customer retention rate for Chevrolet is the highest in the industry,
according to the J.D. Power and Associates 2003 Customer Retention
StudySM released recently.
Chevrolet Has Highest
Customer Retention Rate in Industry
inaugural study measures the ability of nameplates to retain their
owners who are once again in the market for a new vehicle. On
average, the study finds that about one-half of consumers will
repurchase the same nameplate.
ranks highest in customer retention, retaining 60.8 percent of
its owners. Chevrolet models with the strongest retention rates
include the Avalanche, with 74.5 percent of owners purchasing
another Chevrolet model, TrailBlazer (73.8%), Impala (70.1%) and
Silverado 1500/2500 (68.7%).
is followed in the ranking by Toyota (59.3%), Mercedes-Benz (58.7%),
Ford (58.1%) and Honda (57.1%). Isuzu trails the industry, retaining
only 3.5 percent of its customers.
study finds that one of the most influential reasons that customers
do not purchase another model in the nameplate's lineup is that
the brand doesn't offer the type of vehicle they were looking
for. A large number of customers who defect to another brand do
so because they believe their previous manufacturer does not make
the type of vehicle they want when they re-enter the new-vehicle
is an example of a broad product line that offers customers many
options to fit their needs," said Joe Ivers, partner at J.D.
Power and Associates. "While manufacturers tend not to expect
each of their brands to retain customers 'for life,' many have
realigned themselves through mergers and acquisitions to accumulate
a portfolio of brands that give customers a place to move up as
they age and become more affluent. However,
manufacturers vary in the degree to which they have integrated
their brand portfolio into a coherent cross-brand strategy."
from a brand can occur due to owners' poor experiences with their
previous vehicles, or because they are "captured" by
positive aspects of the new brand they buy. Among these "captured"
customers, nearly two-thirds purchase a model from a different
brand because the new vehicle meets their practical needs. More
than one-half feel the vehicle they buy has a better
look or style or because the brand is known for better quality
than the brand of their previous vehicle.
retention is critical to manufacturers, not just because the cost
of keeping a customer is generally lower than gaining a new one,
but it's also a test of whether the brand has staying power,"
said Ivers. "Customer retention can be predicted to a fairly
strong degree based on the sales and service experiences with
the brand along with the vehicle's quality, durability and appeal.
However, a large portion of vehicle owners are up for grabs. Being
able to identify defectors, both within the brand and those of
the competition, can help a brand to develop and implement remedies.
Also, identifying these 'fence-sitters' helps marketers know who
can be influenced one way or the other."