Steve White shares why processes may be getting in the way of a dealership's profit.
I recently read a great blog about our industry by thought-leader Seth Godin. It explains how manufacturers and dealers do things very differently. Godin shares that manufacturers have worked for hundreds of years to refine and create more efficient ways to produce a quality product; evolving from “stopwatches and spreadsheets” to the robotic-assisted assembly lines that exist today, which have, according to Godin, “turned the process of making a car into a predictable, improvable system.” However, in Godin’s opinion, dealerships are not faring quite as well.
Throughout the history of auto dealerships, processes have always been an essential part of operations. These processes mostly revolve around retail sales and the most efficient and successful way is to sell a vehicle. They have been added to and refined over the years and now a literal bible exists with advice about how salespeople should guide the consumer when shopping for a vehicle.
But maybe… just maybe… things have changed.
As Godin states in his blog: “Car dealers might try to measure the easy metrics of output (how many sold) but they’ve consistently failed at managing the improvised human interactions that car salespeople engage in.”
Don’t worry. I’m certainly not here to tell you how to run your dealership or to preach about what processes you should use. I’d like to share a useful piece of information about how, in today’s Internet-driven world, the way you run your digital dealership is just as, if not more important than, how you run your physical dealership.
During the time the car shopper remains in the digital universe, they feel have all the time in the world. And, there’s an additional catch here: there’s nothing your dealership can do to influence that online customer if you don’t even know there are there. It’s one thing to know that 50,000 people visited a VDP page, your website, or a third-party site, but that is somewhat meaningless if those customers don’t convert. Sure, some of them may just stroll in. But you’ll never know why, where they came from, or what message influenced them unless you have some way to capture that information. And, that information is the key to successful marketing.
Most dealership spends a ton of money every month marketing to consumers. Far too frequently it’s hard to figure out where those consumers came from, which marketing channel is working, or which message resonates with them.
The problem lies in the fact that marketing is incredibly dynamic. For example, the effective channels which exist today (if you’re measuring) may become obsolete within as little as a year.
Managing your marketing budget and keeping up with processes that make for an effective marketing strategy can be a never-ending task.
The good news is that the information is out there to help you improve results, track customers, manage marketing channels and optimize results. You need to make sure you have a good, trusted method of attribution in place.
I have no doubt that every dealership would like to get the best bang for their marketing dollars. If digital (or even physical) processes are getting in the way, perhaps it is time to rethink how we’re doing things, evolve and create new processes and better ways to measure and adapt to our society. Consumers certainly are!