Ken Garff Automotive Group Enrolls in Preventive Maintenance Program to Grow Service Revenue and Increase Customer RetentionJanuary 24, 2011 – Ken Garff Automotive Group has implemented a preventive maintenance program to grow its service revenue and boost customer retention with its existing customers. The group began as a single-car dealership in downtown Salt Lake City in 1932, and has since grown to include over 35 new and used vehicle locations throughout the U.S. Garff selected Performance Loyalty Group, a frequency marketing, loyalty and technology services company, to provide their UltraCare® Preventive Maintenance solution because of its unique ability to be administered and sold from the service lane as well as in F&I.
"From the results UltraCare has shown us, this will be a great customer retention tool. It should increase customer visit frequency and our overall vehicle service contract effectiveness, while providing more value for our customers," commented Danny Cox, Corporate F&I Director at Ken Garff Automotive Group. He continues, "I'm very excited and look forward to the results I am certain we will soon enjoy."
Performance Loyalty Group introduced the UltraCare program eight months ago and has since enrolled over 200 individual dealerships. While current industry statistics indicate that roughly one in five customers return to the dealership for service, UltraCare plan holders are visiting their servicing dealers at a rate of 72 percent. Further, plan holders that return to the dealership to redeem their plan elements also purchase incremental retail service about 90% of the time. In addition to the increased visit frequency, UltraCare plan holders are averaging incremental retail service up-sell of $128 per visit.
According to Michael Gorun, Managing Partner at Performance Loyalty Group, as the Ken Garff Automotive Group has recognized, the opportunity is on the service drive. A dealer that writes 1,500 RO's a month can easily sell 150-200 maintenance policies just by asking the customer. In F&I, it takes a 500-600 unit store to generate the same 200 maintenance policies. "Our dealer clients have made UltraCare a new revenue source for the Service Department as more and more plans are sold in the service lane when compared to the F&I Department. Customers are more likely to purchase a maintenance plan in service when they don't have competing F&I products to consider and the loan to value issue is gone," Gorun added.
UltraCare's web-based technology allows auto dealerships to create, manage and market their own branded, in-house prepaid maintenance program while holding all of the program revenue and managing the net service costs to the customer. What makes this attractive to the retail customer is that the dealer can offer a more robust, value-driven plan that customers purchase with higher frequency than those administered through an independent third party.
Headquartered in San Ramon, California, Performance Loyalty Group is a leading marketing technology company providing customized loyalty rewards, customer retention, prepaid maintenance and media tracking programs for the automotive industry.
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