Retention, Defection and Conquest with Greg UlandTrucks stick but brand love shifts.

March 14, 2024
Trucks stick but brand love shifts.
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Reynolds and Reynolds released their 2024 Automotive Brand Retention and Defection Report, and VP of Marketing Greg Uland joins the show to break it down.

Read the full report here:

Greg, with his unique blend of marketing savvy and operational expertise, breaks down the complex web of customer loyalty and buying behavior in the auto industry. Through the lens of comprehensive data analysis, Greg shares staggering insights into how dealers can navigate the tricky waters of retaining customers, winning over new ones, and the surprising fluidity of brand loyalty among today's car buyers.

The conversation isn't just a trove of statistics; it's a lively discussion that ranges from the evolution of brand logos to the unexpected loyalty shifts among truck owners. The team delves into the specifics, like the 43.7% overall brand retention rate, Toyota's stronghold at 60.1%, and the surprising position of Nissan as a prime target for almost every mainstream brand's conquest efforts.

0:00 Intro

2:21 The critical connection between marketing and operations.

4:59 Overall brand retention across the US is a mere 43.7%

9:20 Truck owner loyalty shows a surprising 72.5% likelihood of purchasing another truck, yet brand loyalty within this segment shows significant variation, indicating opportunities for brand switching.

14:38 Greg and the hosts explore the impact of high borrowing costs on dealership strategies, emphasizing the necessity of adapting to a market where new car prices average around $50,000.

19:30 Actionable insights for dealers to refine their marketing and inventory strategies based on changing customer loyalty trends.

Greg Uland is VP of Marketing for The Reynolds and Reynolds Company.

Paul J Daly: 0:00

Kyle, I'm starting to feel like I really miss Michael

Kyle Mountsier: 0:10

this is Auto Collabs. I, I'm it's a little sad to me. You know,

Paul J Daly: 0:16

I mean, I know he's me home, he'll be here soon.

Kyle Mountsier: 0:19

There's a whole reason why it's called Auto Collabs. Lab and

Paul J Daly: 0:23

I do this all the time on a bunch of other stuff. But Michael, I mean, like, who's gonna make dumb jokes at the right moment? Who's going to ask deep questions at the right moment? It's not just gonna

Kyle Mountsier: 0:32

be short at all the moments, you know? Ah, but I'm wondering, no,

Paul J Daly: 0:38

there you go. You get surreal. I'm gonna cut this out, tag you in a social post, and then you're gonna find out and not be surprised what goes on when you're not around. But today, I'm excited for our guests today because I can we call them an old friend. He's younger than me, maybe. But now I start to feel like Greg Newland with Reynolds is like, we got to we got to, we got an energy going now. So now when he shows up, you don't have to do all the pleasantries we can get right to business

Kyle Mountsier: 1:03

get right to business. He's a CO content creator, He is diligent with the way that he works within the Reynolds organization and understands everything, that organization has the capacity for the data around it, you know, the product sets like he's not just I wouldn't he's I think he's the vice president of marketing. He's not just a marketer, he is no ruin through participant in the operations of the business. So that was that makes

Paul J Daly: 1:30

the best marketers absolutely understand operations. And they have they have, like you you say it, marketing is like, the heart of the business, like whatever it is, you say more eloquently, but that's like, they have to be connected to all the different extremities of the business. And Reynolds has a couple different extremities. I mean, like, we're not just talking about arms and legs, like this is like a centipede, right, right. In every third printing check, like there's all the things he talks about last time. Either way, we hope you enjoy this next chapter of our conversations with regular

Kyle Mountsier: 2:07

Hey, we're already laughing here with Greg over Reynolds. And, man, it's just always a pleasure to hang out with you. You've always got insights and laughs and, and goofy things to chat with us. So welcome to another episode of Auto Collabs. Man,

Greg Uland: 2:21

appreciate it for sure. Hope it's not too goofy today.

Kyle Mountsier: 2:25

I'm all in on the goofy, but we're gonna get right down to it. Because, you know, a lot of times on Auto Collabs. We go through a little bit of story. And we've heard your story before. Actually, this is random. My father in law is actually here right now. In the 90s. My father in law was was the agency of record for Reynolds right away. Yeah. So yeah, he has an agency out of out of Cincinnati, and was like the agency of record for all of Reynolds.

