The car wash industry is insanely competitive. In fact, the car wash and auto detailing market is an $11 billion industry, and the industry is growing 2-3% year-over-year. More precisely, annual growth in the car wash industry is projected to continue through 2021 at an estimated 1.7 percent.
While competition continues to grow, so does opportunity. The recent drops in gas prices means more driving, more washes, and more demand for express services and auto detailing.
Smart car wash operators, looking to stand out in a competitive industry and take advantage of increased opportunity, are reimagining the way they look at revenue metrics and how they interact with customers.
How? Instead of focusing on individual sales, successful car washes are now offering monthly plans—subscriptions that encourage repeatable and recurring revenues as well as opportunities for ongoing customer engagement.
If you’re on the fence about whether or not to offer an unlimited monthly subscription at your car wash, this post is for you. Here is how unlimited plans help you grow your revenue, encourage repeat business, and connect with your customers.
1. Unlimited plans encourage more meaningful success metrics
A traditional success metric in the car wash industry is per-car revenue. Per-car revenue tells you how much a pay-as-you-go customer spends in a month.
Per-car revenue is measurable. However, it’s difficult to predict, especially when you factor in `unknowns like changing weather patterns and fluctuating gas prices. Additionally, when you have no way to connect with pay-as-you-go customers, you have no guarantee they will return for repeat car washes.
With an unlimited plan model, on the other hand, car wash operators can look at per-customer revenue as a more powerful and telling metric.
Per-customer metrics tell you how much a specific customer spends in a month, and is more predictable when customers sign up with a monthly membership.
Carwash.com offers a compelling example to illustrate why this is a better metric. They compare Customer A, a monthly plan holder that pays $40 per month, and Customer B, a pay-as-you-go customer who maybe comes in once a month for an $18 wash. The per-customer revenue for Customer A, the monthly pass holder, is a predictable $480 of yearly revenue, while the yearly per-car value of Customer B is only $216.
Per-customer revenue for unlimited pass members is a more predictable and easier metric to measure. Additionally, when car wash owners shift their mindset to think about metrics that result in customer retention by securing repeat business, instead of single per-car sales, it fosters customer behavior that increases revenue and ROI.
2. Unlimited plans encourage visit frequency
It’s true customer washes will increase initially with a monthly plan (although, the excitement of overwashing subsides over time). But, increased frequency of visits is exactly what you want.
When your loyal customers (monthly membership subscribers) visit your car wash more often, you have more hands-on opportunities for boosting customer retention rates and increasing customer engagement.
Frequency = upsell opportunities & customer retention
With increased frequency of visits, car wash employees have more opportunity to encourage monthly plan members to both spend more while they are at your car wash (upsell) and return for additional offers (retention/loyalty).
The value of frequency of visits for upselling and customer retention is unmatched when you look at the stats:
- Repeat customers spend 33 percent more than new customers.
- The average repeat customer spends 67 percent more in months 31-36 of their relationship with a business than they do in months 0-6.
- A 5 percent increase in customer retention can lead to an increase in profits of between 25 and 95 percent.
Frequency = opportunities to engage with customers
The more your customers visit your business, the more opportunities you have to engage with them as well. Of course, your employees can engage with customers face-to-face, but there are other ways to stay connected to monthly car wash subscribers, which we’ll discuss in the next section.
The important thing to remember is ghe numbers prove that highly-engaged customers are the customers you want.
- Engaged customers buy 90 percent more often and spend 60 percent more per transaction.
- Engaged customers are worth 23% more in terms of share of wallet, profitability, and revenue, compared to the average customer, according to a Gallup poll.
This doesn’t mean you turn away pay-as-you-go customers. It just means a more strategic focus for your car wash is to turn those pay-as-you-go customers into monthly, more engaged, and frequent visitors by signing them up for a monthly membership plan.
3. Capture customer data to engage monthly membership customers
A top-notch customer experience for a monthly plan car wash customer means delivering everything from a clean car wash to a personalized experience.
It’s not difficult to promise a clean car, but how do you deliver a personalized experience when you only have seconds to engage with your customers?
The answer: technology.
Rather than trying to get to know your unlimited pass customers with a short face-to-face interaction, the smarter approach is to capture customer data and send targeted and relevant communications to them at the right time.
You can quickly and easily encourage pay-as-you-go customers to sign up for an unlimited membership through your customer engagement app. Then, you can effectively capture customer data including how much customers spend, what times they visit, how often they visit your car wash, and you can even elicit direct customer feedback.
Capturing this customer data is the first step to real customer engagement. The second step is to use the data to reach out to customers in ways that are meaningful to them
Because the express car wash service at Zips is such a quick process, they have very little face platform to boost their engagement.time to engage their customers personally. So, they turned to their customer engagement
Zips used their cutomer engagement platrform from Thanx to send an email to their list of 90K opt-in email subscribers and asked customers to enroll in their loyalty program. After sending one engaging email, Zips Car Wash saw a 9% conversion rate and received nearly 9,000 new loyalty program members.
More importantly, Zips Car Wash can now manage all customer contact information data in one place, and can use one platform to create and send emails to engage their customers, build relationships, and measure the results of their efforts.
You can do the same at your car wash.
Targeted email campaigns are a highly effective way inform unlimited monthly plan members about exciting promotions that are tailored just for your monthly members. You can use these messages to get your monthly members to come into your store more often, spend more when they do, and enjoy all the benefits of a sparkling clean vehicle—inside and out.
Remember, email isn’t your only engagement option. You can also use SMS to your advantage. Customers take their smartphones everywhere so being able to send them a text message with a personalized offer opens up a whole new communication channel that can engage them anytime, anywhere.
Investing in technology to help guide your unlimited monthly plan and connect with customers in more personal ways just makes sense.
The car wash industry is competitive, and without the right tools to engage customers and ensure repeat business, it can be difficult to predict success and grow your business.
An unlimited monthly membership plan, managed through a customer engagement platform is the perfect way to grow your revenue, encourage repeat business, and connect with your customers in more meaningful and long-term ways.