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Building the future of auto sales

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The Hidden Cost of Free Advertising

Customer referrals are as good as gold. Especially in auto retail. A single happy customer or glowing online review can refer several new customers, and potentially influence hundreds more. But all this “free” advertising can have a hidden cost. Here’s how to reduce it.

Word-of-mouth marketing is one of the best ways to find new customers, resulting in more loyal customers than other types of marketing. On the other hand, it can also cost you customers if people have a negative experience with your dealership.

A dissatisfied customer will tell 10-20 other people about their bad experience. This problem is magnified in today’s digital age, where a single negative review could be seen by hundreds — or even thousands — of potential customers.

If a customer is dissatisfied, find out why and take care of it before they leave a negative review online or tell all their friends. Use a survey to gather candid feedback and talk to dissatisfied customers to learn how you can make it right. If they’re satisfied with your resolution, you’ll earn their trust and they’ll be more likely to come back. With the right strategy and tactics, you can turn unhappy customers into your greatest advocates.

Whether reviews are positive or negative, 85% of consumers trust online reviews as much as personal recommendations. Imagine how much more business you could earn if shoppers searching for your dealership saw 4- and 5-star reviews online. Hundreds of potential customers may see and be influenced by positive online reviews.

Deliver a great customer experience and encourage happy customers to leave a review online. By focusing on customer retention, you can also power customer acquisition.

Your New Game Plan

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It costs over 6 times more to acquire a new customer than to retain one. Focusing on building customer loyalty will help you increase profitability and earn new customers through word of mouth.

Want to use ecommerce to sell more cars online? Learn more about Drive Motors’ online checkout and showroom solutions for car dealers. Request your demo.

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About Author

Rune Hauge
Rune Hauge

Rune Hauge is the Head of Growth at Drive Motors. He is experienced in ecommerce and digital media and is excited to share his expertise with dealerships to improve the car buying experience.