Enhance the experience and gain market share
It is far more expensive to get new customers than to retain old ones. And once you lose customers it can be very expensive to get them back.
This is more so in the motor industry where one customer does not buy a vehicle every day but does so after a couple of years.
Demand in the domestic car market has weakened substantially in recent months as a result of the cumulative effect of interest rates increases, pressure on disposable income due to rising energy, food and fuel costs and negative consumer sentiment and business confidence.
Interest rates have gone up by 450 basis pOints since June 2006, as the Reserve Bank struggles to contain inflation which has stayed above its 3-6% target band since April last year. Higher fuel prices have also pinched household income and consumer sentiment has fallen to its lowest level in four years. But it's worth pointing out that people are not going to stop buying cars, argues Craig Cesman, CEO of DMX Music.
"Dealers that engage with their customers are going to be beneficiaries of sales and those that don't are going to lose market share. There is a shrinking market, which presents an opportunity for dealers who create the right environment to grow market share at the expense of competitors. Second hand car sales are more likely going to increase," says Cesman.
The trick is in creating the right atmosphere and environment for the consumer to enjoy their buying experience. This may have ripple effects in that a satisfied buyer will recommend you to other customers who would beat a path to your showroom.
According to Cesman, buyers often go into a dealership, which has the right models but the wrong overall experience. Cesman points out that dealer need to realize that music is not just a means to enhance store ambience; what is more important is that creating the wrong experience in-store can hurt sales and alienate potential customers.
This much is borne by a UK retail study titled Store Atmospherics.
A key finding of the study is that the choice of music in a retail setting has serious consequences in the mind of the consumer in both positive and negative ways. Almost 20% of the respondents in the study said music has encouraged them to spend more time in a store; this result increases to 27% for respondents between 21-39 years old.
Another key finding of the study is that the wrong music can have adverse results. More than 40% said music has encouraged them to leave altogether. Older shoppers aged 40 and above, are much more likely to walk out as a result of music.
Moreover, when asked for their reaction to the statement, "In-store music increases sales," nearly 70% of retailers agreed, and 12.2% said they "agree strongly." The majority also agreed that in-store music makes customers shop longer in the stores and helps the retailer differentiate its stores from the competition.
According to Cesman, it is therefore imperative that the right atmosphere is created in order for your dealership to prosper in these turbulent economic times. There is more and more similarity between products available in the motor industry and customers are buying more than just a product - they're buying an experience.
- Music Engage with customer on an emotional level by making use of our expertly designed music experiences. More info
- Music Video Capture their attention with music videos and your own branded content. More info
- Digital Signage Connect with your customers using onsite digital-media technology More info
- Compilations Branded CD’s can be used as customer incentives, loyalty rewards, brand building, giveaways, gifts, or a fund-raising tool. Enc… More info