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How Dealers Can Successfully Sell New Car Pre-Order
Oct 10, 2022
Karrie Sudbrack, Vice President of Deal Sales, Cox Automotive
Over the last year whether you’re just dipping your toe into how to effectively and successfully sell new car-pre-ordering, or you’ve been doing it pretty successfully for a while now, new car pre-order is no longer something that happens only occasionally at dealerships.
As we all know, due to macro-economic challenges, shifts in consumer buying behaviors and continued inventory shortages in our industry, new car pre-order is now a reality and way of doing business. Dealers and brands have integrated pre-order into their everyday operations and new car sales focus and lead strategies over the past year.
However, it’s important to ask yourself, what exactly is your current strategy when it comes to new car pre-order? Is that strategy actually working to drive sales? Are you educating and targeting the right shoppers with your ordering process? How about the advantages of completing new car pre-order with your dealership vs. your competitor – are you marketing and selling to those? The time has come for you to both re-examine and re-define your new car pre-order strategy now that it is here to stay.
It’s time to re-define your new car pre-order strategy.
First the good news… Cox Automotive’s data shows that consumers are willing to continue to pay MSRP without question, and willing to wait for a new car pre-order, if the expectations are clear. Your customers know there’s a chip shortage resulting in an inventory shortage in our industry. But what they don’t know is what that process looks like to pre-order, how to do it, or what to expect.
By taking a closer look at how your dealership markets, sells and runs new car pre-order, you’ll discover new ways to not only successfully develop and implement a revenue driving pre-order strategy, but you’ll also gain the attention of your ideal customer and increase leads as well as keep existing customers loyal to you and your brand.
Advertise to the person not the car
In the past it was all about advertising to the specific car sitting on your lot. If a certain car was sitting longer than another, you would spotlight it, possibly putting more incentives on it both internally and externally. You focused on that car – not on the person who would ultimately be buying it – which was fine when inventory was plenty.
But in today’s times, especially when it comes to new car pre-order, it’s important you’re advertising to the person not the car you might, or might not have, on your lot.
By selling to the person, you can sell to their wants, needs and preferences. And with most of the purchase process now being done online, you’ll have the ability to target customers and stay side-by-side with them during the purchase process.
You’ve taken advantage of an opportunity when you make sure they see the right messaging at the right time and walk into your dealership because you demonstrated you knew their wants and needs. Ultimately, by selling to them, not the car, you offered them more than a car… you offered them an experience.
And, if you don’t have the car on the lot, which for the majority of dealers today is a reality, you’ll still have their interest, and they’ll want to do business with you. Give them the right experience, show them you understand what they want and are looking for, and you’ll have a sale!
The risks you can avoid
As we add more layers to the possibilities of new car pre-order and lead strategies… let’s talk about some of the things your dealership will gain. Or in this case more specifically can avoid!
Floor Planning Costs: One such thing you can avoid by focusing on new car lead strategies like pre-ordering is avoiding the traditional risk of floor planning. The majority of dealers no longer have to worry about the new cars sitting on their lots for 120 days. Many have literally cut that time in half through efficient pre-order strategies.
For dealers, that presents a profit margin builder, as you won’t be planning for and paying floor planning fees to the extent you were before. This could not only save you thousands (and thousands!), but it will also help increase your profits and the dealership’s cash flow.
Insurance Risk Costs: Additional risks you’ll avoid by focusing on a new car pre-order lead strategy are some of the insurance risks you typically carry by simply having inventory on your lot. Again, this is another cost and risk your dealership carries, as well as fees that eat into your profits. New car pre-order and lead strategies can help you increase your profit margins with decreased insurance risk costs.
Consumers can save money and get what they want
Now some more good news based on surveys and data Cox Automotive collected on buyers, their behavior and their overall expectations vs. results… Consumers love that they get want they want when they pre-order and they can spend or save money based on features important to them – they decide!
Implement educational marketing on how new car pre-order works
When building out your new car pre-order strategy, it’s also important to include that you must implement educational marketing. You should be both showing and telling the consumer exactly how new car pre-order works. And ideally, also educating your entire team on what that process is, the advantages, and your unique differentiators on how it’s handled at your dealership.
Remember, new car pre-order is a relatively new thing for the majority of car purchasers. Educating your customer on how and what to do when thinking of pre-ordering, more specifically on how that is done at your dealership with your brand, is both important and essential to ensuring a successful and smooth transaction.
In re-examining your new car pre-order strategy, ask yourself these questions on how your dealership is educating consumers:
How do you currently educate your current, previous and future customers on new car pre-order?
Do you specifically market that you offer new car pre-order and how are you highlighting how your dealership stands out compared to your competitors?
Do you have a video or series of videos easily accessed by your customers outlining the step-by-step process, including the delivery process, so that they can continue to refer to it as many times as needed?
Do you have marketing materials that show the differences and advantages of new car pre-order on a whole vs. traditional new car purchasing?
Does your sales team outline the steps to ordering – detailing what the customer will do online and what they’ll do in person – so that they know how and when they should be completing the next step?
How do you stay in front of your customer every step of the way from prior to ordering to waiting for delivery – do you preschedule automated emails, retarget online, or calendar touch points?
Make sure you not only go above and beyond when it comes to communicating what to expect, but stand out as a dealer that wants them to feel comfortable, and is willing to educate them and help them throughout the entire pre-order process.
A more profitable way to operate
Now is the time to start investing and strategizing around new car pre-order and the leads it can generate for you, because if you’re not building a strategy from the top down in your dealership around it, one of your competitors will. Focus on getting in front of your ideal customer and demonstrate you’ll guide them through what most likely is a new process for them.
Our analysts, as well as others, believe that new car pre-order is here to stay. Sure, some dealers might flood the market with inventory here or there based on allocations, but pre-order can be a much more efficient strategy over the long haul. Overall, it’s a more profitable way for dealerships, as well as manufacturers, to operate.
Want help powering your business forward? The Deal Doers Solution.
We invite you to connect with us to take a deeper look into ways to capture a buyer’s focus online, especially when it comes to new car lead strategies and pre-order. Our success, data, audiences and destinations can be yours as well, helping you maximize how your brand and experiences stand out to drive profits and close more deals. As your trusted partner at Cox Automotive, we provide you with the solutions to run your dealership more efficiently, driving quality leads. Isn’t it time you put our best-in-class insights and analytics to work for your dealership?
Want access to the replay of the highly attended webinar hosted with Automotive News with Karrie Sudbrack, VP of Dealer Sales, giving you more examples and ways you can stand out to your ideal customer in today’s times to drive profits? Click HERE to watch it now.