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Guest blog: Used cars are the new “new”

car purchase

In this guest blog, Chris Ford - business development director at loyalty services company Grass Roots, talks about how dealers should replicate the new car experience for used car customers in order to have a successful used car operation.

The brands that succeed in the used car space are those that replicate the new car experience as closely as possible, nobody buying a used car wants to be sent around the back to a portacabin, or treated as a second class citizen.

They should feel they are buying into the brand not just getting a cheap deal. Dealers should be aware there is more to the sale than the ‘multi-point check’ and warranty, it’s about level of service too, and buying a car is a high involvement, often emotional purchase even at used car prices.

Challenges

Dealerships are under pressure due to an over-supply of new cars resulting in heavy discounting (savvy consumers are increasingly becoming aware of this) – a good customer relationship management (CRM) system will manage the lifecycle of stock and enable dealers to identify where to focus sales efforts.

The CRM system should also be flexible and easy for dealer groups to self- serve - updating new models and uploading new content and data in an on-brand, professional and consistent manner.

The process of buying a car isn’t limited to engagement with the dealer; it has various lifecycle stages, described below:

Vehicle search

A good programme should enable the customer to make an informed decision. There are ‘Knowers’ and ‘Non Knowers’ i.e. those who know what model and make they want (and have researched the vehicle in detail), right through to those who have a budget but no preference (and thus have considered a range of vehicles in their price range).

A good search facility on the manufacturer’s website plus good use of search engine optimisation (SEO), will cater for both, ultimately driving the right traffic to your car stock.

Consider the audience, what they are trying to achieve with their search and how they have ended up on your site. Their journeys to your car stock will be different dependent on whether they are a Knower or a Non Knower.

If their search doesn’t provide an exact match on your site, consider providing either an alerting service or a relevant close match service i.e. we will look on your behalf and tell you when a car matching your criteria has been found. Customers will usually go the extra mile (literally) for the car that is closest to their dreams and if you do the leg work for them they will travel even further.

Walking into the dealership

Think carefully how you train your sales people and incentivise them both long term and short term. Remember that the 22 year old with £7,000 to spend on a premium marque isn’t necessarily the bottom rung, in fact this is the guy who may offer the most lifetime value to your brand, because once he’s through the door you have the opportunity to ‘upgrade’ him every couple of years through his life stages.

A good training programme and incentive scheme will enable dealerships to buy into longer term brand and sales strategy. In this age of boundless information, consumers have access to so much product information that it becomes essential that the dealer has access to more and can add value through knowledge in their given area – it is not unusual to have product/model champions or specialists to serve the customer - knowledge is power so why shouldn’t the dealer be empowered to serve.

Part two of this guest blog will be published next week and will focus on payment, handover aftersales and staying in touch with customers.



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Comments

  • markccass - 10/10/2012 17:38

    I would be very worried if customers looking at used cars are "treated to the new car experience" as this would in my opinion deflect yet more customers away from the main dealer network. Unfortunately more and more focus is on controlling the customer through structured processes rather than allowing them the opportunity of enjoying the experience within the Brand. Once the "trainers" stop teaching sales teams to patronise and control customers, I think customer satisfaction will naturally soar as they feel genuinely valued and treated with respect. Used car customers do not want to go through a 2 hour structured and controlled sales process to be then (for example) told their part exchange is worth nothing!

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  • wayfwrd - 15/10/2012 21:35

    I agree whole heartedly with markccass comments, i believe this article to be no more than ill informed waffle and in many ways factually incorrect,what over supply does the article refer too.

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  • F4tg1t - 26/10/2012 22:13

    please advise where i can find access to this oversupply

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  • JCT - 31/10/2012 12:57

    This isn't really insight, good dealers have known for years that used car customers need to be cared for as much as new customers (even if the sales process will be different). The over supply is only caused by Manufacturers wanting to hit sales volumes that aren't achievable and therefore pumping pre-regs into their network. More pertinent insight would deal with how best to manage the disposal of pre-regs without distressing residual values for manufacturers, while protecting the dealers right/ability to trade out of this stock?

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