“Innovation distinguishes between a leader and a
follower” Steve Jobs, CEO Apple, Inc.
Triple Play Car Wash in Attleboro, MA is one of the most
impressive car wash facilities I’ve ever seen. Opened nearly three years ago by
Terrance Elder, this 3.2 acre property is home to a 157-foot express-exterior
tunnel, touch-less in-bay automatic, 7-MPD Exxon-Mobil gas station, 6-Bay
Detailing Center, 3-Bay Valvoline Instant Oil-Change, and a 4,500 Sq. Ft.
On-The-Run C-Store with a drive-thru Dunkin Donuts and Jay’s Deli. Under
Terrance’s vision, leadership, and hard work, his overall business has experienced
year-to-year growth of 20% with the oil-change business alone posting a 58%
gain. And just as he’s positioned to relax and reap the rewards of his efforts,
Terrance is doing the opposite. Over the coming weeks, Triple Play is applying
everything it has learned so far to create an innovative new cross marketing
system that leverages technology to build loyalty and drive revenue. Having
already done the heavy lifting, Terrance agreed to share some of his insights
to bring an already successful car wash to the next level. Below are some
excerpts from our conversation.
Analetto: Your sales
across every profit center have steadily grown – what are you planning to
change and why?
Elder: Why -
because there’s an opportunity to get more revenue from this property without
increasing labor. I can only speak for my market, but in the Boston area land
is expensive and construction is expensive. When I first looked to get into the
car wash business, I heard all of the horror stories and felt nervous that I
had to rely on the weather to make it work. So, to me, the obvious choice was
to build a business that would feed the car wash, and I use gas discounts to
make it happen. I opened with a soft 10 cent per gallon gas discount with a car
wash. Now it’s 20 cents off Monday through Thursday and 15 cents on the
weekend. I did that because I knew I wanted to be at 135,000 washes per year
with an average ticket above $10, and that I needed the weekday volume to get
there. The extra 5 cent discount during the week had an immediate impact.
Volume moved from 250 cars per day to 350, and what’s more, the weekend
business wasn’t affected. There’s a lot of emotion with gas prices and when a
customer hits “yes” to a car wash, and the pump rolls back 20 cents, they
absolutely love it. What’s amazing is that after so many years of conditioning
customers to make a minimum gas purchase to get a discount on the car wash,
when we first started doing it, I actually had people ask me if there was a
minimum gas purchase. I would say no and watch as they pumped one gallon of gas
for a ten cent discount on a $12 car wash.
My goal now is that instead of getting an extra $10 dollars
from my gas customer for a car wash, I want to get $40. That’s why I’m
re-inventing everything to teach my customers to buy in bulk and save. Our
average fill-up is only ten gallons. So, in reality, we’re giving a $1.50 to $2.00
discount on the car wash. I could run coupons for $5.00 off a car wash all day
long without the impact of the gas discount. The gas discount costs me a
fraction of what a coupon on the car wash would, has a greater perceived value
for the customer, and I don’t have to pay as much to promote it with direct
mail or other advertising.
Analetto: How are you
planning to move your customers to such a high purchase?
Elder: I look at
it this way – if you’re going to invest thousands of dollars to advertise
something, you have to make the offer strong. If you do that, and deliver a
real value, you’re going to get new customers, increase sales, and build
loyalty. My original goal at the quick-lube was to get to 1,500 cars per month.
So we ran online coupons with my local cable company and supermarket register
tapes for $12 off a lube and included a free $8 exterior car wash. Giving $20
dollars in value for a $39 oil-change is huge. But in one month we did 1,470 oil-changes
with 550 new customers. I spent a lot of time training my workers to get
customers into premium oils and other upsells like wiper blades and have been
able to hold a $60 ticket. And once you’re averaging over 40 oil-changes per
day, it starts to get fun and make some steam. We’re still averaging 400 new
customers per month. My new goal is to average 1,800 monthly lubes in the next
two years with gross sales the same as my car wash. It’s not as profitable, but
it’s a big amount. What we’re working on now is to drive pre-paid car wash
sales and express detailing business by reinventing how washes are sold both at
the auto attendant and at the pump.
Analetto: By giving
away a wash with the lube are you hurting your wash business?
Elder: There’s always
a risk that the customer only gets a wash with the lube, but that’s not what
we’re seeing. An oil-change lasts three
to four months and customers are often upgrading the free wash and visiting
in-between to wash their car. Don’t get me wrong, I also have customers who go
into the c-store with the ticket for the free wash trying to get a discount on
gas, but that’s the exception. Basically, my competition can’t offer a free car
wash so it’s my competitive advantage in this market. It makes the customer
feel good and that will always work in your favor.
