Archive for the ‘Auto Dealership Email Marketing’ Category

How Much Are Your Un-Happy Customers Costing Your Dealership?

Tuesday, March 17th, 2009

Every dealership is after the (often) elusive repeat customers. With people buying less often, earning the loyalty of the customers you do sell to can pay off. Once you’ve earned the business of repeat customers, the next step is to turn them into evangelists—those who recommend your dealership and ultimately send more sales into your showroom.

These types of customers are beneficial because they not only help to create more profit for your dealership, but also to direct those sales away from your competitors. But have you ever thought about how much people who recommend against buying from your dealership could be costing you?

Satmetrix published a study about how much financial harm unsatisfied customers can have on the bottom line of a business. While the results are focused on the wireless industry, I think it’s worth looking at.

The study says that having a negative word of mouth results in losing $300 per unsatisfied customer.  This can also be read as losing 1.3 future customers for every unhappy customer. If you average $1500 in profit per sale, every unsatisfied customer could be costing your dealership almost $2000. Can your dealership afford this kind of loss?

Make sure customer service is consistent throughout your dealership, and that there is a plan in place to try to satisfy unhappy customers BEFORE they start costing your dealership money. This could include using automatically sent surveys to attempt to find those who are less than content with your dealership, as well as keeping you finger on the online pulse of blogs and other online forums.

Now, more than ever, it’s essential that your dealership keeps your customers happy. Whether or not they become repeat customers, ensuring they don’t spread negative word of mouth is saving your dealership money. If you are ignoring those who have an unpleasant experience at your dealership, it may be costing your dealership more money than you know.

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Don’t Sacrifice Content for Quickness

Thursday, January 22nd, 2009

The last blog post I wrote was about the importance of responding quickly to your leads. It seems that a lot of dealerships are taking this too far, sacrificing content in order to respond quickly enough. While auto-responders make sure that your dealership responds to a lead instantly, they can’t actually match the content to a specific question your leads may have.

According to the 2008 Cobalt Automotive eShopper Experience Study, only 25% of leads receive an answer when they
request a price or ask about the availability of a vehicle. This means that 75% of Internet leads who are asking these types of specific questions aren’t getting an answer back from the dealership they contacted. These are high quality leads, typically further along in the buying process, and they aren’t getting the answers to the questions they are asking.

23% of potential buyers that switch brands do so because of the interactions they’ve had with the dealership (2007 Cobalt eBusiness Performance Study). This bad interaction could easily be an incomplete response to a question, like not receiving a price or information about whether or not a vehicle is still in stock. Don’t let your focus on providing a quick response affect the quality of the content you send to your Internet leads.

One way to ensure you are responding quickly while still providing the appropriate content to your leads is to use an interactive marketing system that allows you to instantly connect with your incoming leads by telephone minutes after the lead is submitted. Using this type of tool at your dealership means that you can respond faster than your competition while ensuring your sales staff is able to answer any questions they may have.

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The Importance of Follow-Up in Your Dealership

Tuesday, January 20th, 2009

According to the 2008 Cobalt Automotive eShopper Experience Study, the “traditional” dealership gives up on a lead after three days and stops actively pursuing them as an in-market buyer. This just doesn’t make sense, considering that J.D. Powers reports in their 2008 New Autoshopper.com Study that those in market for a new vehicle begin using the Internet to research their purchase about 12 weeks before they actually buy. 50% of new car buyers take more than 4 weeks to buy their car AFTER they’ve already picked the make/model they end up purchasing.

Lead nurturing or follow-up (whatever your dealership calls it) is critical to a dealership trying to maximize its sales. The first step in this process is to ensure that your sales people respond to each and every email that you receive from potential customers. It’s amazing how many incoming leads don’t get responded to, or don’t in a timely manner.

Check in with your leads at regular intervals via email or telephone to ensure that your dealership has done everything possible to earn their business. Ask if they have any questions about a specific vehicle or your dealership. Try sending short surveys to make sure they feel that they have been treated how they want to and nothing is holding them back from eventually choosing your dealership for their purchase.

It can often be difficult to keep up with all of your new leads, as well as follow up with all of your long-term buyers, so why not automate some of your lead nurturing efforts? Take full advantage of your CRM and any web tools your dealership uses to take some of the load off. These programs can schedule emails to be sent at various time periods to ensure none of your leads fall through the cracks during a buying cycle that is usually measured in months and not days or weeks.

