Affinity schemes offer select customer groups the opportunity to buy new cars at preferential rates. This gives OEMs and fleet managers an additional revenue stream, bringing in customers throughout the year.
However, Affinity schemes run the risk of sliding into obscurity unless managed effectively and continuously.
In this article, we take a look at some of the common barriers to keeping an Affinity scheme alive and showcase a range of potential benefits.
Barrier 1: Affinity sales don’t compare to fleet sales
Fleet sales are always the gold standard – but what about the selling opportunities to large groups of employees who don’t qualify for a company car?
Organisations such as the NHS, the police and national retail chains have huge numbers of employees, but not all of them are entitled to a company car. However, if you offer these workers access to an Affinity scheme, you are effectively creating a new type of company fleet.
This can be an extremely profitable course of action for a brand. Indeed, we are on track to help our clients achieve more than £100 million in incremental sales in 2023!
As with regular fleet sales, Affinity schemes can feed revenue into your business throughout the year. This can help avoid boom-and-bust scenarios in which large purchases are followed by quiet periods. By consistently promoting your Affinity scheme, you can significantly boost your overall sales figures and enjoy a regular source of income every month.
In addition, these sales play an essential part in increasing your exposure in new markets by generating brand awareness. If someone buys a vehicle from your Affinity scheme, they’re likely to tell their peers and colleagues, who may go on to purchase from your scheme themselves.
Your Affinity customers are likely to spread the word about how great your brand is among non-scheme members too. This will create sales that will feed into your regular retail model.
MG UK is just one example of a brand that has achieved greater awareness and market share from this strategy.
When MG UK approached us, they wanted an Affinity scheme to help increase their presence in the UK market. They also wanted to be in full control of the scheme and able to ensure all customers accessing it were eligible. We therefore deployed our sophisticated platform and authorisation process to target employees from the specific organisations they wanted to reach.
This resulted in incremental sales which contributed to MG’s market share increasing rapidly, supporting their efforts to become a leading brand in the UK. We now maintain their sales at a sustainable level, ensuring that they meet ongoing sales targets.
Barrier 2: Affinity schemes need investment
Affinity schemes need a bespoke, easy-to-use platform that can be accessed by both the retailer for in-person sales and by the customers themselves in their own homes.
With VPS Affinity, once your platform is established, the scheme can become cost neutral. This is because our fees are paid by the sales generated through the scheme, which means there is low risk to you and no hidden costs.
We also offer a fully managed solution, which means you don’t need to find additional resources for customer or retailer service and platform support.
A functioning Affinity platform can also help to futureproof your business.
As our research into the agency sales structure has shown, there is a significant number of customers who now prefer to make purchases online. Indeed, a new study reported on by Motor Trader revealed that 27% of UK buyers would now be happy to buy a car online without ever having seen it. This rises to 46% of 18-24-year-olds.
By making the decision to set up or refresh an Affinity scheme, you can support your retailers with a profitable online sales solution. This will stand your brand in good stead for the future, while also attracting a younger generation of customers.
If your Affinity scheme is gathering dust, you could be closing the door on a large number of customers, as well as alienating a younger client base.
Barrier 3: Affinity schemes can detract from retail sales
Affinity schemes work on the concept that they offer selected customers preferential prices for cars. For some, this can be interpreted as undermining the retail offering.
Affinity schemes, however, can actually help to protect your main offering while giving your business full control over who you sell to and for how much. With our platform, you can set the pricing to whatever you want and change it when needed. By only targeting select customer groups and using our detailed sales monitoring, you can also ensure that your retail sales are not undermined.
Retailers can access our Affinity scheme portal from their own locations too, ensuring that customers who walk into the showroom can also be entered into the scheme approval process.
Barrier 4: It takes time to manage and implement
It certainly takes a lot of effort to create a successful Affinity scheme, but not as much time as you may think due to our extensive experience and track record. In fact, we were able to create a sophisticated and fully integrated platform for MG UK in just six weeks.
You can also assign responsibility for the scheme’s management over to us. With our platforms, we provide complete management. Not only can we make updates on your behalf, but it also means that we can provide your customers and retailers with service and support. This is delivered both over the phone and via email so that your team is free to focus on other things.
Barrier 5: The scheme can be abused
There will always be people who try to cheat the system, but a robust authorisation process ensures that only the right people benefit from your Affinity scheme.
With VPS Affinity, you can rely on our stringent authorisation process, which is completely handled by us. This will once again protect your retail offering and your profit margins.
Barrier 6: Promotions take time
Promotional schemes can take time to gain traction, especially when you need to liaise with your partners to encourage them to drive leads in your direction.
At VPS, we can help to speed things up by playing a part in managing these relationships. Thanks to our long-standing experience in the automotive sector, we can help you to promote your Affinity scheme to your desired audience so you achieve optimal results. We’ll even contact your partner organisations to ensure they are promoting the schemes to their members, enabling your in-house resource to stay focused on their core responsibilities.
The solution: Boost your Affinity scheme with VPS
By giving your Affinity scheme the support it deserves, you can benefit from additional revenue without drawing resources and attention away from your retail sales. With the right platform in place, you can also expand your reach into new markets or bolster your presence in existing ones.