Greg Uland: 2:56

When So when was that? Like what part in the 90s?

Kyle Mountsier: 3:00

Like, mid to late 90s. It would have been so Oh, man. I think the company was named sunrise at that point. Okay. I don't know if you. I can't remember when you started. But I started.

Greg Uland: 3:12

Yeah. Oh, wait, I started.

Kyle Mountsier: 3:15

But yes, it was it was right. Yeah, so it would have been he was like, it was like 95 to 98 or 99, or something like that. So and I don't know, like exactly what the outputs were. But yeah, so I had no clue that I had that much like family history with Reynolds. So

Greg Uland: 3:32

99 was actually, you know, last year at NADA, so not 24. But 23 at NADA, you know, we launched our new logo and kind of, you know, got on this this track that we're on right now and went through a lot of history with the company leading up to that. And 99 was the time prior to last year that that we had kind of created a new logo. And so I wonder if there was some transition there, Where were your Father and like, we were like, I probably have stuff in my office here. With examples of, you know, how we launched it was when we launched our first website, and it was when we had a new logo and so there's a lot a lot of stuff so there might be some some meat that we can at least get he's literally

Kyle Mountsier: 4:11

right outside the store right now. We could go grab it. Quick, he's watching Harry Potter. Oh, that's,

Paul J Daly: 4:21

that's amazing. No, we can't do that we have we have data to talk about. We have dealers to help out. Right? Like this, this study that, you know, I'm looking over some bullet points and kinda reviewing it. It seems like some very actionable information for dealers to take, especially as it pertains to conquest. Everyone's trying to figure out where they're going to get this, like we're back to playing the ground game. As an industry, right? There's no more there's no more it's going to come in and everybody knows that. We've been talking about it for the best better part of nine months now. So why don't you walk us through a little bit about what this data is and like how it can really inform some dealers decisions, specifically around conquest.

Greg Uland: 4:59

Yeah. So we've been doing this for quite a few years now. But basically, we look at over the calendar year, every trade in across the US with transactional data, DMS data, so every every trade and across the US, and then what vehicle was purchased on that trade. And so it's a pretty broad set of data. But there's some really interesting things that seems that always stand out in every report that's similar to this has kind of similar numbers. But I love that this is true transactional data. So you can really dig into and you can look at it by geography, and there's all kinds of nuance to it. But so retention across the US across all brands is a staggering 40 43.7%. So it's, it's crazy how six out of 10 people aren't going to drive the same makeup vehicle that they're in today. You know, and that's something that the dealership can't control. Right? The retailer that's not the retailer isn't isn't convincing someone to drive a Ford or drive a Chevy or drive a Honda, right? They're convincing them to buy from them. So the cards are kind of stacked, stacked against us in a lot of ways. Just because, I

Kyle Mountsier: 6:02

mean, that's brand loyal. That's not dealer loyal. Right? So you probably see even a low ID and it could be brand loyal to us brand loyal to new. So that's like overall brand brand loyalty, right? Yep. Yep. Yeah, so that's, that's a wild thing. Actually, there was a lot of conversation as we went through COVID, about declining loyalty, right. So looking at, you know, it looks like actually loyalty, I think over the last year has come up a couple of percentages. Yeah, that's a change. You know, from from the middle of a pandemic, when it was basically buy whatever inventories available. So we're seeing loyalty return a little bit, which is a, you know, an interesting pattern to pay attention to. But it's still, you know, when you look at like, Hey, 40, only four out of 10 people actually buying the same brand, it takes a lot of work, when that's not even dealer loyal to figure out how to keep, especially for new franchises keep people in the brand, which is I think, like it's a, it's a massive opportunity for dealers to figure out how to leverage marketing to move people back into their brand, and not just the brand, but to the dealership. Right,

Greg Uland: 7:11

right. I think it lends itself also when you think about even after sales, right? And you think about where that relationship lies, because at the end of the day, brand retention is really going to be about your experience with the car, right? You you buy it? Initially, you buy it initially, because it's big steel a little bit, right, for some reason or another, you want to be in that car, it's a lot of ways a reflection of who you are. But then over the next 2356 years, whatever it is that you own that car, you're going to, you're going to experience it right and the way that you experience that car is going to determine whether or not you come back and buy that same car again, or that same make again. And that's where you're going to have more touch points as a dealer, again, you're not going to completely influence whether or not they're going to buy another Toyota. But you can certainly have some level of impact in that after sales experience. You know, we focus a lot on the sales experience, which is great, we should. But we also need to focus on that, that ownership experience the full ownership experience, and not just the transactions and the touch points that we get, you know, every year in the dealership.

