Regardless of the current economic situation, people need to keep their cars clean. A vehicle is a big investment, and spending a little more to maintain its value is important. But how can you convince customers to keep yet another monthly membership auto-charging when they are struggling to keep up with expenses?
Let’s address a few things an express exterior car wash owner should know about monthly car wash memberships, such as how to retain customers.
Important Factors to Consider in a Monthly Membership Program
Of course, monthly memberships are only one part of your car wash’s income. However, it can be the most important part of ensuring your wash is producing optimal profits all year long. So, let’s look at three factors you need to know.
Acquisition – How many new members are you getting to sign up for each period (month, quarter, year, etc.)? This is impacted by many factors, including the marketing that you use. Of course, acquisitions are more important than retention in the early days of a business when you start with zero customers. However, retaining a member is often cheaper than finding a new one in the long run, so as long as this number stays higher than your churn, you are increasing your revenue.
Retention – Again, this is cheaper than the cost of acquiring a new customer. So don’t forget to set aside some of your marketing money to retain members after you get them. If this means a temporary membership price cut during a difficult economic time, you are still often saving money over the cost of acquiring new members (especially in a recession when fewer people are looking to add a monthly fee).
Churn – This is the number of members who cancel their subscription each period (month, quarter, year, etc.). Of course, you can’t hold onto every single client. But each one you retain helps you hit your next profit goal without having to increase ad spending. For a car wash business, keeping churn low is important because you have a limited pool of drivers close enough to frequent your wash. So good customer service is a must!
Balancing pricing, marketing, and providing top-notch customer service takes skill, but the reward is a growing customer base that will continue to support you during lean times and that will be happy to stick with you, making it easier to increase profits during times of plenty.
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