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Revamp Your Dealership Newsletters

Tuesday, January 13th, 2009

The buying cycle of today’s auto consumers continues to get longer and longer, with most of your future customers contacting your car dealership further in advance of their actual purchase date than ever before. When every potential car sale counts, like it does in today’s down economy, keeping your dealership’s name in front of these future customers is more important than ever. One cost-effective way of doing this is to send newsletters to any and everyone who has made contact with your dealership.

Sending these marketing newsletters via email is obviously more cost effective than through direct mail and its easy to track, measure, and analyze. The most important consideration for the content that you include in your newsletters is that it is relevant to your customer list. You don’t want to waste anyone’s time, including your own, by sending information and content that doesn’t help you achieve your marketing goals, and ultimately, sell more cars. Make sure everything you send has some sort of marketing purpose and paints your auto dealership in a positive light.

Finding new content every month can be difficult sometimes, especially when you have a lot on your plate. So why not revamp your older newsletter content every once in awhile? Read back through some of your older articles to see if there are any that you can update to reflect the auto industry today. Or maybe, include the article as-is to serve as a nostalgia piece. If this proves to be successful, why not do an entire “blast from the past” newsletter? Find articles that have touched on positive things your auto dealership has done throughout the years and include them just as they are.

The most important aspect of newsletters is that they market your auto dealership and help keep your dealership name in front of your past, future, and current customers. Keep your eyes open for creative ways to do this with the content you send, even if that means going back in time and revamping the content your dealership has used before.

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Social Networking Tips for Auto Dealers

Tuesday, December 23rd, 2008

Social networking can be intimidating for many auto dealerships.  It may seem like a passing craze or something that only teenagers engage in.  However, social networking can be very beneficial to spreading your brand name and engaging your customer base.  With the way auto sales have been going, using all available marketing channels to sell more cars is more important than ever.

Keep these tips in mind when setting up your dealership’s social networking efforts:

  • Be Everywhere Your Customers Are – Put an effort into networking on more than one site.  Some examples are Facebook, Flickr, LinkedIn, Myspace, Twitter, or YouTube.  Link to each site from your blog so that visitors can check out all of your networking sites.
  • Appoint a Real Person to Interact – Don’t use a generic company account; have a real person be the “face” of your company to help your dealership relate to your customers personally.  Make sure you use an actual person’s email address and phone number for contact information.
  • Blog About Your Customers – When people buy vehicles from your dealership, ask their permission to write about them on your blog.  Post their picture with a story about their car buying experience, and a little about themselves.  This is another way to connect with potential buyers.
  • Create and Promote Videos – Video is the “next big thing” in the auto industry, so use it to your advantage.  Make videos that highlight staff members to post on your blog, or send a “Thank You” video email to those that buy from you.
  • Talk, but Listen Too – Social networking doesn’t work if it’s a one way effort; it needs to be a conversation.  You need to make sure you listen to what is being said about your dealership in the social media world, and respond to any comments or posts about your dealership on a timely basis, preferably daily.

The more often your dealership interacts with online social networks, the more often people will write about your dealership and link to your social networking efforts.  This should increase your brand recognition and reputation among potential buyers.  When you open your dealership to the realm of social media, you allow customers to connect with your business on a deeper level.  This will increase trust, and we all know that consumers buy from those that they trust.

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Increase Customer Retention in Your Dealership

Thursday, December 11th, 2008

In today’s auto industry, holding on to repeat customers is extremely beneficial.  A repeat customer not only means more money for your dealership, but also less cost for you to acquire them.  J.D. Powers estimates that in 2009, new auto sales will dip below 12 million, so you can’t afford to lose any potential sales to the dealership down the road.

In the latest J.D. Powers Customer Retention study, Honda has been able to retain the most customers in the United States with 64.7% of their customers returning to buy another Honda.  Overall, customer retention rates are down from 49% to 48%.  Obviously, you can’t control the vehicles that your OEM makes, or their efforts to retain customers on a brand level.  But you can control what your dealership does to increase your own customer retention.

Follow-Up – Have a plan in place for all types of customers and non-customers.  Make sure you get the emails and phone numbers of those that buy and those that don’t.  Send periodic, relevant emails to everyone that comes into your dealership.  Keeping in touch with those that visit or buy from your dealership will help keep your name top of mind the next time they need a vehicle.

