Will You Copy this Company’s Customer Retention Strategy?

Image of CustomerHyundai is crushing it.

How?

By advising you what to do next, deepening the sales funnel, and profiting all the while.

The Hyundai Assurance program is a little stroke of genius. The idea being you buy a vehicle from the Hyundai lot and they quote you a guaranteed trade-in price.

Your future value is based on a new vehicle purchase within the next 24-48 months. Of course, there’s fine print.

You must have brought your vehicle to Hyundai for service, the new purchase must be financed through Hyundai Motor Finance, and the guaranteed value can only be applied against new vehicle purchases.

(No, I’m not a Hyundai fan – this is for illustrative purposes :) ).

Perceived value

Vehicles are a product. They may represent status and prestige but all they do is move you from point A to B.  On Hyundai’s guarantee table they give you reference for what your vehicle will be worth in two to four years.

They know you’re well aware that new cars drop substantial monetary value the moment you drive them off the lot. Why not address that concern by showing you how valuable they perceive, and want you to perceive, their vehicles?

They do with the Assurance program.

We discussed market perception not long ago. In terms of this perceived future value, how are you being perceived in the marketplace? How does your offer stand out and how do you differentiate yourself, your company’s culture and processes to compete in your industry?

You want your products and services to be valuable. You want people to feel a want, need, and sense of urgency to pounce on your offer because they just can’t bear to let it slip away. To achieve that, consider how you can guarantee future value like Hyundai.

Loyal, repeat customers

Repeat customers are the hallmark of a successful sales life cycle. When Hyundai tells you that your investment “is guaranteed” you feel safe. You feel as though the company has your best interests in mind.

Isn’t it easier for you to buy from a company you’ve already purchased from in the past? Of course.

As a customer, you have the inside track about a company operation from initial contact, through sale and even aftermarket service. This firsthand experience allows you to make an educated buying decision in the future.

What about your business?

How do you sweeten the pot for buyers to come back and get more from you? Are you even giving them a reason to come back? “One and done” selling is archaic so with all the new gizmos, gadgets, and cheap (or free) social marketing channels there’s no reason to fall off your buyer’s radar.


Take action

Get to work tweaking your sales process to lend itself to repeat purchases. Are you continually producing quality products and asking for the sale? Is the product going to hold value down the road (be evergreen in utility)?

Take a page out of Hyundai’s book. They focus on creating a deeper sales funnel by selling to their existing customers; this is a strategy worth employing.

How can you bundle your packages, add depth, supplement an existing offer or create a one-off product to (re)serve your market today?

Your input…?

Photo: 10ch


17 Responses to Will You Copy this Company’s Customer Retention Strategy?
  1. Sarah Russell
    July 6, 2011 | 10:11 am

    This is an interesting case study that you bring up. I’ve seen the commercials for this program, and while I like the idea of the guaranteed value, it still wouldn’t be enough to make me buy a Hyundai.

    My perception of the brand has always been that they’re cheaply made and unreliable (whether or not that’s fair). Even this kind of program, which – admittedly – is pretty cool, isn’t enough for me to overcome that first impression I have of the brand.

    Which, in and of itself, is another interesting case study about how much first impressions matter and how important it is to overdeliver from the start… :)

    • Jon
      July 8, 2011 | 9:23 am

      Amen to over-delivery!

      Yep, I’m in the same boat as you with the Hyundai perception (fair or unfair). Should we look forward to that case study on Common Sense Marketing? :)

  2. Adrienne
    July 6, 2011 | 12:34 pm

    I agree with Sarah, now that’s an interesting case study.

    I wouldn’t do it though mainly because I’m not a big Hyunda lover and if I were, I would want my own mechanic to service my vehicle. He gives it much more love than any service department ever would and I may not want to finance it through them. But I can see where that would work for a lot of people, especially if they want a new car every one to two years. It’s pretty smart if you ask me so you’re right about that Jon.

    Guess we can all learn a lesson from them. Very smart indeed!

    Adrienne

    • Jon
      July 8, 2011 | 9:26 am

      It’s a smart play for Hyundai when dealing with the masses. When I hear people talk about car shopping it seems to drift toward body styling (cosmetic appeal) and cost. Hyundai has done a lot to improve the look of their vehicles and perhaps knowing the popular perception is they’re low-end, they’ve countered this by locking in future value of their vehicles (?).

  3. Marcus Baker
    July 8, 2011 | 1:40 am

    Hi Jon,

    I am also not a Hyundai fan. Isn’t that interesting, three in a row now! Speaking about the power of perception, mine is also that they are a ‘plastic’ brand which I just don’t relate to although I can objectively see how they appeal to some people.

    What they are doing is clever however. It is a well established fact that it is more cost effective and easier to sell to existing customers when the relationship has been established than to continually be searching for new customers.

