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Study: Dealers must woo young service customers

Service customers at auto dealerships are intensely loyal -- but are older and spend less than customers of independent shops and chains, according to a recent survey.

So dealers must win converts with online promotions and prepaid programs, said Mike Martinez, chief marketer at DMEautomotive, the marketing firm that commissioned the survey.

Dealer loyalists, defined as those who spend the bulk of their service dollars at the dealership, are more than twice as likely to be 55 years old or older than people who typically get service at independent garages and service chains, the survey found.

Many independent garages specialize in vehicles on their second and third owners, who often are younger than new-car buyers. And the old vehicles frequently need more repairs than new vehicles.

The survey, of 4,000 random adults who had vehicles serviced in 2011, also looked at average annual spending by customers who were highly loyal to dealerships, independent garages or service chains. The 2011 figures: independent garages, $1,191; service chains, $1,178; dealerships, $1,105.

Loyalists of the service chains spend more even though dealership loyalists tend to be wealthier, more diligent in sticking to recommended service schedules and less sensitive to the price of service, Martinez said.

"The aftermarket chains are doing a better job of taking money away from dealers than dealers are taking money away from them."

Old cars, more $$$
Dealerships tend to service newer cars than independent garages, and newer cars typically need fewer repairs.
  Avg. age of cars serviced
Dealerships 6.5 years
Service chains 7.6 years
Independent garages 9.1 years
Source: DMEautomotive

You can reach David Barkholz at dbarkholz(at)crain.com.

Originally posted at Automotive News: http://www.autonews.com/apps/pbcs.dll/article?AID=/20120402/RETAIL0...

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