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WHAT IS A GOOD CAR WASH MEMBERSHIP CAPTURE RATE?
If you operate a car wash with an unlimited membership program, one of the most important numbers you should know is your membership capture rate. I get asked what a good capture rate is, and for me the target is pretty simple: 20% or higher.
There are always going to be variables from one wash to another. Your market, traffic mix, pricing, seasonality and even how your site is set up can affect the number. But if you're seeing a decent amount of retail opportunities come through your site and your capture rate is consistently below 20%, the first lever I would pull is sales.
A lot of times when membership growth slows down, the first reaction is to look for more traffic. Spend more on marketing, run another promotion or figure out how to get another 500 cars onto the property. There is nothing wrong with wanting more traffic, but before I spend money getting more cars to the wash, I want to know we're doing a good job with the cars we already have.
Every retail customer who comes through your site is an opportunity. They already chose your wash. They are already on your property and prepared to spend money with you. If you're only converting 10% or 12% of those opportunities into memberships, I would want to understand why before I went looking for more of them.
That's especially important because membership businesses are constantly dealing with churn.
Churn is never going away completely. Members move, sell their vehicles, change credit cards, run into financial issues or simply decide they aren't using the wash enough anymore. Some cancellations can be prevented and some can't. A good retention process can absolutely improve churn, but no matter how good your operation is, you're going to lose some members every month.
Depending on the wash and how well the membership program is managed, I generally expect churn to fall somewhere around 5% to 10%. That percentage becomes increasingly important as the membership base gets larger.
If you have 2,000 members and lose 5% in a month, that's 100 members. At 5,000 members, the same 5% represents 250 members. At 10,000 members, it's 500.
Nothing necessarily went wrong in those examples. The churn percentage didn't change. The membership base simply became larger, which means the number of memberships leaving every month became larger with it.
That's one of the reasons I believe so strongly in getting capture rate above 20%. As your membership base grows, your sales engine has to be strong enough to continually replace the members you're naturally going to lose.
The difference between a 10% and 20% capture rate can become significant very quickly. If your wash sees 2,000 eligible retail opportunities in a month, a 10% capture rate produces 200 memberships. At 20%, those exact same opportunities produce 400.
Same property. Same traffic. Same number of retail opportunities. The difference is 200 additional memberships.
Now repeat that month after month.
That's why I don't automatically look at traffic when a wash is struggling to grow its membership base. There may already be a significant amount of growth sitting inside the traffic you have. You just aren't converting enough of it.
Of course, saying "we need to get to 20%" is the easy part. Actually getting there takes work.
I've spent a lot of years around membership sales, and telling your team to sell more memberships isn't sales training. It's an expectation. If someone is consistently capturing at 8% or 10%, telling them they need to get to 20% doesn't teach them anything about how to actually do it.
You have to understand what's happening during the interaction. How are they introducing the membership? Are they explaining the value or simply pointing to the menu? Are they asking questions? What happens when the customer says they don't wash enough? Do they know how to respond to objections? Most importantly, are they actually asking for the sale?
Those are things that can be taught.
One of the best ways to understand where the opportunity exists is to look at capture rate by salesperson instead of only looking at the site as a whole. A site might finish the day at 17%, but that doesn't tell the entire story. You may have one salesperson at 27%, another at 23%, someone else at 12% and another at 8%.
Now you have something you can actually coach.
If two people are consistently above 20%, I want to understand what they're doing differently. Listen to their conversations. Watch how they approach customers. Pay attention to how they present the membership and handle objections. Then use what they're doing well to help develop the rest of the team.
This is also where the manager becomes extremely important. Tracking capture rate and managing capture rate are two different things.
If your manager finds out tomorrow morning that yesterday's capture rate was 11%, there isn't much they can do about it. Yesterday is already over. I want managers paying attention to the number throughout the day while there is still an opportunity to change the outcome.
If our goal is 20% and we're sitting at 11% halfway through the day, let's figure out what's happening. Who is struggling? What objections are we hearing? Does someone need coaching? Do we need to role-play something? Is our strongest salesperson positioned where the most opportunities are?
The number should create action.
That's one of the reasons I'm such a believer in visibility. When managers have visibility into performance, they can coach while the result can still be changed instead of simply explaining what went wrong after the fact.
There is another side to capture rate that operators need to be careful with, and that's promotions. You can almost always make a membership easier to sell by making it cheaper. If you offer an aggressive enough first-month promotion, your capture rate will probably increase.
That doesn't necessarily mean your sales team improved.
Promotions absolutely have their place, and I've seen them work extremely well. But I don't want a sales team that can only perform when we're heavily discounting the product. I want a team that understands how to communicate the value of the membership at full price. Promotions should be a tool, not the sales process.
If your capture rate jumps from 12% to 25% every time you offer an extremely discounted first month and falls right back to 12% when the promotion ends, that's something I would pay attention to. You changed the offer, but you may not have improved the salesperson.
Ultimately, capture rate and churn have to be looked at together. On one side, you're continually losing a percentage of the membership base. On the other, you're continually creating new members from the retail opportunities coming through your wash.
You need both sides working.
You should be doing everything you reasonably can to keep churn low by providing a great customer experience, managing cancellations, following up with members and understanding why people are leaving. At the same time, you need a sales team capable of consistently converting retail customers into members.
That's why, when someone asks me what a good car wash membership capture rate is, 20% is the number I want to see.
If you're already there consistently, then we can start looking harder at traffic, pricing, marketing and other opportunities.
But if you have healthy retail traffic and you're sitting at 10%, 12% or 15%, I wouldn't start by looking for more cars.
I'd start with the opportunities already coming through your property.
Train your people. Measure their performance. Coach them consistently. Give your managers visibility into the number and teach them how to manage it throughout the day. At the same time, pay attention to churn and make sure you're doing everything you can to protect the members you've already earned.
You can't eliminate churn.
But you can build a sales team strong enough to stay ahead of it.
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