    This beings us back to the importance of relationships and the mighty list!

    Thanks for the good read.

    ~Marcus

    • Jon
      July 8, 2011 | 9:27 am

      Relationship and trust…know, like, and trust…serving the same customer base repeatedly. These are all concepts we as online marketers are quite familiar with, yes?

  4. marquita herald
    July 10, 2011 | 10:39 pm

    Thanks for this very interesting article Jon – the comments are equally fascinating. I must add my voice to the legions of non-believers when it comes to Hyundai – though I get your point about their approach to customer retention. I wonder if when it comes to brand loyalty, cars might be something of an anomaly because so many of us develop preferences to certain brands early in life from our parents and peers. Thanks for the thought provoking article.

    • Jon
      July 11, 2011 | 9:29 pm

      That’s an interesting point, Marquita. I know my musical preferences have their origins in the rock that my parents listened to, my computer brand influence came from my father…hmm…But I’d venture a guess that a portion of buyers are swayed, in large part, by “perks” offered in the deal.

  5. Jeanine Byers Hoag @ Dressing My Truth
    July 11, 2011 | 1:21 pm

    Wow, that almost makes me want to buy a Hyundai, Jon!

    I totally get your point about “one and done” being kind of archaic, so I need to figure out what that might mean for my own business, in which my main product (an affiliate one) is the big bam boom.

    Might mean I will have to come up with something big myself to offer next…

    • Jon
      July 11, 2011 | 9:31 pm

      I should go back to selling cars, then ;)

      Jeanine, absolutely put something out there that you’ve created. Plan ahead to leave yourself some room to grow out the project and you won’t be stuck in a situation wondering “what do I make next?” You can do it!

  6. Martin Dale
    July 13, 2011 | 12:27 am

    Wow! great case study Jon.
    I love the example of Hyundai that you used.

    It doesn’t make sense to just make a sale, and then wish the customer ‘good luck’…

    I believe that we need to spend as much focus and care on customer service and retention as we do making the sale.

    It is my goal that all of my customers would not merely be happy with their purchase, but rather “Delighted!”

    Great post Jon,
    Keep it up!
    Martin

    • Jon
      July 13, 2011 | 9:17 pm

      Investing just as much time in service and retention as making the sale? Agreed. I think we’d agree that feeling orphaned after being sold is one of the lousiest feelings a company can instill in us as consumers.

      Get out there and delight a few folks today, Martin :) Thanks for your support.

  7. Catarina
    July 13, 2011 | 11:54 am

    Ideally everybody want repeat customers. But if that’s possible depends on the business you are in. If you sell nuclear plants it is more difficult than if you sell online marketing. Unless of course your customer happens to be Iran:-)

    • Jon
      July 13, 2011 | 9:20 pm

      Hahah good point, Catarina. There are instances where you may be waiting a while before the want or need arises for a repeat purchase from you. But you’d likely agree that it doesn’t excuse the vendor from following-up out of courtesy (to stay front of mind) or perhaps even be creative in offering relevant support or service. (?)

  8. Dr. Bob Clarke
    July 14, 2011 | 3:05 pm

    Hey Jon,

    This is very interesting to me. First, I guess it points out the need to read all the fine print! Hyundai’s conditions for their “guaranteed trade in value” may be difficult for some to meet.

    That brings me to a question about Hyundai’s policies (and that of any business). If you offer something of value like an assurance program, but make it with strings attached (and in the case of Hyundai, these are pretty substantial “strings”, unless you are sure that your customer understands and reads the fine print, you could end up with one angry repeat customer who may walk away from another purchase, feeling misled.

    Just a thought.

    Thanks for the great post, Jon!

  9. A. Leigh Edwards
    July 14, 2011 | 3:27 pm

    Hi Jon,

    Very smart analogy you stated here. The challenge with Hyundai’s program is that they have placed the cart before the horse – so to speak. If their authentic intention was truly customer satisfaction and retention, they would have put more energy in the initial structure and safety of their vehicles and then people would TRUST the brand. The same applies to online marketing of products and service. When you focus your energy on building a TRUST-worthy brand; that is, placing laser focused energy on over-delivering value, the probability of your potential customers and clients returning is significant.

  10. Ankesh Kothari
    July 15, 2011 | 6:55 am

    Hi Jon;
    This is simply amazing. And even more amazing is that so few people – or businesses – actually use this strategy. The concept of perceived value is great but I liked the part about giving exiting customers an incentive to use one’s services again even better.
    In case of Hyundai for example, unless the first experience is particularly bad, an existing owner is much more likely to choose Hyundai for an upgrade.
    With some modifications this concept can be used with just about every thing!
    Thank you again for this great post.

Leave a Reply

Wanting to leave an <em>phasis on your comment?

Notify me of followup comments via e-mail. You can also subscribe without commenting.