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The Importance of Loyalty in the Automotive Industry (ft. Kristin Cardona & Amy Ochoa)
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In this episode, we explore the loyalty landscape of the automotive industry with Kristin Cardona and Amy Ochoa from Ansira, a global marketing technology and services firm. We delve into the power of loyalty programs to drive customer retention and increase lifetime value.
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Transcript
Introduction and Guest Backgrounds
00:00:10
Speaker
Get personal with loyalty, where we're discussing using loyalty to deliver personalized, relevant customer experiences. Hello, everybody, and welcome to today's podcast. Today, I'm here with two people from ANSIRA. We have Amy Ochoa and Kristin Cardona. Welcome, ladies. Hello. Good to be here. Hello. Thanks for having us.
00:00:34
Speaker
So excited to have you guys. Why don't we start with both of you introducing yourselves and giving us a little bit of your background and how you got to in CIRA and got into loyalty.
00:00:45
Speaker
Sure, I'll go first. This is Amy Ochoa. I have been in Sierra for almost nine years now. I lead up the Client Strategy and Experience Design Departments at the agency. And I've been in Sierra in loyalty my entire career, both on the brand side and on the agency side. I've stood up some, you know, some of the great programs you may have heard of, like at Famous Footwear and Build-A-Bear Workshop. I was working on the brand side, and now I do that for all of our lovely clients in Sierra.
00:01:14
Speaker
So I run the gamut from how we get people into the program to how we really can create brand loyalists at the end of the day.
00:01:24
Speaker
I'm Kristin Cardona. I work with Amy on the strategy team. I head up our loyalty aspect when it comes to strategy at Anzera. I've been with the company almost two years. We're coming up on two years here relatively soon. And prior to that, I worked a significant amount of time in the hospitality industry.
00:01:45
Speaker
In my time in the industry, I had always been interested in building relationships with individuals, and so that's why I started my career there. I worked for two of the largest hotel companies out there, and what I did is everything from operations to branding to strategy.
00:02:02
Speaker
and finished the majority of my career at the hospitality industry working on loyalty, where I focused on program design, performance optimization,
ANSIRA's History and Industry Focus
00:02:10
Speaker
and project implementation. And here at Ansera, I work with a number of our different verticals, whether it's QSR or retail or even hospitality again, and I help individuals either develop their programs, evolve them, or transform them, and relook at loyalty overall.
00:02:26
Speaker
Great. Wow, you guys have been around a long time and have a lot of knowledge. This is going to be a really fun conversation. Looking forward to it. So, Amy, why don't you spend a couple minutes here and tell us about Anceira and what you guys do and how do you go about supporting clients today? Sure, I'd love to. Anceira is actually a 100 plus year old company. We're a global marketing and technology company.
00:02:51
Speaker
We really specialize in supporting brands who have a distributed sales ecosystem, such as a dealer or a franchisee or distributor. I don't know if you know this, but 75 percent of the world's trade flows indirectly. That's where we specialize. That's our niche. We work with both the brands at the enterprise level as well as with their local partners to create and deliver consistent customer experiences across the lifecycle, driving both demand and then brand loyalty as well.
00:03:20
Speaker
So I guess meaning that we provide end-to-end solutions from the brand level to the hyper-local door level, if you will, and then direct to the consumer. So our expertise and our technology, our proprietary technology is really focused on four main areas. We have channel partner marketing,
00:03:39
Speaker
media and ad tech, local websites, and door-level marketing, and then finally what we call integrated loyalty. So if you think about it from a consumer journey perspective, because us in strategy, we like to do a lot during that thing, right? Let's start with the partner. So we start by supporting the partner by providing
00:04:00
Speaker
enterprise-approved brand assets to support local marketing needs. We manage co-op funds and we can provide a marketplace for those local partners to order marketing campaigns, if you will. Then we offer full-service media strategy and execution, and we have our own third-gen AI ad tech to activate and
00:04:19
Speaker
optimize those campaigns to generate awareness and consideration for the consumer. And then we can drive leads and conversions locally because we have a local website product that we offer and as well as hyper-local marketing capabilities that we can support at that door level.
