The customer experience matters

Automakers work hard to keep customers coming back, and increasing competition is only making that job much more difficult. Some brands are better at retaining customers than others. J.D. Power’s 2020 US Automotive Brand Loyalty Study for new cars, released this week, shows which automakers succeed in customer loyalty, and which ones have work to do.

Lexus tops the study for luxury brands with a 48 percent of customers returning to the brand. That’s followed closely by Mercedes at 47.8 percent with BMW, Porsche, and Audi trailing at 45.1 percent, 44.9 percent, and 43.4 percent, respectively. Those automakers squash brands such as Jaguar (20.7 percent), Infiniti (27.7 percent), and Maserati (28.7 percent). For US brands, Lincoln bested Cadillac 37 percent to 33.8 percent.

Mass market automakers that see a high percentage of returning customers include Subaru, Toyota, and Honda. The three Japanese automakers had a 60.5-, 60.3-, and 58.7-percent loyalty rate, respectively. Ram placed fourth at 57.3 percent, ahead of Ford at 54.3 percent and Kia at 51.3. Chevy came in at just under 50 percent – 49.1.

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Mainstream brands that suffer from low loyalty includes a trio of Fiat Chrysler Automobiles brands – Fiat, Chrysler, and Dodge, which sees 10.4, 14.1, and 17.8 percent of customers returning. Next is Mini with 26.8 percent brand loyalty. Mitsubishi and Buick are in similar boats at 27.1 and 27.5 percent. 

J.D. Power calculated brand loyalty percentages through the Power Information Network, studying the percentage of vehicle owners who chose the same brand when upgrading to a new vehicle. The study calculated the rates based on transaction data from June 2019 through May 2020.

Gallery: 2020 Subaru Outback Onyx Edition XT: Feature

J.D. Power’s Vice President of Data and Analytics Tyson Jominy said there are “many factors that contribute to brand loyalty,” including the purchasing experience and how the car makes owners feel when they’re driving. Jominy pointed to automakers most recent focus on customer retention – the various programs introduced to help customers who may have been affected by the coronavirus pandemic. “Many have gone above and beyond to offer customers financial assistance,” said Tyson. Those sorts of programs build loyalty.

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Brand Loyalty Increasing among New-Vehicle Buyers, J.D. Power Finds

If a vehicle owner is loyal to a specific brand, it’s becoming more difficult for another brand to woo them away when it’s time to buy a new vehicle, according to the J.D. Power 2020 U.S. Automotive Brand Loyalty Study,SM released today.

“There are many factors that contribute to brand loyalty, ranging from the experience a customer has when purchasing the vehicle to how driving it makes them feel,” said Tyson Jominy, vice president of data & analytics at J.D. Power. “Automakers are really focused on customer retention, as evidenced by the payment plans and incentives they’ve offered since the COVID-19 pandemic broke out. Many have gone above and beyond to offer customers financial assistance during a period of economic uncertainty, which does a lot to bolster consumer confidence in their chosen brand and repurchase it in the future.”

Using data from the Power Information Network, the study, now in its second year, calculates whether an owner purchased the same brand after trading in an existing vehicle on a new vehicle. Customer loyalty is based on the percentage of vehicle owners who choose the same brand when trading in or purchasing their next vehicle.

Lexus ranks highest among luxury brands for the second consecutive year with a 48% loyalty rate. Mercedes-Benz ranks second (47.8%), followed by BMW (45.1%), Porsche (44.9%) and Audi (43.4%).

Subaru ranks highest among mass market brands and highest overall in the automotive industry for a second consecutive year with a loyalty rate of 60.5%. Toyota ranks second (60.3%), followed by Honda (58.7%), RAM (57.3%) and Ford (54.3%).

The 2020 U.S. Automotive Brand Loyalty Study calculations are based on transaction data from June 2019 through May 2020 and include all model years traded in.

J.D. Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable J.D. Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, J.D. Power has offices serving North America, Asia Pacific and Europe.