Analetto: Increasing
pre-paid wash and express detailing sales normally means training human
greeters. How do you plan on accomplishing this from your auto attendants?
Elder: The
technology is there, but you have to make it work for you. Measure what’s
working and find creative ways to push it harder. I’ve put service advisors at
my gates and instantly lifted detailing services dramatically. But I can’t
afford to pay a service advisor to do an inconsistent job of up-selling my
customer. I already have effective signs that promote oil-change to detailing
customers, car washes to C-store customers, and detailing services to car wash
customers – but a sign isn’t the same as telling the person the value of buying
more while they’re in the middle of making a purchase, and then asking them to
buy it. Even the best trained person can’t match the consistency of an
automated attendant. The problem is that my auto attendants aren’t currently programmed
to push the up-sell products and services how I’d like, but it’s not because
they can’t. My software provider, DRB Systems, has been working with me closely
to really maximize the potential of my payment systems, integrated across my whole
property. That is what I’m working on right now. By having the multiple name
brands on the same property, I have a lot of equity I can leverage.
Analetto: Can you
share exactly what changes you’re making?
Elder: Big
changes. It’s almost like re-opening.
Last year we sold 65,000 washes from the pump and when customers entered the
code at the wash, the machine asked them if they would like to add a $2 tire
shine or $3 body protectant. I offered the same thing to customers that bought
a wash directly at the auto attendant. It didn’t work. Add-on sales were
disappointing. Going forward, depending on the wash they bought at the pump,
they’ll be presented with an offer to buy additional washes at a huge discount simply
by clicking the “yes” button or decline by selecting “no thanks”. So if they
buy our $21 full-serve at the pump, when they enter the code at the auto-attendant,
the machine will ask if they’d like to save $8 and buy the next wash for only
$13 – a 40% discount. The offer changes depending on what they bought and the
graphics are real creative – it’s a lot different than anything I’ve ever seen.
The promotions change for someone buying a wash at the auto-attendant to push
express detailing and additional washes depending on what they bought. For
example if they buy an exterior wash, the next screen asks if they’d like
today’s wash for free if they buy three more. And when a customer enters the
free wash code from an oil-change, it offers a huge discount if they add an
express detail service. I’m excited. The offers are consistent and always
appropriate based on what the customer bought, or where they entered my
property. A human just can’t do that. I know some operators are doing well
selling pre-paid unlimited wash programs. I tried, but it seemed every month I
would sign up 40 members and lose 30. For me, discounted gas is my loyalty
program. By changing how my auto-attendants work, I’ll reduce the time and
labor I was spending on managing the pre-paid membership program and generate
more dollars doing it.
Analetto: You partnered
with a lot of recognized brands at your site – has the investment paid off?
Elder: Absolutely.
It’s not only about appealing to customers, it also helps keep competition from
coming in. We can have 1,400 cars going through on a Saturday. That draws the
attention of investors looking for a proven market. Recently someone was going
to build near us and decided to pull away. I think we have a strong location
and solid business model, but the brands make a real difference. I’m not just
discounting gas - I’m discounting Exxon-Mobil gas. I don’t just sell coffee, it’s
Dunkin Donuts coffee with a drive-thru open 24-hours. My oil-change is branded
Valvoline and includes a free car wash. And in our market, Jay’s Deli is a
strong regional brand. Someone could build the same business in my market, but
they couldn’t easily compete with the brands I’ve partnered with.
Analetto: Having been
open nearly three years now, what have you learned that you would you recommend
to other operators?
Elder: I believe
you have to keep searching for ways to deliver more value to customers. More
reasons to visit your property. Measure what works and be willing to stop what
doesn’t to try something new. I finally got tired of asking people to buy $2 or
$3 extra-services without any results, so I am shifting to stock-up and save
discounts. This holiday season when someone buys a car wash, the auto attendant
will ask them if they’d like today’s wash free with the purchase of a gift card
– yes or no – and I’m investing in the technology to print the gift card for
them then and there. I’m changing the whole experience for my customers. I know
I have my work cut-out for me to educate them that if they buy in bulk they’ll
save, but I never came into this business thinking it would be easy. It can be
a grind to build your car wash volume, but it pays off if you keep working it.
Take care of the customer and it all comes in time.
Questions can be sent directly to Terrance at: terrancek@comcast.net
Good luck, and good washing.
No comments:
Post a Comment