Dealerships going into receivership in 2020...

Do you know if your dealership is slowly sinking? Are sales only good right now because of a strong economy? What happens WHEN we hit another recession? What are the subtle signs of customer erosion? If you don’t know the exact answers to all four questions, then you need to read this article and get help ASAP from a proven marketing expert within the automotive space.

Nobody ever believes that their dealership will spiral so far down that it will be taken over by a lender and sold off to another dealership or auto group. The shocked face of owners, when they have to walk away from a dream, is sad and yet priceless.  

Question: Why did it happen? Answer (always): Bad management.

I know my answer seems simple, but rest assured it’s not. The Titanic sank because of a Captain who not only hired incompetent people but ultimately made a single wrong decision that slowly sank his “unsinkable” ship. The same principle that applies to the Maritime industry in 1912 applies to the retail automotive industry in 2020.  

I have dealership and auto group clients that, before ProfitMotors? spent hundreds of thousands over the past decade on initiatives that sounded great and yielded next to nothing. Some of these dealerships were happily shocked by the initial positive response of some of these campaigns, but in the end, they experienced a long term decline in sales, gross, and service department revenue. I have also seen dealerships put themselves into a massive liability by using inept marketing managers and getting bad advice from the wrong companies.  

Question: Are you growing by 31% annually with Conquest? Answer (needs to be): YES!

Bottom line Mr./Ms. Dealer, you need to know precisely the answers to these questions:

Question 1.)  How many CONQUEST customers are within 10 miles of your dealership?

Question 2.) How many “at-risk” customers are in your service and sales databases?

Question 3.) When was the last NCOA and PCOA done on your database?

Question 4.)  What is the current trend in your PMA for Creative in your specific market segment?

Question 5.) What is your RETENTION strategy for each quarter of 2020?

Question 6.) What is your CONQUEST strategy for each quarter of 2020?

Question 7.)  Does your marketing manager give you detailed past quarterly reports and future projections?

If you don’t know the answer to ALL SEVEN questions, then you are very likely not even close to maximizing potential sales and service volume. Beyond these basic questions is an evolving ocean of data that is required to be seriously competitive. All too often, owners and managers are assumptive about the past, present, and future. Managers, consultants, and vendors brought on because of personal friendships and not a vetting process. Some stores stay in business from blind luck, manufacture support, or the fact the dealership was probably paid for by grandpa 50 years ago.

Dealerships in 2020 need to have your inventory available for customers to see on Auto Trader or CarGurus. Make sure that your inventory has 14-20 beautiful pictures posted for each vehicle on those consumer-facing websites that own all the real estate on Google. It is then time for you to go after specific potential customers, simultaneously not losing your current customers to the competition. So many companies with all kinds of gimmicks and grandiose concepts wine & dine dealership management. Managers get so excited about the latest and greatest snake oil that they waste all of there money and time implementing completely redundant advertising. Worse than redundancy in ad spends are antiquated ad spends. Advertising and marketing need to be cutting edge, consistent and will produce cumulative results. There is not a get rich quick strategy in any legitimate industry.

The fundamental survival checklist for your dealership:

1.) Are we hitting all potential CONQUEST customers within our PMA?

2.) Are we Retaining 90% of our CURRENT CUSTOMER base in sales & service?

3.) Do I implement an independent PPC google search from a local LTE tower each day to see if my keyword ranking is ALWAYS in the top three?

4.) Am I uploading ALL of my pre-owned inventory to Auto Trader or CarGurus?

5.) Maintaining my pre-owned inventory to capacity by the 5th of each calendar month?

6.) Am I projecting 100% capacity in my service drive by the 3rd week of each calendar month?

7.) Do I have more than 30K likes on Facebook and 10K followers on Instagram, so that my social media engagement size isn’t laughable to millennial buyers?

8.) Do I have more than 500 customer pictures & testimonials uploaded to social media?

9.) Does my advertising company send a hand-addressed letter to each customer 1-6 months out from the customer's lease end? (critical task each month)

10.) Where is my monthly detailed Sales Match report to all direct marketing (email/mail)?

11.) Is my real closing ration over 27%+?

12.) Are our internet leads at a true 12%+ conversion ratio?

If you have clear and quick answers to each of these twelve questions, then you will be fine. If you do not have answers to at least 10 of these questions, you need a reputable, proven, and cutting edge marketing consultant to make sure your dealership and auto group is firing on all cylinders.  

Its unfortunate how so many so-called advertising consultants and companies claim to have all of the answers, but all their answers seem somewhat convoluted. It would be best if you had a trusted consultant that can systematically break-down answers to these fundamental questions. It will give you peace of mind to know that this same competent consultant has your back in this extremely competitive industry. 

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