With approximately 80,000 professional car wash locations in the United States and about the same number in Europe, it is no wonder that car wash owners are constantly looking for ways to make their business the “car wash of choice” for customers.
At a German trade fair in 2016, a panel discussion about the future trends in the car wash business included comments from key industry representatives. Patrick Ginster, with Carwash Sonax, discussed the need for car wash owners to position and brand their businesses in a way that differentiates them in the market. He added that successful branding at the local level in car wash occurs when the effort is based not only on quality but also on loyalty programs.
While marketing efforts such as direct mail, print advertising in local publications, street signage and other types of promotion can draw attention to a car wash, it can be expensive — with a small percentage of mailers, advertisements or promotions reaching people most likely to use a car wash.
“It is seven times more cost effective to target existing customers to retain their business than to attract new customers,” says Zach Goldstein, founder and chief executive officer of Thanx, a customer loyalty program technology company. “In the car wash business, about 75 percent of revenue comes from 25 percent of the customers. It makes sense to recognize and reward those customers so they are not tempted by offers from other car washes.”
Incentivizing existing customers to remain loyal to a business means offering programs that reward them for ongoing, regular visits. In the car wash industry, these programs can look different at each business.
Unlimited wash programs — or subscription programs — that are based on a monthly flat fee, are common in the industry and appeal to the most loyal customers, points out Goldstein. The disadvantage of these programs is that they do not reach customers who don’t come in often enough to realize a savings, but they do come in regularly enough to represent significant revenue.
Loyalty programs that allow customers to earn credits or points toward discounted or free services are the best way to reach loyal customers who are not interested in subscription programs. Although a “punch card” was the first iteration of loyalty program identification and tracking tools, the need to automate crediting and tracking use on the account has resulted in new ways to administer loyalty programs. While car wash companies around the world, including the single-location Luisa Carwash in Milan, Italy, still use cards to recognize customers and generate rewards, the card is no longer “punched” by an employee to track use. Instead a “smart card” with an embedded chip automatically tracks use and applies credits to rewards.
Moving away from paper card-based programs provides a significant advantage to car wash owners, says Goldstein. “Using an app that collects customer email and telephone contact information not only makes it easier to track use and rewards, but it opens up the opportunity to communicate with your most loyal customers,” he explains. Review of the data collected also gives you more information about the services your customers use most often, which helps you tailor programs and services to your market.
A successful customer loyalty program must be simple for the customer to use, says Adam Korngold, president of Washify, which offers an integrated point-of-service and customer loyalty and marketing solution for car wash businesses, and owner of Waves Car Wash in West Roxbury, Massachusetts. “The program should also gather data you can use to personalize communications with your customers.”
Wash Me Fast has been in business for 11 years and has five locations in Georgia and Alabama. “We’ve had loyalty programs forever — starting with business-sized punch cards,” says Jimmy Starnes, chief strategy officer for the business. “We switched to an app-based digital program in April of 2015. We now know who our customers are and how often they use our services,” he adds.
Because Starnes' program ties the loyalty program to credit cards linked by the customer to the account, use and rewards are automatically registered when the credit card is used. This means that customers don’t have to keep track of a separate program identification card, and employees don’t have to take time to record a program number, license plate or any other type of information to be sure the customer is credited with the wash.
“More importantly, we have contact information so we can send out notices to special promotions that reward customers for their loyalty,” Starnes said. “An added benefit to customers is our participation in the Thanx network, which means they earn rewards by visiting other Thanx merchants.”
Although Mike’s Carwash offers an unlimited wash plan, customer feedback from those who don’t participate in the unlimited plan led to the launch of a customer loyalty program in August 2016. With thousands of customers signing up in the first two months of the program, Meghan Hollabaugh, marketing supervisor for Mike’s, says the feedback has been great.
“Our customers can download our app, register with their credit card information and email, and every time they use that card at one of our locations, they receive credit for each dollar they spend,” says Hollabaugh. “Each time the credit card is used, the credits are applied to the customer’s account.”