Increase Service Customers – Give those that buy a car from your dealership a reason to return to the service department.  Offer free oil changes or discounts to those that purchase vehicles.  Send coupons and service reminders while following up with previous customers.  Not only will their service business further increase your revenue and profits, but you will maintain a relationship with a future new car purchaser, so that you will be first in line to sell to them.

Follow the Golden Rule – This one’s easy; treat your customers how you would want to be treated.  Be respectful and ask for their business (now and in the future).  Consumers will buy from salespeople that they like and trust, so get to know your potential customers and get on their good side.

Working to keep as many customers as possible is an even better business practice than ever.  The number of vehicles sold each year is projected to decrease further before it gets better, and building your repeat customer base could be what helps you survive this difficult time, as well as position your dealership to succeed in the future.

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Build Relationships, Then Sell Cars

Tuesday, November 18th, 2008

Customer relationship management seems to be a pretty popular concept lately, but have you ever thought about what it really means? First, it assumes that you have customers, and once you do, that your dealership should take the relationship that is established, and then manage it.  This seems to be the traditional way of thinking, that having customers comes before you build a relationship with them. While reading Call to Action by Bryan & Jeffrey Eisenberg, I was struck by their take on this typical understanding of customer relationship management.

The book advocates mixing up the order of “customer relationship management” a little bit, so that the first step is building relationships, and then transitioning these relationships into paying customers. This means that instead of trying to turn dealership visitors and leads into customers right away, put an increased emphasis on building relationships from day one.

When you receive Internet leads or see walk-in visitors, start by building rapport. Ask them questions about themselves, their lives, and their needs. Open up to them, relating to them when possible. This not only allows them to see you as more than a salesperson, but also helps to ensure that you can match them with the vehicle that will be the best fit. Seeing these potential customers as actual human beings, and not just your next commission check, can help increase your overall sales.

Once you have this relationship established, you can then use your expertise as a salesperson to earn their business. It’s been said over and over that people buy from those that they trust, and one of the best ways to earn this trust is by building relationships with all potential customers.

Thinking of customer relationship management this way might seem a little backward at first, but building relationships with potential consumers before you try to sell them will increase their trust in you and your dealership. This trust will often translate into repeat sales and service revenue for your dealership, and in these difficult times, every little bit helps.

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Send Dealership Info the Right Way

Friday, November 14th, 2008

I’ve used this blog to stress the importance of following up with your leads and customers after they leave your dealership, but I wanted to use the recently published CapGemini Cars Online study to talk about the importance of following up in the most appropriate manner. It’s not only what you say, but it’s also the manner in which you send your communications.

One person interviewed for the study said “I would like to see friendly service after the sale of the vehicle, instead of salespeople just getting the commission, and then forgetting the customer.” I’ll assume that this isn’t the intention of most sales people, but this is unfortunately how many of your customers will view a lack of follow up. But like I said, it’s not enough to simply communicate with them after they leave your dealership; you need to do so in the manner that they prefer.

Overall, customers prefer to be contacted via email, but this can vary depending on the type of communication being sent. For example, people generally prefer to be contacted via postal mail when being sent vehicle brochures (45%) and welcome packs after purchasing (46%). Email, however, is the preferred method for newsletters (55%), post-test drive surveys (52%), as well as surveys after service (51%) and purchases (51%). Being called by a dealership is preferred by 33% of customers after they have filed a complaint with the dealership. An interesting aspect in this study is the rise of customer desire to be contacted by text message for things such as service reminders (16%) and invitations to dealership events (10%).

While they are still in your dealership, ask your customers and leads how they wish to be contacted. Give them the option of different methods for different types of communication, and make sure that you abide by what they say. This means putting a little extra effort to create different forms of the same stock communication, and using them when appropriate. It’s not just a matter of following up with those who leave your dealership anymore; anyone can do that. What will really set your dealership apart from the rest is taking into consideration how your customers and potential customers wish to be contacted by your dealership, and then respecting their wishes.

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Potential Loss of Auto Sales for Slow Responding Dealerships

Tuesday, November 11th, 2008

I wrote a post a few weeks ago about the number of dealerships that don’t respond to customer emails and leads in a timely manner.  Although I touched on the potential loss of sale because of this lack of response, I wanted to expand on how these potential customers react to slow response time.  The CapGemini Cars Online study for 2009 was recently published, and sheds some light onto how customers react when they don’t receive a response from a dealership within the time period expected.