Unknown: 8:09

You know, you mentioned ownership experience. One of the data points in the report. Basically the note is that premium brands are conquesting Ford and Toyota drivers at surprisingly high rates. Yeah, right. When I think ownership experience and you think of premium brands you think like that's what they zero in on more than anything else? Yeah,

Greg Uland: 8:29

yeah. When you look at those, you think a premium brand, we kind of break it out into different segments and premium even. But when you look at those, you would think they're probably conquesting majority of customers from other premium brands, right? There's each other. Yep. Yeah, you know, Mercedes and BMW, it's like they should be conquesting from each other. But when you when you really break it down, you can kind of go brand by brand. Ford, Ford and GM are in part of his market share, right there. They are large market share players. So there's more opportunities out there. But they're not bouncing buyer. buyers aren't bouncing so much between the exact same segment a lot are actually pulling up into those premium segments.

Unknown: 9:09

So I'm looking at some of the other points. truck owners seems like they're still being truck owners 72.5% likelihood of purchasing another truck.

Greg Uland: 9:20

Yeah, so that one's interesting. Because it's a unique segment, right trucks, if you buy a reason to buy a truck, right, and you have probably you're probably going to buy another truck. But what's what was most interesting to me and it kind of has been doing this for the last couple of years, but it's accelerated this year, is the actual brand loyalty inside of those truck buyers inside of that truck segment has gone up pretty dramatically. So GM trucks are the only brand that keep over 50% of their drivers. So even you know the dominant Ford right if you're no

Paul J Daly: 9:50

that's really interesting. GM GMC.

Kyle Mountsier: 9:53

Yep. Yeah, because Ford historically, like you think about just extreme loyalty, but there's Clearly, pressure in the market from other brands, changing the way that the loyalty happens, obviously, there's a lot of hum homogeny, across trucks, I feel. And so you get that change, that's a, it's a dramatic stat, in my opinion when you've got 72% likely to purchase another truck, but the likelihood of them not purchasing another truck from you is like lower as a delta. I feel like that's like, especially for a domestic dealer to really zero in on that segment and figure out how to retain that customer is probably a high likelihood if you if the communication pattern at the after sales pattern is really strong. Right?

Greg Uland: 10:45

Yeah, yeah. So how do you retain that customer, but so forth, as an example, right? So 40 Look at it. So don't get me wrong. 47% is fourth retention number. So if you're if you're in a Ford truck, right f150, or arrangements is grouped together. So Ford truck, you're in a Ford truck 47% of the people that trade those that are going to buy another Ford truck. So you look at that, and you go, okay, if I'm a Ford dealer, it might be a good idea to not be scared of selling some Chevy trucks, right? Like somebody, they're gonna buy a truck. So how do I stop appropriately to make sure that I keep that customer? Forget about the vehicle for a second? Like, how do I keep the customer? So you can really, this is? Yeah,

Paul J Daly: 11:24

so like to put that together? In case you missed it? How

Kyle Mountsier: 11:27

do you stop the use cars that are right for the conquesting? Right, because

Paul J Daly: 11:31

if 72% of the truck buyers are buying another truck, and only 47% of them are buying a Ford truck, like coming back to Ford that the difference is almost 30% of those buyers are going to buy a different brand truck. So you're saying like you might be a better have the different brand trucks on your lot so that you can keep the buyer even though they're not going to be brand loyal to Ford.

Kyle Mountsier: 11:52

Yeah. And I think that's that's the same thing with the Ford and Toyota buyers. defecting more to premium brands is like, hey, maybe you need to have those, you know, late model year. premium brands in your used car inventory as a comparison. Like that's a stocking strategy right there. Yeah.

