IBA memebership subscription

[AutoSpaMobMO]

Checking to see what membership subscription service if any everyone is using for their IBAs and how you price your memberships.
I bought my wash 1 1/2 years ago and the previous owner had a membership program at one time but said it nearly killed him so he ended it.
I am facing a Tidal Wave coming to our small town soon and think I need to revisit this. There are 3 Self Serve IBAs in our town and mine is the busiest but I am worried about what the bigger guy is going to do to my business and I have had customers ask if I was going to bring back a membership program.

I don't know how well the previous owner managed his program or if his pricing was out of line the only thing he said was that it was abused. I have been reading this article from Pit Crew https://pitcrew.com/how-to-price-unlimited-car-wash-subscriptions/ and didn't know if this is kind of how everyone else prices.

Any recommendations on type of program to use or pricing would be extremely helpful.

Thank you

 

[Roz]

You are probably busy due to offering a great touch free wash experience. Hard to compete with a tunnel so not worth lowering your value with an unlimited program. You are always open and are TF, attributes that are worth something extra to many car wash owners.

 

[AutoSpaMobMO]

You are probably busy due to offering a great touch free wash experience. Hard to compete with a tunnel so not worth lowering your value with an unlimited program. You are always open and are TF, attributes that are worth something extra to many car wash owners.

A few people have said this to me. I was comfortable with just waiting it out until they put the signs up today. They haven't started breaking ground but I have been told they will come in fast and hard.

 

[SuperShine]

I wouldn’t wait to lock in loyalty now and upgrade what you need to at the wash.

Offer free vacs for your top wash club, paid for non members
Get some LED’s on your IBA’s if you don’t have already. Tidal certainly will.
Lean into how you’re different then them.

What pay kiosks do you have now?
What type of wash club did the previous owner run? Unlimited or limited? App based, rfid, LPR? Did the kiosks actively sell and convert single wash purchases or did they rely on a sign with a link on it.

 

[Waxman]

I wouldn't do anything. I decided against a wash club program. My competitor has it; fine for him. He is friction; I'm touchfree.

Why give your highest revenue stream customers a discount?

You don't know how much the new competitor will affect you yet. It might seem like a lot at first and then might level out overtime. It depends on their level of service and how the customer perceives their service. I told a customer that he should go to my competitor if he wants a wash club discount. He told me he doesn't want to because his brushes got caught in the grill of his car and tore it out of the car. I responded with silence.

I don't think you should overreact. Just keep your wash the best it can be. I disagreed with the idea of free vacuums because they are such a great moneymaker.

 

[washnshine]

I view the touchfree IBA as the perfect defense against the club membership express tunnels. You naturally have a different style of washing that many perceive as safer and more accommodating to various vehicle shapes and sizes. It is open 24/7, and it is very user friendly to customers. Also - NOT offering a club membership elevates the perceived value of a wash. I believe the memberships, in some ways, can “cheapen” the perceived value of a wash. Customers can realize that they pay $30/month, wash every day if they wish, and conclude that their wash is really worth a dollar. I’m not saying the EE’s with membership plans don’t clean the car well, some do and some do not, but it does heighten customer awareness of the actual monetary value of a wash.

I operate friction tunnels, but I do not have memberships. I differentiate my washes by their quality of clean and attention to detail. We do a very thorough prep and inspection of every car. We clean under wipers, side view mirror glass, under spoilers , license plate recesses and any hard to reach areas. We also routinely spray under wheel wells and mud guards.
we do not stack cars bumper to bumper because we are pretty fussy prior to sending the cars. My customers realize this and appreciate it and are not asking me for membership plans.

 

[AutoSpaMobMO]

I wouldn’t wait to lock in loyalty now and upgrade what you need to at the wash.

Offer free vacs for your top wash club, paid for non members
Get some LED’s on your IBA’s if you don’t have already. Tidal certainly will.
Lean into how you’re different then them.

What pay kiosks do you have now?
What type of wash club did the previous owner run? Unlimited or limited? App based, rfid, LPR? Did the kiosks actively sell and convert single wash purchases or did they rely on a sign with a link on it.