Let’s start with the response times that your leads expect.  In the United States:

  • 6% expect an immediate response
  • 11% expect a response in less than an hour
  • 16% expect a response in less than four hours
  • 54% expect a response in less than 24 hours.

This means that 87% of your leads will be disappointed if you take more than 24 hours to respond.

So, what can this disappointment cause these leads to do?  Most will pull away from your dealership and look to buy elsewhere.  When a lead in the United States feels the dealer has taken too long to respond:

  • 56% will look for another dealer
  • 2% will look for another manufacturer
  • 15% will look for another dealer and manufacturer
  • 13% will call the dealership.

If your dealership doesn’t respond in an appropriate manner or time, chances are you’ve just lost 56% of those leads to another dealership.  More leads will look for another dealer and manufacturer than will actually call your dealership looking for information!

One thing that can help you measure how much this problem could be costing your dealership is to try and put a potential value on each scheduled appointment.  Let’s assume that, if you reach them in time, 50% of the leads submitted on your site will schedule an appointment, and that 20% of those scheduled appointments will buy a car.  If your dealership makes $2,000 per car sold, then every time you don’t get in touch with a lead it costs your dealership $200 ($2,000 x 50% x 20%).

I can’t stress the importance of having an automated response system set up to ensure that your dealership at least acknowledges that you have received their query.  But programs exist that go beyond a generic email response.  Imagine the impact it would have on your leads if your dealership called them within minutes of receiving their lead, especially when your competitors are sending stock emails.  Research these types of automated car dealer lead response programs and how they can work to increase sales for your dealership.  If they allow you to reach an extra 20 customers per month, that will lead to another $4,000 per month in profit and 2 vehicles sold that otherwise would still be on your lot at the end of the month.

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Common Dealership Survey Missteps

Friday, November 7th, 2008

Customer-directed surveys seem to be a blessing and a curse to most dealerships.  OEM survey results can determine so much for dealership, yet are often highly contested by those within the dealership.  So why not find out how your customers feel about the experience they had at your dealership by sending out your own surveys?  Whether through email or direct mail, here are a few common survey mistakes taken from a MarketingSherpa article and from DealerOn’s experience, and how to avoid them.

  • Biased Population – It’s very easy to only survey a certain population of your customer base.  Always keep in mind who you’re sending surveys to, for example: buyers vs. non-buyers, age groups, and income levels.  Decide ahead of time who will receive this survey, either everyone, or a completely random sampling.  If you do want to send a survey to a targeted segment, make sure you keep that in mind when you receive your results.
  • Leading/Misleading Questions – These types of questions include those that are written to lead a respondent to answer a certain way, and also those that are difficult to understand.  To prevent this from happening, have an uninvolved third party read over the questions to ensure they are unbiased and clearly written.  Be on the lookout for judgment words like good, bad, better, worse, etc.  These can push respondents into answering one way or another and can lead to skewed results.
  • Small Sample Size – Typically, a sample size of about 100 will provide a fairly representative sample.  However, it is possible that this sample can get cut up into demographic cells making these samples too small.  Work to prevent this by making sure you select a random sample, and check the results for these smaller demographic breakdowns.
  • Purpose – Before you write the survey questions, make sure you have a clear reason for surveying your customers.  Not only will this help you find a focus and formulate your questions, but it can help you determine what you are trying to get out of the survey results.  Will you use your responses to change your dealership, or are you simply trying to understand how your customer base feels?
  • Consistency and Regularity – The best way to improve your customer satisfaction is to take action based on the feedback, and then re-measure your customers to see whether your changes have impacted their satisfaction.  You want to consistently and regularly ask each new customer the same questions.  You need to have consistent questions that don’t change much over time so that you have a standard scale to measure against.  Ideally, you would ask all the right questions the first time and never have to change your survey.  This is not very realistic, but you need to understand that materially changing a question or the scale for the response (from a 1-10 scale to a 1-5 scale for instance) can compromise the consistency of your results.
  • Length – People have short attention spans, so make sure that every question is clear, concise, and adds to the purpose of your effort.  If the survey itself is too long, analyze which questions will give you the most beneficial results, and use only those.

Surveys can be extremely powerful tools in improving your dealership.  There is no substitute for actual customer feedback on your sales and fulfillment processes.  The most adept marketing companies not only measure their customers’ satisfaction, but also take action to improve satisfaction.  They then measure whether or not the changes they’ve made have been successful.  Using this recursive customer feedback and measurement process is how companies with lackluster customer service become companies with phenomenal customer service.

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