Dealership marketing has traditionally relied on whatever data was readily available, usually from a Dealer Management System (DMS). But in an age of constant consumer movement—brand switching, changing addresses, or even dropping out of the market entirely—this approach leaves a massive gap.
In fact, I’ve found that more than half of a typical dealership’s DMS records are no longer relevant for active marketing. This only results in enormous amounts of money and time wasted targeting people who won’t, can’t, or simply aren’t going to purchase from your dealership.
This is the core dilemma: how do you ensure your marketing dollars reach real, in-market buyers rather than inflated lists containing outdated or irrelevant contacts? The solution is employing modern artificial intelligent (AI)-driven strategies. When you leverage up-to-date consumer data, we can radically transform how dealerships connect with potential buyers.
Why Traditional Dealership Marketing Falls Short
Many dealerships still rely on what I call the “data cesspool”—a Dealer Management System riddled with outdated information. In my experience working with dealerships, on average, 45% or more of the people in a DMS either don’t own their vehicle anymore or don’t own any vehicle at all. Another 7% to 10% of customers may still have the car in question but have moved outside of the dealer’s market area. This translates to over half of the DMS being ineffective for targeted marketing. That’s half your marketing budget disappearing into the void right from the start.
But why does this happen?
- Customer Lifecycle Shifts: About 50% of U.S. consumers switch brands on their next purchase. While some brands like Ford or Toyota might see stronger loyalty, the industry average suggests that you can’t rely on the assumption that people who purchased from you once will return for the same brand.
- Geographical Mobility: People move more than ever before, meaning someone who used to live down the street may now be across the country. Yet your DMS still has them tagged as a local customer.
When your dealership uses these stale records to launch marketing campaigns, it’s like trying to water a dead garden—you’re investing resources without any real chance of growth. Every piece of direct mail or digital ad sent to someone who’s out of your market or no longer owns the same make is a wasted opportunity. Worse, the irrelevant content can hurt your dealership’s reputation, which can signal to prospective buyers that you don’t really understand them or their needs.
How AI Transforms Targeting
Imagine a scenario where every name and address in your database is 100% current. Where you know exactly who still owns which vehicle, who’s likely to consider purchasing from you again, and who has the financial profile to be interested in your upcoming models. This is precisely what data-driven strategies powered by AI can accomplish.
AI thrives on consolidating and cleansing data. In my work, we integrate multiple data sources into a Customer Data Platform (CDP) that continuously updates records. This allows us to identify who actually remains in your market, who has switched brands, and who might be open to cross-shopping another model. By ingesting consumer ownership data from Original Equipment Manufacturers (OEMs), the platform can refine your dealership’s targeting in ways the static DMS simply can’t.
Once AI has unified and scrubbed your data, you can craft far more personalized marketing campaigns. Now, you’re speaking directly to in-market customers who currently own a specific vehicle and have shown past interest in a certain model or trim.
The beauty of this approach is that it doesn’t just trim the fat—it sets you up to achieve better results from a smaller, but more targeted, audience. With each dollar spent now directed to a real prospect or returning customer, your ROI increases. Dealers often see improved open rates, click-through rates, and, most importantly, conversion rates. This is because you’re no longer paying for impressions on ads that reach people who have zero need or interest in your inventory or services.
Smarter Marketing, Higher Engagement
AI-driven targeting means improving the customer experience and dealership reputation. When prospective buyers see relevant offers—like tailored financing options or special deals on the very model they’ve been eyeing—your marketing resonates. People want to feel understood, not spammed.
It’s no surprise that when you’re talking directly to people with real intent, your messaging hits the mark. The reason we see stronger open and click-through rates is because the communication becomes more of a continuation of a relationship that aligns with what the customer is genuinely looking for.
In a market that’s becoming more data-driven by the day, dealerships that fail to adapt risk falling behind. Competitors already using AI-driven strategies have an edge in both reach and results. They’re the ones scoring more test drives, more engaged leads, and more sales—all while possibly spending less overall on marketing.
The Limitations of Traditional DMS Data
Traditional dealership marketing is broken because it relies on data that doesn’t reflect today’s fluid consumer landscape. Between brand switching, geographic relocation, and the natural aging-out of vehicle ownership, a legacy DMS alone can’t paint a clear picture of who’s truly in-market.
For every dealership we serve, we update data weekly, integrating our solutions in a CDP that works hand-in-hand with OEM information. It’s a system designed to weed out the 45%+ of people who have already switched or sold their vehicles, and the other 7-10% who have simply moved out of reach. This means you focus on a smaller but far more qualified segment of your original database. And that focus translates into better engagement, higher ROI, and a stronger reputation in your local market.
If you’re serious about cutting through the noise and connecting with real buyers, it’s time to ditch the antiquated DMS-driven campaigns. Reinvent your dealership marketing with AI-powered insights, and watch as your budget, engagement, and brand loyalty transform for the better. The technology is here, the data is available, and the opportunity to elevate your dealership above the competition has never been clearer.
