Survive and Thrive

From his vantage point as the founder of DealerRefresh.com, a blog for automotive internet sales professionals, Jeff Kershner monitors how dealers invest their advertising dollars. Amid the economic slowdown, he sees dealers shifting their budgets online from traditional media to reach ready-to-buy shoppers.

“This is where the consumers are right now,” Kershner says. “I think a lot of dealers are realizing we need to start taking this internet thing more seriously. The internet departments that are dialed in are continuing to get leads. There are still people in the market who want a car, need a car and have the ability to buy a car.”

Competition for those in-market shoppers will likely intensify in the coming months, if NADA’s forecast holds true. At the association’s annual convention last month in New Orleans, staff chief economist Paul Taylor predicted new-car sales will fall below last year at “just short of 13 million units.”

“The economy should improve slightly and in the third quarter of 2009 start to see positive economic growth,” Taylor said, “to help reach sales of at least 12.7 million units of light vehicles.”

For their part, dealers are aligning their operations to survive and thrive in that leaner market. In addition to cutting unnecessary costs, they’re focused on winning as many deals as possible and optimizing current programs. If you’re looking for advice on how to turbocharge your internet initiatives, consider these tips:

Create New Communication Channels

In eastern Pennsylvania, Mike Myers recently added online chat to his listings. The internet manager for Kelly Nissan and Saturn of Route 33 near Allentown said he wanted to be more accessible to in-market shoppers.

“In this economy, you have to have every opportunity available,” he says. “We want as many channels of communication as possible.”

Myers said he received his first chat request within 10 minutes of activating the system – for a vehicle he sold and delivered a few hours later. Adding chat has not noticeably affected his email and phone contacts, and he says he’s meeting quality buyers.

“You’re getting the most accurate information because they’re choosing the channel that’s most comfortable with them to reach you,” Myers said.

Measure, Adjust, Repeat

At Bob Valenti Automall in Mystic, Conn., BDC manager Dennis Perry said he tracks every aspect of his internet operations. With “you can’t manage what you don’t measure” as his guide, he monitors the full range of his department’s activities – from the monthly number of chat sessions, emails and phone calls to the total contacts delivered by his online advertising partners and the performance of individual salespeople. He then generates reports that provide timely insight on what areas of the business may need to be tweaked for the month ahead – whether the issue is related to people, presence or product.

“You can’t tell where you’re going until you’ve seen where you’ve been,” Perry says. “My goal is to beat this month last year, month after month, year after year.”

How’s he doing in 2009?

“In a down market,” he says, “I’m already up for the year.”

To compile the information he needs, Perry relies on his CRM system and the monthly reports provided by his online advertising partners. He mines the data for guidance on:

  • How well specific vendors are performing so he can appropriately allocate ad spend.
  • What vehicles to keep in inventory so he can reduce days to turn and minimize aged inventory.
  • Who is setting and keeping the most appointments – and closing the most sales so he can identify producers.
  • Where his merchandising may be falling short so he can provide car buyers with the photos, sell copy and video they need to move forward with a purchase.

“We decided to keep (our measurement process) in house,” Perry says. “We’re not going to lie to ourselves.”

Consider What’s Next

Kershner also advises dealers to look for ways to leverage consumer-friendly social networks and dealer rating tools that are increasingly gaining traction. Sites such as Facebook.com and DealerRater.com, he said, are connecting stores with in-market shoppers and may deliver on their early potential. Not surprisingly, Kershner also suggests creating a search-engine friendly internet department blog. Topics could include current incentives and profiles on top-performing staff and repeat customers.

“It’s always easy to sit back and say, ‘Nobody’s doing this,’” Kershner says, acknowledging the skepticism he often hears from dealers about new approaches. “But they’re the ones who two years later say, ‘We’re really missing out on something. We should’ve gotten on this bandwagon two years ago. We should have figured this out.’”

Additional Resources

Looking for additional tips you can implement in your store today to drive more traffic with your online advertising and desk more deals with your internet sales processes? Check out Cars.com’s DealerCenter. Here, you can read previous editions of our DealerADvantage newsletter or listen to archived recordings of our DealerADvantage LIVE webinar series.

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