00:04:35
Speaker
And then finally, once we obtain that conversion, we gain that new customer, then our integrative loyalty team really goes to work to retain that customer and ultimately create some brand advocates. And that's where we partner with companies like you to help bring those experiences to life.
Local-Level Loyalty Strategies
00:04:53
Speaker
Amy, to add on to that, what industries are you guys covering?
00:04:59
Speaker
Sure, so we service five main industries, if you will. We have a lot of clients within the food and beverage industry, such as Nestle and Coca-Cola and Chick-fil-A and Panera. We service technology industry with the likes of Dell, Charter and Microsoft, consumer and retail like North Face and Serta Simmons Bedding and Sally Beauty and Lazy Boy.
00:05:25
Speaker
Financial services and insurance is another one. Health care is one of our clients. VMware and Mellon, American Family Insurance. And then finally, a big one is actually on Burbage. And we service both the manufacturer level, like GM, Chevrolet, Ford, Toyota, as well as the dealer level, like the likes of Soul or Brooks.
00:05:48
Speaker
To me, that seems so unique in the space. I'm sure there's probably people that you're competing with. But one of the things that I see a lot here at Annex is we do have a lot of clients that are global, but also want local and even companies and organizations. And I know we're going to get to this in certain industries where even in states, there's the need to be more
00:06:14
Speaker
high level as the brand, but then also in local and different communities, we want to give more power to the organizations or the franchisees or some things we're going to be talking about, the dealers to be able to actually the people that know their customers better maybe than the global team does in being able to really deliver something that's more relevant and personalized.
00:06:40
Speaker
Absolutely. And that's what we strive to do is enable that local level touch.
Automotive Industry Challenges
00:06:45
Speaker
It's actually one of our four pillars, if you will. When we think about loyalty in general, that local experience level is so important when we're designing programs or campaigns. And I think often missed.
00:06:58
Speaker
Yeah, absolutely. Yeah, getting that local color for sure. Really interesting. Thank you. We kind of alluded to this, but I guess, Kristin, one of the industries that are nowhere near and dear to your heart is the automotive space. And there's the just as we were talking about, there's a manufacturer and then there's the dealer. Obviously, then there's the customer. What kind of opportunities do you see in this space in particular?
00:07:24
Speaker
There's quite a few opportunities. I mean, I think the first thing is just to piggyback on what Emi was saying. There's an intersection with Ancira's vast experience across the auto industry that we've played in for decades now. And then our industry, and then our recognized work in the industry from a loyalty perspective. So when we think about automotive itself, it's an area that really hasn't embraced loyalty as much as possible yet. We can talk about a couple of different
00:07:54
Speaker
dealers and OEMs that are doing that, but overall, there hasn't been an embracement of loyalty. Recently, in the dealer space and the OEM space, a study was done and it shows that loyalty is really stagnant right now in that space. 54 percent of individuals are loyal to OEMs and brands, but only 36 percent of individuals are loyal to an individual dealership or group.
00:08:21
Speaker
So there's a lot of changes that are going on in the space. There's a lot of challenges that are going on in the space. And it's really important at this point in time for auto to take a look at how they can drive more loyalty with their customers and their consumers. Why do you think, I guess, two questions. Why haven't they embraced loyalty? And maybe could you share a little bit more about some of those changes that are happening that are making it more challenging for the market?
00:08:49
Speaker
Yeah, I think there's a number of reasons that there's challenges and changes. Certainly the pandemic caused a problem with supply chain. EV is shaking everything up when it comes to the automotive space. And then there's just the existing challenges that you have in any industry of building loyalty itself and making sure that a customer feels loyal to you.
00:09:13
Speaker
With automotive, the frequency of purchase is so long, it's really hard to stay in front of the customer at times. And that's where dealers are really working more and more with the service side to engage and drive business back to their dealer. It costs seven times more to sell a car to a new customer than a returning customer.