Greg Uland: 12:13

Yeah. When you look at us vehicles, I mean, I think this year, we're gonna see a pretty decent importance put on us vehicles across across retailers. When you look at some of the numbers I was looking at this. Earlier this week, I think it was but you know, when you look at actual vehicle sales, and you look at combined sales, so new sales, we kind of know what those look like us sales, some of us pay attention. But when you look at the combined number last year, so 2023 had the lowest number of combined sales since 2012. So just just over 51 million. So you know, which when you look at that, you got to imagine that we're probably not going to go go down much from there. So we I look back to 2010, which was just under 50 million, and we're just over 50 million last year. So we're probably going to see some level of increase in overall vehicle sales. Not to mention when you look at I don't know if there's a correlation or causation. I think it's causation. But when you look at election years, usually there's there's general optimism, right either no matter which side of the aisle you fall on, you change is coming, right? Or things aren't, you know, things are gonna stay the same. And you like, yeah, one way or the other. Right? Something good, right? Yeah. of optimism. So anyway, heading into into the election year, we got that going for us. But then also when you look at the mix of new to us, so last year, had the highest percentage of basically total vehicle sales. So when you look at new news combined, the highest percentage of new vehicles making up that total vehicle sales since 2012 2016. So over

Kyle Mountsier: 13:45

over 32 makes a lot of sense, because we had inventory for the first time. And there was the most incentive put on new vehicle interest rates for manufacturers, which were helping the affordability issue which wasn't able to be helped with rising interest rates on used car. So it makes it makes sense, the new vehicle sales would be at a at a high last year, for sure.

Greg Uland: 14:06

Right. But, you know, when you look over time, it's probably not gonna stay there certainly not increase. Right, right. So from a percentage perspective and a unit perspective, we're probably going to see more used vehicles becoming an important part of the dealerships retail strategy, I think in 24.

Unknown: 14:22

So also in the report, one of the indicators or one of the assumptions is that the cost of borrowing likely is going to stay high. You have any more depth on that I mean, financing and interest rates, huge conversation. Everybody's watching has any any more pulled out of the report other than that? No,

Greg Uland: 14:38

I mean, it's really just looking at the way the Feds acting right and where they're putting rates and how they're reluctant to to come down. So you know, I think everybody's prediction has been pretty conservative here recently on what 24 is going to look like as far as rate reductions if there are any. So when you when you look at it, you know cars are expensive new cars at I don't know what was average price last year 40 grand or something, it was a tie whatever it is darn darn near 50 grand. Which is funny. Funny story, I watch this, this video every now and then. And it's got a clip in it of this Escalade commercial, and it was talking about how, you know, an Escalade just hit$50,000 There's no way there's no way imagine a personal consumer is going to spend 50 grand to put a vehicle in their own driveway. And now it's like, not escalate

Paul J Daly: 15:31

to like 120.

Kyle Mountsier: 15:34

That's unbelievable. You got to send us that.

Paul J Daly: 15:38

You can't get like a Corolla now for 50 or so it feels like let me read a couple more of these points, kind of going back a little bit to the conquest. So basically, just want to make sure people can hear him in case they don't see the report overall brand retention 43.7%. Toyota has the highest retention at 60.1%. No big surprise there. Here's an interesting one. Nissan is a target on every mainstream brands conquest list.

Greg Uland: 16:08

Yeah, shocked me. I don't know, there was just consistency across every brand that Nissan was in the top five conquests

Paul J Daly: 16:14

for I mean, I guess. Okay, so if I, if I like just quickly try to think through that. Nissan has definitely seen as kind of like, not going to quite like a starting position, like a Mitsubishi like to get into a new car, but Nissan's also like kind of like the quality of vehicles and that like the appeal they've started to have with some tech and things are putting in there definitely moves them a little bit closer to like a transition into Kia, Hyundai. You know, some? I don't know, what's another brand that that kind of has that little Tech Tech kind of feel to it. So I guess it makes sense that like, the Nissan buyers coming out of their Nissan they got that they made it to the other end might be a really good bump set into another brand.

Kyle Mountsier: 16:55

Well, and if you look at it, Paul, similar to Toyota, but not with the brand equity of Toyota, is they have one of the widest vehicle lineup.

