5 Tips to Drive into a Profitable New Year

The New Year is shaping up to be a good one for dealers. According to a report by the Economist, new car sales will be up by 15 percent in 2021.

 

I think we’re all happy to have 2020 in the rearview mirror. Now it’s time to refuel, refine and ride into stellar sales numbers. Get every department in your dealership in tip-top shape and drive into profitability with the following five tips:

 

Tip 1: Market to new audiences

 

This year, commit to reaching new audiences. Millennials and Generation Z (those born between 1993 and 2007) are rapidly gaining buying power. Generation Z alone is estimated to have direct spending of up to $143 million, according to research company Frost & Sullivan.

 

These digital natives prefer to do their vehicle research on YouTube, and spend their days using apps like WhatsApp and Snapchat. It’s smart to add these channels to your marketing mix. When it comes to messaging, authenticity and transparency are critical to them. They don’t want to be sold, they want to be informed. In their minds, your role is a consultant, helping them to find the best vehicle for their needs.

 

Many dealerships are outsourcing their marketing, which makes a lot of sense. An outsourced firm has many employees with different ideas and skill sets who can help to vary your marketing messages for different audiences.

 

Tip 2: Manage leads with an outside BDC

 

Furloughing staff helped keep profits up during the pandemic shutdowns. At the same time that stores were running lean, online and phone leads spiked. It’s likely that leads fell through the cracks.

 

If your on-site employee numbers are down and you are struggling with lead management, lean on an outside BDC. A professionally trained automotive BDC can expertly handle an influx of leads, as well make CSI and service calls. All lead information flows into your CRM so your salespeople can spend time closing the best opportunities.

 

Outsourcing is also a solid cost control move because you don’t have to pay high employee wages plus benefits. Yet, you get all the benefits of a professional team who will work long hours and never call in sick.

 

Tip 3: Sell with digital retailing

 

The pandemic proved that shoppers are ready for rapid digital change. Dealers with digital retailing tools experienced a spike in activity that’s likely to stay. It seems shoppers like to search inventory, take a 360-degree walkaround, review all pricing options and get trade-in information, without stepping foot in the dealership. Yet only 15 percent of dealerships offer this online experience. Digital retailing tools that offer “the Carvana experience” and seamlessly interact with salespeople to create quick and accurate quotes are needed badly. Dealers who continue to insist that shoppers come into the store will lose out to more forward-thinking competitors. 

 

Tip 4: Build your service techs

 

As of late June, vehicle travel steadily ascended to pre-pandemic levels as most states and municipalities reopened. It follows that dealerships all over the country were, and continue to be, flooded with repair work. That’s a problem if you need additional service technicians. Techs  are increasingly hard to come by, and hard to keep due to cutthroat competition.

 

The answer is to build your own technicians. Hold an event or volunteer to speak at a local high school. Bring in someone young that you can train in your core values and processes. Then value them for their work. Younger generations thrive on praise and positive reinforcement. Hold daily or weekly meetings to talk about wins and single out top performers. Competitive pay plus recognition can stop attrition in its tracks.

 

Tip 5: Train employees to wear multiple hats

 

Leaner operations likely mean employees are wearing multiple hats. You may have a service marketing person taking over sales marketing. Or a service advisor who’s now in the service drive. Don’t throw these employees to the wolves. Offer some type of training so that employees don’t get frustrated, and so that customers receive a uniform experience. Consider job shadowing or informal one-on-ones. Always reward good work with some kind of recognition since you are asking employees to go above and beyond.

 

 

Wave goodbye to 2020 and get every department ready for a profitable New Year with these five tips. The dealerships that learn from the events of last year and adapt will survive. Be one of those dealers!

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