So, the experts were right. The first quarter is over and YOY sales are slightly down. Not so bad in general, however March was down 1.7%, with some brands down in double digits. Unlike the past few years where everyone could win, this year we will see actual winners and losers. Market share gains and losses have already been realized and now is a logical time for OEM’s and dealerships to re-evaluate everything.

This reminds me of the old adage “give a man fish and he will eat for a day, teach a man to fish and he will eat for a lifetime”. Since 2009, most dealers have benefited substantially from consistent YOY growth. In 2017, it’s a different story, you must know how to fish to catch more than your fair share. Just waiting for fish to jump in your boat or dropping a line into the same old spot isn’t going to work.

This fishing analogy is really called “Push-Pull Marketing”. It’s simple, “Pull” marketing is a strategy to pull consumers who are already in the market into your dealership. To fish where the fish are biting. A “pull” strategy is easy when there are more and more fish to catch, plenty for everybody. However, “pull” marketing won’t be nearly as easy in 2017 because more people are fishing and the number of consumers in the market will be the same as 2016 or potentially less. We also have an increasing number of 3rd party lead providers trolling the waters. They are going after the same fish and they are really good at fishing for in-market consumers.

Digital Advertising has evolved substantially and the number of vendors that supply this type of “pull” marketing has never been greater and dealerships have never devoted more of their marketing budgets to fishing online. We are looking forward to releasing some case studies with Google in Q2 2017, that highlight the dealerships that have the most successful digital strategies to “pull” in market consumers into their dealerships and show continued growth in a flat market. If your digital strategy does not include content that features every year, make and model you sell with real payments based on live inventory and OEM incentives, online fishing is going to be very difficult for you in 2017. Why? Consumers are no longer biting on ads featuring “Save Thousands”, “Dozens in Stock” or “Whopping Good Deals”. If your ads don’t look like this, then change your bait! And you have to update them daily to make them accurate, real and compliant.

You should be testing your ads often against your competitors, including third parties who are amazing at generating click bait. Don’t pay for this, Google has a free Ad Preview tool that simulates your ads on any device without costing you any clicks or impacting your click through rate (I suggest desktop and mobile) and you can set it for your local market. Just go here, it’s easy.

www.google.com/adpreview

But, to really win in 2017, you have to PUSH.

The dealers who will gain the most in 2017 also know how to “push” consumers in a flat market. They fish off the back of the boat, really well. Its harder, the fish are deeper, but they are also much bigger. In addition to “pulling” in-market consumers, they have strategies and processes to “push” consumers who are not yet shopping… into realizing all the logical benefits of upgrading into a newer vehicle. They know that 50% of consumers don’t realize they can upgrade for a lower or similar payment. Most dealerships do some very basic equity mining, but are not good at this type of fishing. Think about it, they have people (who don’t want to call customers all day…that are very likely not in the market) calling consumers who don’t want to be called.

How do we push customers into the market? To start, STOP sending generic static email blasts. Rather, send custom emails with actual upgrade options built into the email for the vehicles your customers are most likely purchase. Use your historical trade patterns to build customized offers and stop sending your core models to everybody. It’s got to be personal. Also, stop sending your own customers to your public website. Can you imagine starting over every time you went to Amazon? Instead, build private shopping portals for every customer and stock it with custom, personal offers that include their equity, service coupons they can download to apple wallet, and pre-configure their lease and finance payments on every model you sell. Finally, when your customers visit your service department…don’t present them with some bad paper printout. Get yourself a 55″ touchscreen display and show them their options right on their private portal in seconds, then offer to email or print out what they are really interested in purchasing. Or save it, so they can review it when they get home on their private shopping portal. Or maybe just do something crazy and walk them over to that exact vehicle you already know they want because you saw them shopping for it the day before on their portal history. That’s how the best dealers fish for the big grosses by logically “pushing” people into the market who are not yet shopping. Technology is key and there are some incredible companies pushing this industry. Don’t settle for a flat market, you can have a balanced approach to fishing and gain market share. Good luck and let’s make 2017 a winner.

The barriers to entry for these new vendors is next to nothing and there are few credentials to verify their claims versus their actual results. Unfortunately, many dealers have found themselves in a “buy and try” cycle for years. That trend will change as the market flattens and real YOY growth becomes harder to achieve. If you need help or just advice about fishing in a flat market, contact us.

In 2017, we will all start to read and hear about some progressive dealers delivering “a lot” of vehicles to customers outside the dealership. All that hard effort is being worked on now behind the scenes. Like everything in our industry this service will evolve and dealers will obviously experience some ups and downs. Smart dealers are setting the table now. My sense is the first group of consumers who will love the option of completing a sale online and taking a delivery off site…are your existing customers. On average, 50% of your customers will remain loyal to your brand. They clearly love your products, live nearby and you already have all their information to create an excellent experience for them. Think about it, when you got your first iPhone you probably went to the Apple store and they helped you set it up. But, how many phones have you ordered online since then? Why? Because they make it easy for their customers and you already know how it basically works. What’s different for a consumer who wants to upgrade to another model of a brand they already love?

My advice is stop treating your customers like the public. They have already purchased and/or serviced with you. Why market to your customers and send them to slow public websites where they can’t log in, and you can’t track them or do anything special for them? Can you imagine going to Amazon and starting over every time you wanted to buy something? With today’s technology, you can start to create an online shopping experience that rivals the best retailers. Silicon Valley is already betting billions on outside companies that are promising a “dealer less” experience. Let’s beat them to the punch this time.

Here are a few things you can do now to “set the table” for your success in 2017.