Paul J Daly: 17:06

That's a great point. Right? So

Kyle Mountsier: 17:08

when you look at it, and not just that, but from a price point perspective, they have a very, very wide price point. Yeah. And so if you look, any OEM essentially can look at a Nissan buyer and find a segment that matches their target audience. So that's, that's where that kind of starts to make sense for me is, you know, a Kia could be seen conquesting sales from them easy and also some of the luxury and the highlights and even sports cars and larger crossover utility vehicles and things like that, like all have segments that they could target from Nissan. So that's a watch out of your Nissan dealer, you know, coming for you well

Paul J Daly: 17:51

back to the use car strategy,

Kyle Mountsier: 17:53

right yeah, back all the way

Paul J Daly: 17:55

back around we get

Kyle Mountsier: 17:57

that I love it. That's so much fun. Well hey, at time of recording, we're gonna be coming and hanging out with the team at Reynolds at the location so you can't wait if if this has come out afterwards. We might have a couple sneak peeks around around the area there in the behind the scenes what happens down at Reynolds and anything that we shouldn't be watching out for excited for on the grounds of the Reynolds headquarters?

Greg Uland: 18:24

Sure. I mean a couple of new things well, you tear me down on the workout before you gotta get on a plane so you won't get to see the gym I guess but I was excited

Paul J Daly: 18:30

to have Kyle well we can go see the gym. Good Steve doesn't want just want to go get all like run three miles and then go get in line next everybody that doesn't want him next to them in line because he just worked out?

Greg Uland: 18:40

No, definitely have to check out a couple of things. We'll check out one our security operations center SOC that we built out this year. It's it's pretty impressive. I

Paul J Daly: 18:48

think you guys sounds great already.

Greg Uland: 18:51

And we'll check out our will actually do you know as long as you guys are still up for it. We'll do a podcast recording in person in our studio. Got to show off to you guys our video production studio downstairs too. We have a production team here and they do X excellent things. But there's some pretty cool stuff that you guys will probably get a kick out of. So we'll make sure to give the full tour while you're

Paul J Daly: 19:13

speaking our love language. I can't.

Kyle Mountsier: 19:16

He was like Production Production worked out good.

Paul J Daly: 19:20

We get a little work done while we're there to Greg, thank you so much for just being so open handed with sharing the reports and serving the industry in this way. And always thanks for giving us a few minutes of your time today.

Greg Uland: 19:30

No thanks, guys. Always fun and look forward to seeing

Kyle Mountsier: 19:36

first of all, I can't believe that I forgot I that I that like just a couple of days ago I was talking to my father in law about the fact that he had worked with Reynolds to have done the brand discovery of going back on the logo

Paul J Daly: 19:49

we need to have your father in law on the show. He's actually he's

Kyle Mountsier: 19:55

like to another story the way you would use great actually elementary grade on the show. But here's the other thing is, I first, the first thing that I appreciate about this whole podcast is, obviously Reynolds has marketing arms and communications and digital retailing, and DMS and, and security and paper and all that type of stuff. But this is completely service like, hey, we have access to a whole bunch of data that can serve dealers to make really, really intelligent stocking marketing decisions, no matter what the provider that you is, there's not a clean cotton solution for this. But hey, look, if you're paying attention to where customers are moving from, and to what they're buying right now, what they might want to buy over the next year, you can be really, really intelligent with the way you spend your money, the way you stock your inventory, the way you go to market. So just appreciate Reynolds and Greg, for bringing that to life within this conversation. It's

Paul J Daly: 20:53

really great. We are going to link the report in the show notes to this so that if you're listening to the show, the link will get you directly to the report. So you can check out the full thing, you know, we were only able to cover a fraction of it. Just even what we cover. And I feel like it's so actionable. Like there's so many things in that. And that's always the most rewarding thing for us that if through this collaboration mindset, we can bring a couple people together and even have one thing right if we're talking about the like the Nissan conquest, or we're talking about the use car allocation on the on the or the US allocation you have or the inventory stock, because you know about who's going to get out of a truck and what percentage is not likely to come back to your brand. I feel like those are things that can just drop in dealers mind and now when they're on viotto. When they're meeting with their GM or their sales managers, they can just drop this little thing and it can affect real change. So I'm always happy when we get to that point. Always happy. Well

Kyle Mountsier: 21:45

hey, we thank you for joining us on another episode of Auto Collabs on behalf of Paul J. Daly, myself and even Michael Cirillo, who shall be back soon. Thanks for joining us.

Unknown: 22:04

Welcome to Auto Collabs Are we recording

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