Customer Retention: Using First-Party Data to Drive More Sales

Did you know that sitting in your DMS right now is the key to a higher marketing ROI and an increased market share? It all lies within defining your most valuable customers and weeding out the ones that are costing you money. On average, 79% of dealerships’ gross profits come from the top 20% of customers, while the bottom 20% of customers tend to cost dealerships money. Defining these groups of customers can be the difference of wasting your marketing dollars or a higher marketing ROI and more sales.

But how do you identify these groups of customers? This part is simple—run a report on your customer database that calculates the annual gross profit of each customer. From here you will be able to separate your best customers from your less-than-ideal customers. Marketing to these customers is where you want to spend your budget. Your most valuable customers are ones that continue a relationship with your dealership after the initial purchase, in turn spending more money at your dealership with service and more.

So you have identified your top customers, now what? Within your DMS there is first-party data about your customers provided from all of your various interactions with them. This data can provide you with insight into the certain values, behaviors, and service expectations that are common among your customers. From here you can create targeted retention campaigns that provide appealing content to each of your customer segments.

Retention campaigns aren’t the only purpose this data serves. By segmenting out your best customers into common groups, you can then create campaigns targeting similar customers with lookalike audiences. These lookalike audiences target people with the same tendencies as your top 20% customers, so you’ll know exactly how to market to them and win their business.

Overall, the way to get a higher ROI and more sales is taking advantage of first-party data, but the key is to make sure your data is quality and gives you enough information to work with. For more information on utilizing first-party data to its fullest or if you have any other questions, contact us at or 864-248-0886.