The car industry has to change if it wants to win in today’s customer-oriented world. As dealer groups continue to gain power through acquisition and consolidation, it’s more likely that they can invest in the tools they need to change the way customers are marketed and improve performance.
“The key issue for the industry is that funding is now changing very quickly due to impending changes to block exemption, in particular the location clause. Local markets are becoming more important and dealers are now realizing that their territories are actually quite different from the market they are targeting,” says Dr Mark Whitton, automotive sales director at GMAP.
The company specializes in helping businesses develop their retail networks, sales territories and market channels to be more efficient and profitable. It has worked with companies such as Ford, PAG and DaimlerChrysler.
He believes that planning is key to any marketing strategy, and that ensuring you are targeting the right buyers is vital.
“Dealers really need to focus their marketing spend on areas that will give them the best returns. Most vehicle markets are geographical so they need to understand the areas of greatest demand and where their competitors are – then they can change their activity accordingly.”
For some dealers, marketing is virgin territory. Having been spoon-fed for many years by their manufacturer partners, it can appear a daunting task, and the move from being just a stockist to becoming a retailer is not always smooth.
“They need to start understanding the demand for vehicles, aftersales and servicing, as well as the local people. Markets are opening up and the groups that will make most progress are those that target unexploited opportunities, which local dealers aren’t making a good job of,” says Whitton.
But marketing is just half the story. The only way to ensure you are reaching the right customers and maintaining contact is to analyse and measure the effects. This is fast turning into a crucial tool for dealers, enabling them to see what they are doing right, and where they are failing. “Sometimes dealers miss the point. Instead of just aiming to create more enquiries, they need to be making sure that they are capturing the enquiries that they are currently losing, which is typically 50%,” says Michael Jackson, chairman of e-GoodManners.
The company’s software enables dealers to capture and record showroom and telephone traffic. It starts the process of monitoring and following up every customer entered into the system, increasing test drives and, eventually, sales.
“We recently visited a dealer group and reviewed their sales data with them. It showed that, over the course of six months, it had lost 5,000 enquiries across 15 sites. They had simply not done anything with them. These should be followed up by the sales team. It’s common sense but not common practice.”
Now the company has expanded its service to generate a strength, weakness, opportunity and threat (SWOT) report, allowing management to monitor the performance and activity of sales staff through different key performance indicators (KPIs).
“The KPIs we have built in can be used as a training needs analysis for individual sales staff. It looks at the areas that cause sales to happen, rather than just the sale itself. It can also be used as a pay plan, giving rewards to those staff who hit targets,” says Jackson.
Encouraging staff to focus on the overall selling process is the key benefit for the dealership, generating improved customer service and ultimately increased sales and profits. Jackson believes that this should also be the norm for used car sales.
“At a Sytner BMW dealership recently, a salesperson sold a used 7-series to a customer at the 49th follow-up phone call. That’s an exception but it shows that used car buyers should be getting the same attention as those buying new. As our company motto says, it’s about doing simple things extraordinarily well.”
The personal touch gets results
Birmingham-based Peugeot dealership Colliers has achieved record sales by using a simple voice messaging service to enhance its direct marketing activities.
After issuing its normal mailing to around 2,000 customers, the company used a system called RelayStation to send a personal voice message, recorded by a member of staff, inviting customers to visit the dealership to find out more about the offers.
“By using this system to approach and invite our customers in a personal way, we subsequently had a showroom full of buyers and recorded our best ever week for sales,” says general manager Steve Early.
RelayStation has been designed to allow businesses to communicate with customers in a fast and affordable way.
It can send emails, text messages, faxes and personalized voice messages.
“Our system is a cost-effective way of keeping customers informed. It can be installed within the hour and has helped many businesses,” says Mike Heritage, sales director of RelayStation.