Friday, 14 August 2020 17:33

Subaru Tops J.D. Power Automotive Brand Loyalty Study Again

Written by Jason Unrau, CBT Automotive News


For the second year in a row, Subaru ranks highest in mainstream brand loyalty, according to J.D. Power’s 2020 U.S. Automotive Loyalty Study.

Subaru owners who are trading in or purchasing a subsequent vehicle have a loyalty rate of 60.5%.


That rate narrowly beats out second-place Toyota with a loyalty rate of 60.3%, as well as Honda at 58.7%, RAM at 57.3% and Ford at 54.3%.


Luxury brands rated lower overall, with Lexus topping the list at 48%, then Mercedes-Benz at 47.8%, followed by BMW at 45.1%, Porsche at 44.9% and Audi at 43.4%.


The study uses data compiled from the Power Information Network between June 2019 and May 2020. A car buyer is deemed loyal if the car brand they purchase is the same as the brand they are trading in or currently own.


Customer Retention Remains a Priority


Not surprisingly, one of the top goals for carmakers is customer retention. Customer acquisition costs per new vehicle sold was reported to be $633 per vehicle in 2016---a number that’s sure to have climbed since then. Retained customers are about one-10th of that cost, saving the dealership nearly $600 per sold vehicle in advertising, marketing and other costs.


During the pandemic recovery, carmakers have clearly had retention at top of mind. Toyota and Kia offered loyalty cash on certain models, for example, while Honda offered rate reductions for eligible buyers who currently owned a Honda.


“Automakers are really focused on customer retention, as evidenced by the payment plans and incentives they’ve offered since the COVID-19 pandemic broke out," said Tyson Jominy, vice president of data & analytics at J.D. Power. "Many have gone above and beyond to offer customers financial assistance during a period of economic uncertainty, which does a lot to bolster consumer confidence in their chosen brand and repurchase it in the future.”


CX at Point of Purchase


Customer satisfaction with the purchasing experience is a major target for dealerships and carmakers alike. More than ever, reliability and initial quality are on par across the brands sold in North America and is less of a factor than in years past. The difference is now in how well customers feel they’ve been treated during the sales process.

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