Aug 5, 2020
Jade Terreberry, Director of Dealer Sales Analytics, Autotrader
Every dealership I’ve talked to lately has had the same couple of things on their minds: how to get more used-vehicle inventory and how to get consumers to buy now. Today, let’s talk about how dealers’ and consumers’ needs can come together to create used-vehicle inventory and car sales.
Since talking to Kevin LeSage about , I’ve been thinking about even more ways for our dealers to acquire used-car inventory and drive sales revenue at the same time. Given the market we’re in right now, how can we meet our customers’ needs and our goals?
I believe there is a potential car deal happening in at least 1 in 10 households right now – a deal that can get us the inventory and sales we need. We just have to control the TIMING by planting the right seeds and educating consumers.
Many households could benefit from selling or making a trade now (which could mean sales and used-vehicle inventory for you).
Change and unknowns are just about the only constants during the COVID-19 pandemic, but even so, most consumers:
- Still and will likely always need transportation.
- May not have the same transportation needs they did five short months ago.
- Are more budget-conscious than ever and thinking about what their futures may hold.
- Have saved some money over the past few months or need to in the next couple of months.
- Need a pick-me-up.
Right now, I believe that 10% of all households have a potential car deal to be mined. That number may seem high, but let’s think about it. The pandemic and economy have caused five months’ worth of pent-up demand and created new reasons to trade, buy and sell: a car that needs to be liquidated for financial reasons, a payment that needs to be reduced, a need for fewer vehicles (since many families aren’t driving as much), a mileage milestone they shouldn’t cross for depreciation purposes. . . the list goes on.
While many consumers could benefit financially from making a car deal right now, many of them haven’t realized it yet. That’s where you come in.
Okay, so how can we get those consumers ready to trade, sell or buy?
With a little (and I mean very little) prompting from a
dealer they like and trust, I believe today’s consumer will take the leap into
making a deal.
So, I decided to test my theory.
I had a small (social distanced) pool party with four couples from
my neighborhood. They always ask me about the economy, the automotive industry
and any car question that comes to mind. I knew throughout the course of the
night the topic would come up. And it did.
I shared some of the economic predictions and angles I had heard,
but very sincerely shared with them my sentiment that now is the best time to
buy – possibly ever. I shared some simple facts and questions about why now’s
the time to buy, sell or trade:
- “Dealerships and OEMs need your business.”
- “Rates are low and incentives are great.”
- “Inventory is scarce, so you’ll likely get a premium for your trade-in.”
- “A new car warranty would bring you peace of mind. How valuable would it be to know that you won’t have any big unforeseen vehicle expenses in the near future?”
And, it worked. A ten-minute discussion led to 50% of those
couples deciding they’re ready to buy a car and potentially make a trade. And
when I did my Sunday drive through the neighborhood this past weekend, I saw at
least 10 temporary tags in my subdivision, representing 10 recent sales and a
bunch of trades, as well.
Trading and buying are contagious, even in a pandemic.
It’s no coincidence that I saw so many temporary tags in my
neighborhood or that half my visitors decided now was a good time to buy.
Seeing the neighbors make a move makes others want to do the same. People talk,
and right now, car deals are a win-win for the buyer and the dealership.
So, let’s talk about a grassroots approach to educating consumers
on why now is the right time to buy, sell or trade!
5 ways to get vehicle sales moving and acquire the inventory you need:
Here’s my 5-pronged approach to stimulating the auto industry, solving the inventory scarcity problem, helping customers get great deals, and increasing dealership success by controlling the timing of purchases and trades.
1. Your sphere of influence
I shared my story of filling in my friends about why now’s the time to buy. Think about the people you already know who haven’t even considered a vehicle purchase in this crazy environment. They may be ready to move if you give them the facts and get them excited about how you can help them.
2. Mining your CRM
Your CRM is your dealership’s sphere of influence. It’s a gold mine of people that like you and trust you OR have expressed interest in buying from you at some point along the way. Bucket your lost, sold, and even bad and duplicate leads into a few categories. Write a couple of scripts that go into the reasons to buy now that I mentioned above. Then start dialing for dollars and referrals. Set goals and have contests.
3. Geographic farming
Real estate salespeople “farm” neighborhoods all the time. It’s a long-standing cornerstone of their marketing approach to build their books of business. We should adopt it in the car business because it works.
Have each salesperson pick a neighborhood, send a postcard or drop off a marketing piece with the reasons to buy, sell or trade now. And when the buzz starts happening about the great service and great deal their neighbor received from you, your phone is going to start ringing.
Be creative on ways to get the word out in each neighborhood. Network with the homeowners’ association and get a ‘congrats’ section in their monthly newsletter for every new proud vehicle owner with a happy delivery photo! Make it personal and real and fun! Have your new customers share their experiences on social media and reward them for doing it. The goal is temporary tags with your logo in every driveway in the neighborhood.
4. Becoming a networking machine
Be a networking machine and remind all of your salespeople to be. Talk to everyone. Consciously and deliberately network with everyone who crosses your path – standing in line at Wal-Mart, when your grocery or dinner delivery driver drops off your food (they surely need a car with better gas mileage, right?), when pumping gas, at school, while walking in your neighborhood. Tell people why it’s the time to trade, sell or buy. And reward your salespeople for every new opportunity they pull in.
5. Events, reimagined
With a little imagination, events can drive business, even during the pandemic. How about a contactless drive-thru trade-in appraisal event or a “we’ll come to you” week, when customers have you come to their homes to do visual inspections and make an Instant Cash Offer. Or how about an online virtual event featuring your new-car 2021 line-up with walk-arounds and presentations about the best features of the new models? We did tent sales for years, why not try a “Tent Buy or Trade”?
You can move the needle for your dealership.
Remember, car buying is contagious, so spread the word. You know how selling, trading or buying could benefit your local consumers right now, but they may not yet realize it. So, let them know!
We have the ability to influence our entire industry while growing our businesses. Are we going to be let the economy and pandemic drive us, or are we going to turn it into an opportunity that makes us stronger and wins us more happy customers?
In my next post, we’ll dive deeper into the
each of these five strategies. We’ll talk more about each, and we’ll dive into
goal setting, calculating numbers to see what’s working for you, talk tracks, and
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