Be quick, accurate and timely with your customer communications, ensure your data is accurate, open your ramps up to older vehicles and your used car stock to multi-franchise brands, and be alert to safety recalls and the agency model can provide plenty of dealer sales opportunities.

A presentation by Marketing Delivery at Automotive Management Live 2023 tackled several assumptions associated with the moves to agency model:

• Dealer are going to be less competitive because they can’t discount car pricing
• There will be fewer, quality part exchanges because dealers will be selling lower volumes of new cars
• Service opportunities will reduce because of the lack of car sales
• Increasing EV sales means less aftersales opportunities.

Addressing the first point, Jeremy Evans pictured right), Marketing Delivery chief executive, cited Trustpilot consumer research suggesting 64% of consumers conduct most of their research online, 50% said an early response from a dealer influences their decision where to buy, 93% read consumer reviews, and 98% of new Mercedes-Benz customers in 2023 live within 20 minutes of a dealership.

In addition, a National Franchised Dealer Association Consumer Attitude Survey found that only 32% of consumers said a car’s cost was the most important factor in a purchasing decision.

“This suggests, if you delight you customers with quick, accurate, timely responses, paired with a fantastic showroom experience, there are still plenty of opportunities, even with the agency model,” he said.

Charlotte Murray (left), commercial director, Marketing Delivery, added: “The advantage with agency model is that dealers aren’t grappling with quarterly campaigns and enhancing your tactical offers, so you can always be on with a simpler sales focus. Surface positive reviews wherever you can, in social media, at the end of a carousel of pictures, and in your ‘thank you for your enquiry’ messages.”

Mercedes-Benz was one of the first manufacturers to move to the agency model.

Sandown Mercedes-Benz works with Marketing Delivery on its digital marketing. Keith Jackman (centre), head of marketing and CRM, said: “We knew from the start we had to differentiate ourselves from every other Mercedes’ retailer. Our focus was on speed of response and being spot-on with or customer service. We want to get customer beyond the 20-mile radius from our centres, so we speak to our colleagues, friends, and family for opportunities.

“The gloves are very much off now.”

Less new cars being sold means less good quality used stock

Looking at Sandown data from July to September, 55% of service work was on cars bought outside its network. This presents a “massive” potential source of used stock from your service database, said Evans. “Start a dialogue with the owners on the service reminders, when they book the appointment, and when they’re in the workshop.”

Agency agreements don’t cover used cars, so retailers have the freedom to retail on those non-franchise used cars that could previously have gone straight to auction.

“Look at your customer database and ask yourself what stock you ideally want from it and target their owners with texts and emails,” said Murray. “When you send a service confirmation, offer the customer a valuation when they’re in the dealership and a new car test drive.”

A Marketing Delivery system sends service customers a stock alert of younger, new models of cars they own.

At Sandown it’s a challenge to talk to every customer when around 70 are in for service work in a day. “But we identify customers that have only had a car a year or Motability customers that can’t change, leaving us with around 20 who are good customer prospects to start a conversation with,” Jackman said.

Less new cars sold means less customers on your service database

If less new cars are being sold meaning less on the ramps, there’s an opportunity to bring older vehicles with proper contact and product plans, said Evans.

Sandown and Marketing Delivery have been working on a pilot project to reactivate lapsed customers using safety recall information.

“We’ll send them a link to the SMMT recall information to validate the contact and invite them into a dealership to have the work done,” Evans said. Sandown has seen an average invoice value of £300 in resulting work.

The group has seen a 23% increase in the volume of older cars coming into the business for servicing.

“We’ve got an active contact centre with data from Mercedes-Benz contacting customers about their recall work. And beyond that it’s an opportunity to upsell when they come in. We offer them discounted servicing and parts. The results have been incredible,” said Jackman.

Increasing EV sales means less aftersales opportunities

Most consumers say the transition to EV will be a “confusing process”.

Where to they go to ease the process?

“Make it the franchise dealer,” said Evans.

“There will be more workshop visits for EVs due to recalls, warranty work and software updates.”

But ensure you can identify EVs in your customer database. Then invite customers to the dealership for a second handover, invite them to a drop-in day to meet an EV specialist to ensure they are comfortable with the new technology.

Jackman said: “We’ve had to adapt over the years from when a service took more than six hours to 90 minutes. EV is no different. Get the basics right, love your customers and remind them they can’t take an EV anywhere for a service. Your technicians have gone through specialist training to use specialist equipment.”

> Automotive Management Live 2024 - register your interest in joining us at Birmingham NEC on November 13th