Fueling growth through customer lifecycle management

This article originally appeared in the February edition of Powersports Business, written by Max Materne, co-founder of Ownex.io and 2024 40 Under 40 winner.

In my years working in the powersports industry—owning a dealership, climbing the ranks and consulting—one consistent theme has emerged: focusing on the customer’s ownership experience is essential to long-term profitability. While operational efficiency is crucial, it doesn’t guarantee you’ll retain valuable clients. In fact, 73 percent of customers will switch to a competitor after multiple bad interactions, and more than half will leave after just one negative experience. That figure alone illustrates the risk of neglecting a customer relationship once the initial purchase is made.

In analyzing dealership data, I noticed a common pattern: customers come in, buy a major unit—be it a motorcycle, an ATV or side-by-side—then vanish after their first annual service, leading to an average customer lifetime of just 1.1 years. The data shows that most customers never return for their second or third annual service visit, let alone engage in a trade-in. This creates a significant revenue gap, given that repeat customers spend three times more than one-time shoppers. Moreover, a mere five percent increase in customer retention can lead to a 25 to 95 percent increase in overall profits, highlighting how critical it is to keep existing customers engaged.

Yet, it’s more than just creating follow-ups and touchpoints. To genuinely improve retention, you must identify the existing pain points in your customers’ experience and view them from the customer’s perspective. Perhaps it is long service wait times, an impersonal handoff post-sale or confusing financing procedures. Whatever the shortcomings, addressing these issues head-on is crucial to satisfying buyers and building genuine, lasting loyalty.

To better visualize the customer journey, I developed the “Lifecycle Clock,” which spans approximately 40 months—a timeframe our data suggests is the most likely point for a trade-in. The clock highlights milestones such as the first service, annual maintenance, apparel replacement and more. However, simply hitting these obvious points isn’t enough.

If a dealership can consistently reengage customers at all the “hour marks” between these milestones—through personalized follow-ups, strategic marketing and overall improved experiences—they stand a far better chance of fostering long-term, loyal relationships. These “loyal” customers not only generate more revenue but also become brand advocates, encouraging others to visit through word-of-mouth.

Despite this, many dealerships still invest heavily in acquiring new customers while overlooking the value of those they already have. In the auto industry, for example, acquiring a new customer costs $633 per vehicle sold, yet retaining an existing one is ten times cheaper. By focusing on service reminders, community-building events, and, most importantly, resolving any frustrating touchpoints, dealerships can leverage the cost-effectiveness of retention strategies rather than pouring funds into attracting new buyers.

The data clearly shows that transforming an “average” client into a “loyal” one is where true growth thrives. Loyal customers stay longer, service their units more frequently, purchase more accessories and apparel, and ultimately trade-in at your dealership rather than going elsewhere. By the time they consider a new unit, the relationship built through positive interactions and meaningful solutions to their problems often determines whether they stay or leave.

Ultimately, enhancing the ownership experience boils down to listening, improving and engaging. When customers feel valued, respected and genuinely excited about their purchases and ongoing service, they are far more likely to remain loyal through multiple buying cycles.

As the powersports industry continues to evolve, prioritizing customer satisfaction— and keeping the Lifecycle Clock running smoothly—will be the key to thriving in an increasingly competitive market.