Research published in 2014 by the British Parking Association showed parking to be a thriving industry in the UK, comprising an estimated 11 million public parking spaces, 542 private car parks and 3886 local authority car parks managed by ATA members. With 35.6 million vehicles licensed for use on the roads in the UK indicating that 55% of the population now own a car, parking is an integral part of the daily experience.
However, as technology has taken hold, apps, smart parking and alternative transport such as Uber have disrupted the way we park. Parking operators must learn from retail, and build long-sighted strategies to engage with customers.
Much gain is perceived from customer acquisition – getting new customers through those turnstiles to boost revenue. But the real long-term success of any business lies with customer retention.
What is customer retention?
Customer retention does exactly what it says on the tin. It refers to the strategy used by your business to increase the number of repeat customers and to increase the profitability of every existing customer. Customers return regularly to your facility and spend more money.
It’s a commonly accepted truth that it costs much less to retain an existing customer than it does to acquire a new one. It also generates more revenue. According to management consulting firm Bain & Company, increasing customer retention rates by only 5% increases profits by between 25% and 95%. This becomes especially valuable in the crowded e-commerce arena where the cost of clicks and conversions can be high. You worked hard to get your customers in the first place. It’s important to keep them.
Where customer acquisition builds your initial customer base, a retention strategy will optimise your relationship with those customers.
Why are existing customers important?
When a customer has already used your facility and been satisfied with the service you provided, they are likely to it again. The chances are that they will recommend it to a friend. They already have a relationship with your product, and trust has been established. And, you already have that client’s data in your system, meaning that you know what they like and what they want.
You could focus on continually repeating the process of engaging a new customer to this point. But it is much more profitable to invest in people who already park with you.
When you retain a customer and build repeat business you also gain quality insight into how satisfied that customer is with your product, operational service and customer service. Most people who leave do so because they are unhappy with the way a query has been managed. In many cases you may never know what happened, but if a customer has experienced poor customer service, they are likely to tell their friends or leave a negative review. In this way, with one lost sale you can lose many more.
Therefore, in order to succeed, your parking business must develop a customer retention strategy.
Acquisition vs. retention
When you are first starting out with a new parking app, the focus will be on getting customers. Your marketing strategies will centre on growing your customer base. Within a short time you can begin to encourage retention using email campaigns to persuade an existing customer to use your car park again.
As sales grow, the focus on retention can grow too. You can look at setting up a loyalty or referral programme, and develop your marketing automation to offer personalised communications that build customer relations. Where acquisition can lead to a lot of one-off visits, a retention strategy can increase the lifetime value of each customer. As your business becomes more established, it will pay to focus heavily on retention.
How retention works in the parking industry
While the basic principle is the same for any business, the type of product you offer impacts heavily on your choice and implementation of marketing strategy. For example, if you offer high-value products such as season tickets, customer lifetime value will be high and a solid retention strategy is essential.
Knowing your customer
Customer retention is only possible if you know your customer. But what information do you need to know? How do you collect this data, and most importantly, how do you improve what needs improving?
Clear, actionable, real-time insights about your business will enable you to build a retention strategy that increases profitability for the long-term. In order to achieve this, you need access to specific information:
It is easier to calculate these aspects of your business than it may seem. An integrated car park booking and CRM system like Rezcomm Engage offers detailed, up-to-the-minute reporting and analytics for parking companies that include product reports buying trends, and even revenue forecasting. An intuitive dashboard offers clear insights as to how much each customer is actually worth.
10 Customer retention strategies for parking
There are many concepts within business that will improve customer retention, but what tangible actions can you take to develop and maintain those all-important relationships?
1. Use customer accounts
Because of the trust and commitment involved in setting up a customer account within your parking app, many people may prefer to checkout as guests. However, it’s possible to encourage customer accounts without preventing conversions from first-time customers by offering the option to create an account after the first booking has been made.
Rezcomm’s integrated car park booking system allows each customer to create a secure account, brand-matched with your website to build trust. This makes the next booking easier by giving the customer access to previous transactions, as well as reducing the need to enter new information.
2. Work on customer service
Good customer support systems mean you can communicate with your customer and offer them appropriate support. A live chat or helpdesk tool can help both pre and post sale, can turn a question into a sale and a complaint into a positive experience. More often than not, a complaint that is resolved well will actually turn a potentially unhappy customer into a loyal repeat booker.
Data from Shopify indicates that while customers respond to ‘delight’ in a transaction, they see consistent, fast and friendly customer service as more important. In a technology-driven world where tasks can be achieved instantly over the Internet, personalising your customer service will make a big difference.
