Do you want to know how to effectively market your dealership?

Recently AutoTrader revealed the latest iteration of the car industry report. The report outlines results from the analysis of vast amounts of demand, supply and pricing data. Using this data effectively can help you market your dealership.

While new car sales data is one dimension. We asked ourselves, what’s missing for car dealerships and OEMs to run more effective businesses? The answer is consumer attention, what can we learn from understanding the people that are voting with their wallet before they vote with their wallet. We want to know where the consumer attention is, what is it on. Are there indicators that can inform the automotive industry to change their product or product mix before they invest too heavily?

How to think about competing brands

I was at a car dealership the other day and they were looking for insights into what they could do better. Their concern was that most of the volume of second hand cars were available in the independent car dealer market compared to their own franchised dealerships. When digging into the data, I gave them ideas of what they can do differently to capture consumer car buying attention by changing their perception of what brand they are competing against.

They gave me 3 cars that they considered competitors to their brands. My next question was: Why are they your competitors? Their answer was because of the car configuration, and the price range – but that’s not the only way to look at a competitive brand. It’s only one aspect and was born out of a strategy to push product into a market that pre-dated the internet, speed and transparency.

After looking at our latest Industry Report data, category competitor thinking needs to be augmented with real time consumer data – but I would love to hear your ideas. Whilst basing your business on a car category, segment or price range is good and necessary, the thing that I think the larger part of the car dealer market is missing is where the consumer’s attention is. Which meant, in this example, that the ‘competitor/s’ car brands they were closely following weren’t really their primary competitors. Why? Because the car with a similar price range is getting more attention than the one you may think is more of a  ‘competitor’.

So what questions should you ask yourself to determine your brands competitors?

  • What are the top cars in your price band being searched for? – Consideration
  • What are the top cars in your price band being viewed? – Leading indicator of demand
  • What are the top cars in your price band being sold? – Lagging indicator of demand

These 3 simple questions help you understand what products or product ranges you compete with or at least to stock against.

Which means the basis of brand competition is not only category specific, first choice is money but then there is the other stuff – Consumer Attention! The importance of understanding what consumers are searching for and playing in that hierarchy of consideration to lagging indicator of demand, is where the marketing opportunity lies. Grabbing the attention of the car buying consumer from brands that compete with you.

The other principle is contextual advertising on online platforms. As you’ve heard before, dealers need to change how they see themselves, so instead of seeing yourself as a dealer that has to market cars, see yourself as a marketing company that sells cars. There’s a subtle nuance shift in the mindset if you have to think of your dealership in that way. Because if you think of yourself as a marketing company that sells cars in a very fast paced internet world, marketing and building your brand will not become a line item or grudge purchase anymore, it becomes a driver of your businesses success. 

How car dealerships can WIN?

So from my perspective, the dealerships that are going to win in the medium to long term are the car dealerships that build a brand. Which brand do you build, is it your dealership brand or the manufacturer brand? For me, manufacturer brand = car brand. So for example, Haval is a manufacturer brand but Haval Edenvale is a dealership brand. This means it’s important to brand yourself, even if you are a franchise dealer to brand the nuance that makes you different to the car brand itself – is vital. Independent car dealerships have an even bigger opportunity to brand themselves as their dealerships are “car brand” agnostic.

3 Truths for a car dealership world in South Africa

  1. We have to accept that independent car dealers dwarf new car dealers  i.e. there are 2 – 3 times more used car dealers than there are new 
  2. The margins on used cars are significantly higher than it is on new car
  3. This then means that the most important thing that’s going to get you consumer attention is your individual car dealership brand and not the car’s brand

When people search, location is important. Own your local area online first. There are very few dealers getting local car dealership online branding right at the moment. Most car dealers are posting delivery photos, cool pictures of cars (a good start), but there’s one way to drive your brand in your area and that is to solve consumer problems in the context of your consumer – no one’s doing that. What do I mean? It means putting out material that helps the consumer, that is unselfish – get out of sales mode and educate your customer. I would love to see a dealer do it properly and consistently. If you know of one that I haven’t seen, please let me know.

An example:

Shoot a video that shows the consumer the inside the boot of a car you stock ‘look at how much stuff I can fit in here!’. That’s helping the consumer. This is why I think it’s time car dealerships should start creating informal videos, talk to the camera, being real and solve consumer problems and answer questions.

Where do car dealerships start?

  1. Keep it simple, don’t try and sell the car. Even if it’s your sales teams taking short videos like: Have you ever driven a Mercedes Benz S-Class? This way you try and grab the attention and emotion of the consumer whether or not they are ready to buy. 
  2. Use a real setting in your dealership’s parking lot. A simple walk around showcasing the car as if someone has walked onto your dealership floor. So imagine if you have 3 Sales Reps each creating one 3 minute video a week – guess what, you have 3 videos a week. In the end you’re creating content in your area without spending much.

I’m not suggesting that you divert money to alternate places, be creative and use your current resource. South African car dealers aren’t doing it yet, but the car dealers who will do this will WIN in the long run. They will double, triple, quadruple their dealership scale if they get ahead of the curve – all by doing simple things instead of waiting on advertising platforms to offer a product.

Just putting up a classified doesn’t work anymore, you’ve got to also build your car dealership brand – so market your dealership effectively.

Let me know what you think, I love hearing from you!