On January 8, LexisNexis Risk Solutions, a provider of data and analytics for the insurance and automotive industries, revealed that customer brand loyalty in the U.S. grew in 2023 based on information gathered throughout the year.
From January to December 2023, researchers calculated vehicle brand loyalty by analyzing 107 million garages throughout the U.S. According to research by LexisNexis Risk Solutions, 51.3% of new car buyers in 2023 remained faithful to the brands they already owned, a 1.6% rise from 49.7% in 2022. Tesla continued to dominate in customer loyalty with a rate of 60.7%, nearly two percentage points higher than 59.0% the year before.
“We discovered that seven other brands also exhibited loyalty rates surpassing the industry standard,” stated Mike Yakima, product principal at LexisNexis Risk Solutions’ U.S. Connected Car division. He continues, “Brands that do better than average in the sector keep more customers than they are losing. To enhance their market share, the brand actively engages current owners through effective retention strategies.
The study also found that roughly 62.3% of new car purchases were linked to trade-in vehicles, while 26% of garages added a vehicle to their space. Moreover, first-time or long-time car owners made up 11% of new car purchases.
With a brand loyalty percentage of 21.1%, an increase of 1% from last year, drivers who both acquired and now hold used cars tend to avoid repeat purchases of the same OEM. Meanwhile, 26.1% of used car owners buying new cars stayed with their original brand.
Head of OEM products, U.S. Connected Car, LexisNexis Risk Solutions, Dave Nemtuda, “Automakers can further build brand loyalty by connecting with used car owners and offering services to them as if they were the original owners.” “That connection could be the shift that automakers need to see an uptick in brand loyalty and customer engagement with their brand on many levels.”