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Why Dealerships Are Losing Service Loyalty and How to Retain Customers

October 9, 2025

Digital Retail

During September and October 2025, several industry studies and news articles indicated an expanding loyalty gap for franchise dealers. The J.D. Power 2025 U.S. Brand Loyalty Study (released 24 September 2025) and the J.D. Power 2025 U.S. Customer Service Index (CSI) Study (released 13 March 2025) both indicate diminishing repeat purchase and increasing service friction. September and early October 2025 trade coverage reported lengthy appointment waits, communication failures, and increasing customer demand for convenience-driven alternatives like mobile service and third-party workshops. 

This piece examines why dealership loyalty is declining, how recent statistics demonstrate the trend, and what action dealerships can take to restore trust and long-term relationships with customers.

 

What's happening to dealership loyalty in 2025?

Dealers are experiencing declining repeat buyers and diminished aftersales recapture, even as overall service satisfaction is still fairly robust. September 2025 industry analysis attributes this to quicker changes in shopping habits since the pandemic, aggressive price actions by OEMs, and increasing customer expectations for frictionless, digitally enabled service experiences.


The impact of the change is now evident throughout the industry. Various research reports published during 2025 illustrate the widening disconnect between customer satisfaction and customer retention:

 

  • J.D. Power 2025 U.S. Brand Loyalty Study (24 September 2025) found that overall brand loyalty dipped year-over-year, with many consumers willing to switch brands for lower prices or quicker delivery.
  • J.D. Power 2025 CSI Study (13 March 2025) reported excellent satisfaction rates but fewer repeat visits because of long lead times to book and insufficient communication during the service process.
  • WardsAuto Analysis (10 September 2025) listed operational chokepoints in fixed operations departments, particularly with regard to scheduling, technician productivity, and follow-up procedures.
  • DealershipGuy Report (9 September 2025) indicated that dealerships with mobile service capabilities enhanced customer retention by as much as 25%, although take-up is still limited.
  • Market Aggregated Data (September 2025) estimated that less than 50% of customers return to the same dealer for future purchases or regular servicing.

These findings confirm the point: satisfaction does not make customers loyal. Dealers need to reassess service strategy, operational effectiveness, and engagement with customers in order to retain repeat business.

 

Why aren’t customers going back to their dealerships for service?

There are a number of reasons customers stay away from their selling dealerships even when overall satisfaction with service is high:

  • Long appointment wait times and inconvenient drop-off windows make it more convenient for customers to try independent shops.
  • Lack of communication during service, including failure to provide updates or an explanation of pricing, annoys customers.
  • Price sensitivity, with much of the consumer base viewing third-party or chain alternatives as less expensive for routine maintenance.
  • Limited convenience choices, e.g., mobile service, pick-up/drop-off, or loaner cars, decrease repeat visits.
  • Bunched-up digital experience, with customer wishes not being monitored and used to create personalised offers.
  • OEM price moves and shifting incentives, which influence ownership cost and value perceptions.

The trends echo a broader change in consumer behavior: convenience, transparency, and digital-first experiences increasingly determine where people go with their cars.

 

How can dealerships win back customer loyalty?

Instead of responding to diminishing retention, dealerships can implement strategies that affirmatively bridge the loyalty gap:

  • Streamline appointment booking: online scheduling, same-day scheduling, and real-time confirmations eliminate friction.
  • Improve communication: automated service notifications, digital approvals, and transparent pricing information increase transparency.
  • Provide convenience-driven services: mobile service, pick-up/drop-off, and loaner programs make service appointments seamless.
  • Utilize CRM and first-party data: capture preferences at sale and leverage them to deliver contextually relevant, timely service offers.
  • Establish loyalty and reward programs: encourage repeat visitations and referrals to drive lifetime value.
  • Emphasize employee training and fixed operations efficiency: track NPS, turnaround time, and communications effectiveness to support retention objectives.

A dealership that incorporates these methods can convert transactional engagement into long-term relationships so that customers return not only out of necessity but because of the experience.

 

Ahead of the curve: service loyalty as a competitive advantage

In late 2025, the dealerships' loyalty gap is visible and quantifiable. It is those who will invest in eliminating friction, providing convenience, and developing tailored, digitally enabled experiences that will stand out from the competition. Aftersales is more than maintenance and repair; it's a strategic lever for driving lifetime customer value.

 

Through an understanding of these trends and proactive action, dealerships can capture lost revenue, consolidate customer trust, and achieve durable growth.

 

FAQs 

Q: How large is the loyalty issue today?

• September 2025 studies show repeat purchase and retention rates decreased from pre-pandemic standards, with less than 50% of customers returning to the same dealer.

 

Q: What change best enhances retention?

• Convenience activities like mobile service and pick-up/drop-off always produce the greatest retention returns.

 

Q: What studies should leadership examine?

• J.D. Power 2025 Brand Loyalty Study (24 Sep 2025), J.D. Power 2025 CSI Study (13 Mar 2025), WardsAuto Analysis (10 Sep 2025), and DealershipGuy Report (9 Sep 2025).

 

Q: Will digital tools alone solve loyalty?

• Digital tools by themselves are not enough; they need to be added to convenience services, transparent communication, and tailored offers to significantly drive retention.