Be aware that people are more affected by negative experiences than positive and will be willing to comment on bad service both face-to-face with friends and on social media. Therefore, if a customer is unhappy with the service it is worth making sure their problem is resolved in a friendly way.
Your customer service team will need tools to handle client communications as quickly as possible without asking too many questions. The customer wants to know that your company recognises them, knows their booking history and will solve any problems smoothly.
3. Develop a customer loyalty programme
Loyalty programmes motivate customers to purchase more often in order to earn rewards. This is a great way to increase the frequency with which a customer books at your facility.
Introduce customers to the scheme by offering welcome points when they create an account. When a customer sees how easy it is to gain rewards, they will be keen to return to your facility to earn more. The programme can be as simple as directly rewarding a customer for repeat bookings or after a set lifetime booking value has been reached.
A CRM and e-marketing software like Rezcomm Engage can be set to automate these rewards, giving you a proactive approach to customer care without adding to the workload. Discount codes, personalised promotions or thank-you messages will all be appreciated.
4. Ask for feedback
Asking for feedback gives you the chance to identify problems early on and improve where necessary. By asking questions on a personal level you can also avoid negative public feedback. Reach out to your customers using a short customer satisfaction survey: Do they like your facility? Was checkout easy? What would they change? Timely customer feedback is worth way more than market research and will make your customers feel empowered.
Survey responses can be integrated with customer data in the CRM system allowing you to build a more holistic picture of your customer that will be useful in customer retention.
5. Build and maintain a relationship with the customer
After the first booking, you receive a lot of information about the customer. Use this data to stay in touch, build trust and develop customer relationships with an engaging e-marketing strategy.
6. Send engaging emails to customers
Since purchase frequency is front and centre of customer retention, email marketing is vital to your retention toolkit. According to Shopify, email has the highest conversion rate among online marketing strategies. With email, you can build a relationship with your customer before and after their initial booking. But make sure each communication adds value to your customer’s experience. If it doesn’t, they can simply unsubscribe.
Automated messages can begin with follow-up emails. After the first booking, send the customer an email that acknowledges and thanks them for parking with you. This type of message leaves the customer feeling good about their decision to park at your facility and makes your brand seem friendlier.
You can build value into this email by recommending up-sell and cross-sell products such as car valet or electric vehicle charging, or partner offers from retailers near your facility. Include user reviews to increase the appeal of each recommended product and the customer’s desire to purchase.
Continue to nurture customer relationships using Rezcomm’s e-marketing tools to send regular, personalised messages. Remember, every customer is different and requires a specific approach. Personalising your messages and offers based on previous buying behaviour and customer data can mean the difference between a second booking and losing that client to a competitor.
7. Customer-management platforms
The more successful your parking operation is, the more complicated it becomes to manage operations and customers in a seamless, efficient manner. Implementing a Customer Relationship Management (CRM) tool like Rezcomm Engage is a proactive way to enable your employees to provide the best quality service. A platform that understands the needs of your specific business will manage your customer database, send automated emails, suggest promotion and issue payment reminders. It becomes easy to action your customer retention strategy giving you more time to focus on other aspects of your business.
While there are many CRM systems on the market, it pays to go with a company that understands parking. Rezcomm combines many years of parking industry experience with technical innovation. Rezcomm’s products are used by leading car-parking operators to maximise revenues and reduce operating costs.
8. Offer a discount or credit to return
Discounts can result in loss of revenue. However, they can also be used to optimise revenue, for example by filling a parking space that may otherwise sit empty at certain times of day. Consider sending a discount code to a first-time booker offering money off their next visit. This can be a good way to retain customers and to recover clients who haven’t purchased for a while.
9. Use social media
Good handling of social media can be a powerful way to boost customer retention. Use the fact that your clients are very likely to be using social media to stay visible. Develop brand accounts on Facebook, Twitter, Instagram, LinkedIn, YouTube and Snapchat. Learn which channels your customers use and communicate with them on those platforms. This is a good way to learn their thoughts about your company and to encourage them to share positive experiences.
10. Keep your website, mobile app and checkout process customer-friendly
Customers will respond positively to an easy booking and checkout process. Any aspects of your booking system that fail to work smoothly will result in abandoned carts and lost customers. Rezcomm’s integrated car park booking software integrates seamlessly with your website or app to provide a simple checkout for customers. It even offers different language options for customer convenience.
The benefits of customer retention
Your current customer base is your best asset. These people already know your brand, use your facility and appreciate your products and service. It makes sense therefore to focus time and resources on improving the experience for existing customers and enjoy increased revenue from your inventory as a result.
If you would like to speak to Rezcomm about our integrated car park booking and CRM management solutions, contact the team today.