I just wrapped up a long-running assignment in the automotive world, diving into customer understanding and engagement. And here’s the thing: while everyone’s eyes sparkle at selling the latest shiny new model, the real profitability story is hiding elsewhere.

Reports (e.g. NADA) show that:

  • For dealers, aftersales is just 13% of revenue, but delivers 50% of profit.
  • For OEMs, aftersales is 10-20% of revenue, yet contributes 30-50% of profit.

Less glamorous than a showroom launch, maybe. But much more important for the bottom line.

And unlocking this potential boils down to one word: loyalty.
If customers stick with the official network for maintenance and repairs, everyone wins.

The Shifting Landscape

We’re in the middle of a fundamental change:

  • OEMs are moving from having no direct customer contact to suddenly having connected cars feeding them usage data and opening new direct communication channels. They have the scale to invest in systems, but creating loyalty with end customers isn’t (yet) in their DNA. Too often, the responsibility still gets pushed down to the dealers.
  • Dealers are evolving too: from local mechanics with a showroom to large groups managing multiple brands and locations. But their scale often isn’t big enough to invest in specialized customer loyalty teams. The best dealers make it work; most are still catching up.

The Complex Challenge

The entire value chain is in flux:

  • Manufacturers, distributors, and dealers are all racing to set up new CRM systems to “own the customer”
  • Data regulation adds layers of complexity to combining insights.
  • Customers, meanwhile, expect seamless, personalized interactions – because that’s what they get everywhere else.

The result? Chaotic times. Everyone is chasing loyalty, but no one fully owns it.

The Opportunity

The winners will be those who:

  • Combine data from connected cars, dealers, and distributors into one clear customer view and act on it!
  • Balance focus of shiny new car launches with long-term loyalty & after sales engagement.
  • Stop shifting loyalty responsibility around, and start owning it end-2-end

Because in today’s automotive world, customer loyalty isn’t just about keeping a seatbelt fastened – it’s about fastening profits for the long run.

A cup of coffee

I’d love to hear how your opinion on the topic, did you nail the customer loyalty topic? Do you share the view that customer loyalty should get more attention as a corner stone to get those after sales profits. Are you struggling to get the loyalty message to the driver:  The feeling that you care and they can trust you?

Lets get in touch.

 

About the author

Matej is a seasoned customer value expert with over 20 years of experience in marketing, CRM, and business strategy. He has a proven track record of driving growth and transformation across the telecom, banking, and retail sectors. Matej specializes in uncovering untapped value within customer bases and designing strategic roadmaps that help organizations unlock their full potential.

He is founding partner at Hyperson

 

Related Posts