I came across a recent statistic that should help some dealers answer that question that has been around for a while. “Should I quote a price or not quote a price to internet customers?” If you read what I read last week, then you would quote a price from now until the day you decide to hang up the mouse. In 2008, TWO-THIRDS of all new car shoppers for a specific area of the country bought a different vehicle from a dealer than the one they originally inquired about. What this means is, “Don’t just quote your customers a price, quote them a stupidly low price.” You will get more traffic and will repair your new vehicle gross average on the two-thirds of the customers that you are able to work from sticker price instead of the quoted price. Now, for those customers you quoted a price to, you better have a strong F&I department that can make up some of the difference. You will be the winner in the end, and ultimately the last man standing in the internet game.
Figures lie and liars figure! But playing with numbers can be mind boggling – like if you started by saving a penny and doubled the amount saved for 31 days, you would have how much? $10,737,417! Anyone got a penny to get me started?!?
Here’s another one. GM is projecting 11.9 million new vehicle sales in 2009; divide that by the number of dealers open right now – 20,000 – that’s a yearly average of 595 new vehicles sold per dealership. Divide by 12, a monthly average of 49.5 new vehicles sold. Problematically, that number would thrill a Jaguar dealer… and put most Toyota dealers in a coma. But it gives credence to the analysts who are saying up to 30% of dealers may close, sell or merge, in the next two years.
I always think in terms of ‘good, better, best’ (it comes from how we have determined media budgets). For 2009, your overall planning must key on ‘best’ - the best promotion at the best time with the best offers to the best market segment considering a purchase.
The ‘best’ comes when you think ahead! February this year is a good example: Presidents’ Day falls on Monday the 16th, a holiday after an early Friday payday. Do you have something planned – an email blast, direct mail, a special Used Car event?
Here’s a long term example of thinking ahead: If one of your competitors closes the doors, are you ready with the ‘best’ message to convert their existing service customers to your dealership? Are you planning on how to ‘best’ reach that entire owner body? Planning is the‘best’ way to create traffic, increase absorption, and climb way, way, above that 49.5 average. The ‘best’ will survive and prosper… think about it!
Is any of your advertising in January and February targeted to special finance and tax customers? What about your internet lead follow-up from December? You know all those customers that you did not close who submitted you a lead?
Now more than ever go after the “low hanging” fruit. That fruit will make the tastiest pie in times like these.
If you run a dealership and are sitting around wondering what the next couple of months will be like. You may want to consider getting back to a carnival atmosphere. It doesn’t have to be as crazy as a donkey jumping off a high dive. But you already have a lot of the items listed above that made any good baseball game or circus fun.
BALLOONS.
Put out the balloons – not just one on every car, but one on every car – 100 at the entrance gate and 25 at each entrance to the showroom.
FOOD.
This is America, not France. WE LIKE TO EAT.Get the grill, hot dog vendor… hell – be different and call the funnel cake trailer once a month, call the ice cream man for the kids. I know Jim Moran would applaud the ice cream tactic.
LIGHTS.
If you don’t own a pair of search lights, then rent a pair – turn them on now that it gets dark at 5pm.
SOFT DRINKS.
A little hint: Buy enough caffeinated products that the customers get wound up and your sales people do to (even an ad agency performs at 120% when you have an endless supply of Red Bull).
VENDORS.
When was the last time you asked your truck box vendor or spray-in bed liner vendor to set up and do a demonstration at your dealership on a Saturday?
ACTIVITY CREATES ACTIVITY!
BIRDS OF A FEATHER FLOCK TOGETHER!
MAKE IT LOOK BUSY AND IT MAY SURPRISE YOU AND GET BUSY!
The light vehicle SAAR (seasonally adjusted annual rate) for December 2008
was 10.3 Million - DOWN from 16.1 Million a year ago.
Toyota Motor Sales reported December sales of 141,949 vs. last December of 224,399. TMS share for the month was 15.8% - DOWN from 16.1 last year.
Honda Corp. sales of 86,085 vs. last December of 131,792.
Honda’s share for the month was 9.6% - UP from 9.5% last year.
Nissan sales of 62,102 vs. last December of 89,555.
Nissan’s share for the month was 6.9% - UP from 6.4% last year.
GM sales of 218,851 vs. last December of 317,089.
GM’s share for the month was 24.4% - UP from 22.8% last year.
Ford sales of 133,372 vs. last December of 195,105.
Ford’s share for the month was 14.9% - UP from 14.0% last year.
Chrysler sales of 89,813 vs. last December of 191,423.
Chrysler’s share for the month was 10.0 % - DOWN from 13.8% last year.
It’s clear to see the trends, and even in these times, the ‘automaker giants’ have the ability to gain and lose market
share from each other in a 30-day period – just like a dealer does with his facing competitor. The old adage that “when the pie shrinks you have to get a bigger piece” is clearly abundant with these numbers.
Let me open by saying one of 2008’s biggest disappointments was how the industry missed (in my opinion) consumer reaction to $4 a gallon gas. Will gas prices reach those heights again? It’s likely, and if you’re a Toyota or Honda dealer, my bet is you agree.
