Today’s car business is undoubtedly one of the most competitive U.S. retail markets, where new-vehicle franchised dealers shell out approximately $6.4 billion on advertising annually according to NADA’s 2012 Annual Report.
With thousands of dealers vying for the attention of ready in-market buyers, many of them share similar ongoing challenges of how to effectively reach the right customers with the right message, bring those customers into their showrooms and service bays, and keep them coming back again and again.
Consumer shopping habits continue to shift away from traditional mass media platforms like TV, print and radio, toward more targeted and digital mediums that are more personalized and accessible like targeted direct email and mail, internet, mobile and social. Dealerships that do not understand targeted and digital marketing continue to see diminishing returns with traditional mass marketing that remains costly, not to mention extremely difficult to measure.
Today, the most successful dealers are using targeted and digital mediums that are less expensive, more measurable and give a better return on investment than traditional mass marketing. Although, combining multiple ad mediums can present its own challenge; as the average dealer works with multiple vendors to execute their marketing strategy often resulting in different messages and designs that too often are not integrated with one another. The key is to integrate all targeted and digital advertising into one cohesive campaign to maximize results.
Courtesy Chevrolet, a member of the Courtesy Automotive Group, has found a solution by implementing an integrated targeted and digital marketing strategy across multiple mediums using one marketing partner to attract, sell, service and retain more customers for less cost than traditional mass marketing.
“Our new sales are up 17 percent and our ROs have increased by 16 percent since implementing this program back in September 2012,” said Scott Gruwell, General Manager of Courtesy Chevrolet in Phoenix, AZ.
Success has not been fleeting for this long-time dealer who strives to stay ahead of the game. Since opening their doors in 1955 they have always done things right and most recently, Courtesy felt it was time to re-strategize their marketing efforts.
They began with a comprehensive five-year historical analysis of their sales and service transactions to determine customer trends. Those findings were then compared to leading third-party and industry data to establish consumer patterns within the local market. The results enabled Courtesy Chevrolet to identify vehicle owners with the highest statistical probability of buying or servicing with their dealership, identify same-brand vehicles owners who had never visited their store, and off-brand vehicle owners with a historical pattern of crossing over to Chevrolet.
Once Courtesy had more clearly defined their market through exhaustive data research, they implemented a comprehensive targeted and digital marketing strategy using variable direct email and mail campaigns that consistently speak to their customers throughout the 60-month life cycle of their vehicles by using custom messaging that includes: a thank you and welcome message for recent purchasers, maintenance reminders for newer vehicles not yet in-equity but that may be due for recommended maintenance, and ongoing targeted email and mail sales communications to customers in an equity position.
Courtesy Chevrolet also targets conquest service customers within their primary marketing area who own Chevrolet’s but did not buy from them. This is unique because most dealers use the manufacturer’s service marketing program which often limits a dealer to only communicate with customers that have purchased directly from their store, but limits the dealer from contacting numerous conquest opportunities within their market. So, if a dealer only has 30 percent market share, essentially they’re missing out on an additional 70 percent of the area’s service market. Courtesy Chevrolet recognized the opportunity to broaden its service marketing program with conquest and has greatly expanded their reach of potential service customers.
Every outbound targeted email and mail campaign from Courtesy directs customers to an online Campaign Conversion Site that not only displays the featured promotions of the email or mail campaign they have just received, but also shows them every sales and service offer that Courtesy Chevrolet is currently running. If a customer is not in the market for the specific offers they just received they can check Courtesy Chevrolet’s campaign conversion site, www. CourtesyChevOffers.com for other available offers with just a few clicks.
“This site is an added bonus. It ties in with all our sales and service promotions and it’s always current because our marketing partner updates on the first of each month. We’ve seen an increase in the customer traffic printing coupons from the site,” said Gruwell.
Another important aspect of Courtesy’s strategy is in-store merchandising. Sometimes viewed as an ineffectual or unnecessary piece by some dealers, yet, when customers visit the dealership and see POS merchandising throughout the store that mirrors the exact promotional offers they have just received it helps validate the dealership’s advertising message and builds credibility – helping increase their closing ratio.
