Whether for repairs following an accident or for automotive enthusiasts looking to upgrade and add-on to their current ride, the automotive aftermarket industry has had a strong niche market. From repair shops to individuals at home who just love working on cars, the aftermarket industry isn’t going anywhere. However, like other industries, it continues to evolve, and for manufacturers, within the sector it is important to stay ahead of the curve. With material shortages a regular concern, as certain metals and electric chips become more expensive or difficult to come by, a manufacturer within the industry must look for ways to maintain a strong connection with clients while looking for ways to bring new customers into the fold. The need to repair vehicles isn’t going anywhere anytime soon, but if materials rise, repair shops (potentially pressed by insurance companies) might look for any way possible to save money, including going with another manufacturer. Incentive management programs can help keep customers coming back for more. For any automotive aftermarket manufacturer looking to maintain and grow their client base, here are five reasons incentive management needs to be brought into the fold.
It Rewards Repeat Purchases
There is a strong connection between manufacturers and customers within the automotive aftermarket industry. Regular customers know who produces a quality product and who can deliver that product on time. If at all possible, they will continue to work with the manufacturer because they know what to expect. With the rising cost of metals and other necessary materials already eating into profit margins, many manufacturers within the industry are doing whatever they can to avoid significant price jumps. In order to remain competitive and yet still give customers a desirable benefit, incentifying purchases can help with this.
A customer will not receive the incentive after a single purchase, but instead, after spending a certain amount of money, after buying specific products, or after placing a set number of orders. The specifics can be tweaked to fit the needs of the manufacturer as well as best entice the customers. The reward program is a fantastic way to give back to customers and reward them for their continued support.
Increase Bulk Purchases
With an incentive rewards program, you can offer a discount to customers if they purchase a certain number of products in a given time. This can be anything from offering a rebate on buying a set of four off-road tires at once all the way to providing other benefits to a repair shop purchasing several dozen lift kits or new shock systems all at once.
Bulk purchases are typically made from repair shops or multi-vehicle owners as they will go through a number of items on a regular basis. This could be anything from new air filters to exhaust systems. For a repair shop that does regularly install the equipment, it makes financial sense for them to buy more at once when they know they will use the equipment in a short period of time. This can boost short-term sales without forcing you to rely on offering a sales price (which eats away at your profits). You can decide how you want to incentivize the purchases, but if you want to push more bulk orders, this may just be the way to go.
Increase Off-Season Purchases
Certain products don’t sell as much during different times of the year. Winter tires are not going to sell well during the summer, for example. If you produce tires, you may have a large surplus of winter tires left over from the previous year. Instead of holding onto them for another six months, which will take up valuable storage space, you can offer incentive deals for these off-season items. The customers will save in the end, and you’ll push products you wouldn’t normally sell at that time of the year.
When you have a reward program, the customers do not receive the reward until they have completed the requirements for the reward or made several purchases. This will improve the chances of customers making more purchases. And, at the very least, they won’t take advantage of a sales price and never come back. With a reward program, you increase the chance of future sales.
The infographic above is a breakdown of the top reasons why the automotive aftermarket industry needs incentive management
Begin Crafting An Incentive Program Today
Attempting to draft an incentive program without experience is more challenging than many believe. It’s far more complex than a basic sale, as there are more variables to consider. This is especially the case if a manufacturer is interested in crafting specific incentive programs for different customers. Instead of attempting to go about this process alone, and to also stay on top of sending out the reward when the necessary incentive purchases have been made, it is far easier to hand off these responsibilities to a team of professionals that specialize in it. At Incentive Insights, all of this comes as second nature to the staff. The team can work with any automotive aftermarket manufacturer to craft an incentive program that best works for their particular needs, as well as their overall outcome goals. So, if you are in the automotive aftermarket industry and want to learn more about how incentive management can elevate your sales and improve customer retention, now is the perfect time to contact the staff at Incentive Insights.
Nathaniel Smathers, a contributor to the Incentive Insights blog, brings a fresh perspective on business strategies and market trends. With a background in marketing and a passion for data-driven insights, Nathaniel offers a unique blend of expertise and creativity. His approach to dissecting complex market dynamics and transforming them into actionable strategies makes him an invaluable asset to our team.