Three headlines caught my attention this morning:
Israel/Palestine conflict escalating in the mid-east
(oil flow disruption issue)
Headline reading ‘Oil tops $46 as OPEC cutbacks take hold’
KBB.com report on vehicles most researched online.
You don’t need to hammer your market with #1 and #2 – they’re
online more than ever and undoubtedly see this news. What your
market doesn’t see is the KBB.com report. In a quick overview, Hondas held positions 1, 2, 6, 13, 14, 15 out of 20; Toyotas
came in at 3, 4, 7, 8, 9, 11, 18 – look up the poll on KBB.com
and see all the results.
Timing is everything, and for Honda or Toyota dealer advertising
a nice ‘first touch’ this year would be an email blast informing
your market they are not alone in researching online the quality
and value of your product.
No question hybrid and small size segments have fallen as gas prices dip below $2 a gallon. The question is though, how high will gas prices have to climb before these segments take off once again? I’m anxious to hear what you think the ‘magic number’ is – I believe it is $2.50 range – and headlines indicate that could happen sooner than later.
Someone who reads this blog asked me to comment on marketing service. Should be an easy thing to do right? That is the business I am in and the company I run. But after putting some thought into it, there are so many facets that face a “true” agency that it is very difficult to in a few paragraphs talk about what “Marketing Service” really is. Every dealership in America is different. There are different parameters and needs of their business that require an automotive marketing company to be able to adapt to different personalities and methods of operation while keeping the same goal in mind: ”Creation of Traffic”.
I decided to focus this article not on what a “Marketing Service” IS, but what it is NOT.
Hyundai’s marketing group announced today that they were buying two spots in the Super Bowl. This is the type of thing that frustrates me. It’s the same as a Radio Station selling a ‘College Basketball Package’ or a Newspaper offering a special ‘Kick-off to College Football.’ The value in what is being bought and what it will deliver is fraudulent. Some marketing guy probably pushed this on Hyundai because they wanted to look back and say, “We had a Super Bowl Ad in 2009.”
The only time I have EVER seen a Super Bowl spot work for an automaker was the buzz created by the “Cadillac Breakthrough Campaign in 2002″ (featuring Led Zeppelin’s high-energy song, “Rock and Roll”), which only kicked off what was to be a brand revitalization campaign. But the Super Bowl ads didn’t bring back the brand, THE HUNDREDS OF MILLIONS OF DOLLARS SPENT IN THE NEXT 36 MONTHS MADE THE BRAND COOL AGAIN and made people under the age of 70 actually think about buying a Cadillac(sorry Buick).
Getting sucked into a mindset of, “I have to be there because people will watch this,” is about as dumb as me trying to play in the NBA (I’m only 5′ 6″). Effective marketing really involves 3 key things: Reach, Frequency, and Consistency. You have to reach an audience enough times with a message in order to have mental awareness. You have to pound the message into their minds with words or phrases that can be remembered in order to have any type of recall. And you must be consistent. The hardest thing in the world in the auto industry is to stay the course even if you feel like the ship is taking on water.
Hyundai is probably going to spend $2 million on the Super Bowl Ads. There will also probably be about $500,000 worth of filming and production for the spot (if it’s good). No one will probably remember the message the day after the game. And, it probably won’t rank high in the poll taken about the great Super Bowl Ads. I call this “Marketing In-Service.”
NOW, what a Marketing Servicewould be for Hyundai would be someone in a board room saying, do you realize how many people we could mail to announce our Hyundai Assurance Program, or the amount of web coverage if we spent $2.5 million dollars in a smarter area?
It equates to about 5 million direct mail pieces, which if it drew a 1% response would equal 50,000 “ups” or “qualified intenders.”
I wonder if the Hyundai dealers in America will have 50,000 showroom “ups” in their stores on February 2nd? PROBABLY NOT.
This chart is specifically tied to New Car Sales,
with online sales with growth trends going from
25% in 07 – to 40% by 2011.
This creates a very interesting angle for the
progressive dealers of the world who are trying
to gain a BIGGER piece of the “market share pie” and eat it too. Everyone is learning
the tools and tricks needed for aggressive and effective online Used Car sales, but
how actively are you pouring through the search engines for new car traffic, building
duplicate new car websites or landing pages, creating a greater keyword presence
and perfecting your sales organization to handle these new car buyers?
Don’t Panic. GET TO WORK!
The next bombastic change in our industry will be selling, delivering more new cars
completely over the web. I mean if the French are going to do it, we should be able
to eat them for breakfast.
Figures lie and liars figure! But playing with numbers can be mind boggling – like if you started by saving a penny and doubled the amount saved for 31 days, you would have how much? $10,737,417! Anyone got a penny to get me started?!?
Automotive Advertising
Remember going to the baseball games as a kid, or maybe even the circus. There was a LOT going on:
FOOD. 
LIGHTS. 
SOFT DRINKS. 
VENDORS.
The light vehicle SAAR (seasonally adjusted annual rate) for December 2008 
18 – look up the poll on 
In a December 31st article from 