Successful Auto Industry Loyalty Programs
00:09:34
Speaker
So having that loyalty and thinking of the acquisition cost that you could save would be
00:09:39
Speaker
Really something that's huge. Yeah. I mean it's a it's a really really big number out there. So I think those are some of the reasons that are impacting right now the auto space. As you're thinking about that and us being loyalty marketers it seems that there are ways that loyalty can come in and support.
00:10:02
Speaker
Are you seeing it happen anywhere in doing it? Well, I've heard about a Ford program, I think, back from my loyalty 360 days hearing about them. And I don't know that I've ever experienced anything different at a dealership. What are you guys seeing in that kind of landscape? Are there organizations who are dabbling in this now and are they seeing some results?
00:10:25
Speaker
There are definitely some individuals that are dabbling to your point in the loyalty program space. There's also other companies out there that are driving loyalty through engagement. You mentioned Ford and Ford Pass Rewards is a traditional loyalty program. They actually just even recently introduced a tiers to their program as well as an opportunity for your cars to be picked up.
00:10:49
Speaker
and service. So they're really trying hard to take the path of a traditional loyalty program. But on the engagement side, you have companies like Subaru who have their love program and where you have specific passion points for yourself, such as pets or the environment. They rally people around those causes and then those actual causes
00:11:13
Speaker
are events that they bring people together to celebrate. And if you know anybody that owns a Subaru car, they are the most loyal individuals and actually J.D. Power did a survey last year and it is the most loyal car brand in their category. So
00:11:28
Speaker
That's on the OEM side. On the dealer side, there are some companies out there that are doing traditional loyalty programs. Bannister Rewards is one company that does that, or Bannister Automotive is one company that does that. They have Bannister Rewards. It's based around the service again and how often you bring in your car and what you purchase from them. That goes in towards free service, oil changes, tires, things like that.
00:11:54
Speaker
But on that engagement side, you have companies like Asul Automotive down in Dallas, where they do things like continue to wear or use the license plate on the back of your car with Asul, you can come in anytime and get a free car wash. No reservation needed, no restrictions or things like that.
00:12:14
Speaker
There's also a company out in Southern California called Fletcher Motor. And Fletcher has a number one Mercedes Benz dealership in the U.S. And they allow you to park your car at their dealership when you go to the airport. They'll give you a transport to the airport. And we all know how expensive it is to park your car at the airport. So those are a couple of different ways that local dealers are doing loyalty.
00:12:39
Speaker
Really interesting.
Integrating Loyalty into Daily Life
00:12:40
Speaker
So as you were talking about really both of these what I was taking notes on engagement experiences and really taking the experience and extending it into people's lives into the things that they're interested in. We've talked on the podcast in the last season a lot about the trends that we were seeing
00:13:01
Speaker
in loyalty and those are a number of them like going beyond transactional loyalty, getting people to engage to someone that's engaging with your brand and also Transax is going to be far more valuable than the one that doesn't. Everything is about experiential loyalty those of us that are in the space probably are hearing that way too much but it is true. How do you create more experiences for the customer because that creates the emotional bonds and then
00:13:27
Speaker
And then the part, one of the ones I really like is how do you get your brand in this experience and what you guys are talking about, like out of the showroom and into someone's daily life, how do you make that transition? It's really great to see that there are some organizations that are doing it. Amy, you're shaking your head, smiling. There's something to say about this. You're absolutely right, because I think about the dealership bringing blood, five, seven years, I'm going to buy a car if I need oil change or
00:13:56
Speaker
or something like that. So how do we start to insert ourselves in a consumer's daily life? So they're like, oh, my dealer can do that for me, you know, and then when I am ready to buy my car, they are the first person I'm thinking of.
00:14:12
Speaker
Yeah, you're not thinking about anyone else. I had one of those dealers and I had the experience and then I sold the car and I bought from a different manufacturer, different dealer. I didn't really even think twice about it, but it's further from my house. And my first experience of service, I call up and I'm like, okay, well, when can I get a loaner? Let me schedule my service around when I can get a loaner. Well, you can't get a loaner.
