PUBLISHED DATE: 2023-06-15 01:56:04

The Power of Post-Purchase: How Automakers Can Maximize Customer Lifetime Value

Publicis Sapient Transportation & Mobility

As the global automotive market sees a slowdown in growth and heightened competition, automakers must seek new ways to maintain their position. By shifting their focus from pre-sales and sales (e.g., units sold, market share) to maximizing Customer Lifetime Value (CLV) for existing customers, automakers can take advantage of a significant opportunity to differentiate themselves.

The post-purchase experience is often overlooked by automakers and dealerships. And aftersales operates separately without an integrated view. As a result, customers remain loyal for the first 3 years due to warranty and goodwill, but their relationship with automakers lacks a CLV perspective.

To build lasting customer loyalty, automakers must create a positive post-purchase experience with value-adding products and services. This requires a holistic customer view alongside the CLV and Vehicle Lifetime Value. An improved organization and governance structure, as well as the appointment of a Chief Customer Officer (CCO), are essential components.

Automakers that invest in the post-purchase experience will increase brand loyalty and elevate CLV, setting the foundation for success and differentiation in the future.

Here are 3 ways automakers can enhance the post-purchase experience:

  1. Gain a 360° customer view

    In today's digital age, customers expect "always-on engagement" and seamless experiences from the brands they interact with. With a 360° view of the customer, Original Equipment Manufacturers (OEMs), dealers and other stakeholders can gain a full understanding of their customers and provide personalized recommendations for an excellent post-purchase experience.

    To achieve a unified view of the customer, it’s essential for OEMs to invest in technical infrastructure that facilitates seamless data sharing with relevant stakeholders. Once established, this infrastructure can drive the development of valuable post-purchase services, including:

    Providing a seamless, omnichannel post-purchase experience through data sharing is crucial, as customers don’t differentiate between tiers but do expect a consistent experience.

  2. Orchestrate an integrated ecosystem around the customer with real added value

    To provide a seamless post-purchase experience, automakers need to consolidate their digital offerings into one ecosystem to avoid fragmenting the customer experience across multiple apps and sites. An integrated ecosystem makes it easy and convenient for customers to access services in a single place. Companies like Apple are a leading example of offering value-added services that make it easy for customers to transact and get their goods.

    OEMs can choose to create an ecosystem of in-house solutions, orchestrate an ecosystem of both in-house and third-party solutions or outsource the ecosystem altogether. The most effective approach will be merging both in-house and third-party solutions, transforming OEMs into ecosystem orchestrators that oversee the creation, implementation and evolution of a complete range of mobility services.

    Ecosystems enable OEMs to engage customers at a much higher cadence and with new branded experiences, such as offering mobility services, over-the-air (OTA) updates, functionality on-demand and adjacent services.

  3. Connectivity will become key

    Integrating the car into the ecosystem is critical, and in-car connectivity plays a vital role in keeping consumers connected and engaged while on the go. Connectivity enables the development of new digital ecosystem services that offer a more immersive and personalized driving experience, better safety and security and added value services such as OTA updates and in-car payment solutions.

    Here are a few of the most promising applications for car connectivity:

    • Usage-based insurance
      Pay How You Drive policies offer reduced insurance premiums to safe drivers, as cars become more equipped with sensors. Pay As You Drive policies provide on-demand coverage for specific trips, catering to the rise of short-term rentals and flexible mobility options.
    • Predictive maintenance
      Predictive maintenance leverages machine learning to alert car owners of potential vehicle issues before they arise. It can proactively order parts and schedule repairs, saving time and money for vehicle owners.
    • Charging booking
      Charging booking lets electric vehicle (EV) owners reserve charging spots in advance, helping alleviate range anxiety and minimize disruption to the EV driving experience.
    • In-car payment
      In-car payment allows anyone make payments from inside the vehicle for services such as parking or tolls. With the rise of EVs, in-car payment lets drivers pay for charging services without having to leave their cars.
    • OTA updates
      With OTA updates, OEMs can expand their service offerings to all car passengers, connecting CLV to loyalty programs and providing targeted services at the ideal moment.
    • Concierge services
      The car brand NIO, for example, offers concierge services that include battery swapping, social hubs, mobile charging and 24/7 customer support through its app.

    By offering ongoing engagement opportunities and value-added services through cars that are plugged into the larger ecosystem, OEMs can create a more meaningful and memorable ownership experience for customers.

Seize the moment

Exceptional post-purchase experiences can help automakers create lasting and meaningful relationships with their customers, fostering loyalty and driving revenue growth. As few automakers currently prioritize the post-purchase experience, there's an untapped opportunity for those that do to differentiate themselves and gain a competitive advantage.

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Nelson Pereira
Group Vice President and Managing Partner, Publicis Sapient
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