One of the most noteworthy changes to their previous marketing strategy is Courtesy’s new sales-in-service program, the “Vehicle Exchange Program (VEP)”, where a dedicated team of Specialists proactively sell to service customers who are in an equity position. When customers bring their vehicles in for service, a trained VEP Specialist greets the customer and explains that the customer is eligible to upgrade to a new vehicle for the same or lower monthly payment. Rather than wait and hope that customers will buy from them when they’re ready, Courtesy takes the initiative to sell customers in the service bay before they enter the market and shop the competition. This sales-in-service program is integrated across Courtesy’s web site, campaign conversion site, showroom and service lanes, as well as their direct mail.
“For many years we have done a lot of things right, but we never fully took advantage of the opportunities in our service lanes. We write over 150 ROs on any given day and now we also sell 2-3 deals a day out of the service drive – before we may have sold 1-2 deals a week,” said Gruwell. “We developed processes, trained select employees as VEP specialists, and now we have the capacity to focus on active service customers who are literally right in front of us – no more missed opportunities. It has made a significant, profitable, difference.”
“The best customer any dealer can find is one they already have,” said Budd Blackburn, owner of Team Velocity Marketing, the company that Courtesy Chevrolet uses for their sales and service marketing. “Customers who have an active service relationship with a dealership are seven times more likely to purchase with that dealership. Targeting active service customers is smart, but you have to have solid processes and a dedicated team in place to be successful. Courtesy has done a stellar job at turning their service lane from one profit center into two.”
An added benefit to this integrated sales and service marketing strategy is a healthier trade pattern. Courtesy has seen a noticeable improvement in their trade pattern. Since implementing their integrated strategy they bring in more late model trades, 2012-2008, which is ultimately a big savings for Courtesy and practically eliminates having to overpay at auction against the competition.
To measure the effectiveness of all their marketing strategies and ensure quality customer care, Courtesy Chevrolet uses a call-monitoring system to track their advertising, employees, and how their customers are treated by listening to every call that comes into their dealership. They receive daily, weekly and monthly reports that enable them to see which ad campaigns generate the best response and pre-empt any potential customer concerns before they escalate, improving their overall CSI and creating lifelong satisfied customers – something that Courtesy Chevrolet prides themselves on, for more than 50 years.
The Bottom Line
Up 17% in New Sales and 16% in Service ROs, Courtesy Chevrolet Continues to Set the Pace as the No. 1 Chevy Dealer in the Western Region
What They Do:
1. Conduct comprehensive market research to clearly identify vehicle owners with the highest statistical probability of buying and/or servicing with their dealership now and in the future.
2. Speak consistently to their customers throughout the 60-month lifecycle of their vehicle.
3. Drive consumer traffic to a custom campaign conversion site that promotes all their current sales and service offers.
4. Use in-store merchandising to support and validate campaign messaging.service offers.
Resource They Use:
1. DMS: ADP Dealer Services www.ADPDealerServices.com
2. CRM: DealerSocket www.DealerSocket.com
3. Targeted Marketing Company: Team Velocity Marketing www.TeamVelocityMarketing.com
Recommended Actions:
1. Define your ideal local market by finding the perfect customers and prospects with the highest statistical probability of buying and/or servicing with your dealership now and in the future.
2. Create dynamic, cohesive campaigns that consistently speak to your customers throughout the 60-month lifecycle of their vehicle.
3. Consistently target in-market same- brand prospects, and consumers who drive off-brands with a historical trend of crossing over to the brands you sell.
4. Drive consumer traffic to a custom campaign conversion site that promotes all your sales and service offers to help increase your internet sales and service leads.
“OUR NEW SALES ARE UP 17 PERCENT AND OUR ROS HAVE INCREASED BY 16 PERCENT SINCE IMPLEMENTING THIS PROGRAM. ” – Scott Gruwell, General Manager
