In DriveSure’s newly released 2023 Dealership Service Retention Report, we uncovered startling insights into the tire sales landscape at dealerships. Our research revealed a significant gap in customer awareness, with nearly a third of customers unsure if their dealership even sells tires.

This lack of knowledge is creating a major missed opportunity for dealerships, and potential repeat customers are turning to other businesses for their tire needs.

Why focus on tires?

Profits from traditional services like oil changes have been declining for years, due to issues like advancements in vehicle technology and extended service intervals. More than just a sale, an oil change is an opportunity to offer other, more profitable services. So fewer oil changes means lower service profits overall, and lower retention of customers.

Tires sales have emerged as a major solution for this. Tires aren’t known for big margins at dealerships, but they are a major defection point for drivers. If a vehicle owner starts going to a repair shop (or Walmart) to get their tires changed, you might not ever see them again. That other shop gets a chance to win them over with a great experience or better pricing.

Meanwhile. each customer visit for tires gives your service advisors a chance to identify and address minor issues, and to offer an exceptional, loyalty-enhancing experience.

In other words, tires are valuable not just for the sale itself, but for retaining the customer in the long term.

Tire services are essential, but dealerships need to do more to promote them

Dealerships often struggle to sell tires. In DriveSure’s 2023 Dealership Service Retention Report, we found a big obstacle to tire sales: customers don’t even realize they can get tires from their dealership, so they go elsewhere.

  • A mere 33 percent of vehicle owners who’ve purchased tires for their current vehicle purchased their last tire (or set of tires) at a dealership.
  • A staggering 29% of customers are unsure if their dealership even sells tires.
  • Even among the “extremely loyal” customers, 24% say they’re not sure if their dealership sells tires.

This lack of knowledge is a big problem because potential customers are going to other businesses for their tire needs, creating a missed opportunity for dealerships.

To compound the issue, big box retailers are quickly capturing a massive share of the tire business, luring customers with their aggressive pricing and marketing strategies. This shift is causing dealerships to lose a substantial portion of their customer base, further eroding their profits.

So how can dealerships capture more tire service customers before the big guys make it even harder?

What keeps customers coming back to your dealership in 2023?

Insights from Nearly 1,500 Dealership Customers

Increase tire service awareness with smarter marketing

A small customer base for tire service doesn’t need to be such a big issue: a full 63% of vehicle owners prefer to have tire rotations and repairs done at their dealership. In other words, winning more customers to your dealership can be as simple as increasing awareness.

One solution is to be more strategic in promoting tire services. By increasing awareness of your dealership’s tire services, you can tap into a lucrative market. Based on our research, if all your dealership’s customers knew you sold tires, you could see as much as a 10% more of your total customer base buying tires.

In other words, say you have 100 customers and 50 of them buy their tires from you. When your customers are all aware you sell tires, that number can grow to 60 (50 plus 10 percent of 100) — which in this example amounts to a 20% increase in the number of tire service customers.

So how do you get started?

  • More Comprehensive Promotion of Tire Services: Start with the basics, being sure to update in-store signage, your website, and social media, making sure to inform and remind customers about your tire services.
  • Direct Marketing: Utilize direct marketing techniques such as email newsletters, mailers, and text messages to remind customers about your tire services. Text messages in particular are quickly becoming the preferred method for dealership customers to receive information.
  • Value-Added Services for Tires: Offer value-added services for tires. According to our report, customers value these services more than other amenities. Consider offering Value added services like the free road hazard tire protection included with DriveSure Renewable Benefits. These services are highly appealing to customers and are easy to manage.

Employing value-added services like these has proven enormously beneficial for dealerships trying to stay competitive in tire service. It even helped a Parts and Service Director at Kastner Honda sell more tires at three separate dealerships, using DriveSure.

In your messaging, be sure to highlight your competitive advantages over tire competitors. This could include your specialized knowledge, personalized service, high-quality products, or the convenience of getting all car services in one place.

This shift could significantly boost profits and offset the decline from other services. Therefore, it’s crucial to communicate clearly about your tire services, from the initial sale and at each relevant point afterward. By doing so, you can ensure customers turn to your dealership for their tire needs, driving up sales and bolstering your bottom line.

This not only provides an opportunity for increased profits but also ensures customer retention by offering comprehensive, one-stop service.

Get the latest data on service customer preferences

The better you understand your service customers, the more you’re able to give them what they want and keep them coming back. That’s why we surveyed nearly 1,500 vehicle owners who rely on dealership service departments for a portion of their vehicle’s upkeep and repair, and published the results in our 2023 Dealership Service Retention Report.

This report provides a deep dive into customer preferences, from tire services to reasons for customer defection. Other key findings include the relative importance of quality, price, and service appointment availability in customers’ choice of service provider.  From evolving communication preferences (both during and between services) to what people of each age group prefer, you’ll learn how to better serve your customers and keep them coming back.

What keeps customers coming back to your dealership?

Download the 2023 Dealership Service Retention Report to see what dealership service customers have to say.

Join us for a free online event on July 28th!Battling 5 Dealership Service Defection Points with DriveSure