Leverage data insights to improve customer engagement
Today’s major dealers are watching closely for interest rate hikes from the Federal Reserve and what it means for the auto market. In September alone, the average auto loan rate increased by about two percentage points.
This indicates that expensive new cars are out of reach for many consumers. And lenders are hesitant to take out subprime loans. The good news is that with limited vehicle production continuing, consumer demand for new vehicles has not diminished. This means you can still show significant revenue and hit your sales goals. But you can’t use the same old strategies like buying more leads.
Let’s explore what top dealerships are doing to find quality buyers, engage with the right messages, and choose the right communication channels to maintain sales and profits during this tumultuous time.
Take stock mining to the next level
Stock mining is the most well-known tactic for finding new opportunities with sales and service customers. This is especially useful if you’re not securing the volume of high-quality leads you want from your website and marketing efforts. Your CRM should facilitate the creation of targeted marketing and sales lists based on customer profiles.
Top dealerships dig deeper using stock mining tools equipped with propensity-to-buy intelligence that provides a predictive high, medium, or low score to indicate a customer’s likelihood to purchase a vehicle . Using artificial intelligence and business insights such as lifetime sales transactions, days left on lease, or number of payments made, propensity to buy helps limit sales and marketing efforts to the best prospects.
The same technology can be used to predict what type of vehicle should be recommended to a customer – instead of just suggesting a newer version of the current vehicle. This fits well with the industry’s push towards a more consultative sales experience for customers. Armed with this information, a salesperson becomes a trusted vehicle expert who can speak intelligently about the best-suited vehicles.
Please feel free to order and send messages in transit.
During the pandemic, lack of inventory affected dealership engagement behavior. A 2021 study of mystery shoppers from nearly 4,000 dealer groups of a particular OEM who together account for 90% of that OEM’s sales in all major markets, found that online prospect responses have changed dramatically during the pandemic.
For example, in May 2021, 25% of sales reps addressed vehicle availability when responding to leads online. Only 6% did so last September. Also in May 2021, 31% of sales staff invited customers into the dealership. That number plunged to 2% last September.
Why? Staff were afraid to answer inventory questions and were unprepared to sell through the ordering process that is the reality of today.
The best dealers are quick to talk about out of stock. They explain how customers can order a custom vehicle and/or how vehicles are in transit every day, and there is a waitlist process.
Leverage your CRM’s customizable templates to create lead response messages that highlight all vehicle purchase opportunities. The approaching model year turnover makes this an opportune time to reach out to quality prospects and explain all of the options available to get them into a new vehicle.
Adjust cadences and CRM communication channels.
Now is not the time to set CRM communication triggers and forget about them. A customer interested in vehicles in transit may need twice the communication of a prospect who won’t buy now. Consider each customer’s needs and set reminders accordingly.
The best resellers also rely on A/B testing. Create different messages using different channels to see what gets results. Sales reps need customizable templates for email, text, and chat.
The bottom line is that interest rates are rising, but the winning dealerships in today’s market aren’t using the same old cookie-cutter commitment tactics to find buyers. They don’t spend money on high-funnel leads. They spend time and money where it counts – on technology and communications to find and talk to quality buyers with a propensity to buy.
Michael Biasco (photo, top left) is a Product Marketing Manager at Elead/CDK Global with over nine years of experience in automotive retail sales, marketing and operations.