PureCars 4th of July Forecast: Tips & Best Practices for Auto Dealers
This Fourth of July will be much different than those in the past. There is a lot of talk about the myth that is a ‘new normal’ and what that will look like. The truth is that no one really knows what it will look like because nothing is “normal” anymore – and it hasn’t been for quite some time.
What we do know is that dealerships across the country are in various stages of reopening based on state-by-state orders and social distancing guidelines. We also know that 47% of all consumers believe that “sales events are the best time to buy a vehicle.”
With the complications from the COVID-19 shutdown, it’s more important than ever to lead with data, lean hard into sales events and quickly adjust to capture the demand that’s out there when and where you can. Of course, we’re not telling you anything you don’t already know here. The difference, this year from previous years is a complex situation with a larger number of unknown variables.
Knowing that the average shopper visited only 1.5 dealerships before making a purchase pre-pandemic, that number is more likely 0-1 with social distancing in place. That said, your challenge remains the same — you and your brand need to embrace media to communicate the experience of buying from you.
Thanks to digital technology, that experience can be easily communicated across media channels through video and conversational tools like Facebook messenger and chatbots.
Striving to beat Memorial Day may be your new bar for 2020. While we’re not recommending you throw out your historical data as a guide, looking at this unusual summer differently can help your dealership stay focused on recovery through the summer months.
Navigating COVID-19 In-Store & Online
We all feel COVID-19 fatigue setting in, but this situation is far from over. During this time, dealerships need to remain vigilant and understand that their customers are not all experiencing the pandemic in the same way. While some people are itching to get out of the house and walk the lot, other people are still very hesitant to go back to “business as usual.” Considering how abnormal everything is right now, whatever we’re calling the ‘new normal’ right now, could look very different in a few months time.
As we head into the fourth biggest sales event of the year (so far), make sure that you continue accommodating customers across that spectrum to make them feel as comfortable as possible and keeping your employees safe.
Continue to lead with empathy. Continue to ask how you can help. Continue to collect feedback and ask if shoppers feel comfortable. Continue to read customer cues and don’t feel pressured to revert to pre-pandemic methods. Continue with an open mind to find the best ways to serve your customers and communities. Continue to press forward. Continue to celebrate the heroes.
On the digital side of things, here are some expert tips and best practices that we are using with our dealers to make sure they get the most out of this Fourth of July sales event.
Facebook Should Be a Given
At this point, social media is a must have in every dealer’s media mix. Engagement and lead counts across Facebook, Messenger and Instagram continue to skyrocket every week. Between the audience reach, targeting capabilities and the unbelievably low cost (now more than ever before) it’s only costing you business when you aren’t active on social media.
Facebook continues to grow the type of ads it offers and dealerships continue to reach new customers within the platform. The differences in the ads above are subtle, but can have a large impact on a dealership’s bottom line.
The “Shop Now” ad features relevant, dynamic inventory that will drive in-market shoppers directly to your website. The “Get Quote” ad also features relevant, dynamic inventory but keeps the shopper within the Facebook experience, pre-populating a lead form with shopper information to facilitate a lead pass into your CRM.
One dealership saved $180k in media spend over 3 months by reconfiguring their media mix with Facebook. Representing only 8% of overall spend, Facebook was a touchpoint for 55% of the dealership’s sales during that time.
Recent studies show just how influential Facebook is in the car buying journey. It’s true that the majority of people still aren’t going Facebook-direct to buy a new car. That said, a recent study PureCars did with Facebook showed a 23% increase in sales for people exposed to dealership ads vs. those who weren’t.
Facebook worked with a dealership recently, saving them $180k in media spend over 3 months by reconfiguring their media mix and ad spend. Representing only 8% of the overall media budget, Facebook was a touchpoint for 55% of the dealership’s sales during that period.
Also, unlike other, more expensive third-party listing sites, Facebook drives traffic directly back to SRPs and VDPs on your website where you can control the conversation and experience.
Not sure if your Facebook campaigns are delivering max ROI and following best practices? Facebook put together a super handy playbook that you can use to evaluate performance. You can also reach out to us for help running efficient, high ROI social campaigns. PureCars Strategists can help identify which type of ad unit best fits your dealership’s needs to significantly drive down your overall cost per lead.
CRM Targeting is Your Best Friend Right Now
Your CRM data is a veritable gold mine for digital advertising all the time, but especially right now. Leverage all the data you already have to create lookalike audiences on Facebook; target expired lessees to incentivize returns; target customers due for service or those who have been inactive for 6-12+ months with specific offers ahead of the holiday.
By using your CRM data, you can serve hyper-targeted ads and offers based on intent, interest, time decay and more. Considering recent estimates that over 20% of expired leases are still out there, and the squeeze on in-demand inventory, a data-driven approach to acquiring and moving vehicles is the smartest way to maximize sales this Fourth of July.
For inventory acquisition specifically, here are a couple examples of campaigns we’ve recommended to our dealers on the best ways to acquire more heading into the holiday:
Lease Returns / Lease Pull Aheads
J.D. Power estimates that 1 in every 5 customers whose lease expired in March-May is still in-market for a new vehicle. These customers present the absolute best opportunity for you to improve your used car inventory. Why?
- You already have an existing relationship with these customers
- They are nearly guaranteed to be in-market for a new vehicle
- Lease returns make for the best Certified Pre-Owned inventory, which is the highest profit opportunity
We have learned at PureCars that a “Trade In & Trade Up” message works best when targeting these customers on Facebook. So, what next? First, pull a list of customers who have not returned an expired lease + those who have leases due in the next 90 days. Then, get in touch with your PureCars digital strategist for campaign coordination. This campaign will be sniper-like in that the audience list may be small, but is a sure fire bet to convert.
We’ll Buy Your Car
If you are in a dealership with lower lease penetration, and/or you have already mined your outstanding lease base for trade-ins, it is time to take your message to the masses. Make sure the public knows you are in a position to acquire their car with a Facebook campaign, and pair it with a targeted offer on your website (for our dealers we use Activate Offers).
The best results have come from dealers who advertise a significant “$ or % Over Book Value” offer. We recommend 120% or $1,000 over Fair trade value at minimum for top engagement rates. It is okay to be honest with your customers here, too — let them know you are in a “once in a blue moon” position to offer them top dollar for their ride!
While there are still a lot of unknowns right now, we know that pent up demand is out there for dealers to capture. The last thing your dealership needs right now is to waste any ad spend or scatter shot your digital marketing in the hopes of driving ups to your store or ready-to-buy shoppers to your site.
As we stated up top, the idea of a ‘new normal’ is a myth. What we do know is that the lessons learned the past few months have been profound. We’ve all seen advances in both the use of, and customer acceptance of, digital technology and automation; this includes everything from online trade appraisals, valet delivery services, and so much more. The best thing your dealership can do is stay agile, remain diligent, and above all else, listen to your customers.
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