00:14:37
Speaker
I'm like, what? I can't get a loader. And you guys are so far away from where I live. And I was like, oh man, I really didn't think about that when I made the purchase because it's amazing what those really positive experiences can do and how dealers are really helping you out.
00:14:55
Speaker
Because it is hard to find the enterprise level, the brand level, the OEM level to understand kind of what those deals are doing, how they're treating their consumers. Sometimes we do in the street shop and we look at things like that. Or, you know, how is the waiting area? Is it is it stocked? Are they doing things that are going to make you want to come back time and time again? That's something that we offer our clients. Wow, that's great.
00:15:20
Speaker
And just a fun fact to add to that is that customers who service their vehicles at your dealership are 86 times more likely to buy from you. So having that specific relationship ahead of time will really allow you to grow the lifetime value of a consumer.
00:15:40
Speaker
And so it really goes full circle. So even though there's such a long time in between purchases, there isn't such a long time in between oil changes.
Starting a Loyalty Program
00:15:49
Speaker
So how do you make sure they're not going to jiffy lube and they're coming to the dealer for those things? It's really key. Interesting. And so as we think about.
00:15:57
Speaker
loyalty and obviously we're talking about automotive but I think it applies everywhere and maybe switching gears a little bit. When you're talking to somebody that wants to get started, how do you guide them? That's a great question because one thing we haven't talked about yet is
00:16:14
Speaker
the data side of things when it comes to automotive. Because if you think about it from a dealer perspective or even a dealer group perspective, you know, the large ones out there, they are selling cars from multiple brands, from multiple manufacturers. So they have a data set for Ford and they have one for GM and they have one for Mercedes or whatever. And a lot of times those sit in silos. And so they may not know that their consumer has their
00:16:41
Speaker
cars in the garage. So we really kind of start from a data perspective to understand where they're at, how accessible all that data is, and do an assessment of that. So that's a good place to start. And then really assessing what the true loyalty drivers are. Are they having problems with getting that second service? Or where are their consumers falling off in the automotive funnel, if you will?
00:17:08
Speaker
So it really starts with an assessment. Once we do that, we offer several different things such as loyalty playbooks, implementation activation plans, or even like a Martech consultant where we may say, okay, we feel like you need a technology if we're going to move forward, and then we identify what that technology is for them, and then ultimately help them implement it. It's super interesting. I have to ask, what is a loyalty playbook?
00:17:37
Speaker
So it's really, it's a loyalty activation recommendation, if you will. So we create a playbook that directly addresses the needs and general best practices of data capture, data enablement, and then campaign execution from a one-to-one basis. So whether that is going to be texts or a push or email.
00:17:57
Speaker
We also provide strategy and logic across key life cycle and engagement campaigns so that we're developing that loyalty and building that retention. And then data activation guidelines. So how you're capturing the right data or driving acquisitions into the program.
00:18:16
Speaker
or increasing participation and retention, things like that. I love it. It sounds like a guide that you can use as the marketer of, okay, what am I going to do? How am I going to do it? So they can certainly call you, I'm sure, but they also have this great resource to help guide them along. Very cool. Well, especially if you're thinking about working with all these local operators, they might not be able to afford to have a full-service agency supporting them all the time. So we want to give them the tools so that they can self-serve on your own.
00:18:47
Speaker
Great, great. I know we're getting close to wrapping, but I do have another question around back to automotive is you guys are looking at this. How are you getting out there to talk to these organizations about the opportunities that are available? It seems like a market that's really ripe for.
00:19:08
Speaker
stronger customer experience overall, the opportunity to do more personalization,
Engagement with Automotive Organizations
00:19:13
Speaker
obviously using the data, and being able to create more programmatic, but probably, I would guess, not point program either, I suspect. Curious kind of how you're going after that and how you're guiding people as they're talking specifically.