Because the record-keeping is handled by the technology, there is never a need for a customer to show a card or other identification to car wash employees, except when they are redeeming points for a free wash, says Hollabaugh. The process is simple, and an entire family can sign up for one loyalty account, even using multiple cards. This allows loyal customers to accumulate rewards much faster, she points out.
Although the app is designed for mobile devices, Hollabaugh says that some customers are less likely to use phones for online services. “Our program is also accessible via desktop computer so people can use whichever device they prefer.”
Although a free wash is given to everyone who signs up and free washes are given for every 100 credits, Hollabaugh said that it is important to include all customers when considering rewards. “We are exploring more reward options for the future. A free wash may not speak to our unlimited wash program customers, so we are looking at other ways to reward them,” she said.
At DetailXperts in Detroit, Michigan, the car detailing service created a customer loyalty program that goes beyond discounted services and provides credits for more than actual use or dollars spent. Recognizing that customers are going to purchase detailing services less often than car washes, the company offers reward credits for use for multiple vehicles, including boats and recreational vehicles, and for new customer referrals.
“Because we schedule our services, I track and credit reward points at the time the service appointment is made,” said Katrina Forster, owner of the Detroit location. “I always ask how a new customer learned about our company to be sure I credit an existing customer with the referral.”
Forster’s program also offers rewards beyond discounted services, including free transportation to and from the service location while the vehicle is detailed, priority scheduling for services, and gifts such headphones, electronics or other DetailXperts-branded items.
Another attractive feature of a loyalty program is flexibility — enable customers to earn reward points at any of your locations. Companies with multiple locations, such as Star Car Wash with 70 locations throughout Australia, face challenges that can be overcome with the right technology. Cloud-based applications can easily support multiple locations and increase convenience to customers as well as employees.
Wash Me Fast also uses the loyalty program app to enable direct communication with the business, Starnes said. “At an express wash, customers who have a complaint are less likely to look for the manager or employee and instead post their dissatisfaction directly on Yelp, Facebook or Twitter,” he said. “Our loyalty program customers can easily reach one of the owners through the app.”
An automated survey asking customers to rate their service and post any comments goes directly to the general manager and other owners. “We respond to the notes within 24 hours, but if possible, we try to respond in one hour,” Starnes said. “We want to make it easy for customers to let us know if our high standards have not been met at one of our washes, and we don’t want to find out on social media.”
“We send a customer survey through the customer loyalty app after each visit asking about their visit and asking how likely the customer is to recommend us to someone else,” Hollabaugh said. “A team member responds to every survey — positive or negative — within 48 hours.”
Don’t forget to ask your customers what they would like to see in a customer loyalty program. “We listened to customer feedback to identify which features and rewards would be included,” Hollabaugh said. “For example, we are looking into the idea to reimburse unlimited plan customers for vacuum fees, which came from customer feedback.”
Be sure your reward system not only reflects what your customers want, but also what you want for your business, advises Goldstein. For example, if your goal is to drive volume, giving credits based on number of visits will achieve that goal. “However, if your goal is to drive more revenue, base your reward credits on dollars spent,” he said. This rewards customers who select higher priced services more quickly than customers who buy the basic wash and no extra services.
In addition to asking customers for input, make sure employees understand the program’s goals and the critical role they play in the program’s success, suggests Brett Yorks, director of training for Washify. “Loyalty programs must be promoted to customers, and if employees don’t believe in them, or if they think they will just add to their workload, they won’t encourage customers to participate.”
Promotion takes a variety of forms depending on the car wash business —signs at the locations, emails to customers with contact information on file, the company website and inclusion in any other form of advertising or marketing, will create a buzz and let people know the benefits of participation.
To maximize the benefit of a loyalty program, be sure the technology can support a variety of purposes, suggests Matt D’souza, head of operations for Washify. “Automate email reminders, notices of special events or discounts specifically for loyalty program customers to eliminate the need for employees to handle these marketing efforts,” he said. Also, use an online system to allow customers to schedule appointments for detailing services, emission inspections or other specialty services you offer. “Allowing customers to schedule services themselves is not only more convenient for them because they don’t have to reach someone on a phone, but it reduces the amount of time an employee must spend scheduling services.”