The holiday season is fast approaching, and with it comes the same rollercoaster of unknowns we have been navigating for the past year. With an average 30 day supply on the ground according to Cox Automotive and historically high gross per unit, it makes it difficult to truly know the best way to market and manage to lead to a strong end of 2021.
It is important to get ahead of the season and prepare to make the most of what we have: high prices and low inventory levels. Low inventory levels can equate to lower customer loyalty, but there are ways to not only make the most of every opportunity, but also to maintain and nurture relationships with current customers, further improving chances of repetitive sales and service opportunities.
State of the Industry Heading into 2022
To plan where you want to go, it is important to understand where we are. And while much of the information below is forecasted, it can help when creating a plan for success not only for the end of 2021, but well into 2022.
- September sales volume fell nearly 26% YoY finishing at 1.0 Million units-- among the lowest in the past decade. (Cox Automotive Forecast)
- Sales pace in the U.S. Market has fallen every month since the peak in April 2021 (18.3 Million)
- Sales Supply is dramatically lower than last year
- Incentives are down, but transaction prices are up
- Average monthly payment for used vehicles is expected to climb to $500 (up $80 YoY) (Edmunds)
This may seem like an insurmountable situation, but in reality, there are many ways to take advantage of what we can and maximize our marketing, spending, and customer interactions.
As Winston Churchill stated, “Never waste a good crisis.”
How to Connect with More Automotive Customers in Q4 and Beyond
Omnichannel approaches will be more important and effective than ever. Even before the second rise of Covid, customers were becoming more accustomed to online purchases and processes. They became familiar with and used to curb-side pickup and Zoom meetings to facilitate the purchase of a house.
The same is with automotive.
Be Flexible in Your Communication
Be prepared to connect with the customers in the channel they desire. There are going to be fewer leads with less inventory, which means you cannot afford to miss or miss treat a single lead.
We may see the normal end-of-year bump in leads, and you need to be prepared. Do you have a team in place who can answer leads in 10 minutes or less? Are they trained on email, text, video, and phone calls? These critical skill sets need to be honed and perfected to provide the best white-glove experience for your customers.
If you do not give them that experience, they will continue to look--or even worse, you could lose a loyal customer.
Lower Inventory/ Lower Lead Count/ Higher Engagement
With the lower inventory battle being fought, it is more important than ever to engage all of your customers. The ones that generally come to mind first are your website leads, Digital Retailing Leads, Paid Search and Social Leads, and Third-Party Endemic Leads.
These are critical and need to be addressed within 10 minutes. They need fast, specific, and knowledgeable engagement. You know this.
But what about creating more demand within your own customer base?
How many lists have gone unnoticed and unnurtured? This is a great time (while lead volume is low) to reach out to Lost Leads, Unconverted Leads, and Sold not Serviced Leads. This is beneficial to both sales and service and will help keep a steady stream of customers coming into your dealership.
- Lost Leads: Contact the customer and find out where your process went awry. And then offer the customer a reason to come in for service: a free oil change; tire balance; free diagnostics. Let them know you valued their time, and even if they purchased from someone else, you would love to win them back with service!
- Unconverted Leads: You are not sure if they have purchased elsewhere, and this is a great opportunity to pull those lists and have a BDC call them. Best case scenario, they are still in-market and you can let them know of all the programs, community outreach programs, or incentives that are happening in Q4. Worst case scenario, they are already purchased. Refer then to the first bullet point.
- Sold not Serviced: Call, email, text, direct mail, targeted social marketing-- all of these methods are strong ways to reach out to the customers in your market area and bring them back in for service. Ensure your value propositions are ready. Review how you are priced in the market and be prepared to either surprise the customer with market-consistent payments or explain your value and why you may cost a little more. Know your market, know your strengths, and convey them to the customer.
Mine Your CRM/DMS
Similar to the above, now is the time to mine your database in both service and sales to look for opportunities that could close in Q4. Equity mining in service, lease maturity, loan maturity are excellent places to help increase conversations with customers and also provide guidance on next steps.
Not all customers in your market area leased their vehicle from you or a dealer in your PMA. Create landing pages that guide the customer through the process. When they search “How do I turn in my “Brand” lease,” you will organically show and be the point of information for the consumer.
Customers are generally in-market for 60 days. If you are looking to prepare for a strong end of the holiday season and year, now is the time to take action.
Evaluate your current Sales and Service BBC. Mystery Shop them and review the experience. Engage with the chat/messaging system on the website and record the experience.
And if you need help with any customer engagement (Outbound Calls, Lead Response, Managed Engagement), reach out to Better Car People. We are here to help make you the best.
End 2021 Strong!