I have wash select II's. He had and app for his membership program. I have been considering RFID reader the cost is quite high to get started.
He had signs up with how to download the app

 

[Damoni88]

I agree for a touchless wash I would never do a membership.
1. We use ALOT more chemical than a friction.
2. I already have repeat customers coming from all over.
I am located in SW Louisiana so we really don't have bad winters.

 

[Car_Wash_Guy]

I went with dual Petit's and Dencar tellers with memberships. Absolutely transformed my site. Wish I would've done it sooner.

 

[WashCardMarketing]

Memberships can be a great way to kill business fast depending on how often your customers are washing. We've written several blogs about this topic and discuss it heavily here at WashCard. Our UWashApp just came out with a new version that now offers package washes, but our membership program has also always allowed to set up "Limited Memberships". One monthly price for a set number of washes at a particular value. We'd love to chat with you more if you have questions or want a demo of our app.

 

[SuperShine]

Memberships can be a great way to kill business fast depending on how often your customers are washing”
.

Maybe if you have to charge 3x to 5x a wash for monthly members because you’re leaning on an app only wash club model that doesn’t have effective fraud mitigation or active wash club selling directly from the pay station to convert single wash customers.
They’re washing 20 times a month because IBA morons way overprice their monthly wash club pricing to account for the fraud, overuse and perceived added wear and tear on the wash. They end up inviting more fraud and abuse because of it. Your overpriced wash clubs attract only your most diehard washers who will create their own value by overuse and neuter your clubs potential to grow

Kill business, seriously? How exactly does a successfully ran wash club kill your business?
Tell that to the PE money flooding the industry. Wash clubs are the single biggest boon to car washes our industry has seen.
To not see the upside by now is crazy.
Take your typical single wash customer who washes on average four to six times a year, bringing in say $84/ year at a $14 single wash ticket vs a monthly membership customer who washes on average 2-3 times a month at $25/month (with a properly priced plan) yielding $300/year, which customer would you rather have?

Add family plans into the mix and you have an even better profit metric with the added benefit of crazy sticky customer loyalty.
Wash clubs don’t devalue your wash they do the opposite by creating undeniable value customers can’t help but see

Evolve or die I say. Don’t wait for an express wash to come eat your lunch and steal your customers. Lock in loyalty now, twin or triple your IBA’s and take a page from their playbook. Build up your wash clubs, price them for undeniable member value and expand and protect into your local market.

God knows it’s worked for them

 

[OurTown]

Take your typical single wash customer who washes on average four to six times a year, bringing in say $84/ year at a $14 single wash ticket vs a monthly membership customer who washes on average 2-3 times a month at $25/month (with a properly priced plan) yielding $300/year, which customer would you rather have?

I mostly would agree but would love to see the actual data on this scenario. Any wash that uses LPR should have the data on converting them from occasional washers to members and how long they stay on.

 

[WashCardMarketing]

Maybe if you have to charge 3x to 5x a wash for monthly members because you’re leaning on an app only wash club model that doesn’t have effective fraud mitigation or active wash club selling directly from the pay station to convert single wash customers.
They’re washing 20 times a month because IBA morons way overprice their monthly wash club pricing to account for the fraud, overuse and perceived added wear and tear on the wash. They end up inviting more fraud and abuse because of it. Your overpriced wash clubs attract only your most diehard washers who will create their own value by overuse and neuter your clubs potential to grow

Kill business, seriously? How exactly does a successfully ran wash club kill your business?
Tell that to the PE money flooding the industry. Wash clubs are the single biggest boon to car washes our industry has seen.
To not see the upside by now is crazy.
Take your typical single wash customer who washes on average four to six times a year, bringing in say $84/ year at a $14 single wash ticket vs a monthly membership customer who washes on average 2-3 times a month at $25/month (with a properly priced plan) yielding $300/year, which customer would you rather have?

Add family plans into the mix and you have an even better profit metric with the added benefit of crazy sticky customer loyalty.
Wash clubs don’t devalue your wash they do the opposite by creating undeniable value customers can’t help but see

Evolve or die I say. Don’t wait for an express wash to come eat your lunch and steal your customers. Lock in loyalty now, twin or triple your IBA’s and take a page from their playbook. Build up your wash clubs, price them for undeniable member value and expand and protect into your local market.

