“Nabobs & Neighbors” Lead the Sales Surge Parade
In the early 1970s during the Watergate scandal, then Vice President Spiro Agnew was defending President Nixon and called the national press ‘nattering nabobs of negativism’.
Today, for once, I am on the opposite end from the ex-VP. Just as happened during Cash for Clunkers, the national media is spreading the message that America is back to buying new cars. It may be their way of telling us this is the only reaction of a victimized consumer at the gas pump, but it’s bringing out the buyers even while manufacturer incentives are being cut.
That brings us to the buyers, and I don’t know who said it first – might have been Mike Strong – but the airwaves are covered up with commercials saying ‘join your neighbors this week, it’s a great time to buy!’ Again, just as we saw with Cash for Clunkers, there is no better motivator than seeing a new car in the neighbor’s driveway.
Thank you national media, keep those stories on the front page and the traffic will continue to grow. Yes, history is repeating itself and I hope you are ready – lead, follow or get out of the way of this long-awaited bandwagon!
Sell the Savings, Underline the Urgency
Opening day for baseball is here and the car business is hitting a home run! These factory statistics are amazing: Ford up 5% with best March in 5 years, Nissan best increase since 1973, and the Chrysler numbers are phenomenal – up 34% and the brand 70%! But as the great philosopher Yogi Berra said, ‘It ain’t over til it’s over’, and that is my point.
Inventory and ordering need your absolute undivided attention! In talking to some of our STRONG LLC dealers, this current selling frenzy is on pace to outrun production. With that in mind, right now is still the absolute best time to increase your share as more traffic comes on the lot. These same dealers are coaching up their salespeople to sell the savings double-play of economy and warranty, but also underlining the urgency to purchase now. We not saying resort to the old ‘buy it today or it will be gone’ mentality, just give consumers the straight story as another step towards closing.
Bottom line, if your shoppers buy somewhere else, you may not see them again for 10.8 years and you know what I’m referring to – that’s a lot of sleepless night when you think of losing business for a decade!
Tire Kickers turn into Sticker Rippers
I shot an arrow up into the air, and it came down…yup, right where I said it would. This blog has stayed the course throughout the 1st Quarter saying March would be big and today’s headline from MSNBC tells the story: “Auto Sales on Target for Best Quarter since 2008”. Many analysts as well as manufacturers saw this push coming, but for a while I was like the Lone Ranger forecasting March as ‘one of the best retail sales months since the start of the Great Recession’.
For many of the automotive dealerships we work with on a day-to-day basis, sales came out of the gate big, hit kind of a lull around mid-month with spring break, but came back with a vengeance the last 7 days of the month. Increased sales coupled with service trends continuing to rise as many Americans choose to keep their cars longer and perform higher priced maintenance/higher mileage services to keep their vehicles on the road make March appear a win-win for sales and service.
As month-end numbers continue to come in, I dare say the trend here at the close of the first quarter is more shoppers are ripping up the sticker on new (and certified used) vehicles. Many of STRONG LLCs dealers are reporting the best sales volume month in quite some time; and dealership profitability by all accounts should far exceed the monthly average over the last 12 months. As we are now entering into the second quarter – one of the best quarters for historical retail car sales – it is time to get prepared and establish a volume mindset for new and used vehicle sales. I will shoot another arrow into the air, and come June my confidence is high that even better numbers will be reached by the dealers who ‘aim high’ right now.
Sales Have Sprung and the Heat is On
Whether or not “global warming” is the cause for the above average temperature numbers all across the country this month, I firmly believe that “global selling” is responsible for the hot sales numbers we’re seeing as we move into the second quarter.
In talking with a number of our dealers and general managers over the last couple of days, it is evident that the mercury is rising in the automotive marketplace. There is more consumer interest, website activity and floor traffic in dealerships this month than recent history.
The trend is similar to the upward spiral in March of 2011, until the effects of the tsunami were felt and inventory of both imports and domestics evaporated. This year is shaping up to be very different. While gas prices have increased, they have received less media attention and consumer confidence continues to rise. All signs point to the release of a lot of pent-up demand for new and used vehicles in the second quarter.
Just as the weather is getting hotter, so is selling intensity in most dealerships that STRONG, LLC works with. Now is the time – strike while the iron is hot.
Searching for new business? Start with your current customer base
John Paul is a contributing writer for the Business Journals Digital Network’s “How-to: Growth Strategies” series. Below is his most recent installment.
I find myself telling people all the time, “I don’t care whether you took a high school economics class or graduated from Harvard… the most basic foundational lesson you learned is that your No. 1 source of new business is the person you are currently doing business with.”
This philosophy lies at the core of any effective marketing plan.
These customers already exist, have already had the experience, and are aware of the good and bad associated with buying from you.
Existing customers are without question the most overlooked source of new business for any retailer.
The challenge for most businesses is the absence of an exact marketing plan on how often previous owners should be contacted, or what message will make them respond the most.
The way to combat this is to build a marketing plan that allocates enough resources on a monthly basis to send out communications to your previous customers to generate a response that results in new business.
I have broken a pre-planning strategy down into five points. Regardless of what industry you are in, these must all be addressed before a plan can be created.
1) What’s the size? The size of your owner base will be the greatest factor in determining the amount of effort and dollars required for effective marketing. Once total audience is determined, you can apply the frequency of how many people are contacted every week, month, quarter and year to effectively market to this audience. Once the frequency is applied, you can set a calendar or schedule of events to take place in your plan.
2) What’s the message? The greatest point of all in terms of a message is that no message is a bad message. Every piece of direct mail or email that gets sent ultimately makes an impression. The bottom line is that a message should always be sent and it should be created by knowing what a customer base is most likely to respond to based on what are the best products or services you sell.
3) How’s it sent? There are three methods I find most effective; the mailbox, email and telephone.
Every American has a mailbox. Direct mail is one of the only methods in marketing where you can physically place a message in someone’s hand. The latest data showed 94 percent of adult Americans have an email address, thus email is another very valid and more cost effective way to market.
The final and absolute most critical form of sending the message is the telephone. The telephone is the lifeline of any business. I am a huge advocate for outbound calling as it is the only source for live two way interaction between a buyer and a seller.
4) How often? I believe you are best served using the following:
• Email – can be sent 2-3 times per month and you can send a message to all your owners at once for no cost.
• Mail – can be sent every 30 days or set to send every 60 days if the customer base is too large to contact all owners each month.
• Phone – can be used 3-4 times per year. This is used sparingly as it is the most intrusive form of outbound marketing.
5) How long do you do it? The easiest answer of all. Forever. Once you develop a system to mine your existing owners and outwardly market to them for new business, you never stop.
The return on investment and dollars spent to keep an existing customer pale in comparison to the dollars needed to create a new customer.
The main source of new business is the person you are currently doing business with. I would invest my marketing dollars in this area before spending a penny targeting the mass public.
John Paul Strong
