Tesla, the electric car giant, has been consistently breaking records and setting new standards in the automotive industry. From its innovative technology to its environmentally-friendly vehicles, Tesla has been making waves and has a lot to offer. One of the most impressive things about Tesla is its ability to retain its customers, which is a testament to the brand’s quality and customer satisfaction.
According to S&P Global Mobility, there are three types of customer loyalty: Super Loyalists, Loyalists, and Nomads. Super Loyalists are consumers who have made multiple repeat purchases from the same brand. Loyalists are consumers who have made a repeat purchase, and Nomads are those who do not show any identifiable loyalty patterns to any brand and are most likely to defect. The industry average for “One and Done” (defection rate of Nomads) is 58%. However, Tesla has managed to keep its defection rate to just 39%, which is the best in the industry. Ford, the next-best brand, has a “One and Done” rate of 50%.
Loyalists have an average 13-point advantage on a brand’s loyalty rate compared to Nomads. Brands that fail to transform Nomads into Loyalists not only lose the immediate sale to the Nomad, but also the future loyalty benefit they could have provided as Loyalists. By retaining its customers, Tesla not only keeps the customer at that return-to-market event but also makes them more likely to stay with the brand when they are ready to buy again.
Nomadic households tend to be the wealthiest families of highly educated professionals with high disposable incomes. They tend to live in suburban neighborhoods and may be high-risk for “One and Done” if they chase the latest trendy product. However, a one-size-fits-all approach shouldn’t be taken when identifying possible “One and Done” customers. Understanding and segmenting the consumer and their propensity to move into certain body styles, fuel types, and brands is also important.
It is clear that Tesla has proven to be a strong brand with a lot to offer. Its ability to retain customers is exceptional, and its low “One and Done” rate is a testament to its quality and customer satisfaction. Whether you’re a loyalist or a Nomad, Tesla is a brand worth considering, and its unique position in the automotive industry is a testament to its success.