God knows it’s worked for them

You make some great points. There are definitely some benefits when you talk about what a "typical" washer looks like. The biggest issue is users who wash more than 2-3 times a month. There are a lot of users who will wash more than that, some every day when they have an unlimited option. I've heard it mentioned here that customers will go to the wash while it's raining outside. Even with 10% of users doing this it can hurt profit margins, beat up equipment faster, go through more chemicals, etc. In the long run, it costs more to have those kind of unlimited users at the wash.

Unlimited programs can certainly be great for new operators to gain new customers, but there should be an exit strategy in place. For instance, "First 100 get unlimited washes for $29 a month. Or offer unlimited for the first three to six months until you have a built that loyalty base of customers.

It's not that unlimited programs aren't great for some operators, but for others it can be a downfall to their business and earning the best possible profits through their car wash.

As mentioned, this is something we talk about often here at WashCard. It's a program we've had available for years through RFID programs, loyalty cards, and now with the UWashApp. We've ran the numbers. We've done the research. We still highly recommend wash packages, or limited programs for operators so they aren't completely losing out on those few customers who abuse unlimited programs. We would just encourage anyone considering an unlimited program to do some research and discover what is best for them, their wash, and their customers.

 

[washnshine]

You make some great points. There are definitely some benefits when you talk about what a "typical" washer looks like. The biggest issue is users who wash more than 2-3 times a month. There are a lot of users who will wash more than that, some every day when they have an unlimited option. I've heard it mentioned here that customers will go to the wash while it's raining outside. Even with 10% of users doing this it can hurt profit margins, beat up equipment faster, go through more chemicals, etc. In the long run, it costs more to have those kind of unlimited users at the wash.

Unlimited programs can certainly be great for new operators to gain new customers, but there should be an exit strategy in place. For instance, "First 100 get unlimited washes for $29 a month. Or offer unlimited for the first three to six months until you have a built that loyalty base of customers.

It's not that unlimited programs aren't great for some operators, but for others it can be a downfall to their business and earning the best possible profits through their car wash.

As mentioned, this is something we talk about often here at WashCard. It's a program we've had available for years through RFID programs, loyalty cards, and now with the UWashApp. We've ran the numbers. We've done the research. We still highly recommend wash packages, or limited programs for operators so they aren't completely losing out on those few customers who abuse unlimited programs. We would just encourage anyone considering an unlimited program to do some research and discover what is best for them, their wash, and their customers.

You almost need a way to “ limit” the unlimited programs. This probably wouldn’t work, but you could have people sign up for “even day” or “odd day” of the month memberships. It would automatically cut their days to 15/16. Or a “weekend only” option or a “weekday only option”, or a combination of both that is good for 3-4 days per week. Ideally, the variety in days would even out the throughput on any given day and cut “over washers” down.

 

[WashCardMarketing]

You almost need a way to “ limit” the unlimited programs. This probably wouldn’t work, but you could have people sign up for “even day” or “odd day” of the month memberships. It would automatically cut their days to 15/16. Or a “weekend only” option or a “weekday only option”, or a combination of both that is good for 3-4 days per week. Ideally, the variety in days would even out the throughput on any given day and cut “over washers” down.

We do have a way to offer this within the UWashApp. As well as wash packages. There are a lot of different options to do what works best for you.

 

[SuperShine]

Notice how I never used the dreaded unlimited phrase in my posts? I use wash club for that reason. I agree IBA washes shouldn’t offer or promote truly unlimited wash clubs and we don’t have to. Call it a monthly wash club and set your monthly, daily caps for each package.
All the good apps: Amp, Beacon, Hamilton and LPR assisted apps from other manufacturers, give you the ability to set wash club limits. (sorry I’m not familiar with Wash Card but it sounds good as long as it’s not taking a percentage of sales. I still prefer a custom app that’s branded with my brand alone and easily searchable on the app stores)

While capping monthly wash clubs help, it still doesn’t eliminate club abuse or overuse. Say customer A has an app membership capped at 20 washes a month, nothing stops him from washing every car in his household up to your monthly cap. If you charge too much for your monthly wash clubs you’re almost insisting that he will app hop and wash his wife’s, friends, daughters and boomerang, thirty year old, basement dwelling sons mustang up to the cap.

