by David Metter
I’ve said it before, and I’ll say it again. Our industry has a skewed perception of big data and its intended uses. I think that the term “big data,” has been overused and I believe it’s time to replace it with “best data.” Big data will only continue to get bigger, and I don’t think “colossal data” will ever really catch on or be worthy of a hashtag. So let’s open our eyes to what’s been missing from the information age and allow a little common sense to flow through our vantage point, straight into our dealership operations.
So what is the best data? If you asked 50 different people, you’d get 50 different answers. But these are just opinions, and opinions are noise. The best data is science-based, inarguable, and absolute. The best data is something you already have, and it’s located right within your own DMS. The data that matters most, before observing any other KPIs, is sales and service data – that’s it. If you think any other type of information is more important than if people buy cars from you and if they get their vehicles serviced from you…I’d advise you consider a different line of work.
If I were to purchase a dealership this very moment, the first thing I’d put into play is equity mining. I don’t own an equity mining company, and I’m not trying to sell you an equity-mining product. But I do know good common sense solution and execution when I see it. Equity mining takes the sales and service data you already have, and identifies opportunities to drive people actually in-market to purchase into your showroom or to your service department. It’s that simple.
According to Automotive News, “Equity-mining software, sometimes called data-mining software, enables dealerships to spot current customers who are in a good position to get out of the vehicle they have and into a new one for about the same monthly payment.” They also say it's been an absolute “gold mine” for one Honda store that has utilized it to fuel profit in nearly every one of their departments.
Top Equity-Mining Software Providers:
- CDK Global
- DealerSocket’s Revenue Radar
- Dominion Dealer Solutions
- ELEAD1ONE Xchange
AutoAlert has one of the industry's best data mining tools that uses advanced algorithms and analytics to reveal online trends and consumer behavior in order to provide actionable, in-market consumer intelligence. Their AlertMiner Retention Alerts will inform dealers of any and all profit opportunities as they arise. The software shows dealers when a past or potential customer’s contract is ending on a lease or purchase or if they can get a newer vehicle for the same monthly payment they have now.
AlertMiner alerts dealerships of relevant consumer shopping behavior and when it is a good time to reach out (or not).
DealerSocket’s Revenue Radar continuously scans your DMS in order to highlight customers that are in a favorable position to spend money at your dealership, before they shop your competitors. Their equity mining process is shown below.
The choice is yours. Go with your gut, or go with the recession-proof combination of science and common sense. Common sense will tell you science has a higher probability of being right – despite your intuition and experience. Equity mining is at your disposal, waiting to help you reach past, present, and future customers when they are in the market to buy. You have the best data already (sales and service data), now it’s time to mine it and work it! It’s the difference between being part of the noise and being the first one to speak up when the moment is right.
Equity mining is exactly how dealerships get their ducks in a row prior to a campaign launch. It is how you avoid wasting money on prospects that are not considering a purchase. I believe in this concept so much is because it’s common sense in its purest form and much less complex than we’ve been led to believe.