dealers to proactively engage with their customers and build loyalty to prevent defections. This is where Mastermind comes in.

Mastermind is a data-driven platform that provides predictive analytics, customer segmentation and sales enablement tools to dealerships. By leveraging advanced data analytics, the platform can identify potential defectors and provide valuable insights for dealerships to take proactive measures to retain them.

Through a combination of machine learning algorithms and data integration from various sources, Mastermind can predict and identify:

  • Which customers are preparing to return to market (and their likelihood to buy) 
  • Which customers are most likely to purchase or lease a vehicle 
  • What type of vehicle they are likely to choose

To proactively prevent defection, Mastermind leverages this data to automatically engage loyalty customers with the right messaging, in the right format, and at the right time to nurture buyers until they’re ready to purchase.


In today’s hyper competitive market, it’s essential for dealerships to focus on customer retention to ensure long-term success. Retaining existing customers is more cost-effective than acquiring new ones, and with the rise of “one-and-done” buyers, it’s becoming more challenging to build brand loyalty.

To proactively prevent customer defection, dealerships need to understand their customers’ buying journey, needs and preferences to provide a personalized and exceptional experience at every touchpoint.

By utilizing customer targeting and predictive marketing methods, dealerships can meet customers where they are in their path to purchase to engage buyers at the right time, in the right way and in the right place.

Interested in learning how Mastermind can help your dealership to meet buyers where they are to increase customer loyalty and retention? Contact us for a free demo.