The real issue for car wash owners considering memberships - particularly unlimited - is the long-term profit potential.
Unlimited Wash programs have their place – but don’t confuse heavy use with loyalty.
In an article entitled “Customer loyalty: why loyalty programs are no longer enough” there are lots of facts supporting an overall decline in consumer interest in loyalty programs.
While there is an overall decline in interest in traditional loyalty marketing across many retail segments, membership programs like Unlimited Wash options can generate lots of traffic and would appear to defy these trends.
However, what is true, is that unlimited programs attract and hold high volume washers. These ‘chronic’ washers can wash several times a week – maybe daily – driving up the traffic, sales and expenses of the wash, but driving down profit margin.
The real issue for car wash owners to look at when considering a membership program – particularly an unlimited wash program – is the long-term profit potential.
Many car wash operators do not accurately measure the true profitability of their wash programs. Understanding the low profitability of a heavy wash user is important when considering an unlimited wash program. That’s why unlimited programs should be considered as a short term promotion — and make sure you have an exit strategy! Make sure you have the tools to transition customers into a more profitable program that rewards real loyalty.
This from the Harvard Business Review: “Realizing the benefits of loyalty requires an admission that not all customers are equal. In order to maximize loyalty and profitability, a company must give its best value to its best customers. That is, customers who generate superior profits for a company should enjoy the benefits of that value creation. As a result, they will then become even more loyal and profitable.”
The key word is PROFIT. The best car wash customers are frequent visitors, loyal users, and full-order shoppers; they trust your operation for complete wash services and appreciate the value of a fairly-priced, high-quality wash. They ‘pay their own way’ and don’t drag down margins – that’s what real loyalty delivers to a good retail brand.
App-based membership programs (like the WashCard UWashApp) offer a wide spectrum of options for membership and loyalty programs that can be tailored for any operation and any type of customer base.
Make sure you research all your options for traffic-building membership programs.
Don’t get locked into a one-size-fits-all unlimited program that will be difficult to keep profitable, and get out of when the time is right.