Does the word coupon or discount make you cringe? If so you are not alone, since many quick lube owners believe they provide a quality service at a good price, and feel they should not have to discount their service as an incentive to purchase it.
Does that sound familiar? The question of whether to coupon or not to coupon is encountered by all business owners whether they own a restaurant or run a quick lube.
Coupons, Coupons Everywhere!
According to the Promotional Marketing Association’s (PMA) Coupon Council, as many as 3.8 billion coupons were redeemed last year, saving shoppers more than $3 billion.
In fact, 79 percent of the United States population uses coupons, making it a very popular component of shopping in America.
These statistics force you to absorb the fact that coupons play a vital role in making a sale in America. Therefore, the answer isn’t whether to use coupons as a marketing incentive but rather when and how to effectively use them.
The basics: An effective coupon is one that fulfills its main purpose, working as an incentive to motivate the customer to make a purchase, resulting in a profit for your business.
Keep it simple: When couponing, make sure your offer is clear and concise. It is best to communicate one message or incentive clearly and specifically so the customer can comprehend and act on it.
Special offers: Try to avoid running the same discount offer every week in the local newspaper. If you run a discount, tie it in with a special occasion or a seasonal promotion (i.e. back to school, summer special, business anniversary promotion, etc.).
This way your customers don’t expect a discount all the time. This will cause customers to appreciate discounts when offered while protecting the value of your service.
You don’t want a customer coming in for an oil change or other service knowing that they don’t have a coupon that is always in the paper; this might make them feel that your service isn’t worth the regular price but rather the discounted price.
Upsell incentives: Rather than frequently discounting your standard oil change service, consider coupons that encourage the customer to purchase other services like:
• Wiper blades,
• Tire rotation,
• Radiator service,
• Fuel injection service, etc.
This motivates the customer to make a larger purchase, but it also familiarizes them with the other services you provide. Consider a free tire rotation as an offer that might inspire a customer to visit you versus the competition.
Dollar amounts vs. percentages: When placing a coupon, keep in mind that a specific dollar amount savings tends to grab a consumer’s attention quicker than a percentage-off savings. And nothing grabs a consumer’s attention more than the word, “free.”
Track it: When you coupon you should also have a system of tracking your offers.
A good habit would be to track the number of coupons redeemed daily. That way you can evaluate what incentives work and which ones don’t and make necessary changes.
Reward Loyalty: Focus your marketing energies and dollars on building loyalty with your existing customers. Statistics find that it may cost you as much as 10 times more in obtaining a new customer than to retain an existing one.
Continually couponing and deep discounting create loyalty, but they inadvertently tie the customer to the discount rather than to the service.
If the focus of your loyalty is based on the concept of getting an oil change for less, then that is what you will get: less. For the best results, your incentives should entice customers to spend more and spend often.
Ways to create loyalty
Auto care club: Start a loyalty club where customers can join to gain certain benefits.
For instance the club could cost $29.95 to join and the customer will receive a free oil change, a number of preferred pricing oil changes, a percentage discount off other services and maybe a free tire rotation with every visit.
Punch card: Reward your loyal customers and ensure repeat business with customized punch cards. Each time your customer has an oil change performed, punch their card. When they have 10 punches they redeem the card for a free oil change.
Incremental punch cards: Much like punch cards, these provide customers with instant gratification. Each visit is rewarded with a higher discount:
• The first visit will be the card;
• The second is a 10 percent discount;
• The third is a 15 percent discount; and
• They are working their way up to possibly a free service.
Birthday program: Track your customer’s birthday information and send them a birthday postcard with either a pop out loyalty card or perforated coupons.
The postcard could contain a free oil change, or a free add-on service (like tire rotation, wiper blades, etc).
Reminder cards: Reminder cards should be sent out to customers that are due for service. This can have an offer to entice the customer to come in for service. The offer should get stronger the longer the customer is overdue.
Your reminder cards can also promote one of your loyalty programs as an incentive for the customer to visit. Another twist for a reminder card is to combine it with a scratch and win contest where the customer must bring the card in to see what they have won.
Partnerships: A nice way to reward your loyal customers is to offer a free service or discount with another business such as a carwash.
If you have an attached carwash to your service station, offer a coupon for a free basic wash with the purchase of an oil change or another service.
Email offers: When a customer signs up for your loyalty program ask them also for their email address. That way you can double your marketing efforts by emailing your loyal customers the weekly promotions you are running in the local newspaper, special deals, and information about new loyalty programs.
The bottom line
Keep in mind that whatever type of incentive programs you develop you do not have to offer the best deal in town or be the cheapest oil change to gain and keep customers.
Rather, work on your image and maintain your reputation as being the best quality service and value around.
Focus on what sets you apart from the competition (i.e. your people, quickness, value, cost, service, even your food in the waiting room, etc.) as a result your customers will feel loyal to your exceptional service than to your discount offers.
Written by Ron Beverly, President and Chief Idea Generator for Vision Marketing, Inc., Lynchburg, VA, which provides marketing products and solutions for the car wash and oil change industries, and can be reached at email@example.com.
The above article was originally submitted to Professional Carwashing & Detailing® magazine in December 2003.