Ask the expert: How can you leverage loyalty programs in your car wash?

Why are car wash membership programs becoming more popular?

Customers know that washing their car on a regular basis is important in maintaining their
automobiles. However, the traditional way of buying a single wash that involves being in a line
with everyone else is not convenient and expensive the more frequently you wash. Car wash
memberships provide several advantages that are captivating to consumers.

1) Memberships allow customers to wash their car several times per month for less than
2 times the regular price. This can be significant cost savings if they wash frequently.
2) Car Wash surveys tell us that washing our car makes us feel good. Membership
allows us to enjoy this pleasure without the significant cost of washing many times
per month.
3) Many memberships allow customers to skip the line with a dedicated membership
lane. This reduces the amount of time it takes to get a wash.

Are there any downsides to offering them?

The common response is overwhelmingly positive when Car Wash memberships are introduced
to a new market. Customers embrace the value proposition so much that some end up using the
program 4-6 times per month on average. When that happens, the margin on membership is
much lower than on a single wash. Thus, the profitability can be much lower than expected if
the site entices too many high-usage memberships. For example, an area with a high density of
RideShare programs such as Uber.

What are the best practices?

Whether it’s a single wash or membership, the bottom line is that operators must produce a
clean, dry shiny car. We have all had memberships at the gym or group buying coupons,
resulting in a frustrating experience. Customer convenience is king when it comes to
membership best practices.
The membership program is an extension of how customers pay for that wash. Best practices
start with educating the customer.

• Every customer is presented with a compelling conversation as to how they might benefit from membership.
• Next comes overcoming objections.
• Memberships must be easy for the customer to cancel, whether that is in person at the car wash, through the phone or online via the internet.
• Memberships must be cheaper than purchasing single washes in the consumer and usage behaviour.

Last is continual communication reinforcing the value proposition and appreciation of their
loyalty. Industry membership innovations include granting customers additional benefits directly from being a member. These additional benefits can include donations to local charities, chocolate on Valentines day, popsicles on Canada day, and various forms of swag on retail holidays.

How do they drive traffic?

Memberships drive traffic from a couple different angles. The value proposition allows the
customer to wash their car as much as they think they should without breaking the bank. This
has an interesting effect on the market where the convenience is so overwhelming that there is
new demand created in the marketplace. Second, a busy site attracts more customers. Retail
customers frequently follow the herd. The customer thinks “I will probably like it, since
everyone likes it, so I should try it”.

What tech/POS equipment do operators need to invest in to make it work?

Membership programs are enabled by technology. In the past, customers were sold a physical
card, similar to a bus pass, each month that allowed them to wash. However, this process was
cumbersome and not widely adopted. The current membership technology involves placing a
Radio Frequency Identifier (RFID) in the customers; windshield and a combination of scanners
and point of sale systems identify the customer, their recurring billing status, and then open the
gate for them to receive a wash. All without ever talking to an employee or rolling down their
window.

New technology involves using cameras to identify the customer through their license
plate, car colour, and other identities on the car. The POS must also have the capability to
automatically bill a customer's credit card each month until the customer requests a cancellation.
In any event, car wash operators must invest in a point-of-sale system and credit card processing
company that is designed to enable the membership billing program.

What else can you do to upsell the experience? 

Memberships effectively take a potential car wash customer off the market. To keep these
customers from getting bored or getting fatigue so that they don’t notice your site anymore, it is
important to keep them interested. This means operators must continue to market to existing
customers. This kind of marketing reinforces the decision the customer made to become a
member. This can include exclusive discounts on store products, special promotions, or
discounts from neighbouring businesses.

For example, once a year, throw a customer appreciation party. Free hot dogs and hamburgers
for everyone plus members get a chance to spin the wheel and win a prize such as microfibre
towels, windshield cleaner wipes, air fresheners and a grand prize of one-year free membership.

Why do you implement these programs and how it has changed your business?

Membership programs benefit operators in two ways. First, if a customer signs up for a
membership they are loyal to your car wash. In other words, that customer is effectively
guaranteeing they will not go anywhere else because they have already paid to come to your
wash. Second, most customers change their wash habits throughout the course of four seasons.
Most will wash more in the spring when daily thaws and nightly freezes result in a sand/salt
covered cars every day.

Conversely, most customers have summer plans involving a cottage, lake, vacations, camping, hobbies or a myriad of distractions that cause them to use the car wash less often. However, most will not cancel their monthly membership. This results in a more stable cash flow for the car wash operator. In other words, summer is usually when revenue drops off when all you sell is single washes. With memberships, single washes will still drop off in the summer, but operators will still get the revenue from memberships even if customers don’t use the car wash as often.

Travis Braithwaite is the chief operating officer at ClearWater CarWash in Edmonton, Alta., as well as an operational advisor to Waterfly CarWash in Sacramento, Cali. He joined the Canadian Carwash Association's Board of Directors in 2023.