April offers a month of renewed optimism for car dealers everywhere as spring comes into fruition and pockets become heavier with a little cash back from Uncle Sam. Tax refund season has arrived, and with it, infinite profit opportunities for both vehicle sales and your fixed operations. I fondly remember April 15th back in my car-selling days as the “real” beginning of the month.
With that in mind, the following have the potential to be the three most lucrative areas to focus your strategy on during this season of budding opportunity:
1. Increase Show Rates. Okay, this is obvious - but here’s how. We all know the probability of closing a deal skyrockets when a customer is physically in front of you in your showroom. The challenge is getting them there. This is where lead scoring comes into play. If you had the ability to instantly score leads based on their level of buying intent wouldn’t that make the time you spend chasing leads drastically more efficient? Wouldn’t you then know which leads to focus your attention on first and foremost? I recommend implementing technology that has the ability to score all your site, mobile, and third party leads simultaneously and in real-time, so that you know where to focus your efforts.
One way to increase your odds of getting buyers in the showroom is to offer an incentive just for coming in for a test drive, or for a vehicle inspection if their car is a potentially desirable trade-in. The higher the lead score, the more you should offer in exchange to facilitate heavier foot traffic, both on your showroom floor and in your service drive.
DealerRefresh just published an article advising dealers to have their sales staff “put the phone down!” Customers who call your store are not looking to be sold. In fact, they are already sold on which vehicle they want down to the year, make, model, and even and trim level. Therefore, all calls should be managed by your BDC, or your appointment setters as the one and only goal should be setting the appointment to get them in the door.
2. Reclaim Your Fixed Ops Revenue. The service and parts department of a dealership is easily the revenue engine with the most powerful horsepower. The potential for profit opportunities is greater than ever before in a market infested with disloyal service goers. According to DME Automotive, service center loyalty is remarkably low. “Fewer than 1 in 4 drivers are loyal to their service center type, leaving 88.2B up for grabs.” Yes, you read that right. Eighty-eight BILLION. That is how much money is at stake in the market for service and parts. So, who’s going to claim it?
Cars.com agrees and points out, “We in the industry know that dealerships provide fair, competitive prices on quality service, but service shoppers don’t because we aren’t telling them, and it’s squeezing dealership profitability.” National repair chains take business from dealerships either because their digital marketing is more effective, or they offer a smoother digital experience – or both. A better experience includes superior visibility and more transparent pricing models. “All things that are within a dealership’s power to control, improve upon and use to influence service customers,” says Cars.com.
3. Deploy a Millennial Marketing Strategy. As you’ve probably heard, the Millennial market of vehicle buyers is rapidly accelerating – and it covers a wider age group than you may realize, spanning the ages of 18-34 years old. The differentiating factor in this generation is that the dealership experience is rated much more heavily than the actual price of a car. According to a recent DrivingSales study, “While finding the right vehicle at the right price is important to everyone, our study shows that most younger consumers want a positive customer experience at the dealership and are willing to pay a little more to ensure they get it.”
Edmunds.com also offers insight as to what the mobile experience in particular looks like for Millennials, reporting that 60% of Millennial visitors come through their mobile site. These shoppers are most active during evenings and weekends when they are out and about, implying they’re using their phones while on the dealer lot.
Tips for Appealing to Millennials:
· Mobile Focused Ads
· Fluidity of Setting Appointments
· Up Front Pricing
Time and convenience are perhaps the greatest hurdles to overcome when competing for millennial attention, with price following closely in third place. People don’t have time to sit and wait. Often, they are willing to pay slightly more for a faster, easier experience. Wouldn’t you? Quite frankly, time is money.
There is no time to waste. Spring has sprung, and there are billions of dollars to be claimed!