The auto industry is undoubtedly going through a number of changes, forcing dealerships to take on new strategies if they wish to stay competitive. These strategies obviously come with a cost but current marketing trends suggest the most popular options are indeed worthy investments. Different customers have different demands, and meeting them has proven to be very rewarding, even from a long-term perspective.
The most important change dealerships need to undergo is the same one that is sweeping virtually every industry on the planet. People of all ages are now basing the majority of their decisions on what they see online, including what car to buy or lease. Research conducted by eMarketer found that the US automotive industry spent $7.30 billion on digital marketing in 2015 and is predicted to spend a total of $12.08 billion on such initiatives by 2019.
KNOW YOUR AUDIENCE
Dealerships that take advantage of digital marketing tactics are highly accessible through general search queries, and feature up-to-date yet easily-navigable websites. They allow customers to schedule appointments online, fill out paperwork online, and receive immediate responses to questions they submit. Their target demographics see video ads all over social media and the platforms they are most likely to frequent, especially when summer or the holiday season rolls around. According to Relevate Auto, millennials looking to secure new vehicles visit an average of 18 websites for recommendations or price comparisons before actually going to a dealership. This is the same generation that prefers engaging content that shows a dealership’s personal side to traditional, television-geared advertisements. A little data mining is all it takes to know the precise age and income of a dealership’s most promising leads and therefore deliver seemingly personalized discounts.
The quickest way to expand your dealership’s online presence and strengthen your connection with your target demographic is to hire a digital marketing specialist or team. You’ll be a lot less stressed about the competition once you can tell yourself that you are putting maximum effort into maximizing leads and publicizing exclusive offers.
CONNECTING ORGANIZATION AND MARKETING
In addition to marketing, digital specialists offer the benefit of organization, which becomes another form of data mining. Many dealerships have customer data spread across various different databases such as billing, customer service inquiries and maintenance requests. Should you consolidate all of this data into a single database, you’d gain a firmer understanding of your customers and will now be able to tailor your promotional campaigns to their personal characteristics.
Marketing initiatives take time to pay off but alternative business financing companies like United Capital Sources offer several funding programs that do not involve fixed, monthly payments or due dates. A Business Line of Credit, for example, supplies your business with a revolving line of credit, much like a credit card that you can use, pay back, and use again. This program is ideal for dealerships because they have high overhead with inventory and need to market new products during the slow season, when sales are down. You can run your business smoothly and pay off the balance when your investments start to prove successful.
IN WITH THE OLD
Speaking of millennials, this age group has apparently spearheaded a general gravitation towards used cars. Used cars accounted for 78% of all millennial car purchases in 2015, compared to 68% of car purchases by adults 35 and over. This has prompted dealerships to vastly increase their inventory of used cars, a great deal of which are traded in. It’s currently not uncommon for dealerships to have up to 75% of their assets tied up in inventory but they cannot withhold on discounts at any point throughout the year, and the main reason to have so much inventory is to keep prices competitively low. With the right auto dealer business loans program, however, dealerships can buy all the used cars they want without having to worry about operations slowing down or paying monthly expenses.
A business line of credit is particularly useful for buying inventory when your dealership needs it, because with other programs you would begin making fixed payments immediately after borrowing getting the business loan, which could put your cash flow in jeopardy. Another way to get working capital would be to try a Revenue Based Business Loan which provides enough money to operate your dealership for several months so you can dedicate much of your revenue stream towards gearing up for President’s Day or New Years’ clearance drive away sales.
CUSTOMER SERVICE VERSION 2.0
In addition to a flashy website and a good deal, the modern car buyer places a lot of value in customer experience. A study by Walker found that customer experience is expected to overtake price and product as the key competitive difference-maker by 2020. Customers want to be entertained while they shop, which is an increasing amount of dealerships and other retail businesses now feature cafes, a mini-salon, or a children’s playroom. You’d be surprised as to how many more customers will return for an oil change if they are able to eat free popcorn and drink halfway-decent coffee as they wait.
MAKING SURE YOU NEVER FEAR CHANGE AGAIN
United Capital Source has helped numerous car dealerships obtain the competitive edge they need to take on larger chains and overcome major dips in cash flow. The tools to promote the right cars to the right people at the right time can be yours as long as your dealership has succeeded in every other aspect of the business thus far. If an increase revenue wasn’t enticing enough, just imagine how much more productive you could be if you no longer feared the slow season or the advancement of technology. These changes should be used to your advantage, jump-starting your dealership into a prosperous future!