As IBA operators, most of us don’t have staff at all of our locations 24/7. We need a way to offer monthly wash clubs differently from the express washes. RFID and even LPR still require customer handholding and have significant fail rates that can kill your throughput and cause customer dissatisfaction when staff aren’t on site to assist right away.
Sunny’s, NCS, ICS haven’t cracked it and they probably won’t anytime soon since IBAs aren’t viewed as where the money and opportunity lies for them.

The app companies and a very small number of hardware companies are our best hope I think.

I’m encouraged by Hamilton’s latest offerings with App based wash clubs supported by LPR and now finally with direct onscreen kiosk signup. It’s been promised for years and finally available. I’d love to hear if any operators have taken the plunge with the new LPR system. I still worry about how you’d manage plate misreads and how that jives with an unattended or semi-attended wash environment. They also seem to be plagued with touch screen fail rates that are high enough to give me pause when considering a HTK or CTK. Not sure about the screen reliability on the Commanders.

Dencar’s offerings appear primed for great things, and appear to be the only hardware Co that gets it. Interestingly it was started by IBA wash owners. They’re still very much in their infancy as a smaller company and evolving hardware and services as their software matures.

 

[jubalr]

I use the Touch4Wash app for my wash. While it has the ability to do unlimited with or without limits, I prefer to use it as a loyalty program. Every wash is cheaper than from the teller, they earn a free wash for every 10, they can prepay for washes at a discount and they start the wash from their phone. I'm in a small town and have over 500 users and growing and I think that is pretty good. We have 4 other IBAs in town and a new express tunnel.

 

[JLanman]

To add to jubalr's comment above, you can build an excellent loyalty program that offers the customer savings without the risk of heavy users from the unlimited approach. If you look at the industry stats for the membership approach. The stats say to charge 2.3x your top wash level in the plan, then expect ~4 washes per customer per month as an average. If you get these results, you are basically (looking strictly at washes) giving away 1.7 washes each month, with some risk for heavy users to max out their unlimited plans. 1.7/4 gives you 0.425 or 42.5%. Keep in mind that when you launch these programs, you will attract the heavy users first. These customers will see the value and jump on the plans, so your averages will be high till you get through this group and make your way to the lower user group you really want in these plans.

You could build a similar value proposition with your loyalty plan. For example you could set your loyalty plan to be buy 2 get 1 free. So a total of 3 washes in the program, two are paid for before you give the 3rd for free. 1/3 gives you 0.333 or 33.3%. You don't have to weed through the heavy users with this approach as the deal is the same no matter how often you use the program. This approach reduces your risk, but does not send the same message as "Wash as often as you like".

This is really the differentiator between the two type of programs. Which is easier to sell to your customers. The memberships statement seems to have a higher value proposition to the customer, while the loyalty program is a more even playing field for both the owner and the customer. Both are great deals, but which sells faster.

With the membership approach, your goal is to get folks to sign up and then you really don't want them to use the value (or you only want them to use it sparingly). So you are kind of marketing a program that contradicts your expectations. But it is easier to manage and possibly easier to sell, but has some risk.

With the loyalty program, you are actually advertising what you expect the outcome to be. "Buy two washes and I will give you a free wash". Your goals are aligned with the customers goals. You secure the funds for two washes before you give the 3rd. You have mitigated the risk of over use. This model requires a bit more communication to the customer to remind them of their points, cash, etc... to keep them loyal. The reminding is a factor to consider as this means communicating with them in some fashion, text, email, signage, social media, etc... These also come at some cost (ads, time, etc...).

We have seen both models have great success. It really depends on your approach to these programs. Just be sure when you are shopping for a system to help manage these programs, that you find one with the tools and flexibility to meet your goals.

 

[Mr. Clean]

"Take your typical single wash customer who washes on average four to six times a year, bringing in say $84/ year at a $14 single wash ticket vs a monthly membership customer who washes on average 2-3 times a month at $25/month (with a properly priced plan) yielding $300/year, which customer would you rather have?"

I've yet to meet someone who washes this infrequently that can be converted to a monthly membership, regardless of the price. They're washing infrequently because the car is basic transportation, not a point of pride.

 

[Bud's]

How about we stop using the customer that washes 4-6 times a year nonsense when trying to establish a baseline for membership calculation when we all know that guy will not buy a monthly unlimited anything anyway.
Use a customer that will actually buy a membership that washes three times a month and all the unlimited math falls to pieces.