1. Create an Amazon like experience by giving your current customers a private, secure, fast and mobile friendly place to shop. Include personalized offers and coupons that are relevant to their vehicle. Make it easy for them to configure a lease or finance payment that includes their trade equity and all OEM rebates and incentives. Enable them to save personal offers to their Apple Wallet or their image library. Allow them to browse your inventory by payment, and ultimately allow them to schedule their delivery. You already have all their data; use it!
2. Car buyers are highly motivated by monthly payment. More than 85% of todays’ consumers finance or lease their new vehicle purchase. You must get used to making sure you have a realistic lease and finance payment on every vehicle in your inventory. Having a price is great, but only 15% of people write a check. It all starts with an actual VIN and a real payment. There is some very innovative technology to properly price and configure pricing and payments for every vehicle you have in stock. Again, give the shoppers what they want.
3. Change your advertising content to be more relevant for consumers who want to buy your products. It’s simple. They want to know “do you have what I searched for and how much is it?” Just go search for any new year, make and model in your hometown. Most ad copy still looks like 1980’s newspaper ads. This is not a joke. “Huge Discounts, Big Savings, Great Selection”. That’s dead and not credible. Find an accredited company with Google and Bing that can generate relevant pre-owned and new car ads for every year, make, model and trim you sell and update them nightly in Google, Bing and Facebook…based on your stock and pricing. Your traffic and phone calls will a see significant increase instantly when you give consumers the information they want. Trust me on this. Pundits say you can’t increase traffic without sacrificing quality. That’s nonsense. Relevancy trumps everything in marketing.
4. You can efficiently communicate with your customers through calls, mail, email, and text. Do this simple exercise and you might be shocked. Take your largest conference room table and lay out every single piece of communication your customers received from your dealership or your OEM (on your behalf) in the last 90 days. Grab all of them, including emails. Write the description of which type of your customers received these communications. Ask yourself 4 questions. First, do you have a clearly defined strategy to communicate timely offers to your customers? Second, are the offers relevant to the vehicle they own and where they are in their life cycle. Third, how much overlap and confusion is there? Fourth, where do you direct your customers, to a public or private site? Often, less is more when directly communicating with your customers. Simple and relevant is always better.
5. Decide if you want to manage relationships with more or fewer vendors. There are plenty of pros and cons to both approaches. There are literally hundreds of innovative options and their products are more niche than ever. Other companies, like us, have developed a broader technology platform to support an entirely integrated marketing strategy across every medium. It’s not for everyone as some dealer executives are not comfortable with all their “eggs” in fewer baskets. There is no right or wrong. However, if you survey the largest and fastest growing dealers they have far less vendor churn because they develop consistent processes around fewer tools.

Start working now to make sure your dealership is ready to offer all the information and options today’s consumers prefer. My favorite quote from Ali, sums it up.

“The fight is won or lost far away from witnesses – behind the lines, in the gym, and out there on the road, long before I dance under those lights”.

Good luck in 2017.

Dealerships make money when a consumer purchases a car or services their vehicle. Why don’t digital agencies measure ROI using actual transactions? If you owned a dealership, wouldn’t you ask a simple question, “How much money did I receive in return for the money I spent in digital advertising?”. Online consumers who take action (like calling) and end up transacting with the dealership is what’s most important. Today’s technology allows us to better identify “online” shoppers. Plus, any vendor can download transactional data (or find someone who can) to store a dealerships sales and service transactions. Just cross-reference the shoppers with the buyers, it’s a simple concept.

Digital vendors and experts create their own conversion metrics to rate what they define as engaged traffic. It confuses most dealerships because what counts as conversions and engagements are purely a matter of their opinions and they vary greatly. It’s hard to argue that Google and Bing don’t already have most of the key metrics that matter to advertisers and it’s free.

My point is why not rely on the metrics that dealership executives understand and care most about…. which is selling and servicing more cars. That’s the primary reason they advertise in the first place. Most dealers simply want proof on which strategies, digital or otherwise, are genuinely driving their sales and service transactions.

Here are 5 easy and affordable steps that every vendor can do to provide their clients an undeniable return on their digital advertising investment. Below is a simple guide on how to do this.

5 easy steps to establish a return on your investment in digital advertising.

1. Download all the dealerships sales and service transactions and store those into a secure database and update daily.
2. When a consumer calls, texts or submits a form from a digital ad, save their information to your database. More shoppers will call from their mobile device before they visit and transact with a dealership. Especially new customers.
3. Cross-reference the dealerships transactions with identified online shoppers.
4. Place the cross-referenced transactions, including the actual gross profits from their sales and repair orders on a simple dashboard. This allows the dealership to easily verify the digital transactions and determine an ROI.
5. Differentiate previous customers versus new customers. That’s a major benefit of downloading transactional data. It’s important the dealership understand how much incremental revenue from new customers was generated from their digital advertising investment.

With today’s technology, these 5 simple steps are easy and costs very little. This method would be so welcomed. Sure, there are a few holes that readers, myself, and the so called “experts” can poke at this. The main one is you won’t “catch” everybody. I say, so what. The ones you can match are undeniable and a leading indicator of what’s working and what isn’t. Most importantly, this attribution method is 100% based on ringing the cash register. While some buyers will be undetectable, this 5-step method will catch the majority of online shoppers and the ROI will be crystal clear.

In 2017, dealerships will require more straight-forward metrics they can digest based on their revenue model. Most importantly, it holds vendors accountable to the standard of attributing a dealerships digital marketing investment against their sales and service transactions. Really, what else matters?

Online Actions + Transactions = Real ROI.