00:19:30
Speaker
So there's a couple of different ways, Erin, that we're doing this. First of all, we're working with Brian Pash, and we've gone to a number of his different conferences, the Modern Retailing Conference we attended last year. We've done a couple of things at NADA as well to ensure that we're getting out there in front of the individuals that would need these. We're doing things like this with you today, obviously, as another opportunity, and we've continued to look at future conferences down the line that we'll be participating in.
00:19:58
Speaker
So coming soon to theater near you, you can keep eyes and ears open for future conferences where we can meet with individuals across the board in the automotive industry to not only share what we're doing, but to learn what they're doing and capture best practices all the way around. We'd love to keep us posted. For sure.
00:20:15
Speaker
And we also, because we have such a long history in the automotive industry, we have a lot of clients, both from the OEM perspective and the dealer perspective. And so they may only have one of our four main services. So we're always starting to talk about new opportunities and how they can bring this loyalty piece to life. Because we do feel like this is the biggest opportunity.
00:20:37
Speaker
Yeah, it certainly sounds like it. Great. Well, thank you guys. As we wrap up this conversation, do you guys have some additional thoughts? Anything else that we didn't cover that you'd like to share or chat about?
00:20:49
Speaker
You know, I think from my end, the industry continues to evolve and consumers continue to evolve. So I think it's important to just ensure that you're an advocate for your brand, whether it's at the OEM or the dealer level. And, you know, loyalty is just essential nowadays. It's, you know, in an ever changing world, having someone loyal to your brand, to your to your company is key and it will save you money from a lifetime value and perspective for years to come.
00:21:19
Speaker
Yeah, and I think as companies are starting to consider loyalty, just dip your toe in, just assess where you're at, see what's needed. We can help you map out how to get there and do it in a phased approach. So it doesn't have to be all in immediately. Let's just start small and get started.
Financial Modeling in Loyalty Design
00:21:40
Speaker
We were actually just talking about this in a meeting internally. Loyalty is a big decision.
00:21:48
Speaker
And it's a commitment that frankly can last the lifetime. How do you help and coach organizations
00:21:58
Speaker
to feel comfortable making that commitment. And I love what you said and I think why it piqued my interest is taking the baby steps first and then I think people see these big programs out there that they're involved in and they just love and have all these different tentacles like the things that Nike is doing and Nordstrom does, but these programs have evolved over years and years.
00:22:24
Speaker
How do you help coach people that, hey, this is OK? You can do this. You will see success and help them feel confident in that.
00:22:37
Speaker
Part of our process whenever we do any type of program design is financial modeling. It's so key to this process and we go in depth with all the data that we will get from the outside when we're doing that onset, when we are doing that assessment to find out what levers we can pull, where we think loyalty can impact that, and then really forecast an hour of our multi-year period.
00:23:02
Speaker
We layer in all the investments that may have to occur to stand up our program and create that business case before they really actually invest. That's so important to this process. Great. Makes sense. Then actually, I had a conversation with Sukumar from NCIR a couple weeks prior, the people have heard already that he talked about then once you have loyalty in place, it's a great way to be able to help forecast for the future.
Conclusion and Next Episode Teaser
00:23:32
Speaker
And if you're if you're getting the majority of your customers making those purchases, then you know what's going to be happening in the future and you have levers to pull in order to be able to do it. Yeah, well, terrific. Thank you so much. Where can people get a hold of you?
00:23:49
Speaker
Probably the easiest way to get a hold of us is just to shoot us an email. It's our first and last name at anzera.com. So I am Amy Ochoa, Amy Ochoa, that's A-M-Y dot O-C-H-O-A at anzera.com. And I'm Kristin Dott Cardona at anzera.com. I'm Kristin with an I, so K-R-I-S-T-I-N dot C-A-R-D-O-N-A at anzera.com.
00:24:18
Speaker
Terrific. Thank you, ladies. Thanks so much for joining us today. Thank you. Thanks, Aaron. Thanks for listening to this episode of Get Personal with Loyalty. Join us next time for more Loyalty Insights. Until then, dare to dream. Let Annex Cloud help make your dreams a reality. Visit annexcloud.com. See you soon.