Experian Report Examines Automaker Loyalty

According to a new study, the longer that you hold onto your car, the less likely that you will to stay with that brand. Edmunds released a study, which indicates that the average car loan length is getting longer. Specifically, around 5 years and 7 months, based on October 2014 stats. However, what does that stat translate into? How long do people hold onto their cars in today’s market? Also, when they make a change, do they want to stay with that make?

An Experian study took on these topics. The results of the research indicated that the average length of car ownership is 93 months or 7.75 years. The loyalty of the customer to that same brand of vehicle after that time was 49.5%. Thus, more often than not, after nearly 8 years, consumers are looking for a different automaker. The study went on to find that if a consumer owned their vehicle for 12 years, they changed the vehicle make on their next vehicle a staggering 76.2%Â of the time. Brad Smith, Director of Automotive Market Statistics for Experian, explained that dealers who seek retention must keep long-term customer relations alive. “The increase in time between dealer interactions, whether they are for sales or service, increases the probability of a customer defecting to the competition,” Smith said.

The study also looked at which brands consumers owned the longest as well as which ones they were loyal to.

The top five brands in terms of length of ownership were:

1. Dodge (113 Months)
2. Buick (113 Months)
3. Chevrolet (111 Months)
4. Ford (110 Months)
5. Mitsubishi (109 Months)

The top five brands in terms of customer loyalty retention percentage were:

1. Ford (61.0%
2. Subaru (59.4%)
3. Toyota (58.9%)
4. Kia (58.5%)
5. Lexus (55.8%)

Reviewing this data Smith noted, “Dealers and manufacturers should continue to emphasize on keeping customers loyal to the service drive and using these customer interactions to highlight their new and soon to be released product offerings, as these efforts will aid in increasing service revenue and repurchase loyalty.”

What does your store do to help reinforce customer loyalty? Have you seen loyalty and longevity that coincides with these statistics and brands? What are you doing to make customers want to come back to your store years after their purchase?