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Ebay Survey Results
A new eBay Advertising survey found that 63 percent of respondents are either “extremely likely” or “likely” to purchase a vehicle online in the future.
For the two-part survey, eBay Advertising says it garnered responses from more than 1,000 U.S. consumers between the ages of 18 and 65 who had purchased a vehicle in the last six months. The company also analyzed eBay Motors data based on approximately 1,000 consumers who had either made purchases from the “cars & trucks” category on eBay Motors, or who had browsed through eBay Motors in 2016.
The eBay Motors platform houses thousands of vehicle listings from dealerships and private sellers.
The eBay report comes at a time when an increasing number of dealers are taking the plunge into online vehicle transactions. Some dealers are offering online services via in-house projects like those at giant retailers AutoNation Inc. and Penske Automotive Group Inc., or through third parties such as Roadster, which launched an online-shopping platform for dealership websites last summer in California.
While dealers look to adopt the Amazon experience for vehicle purchases, data shows that the public demand for such services is still evolving. Although eBay’s survey found intense interest for buying vehicles online, a recent report from dealer software provider Dealersocket told another story when it said that a mere one-third of shoppers want to complete an entire transaction online.
But no matter what survey you look at, the online wave isn’t going anywhere. With a growing number of digital outlets to buy vehicles from, eBay Motors continues to make a play in the space by providing leads to dealers who populate the site with a plethora of new and used listings.
Some dealers start accounts on eBay Motors and don’t realize the site can integrate with a store’s customer relationship management and inventory tools.
Dealers using the eBay Motors integration receive lead notifications through their CRM platforms. The site also has a vehicle merchandising platform that links to dealer inventory systems and allows them to automate which models are selected for display on eBay Motors.
Kevin Considine, eBay Motors’ senior merchant of vehicles in the U.S., said he feels the rise of other online shopping platforms won’t detract from eBay’s offerings, but complement them.
“We are trying to serve that same demand from buyers in the marketplace, which is to take that process as far as they can online. A lot of those dealers that are offering those services on their own platforms, or are planning to do that, are also the same dealers that are reaching our buyers through the eBay marketplace,” Considine told Automotive News. “They’re not just relying on traffic to their own site. Many of them are finding those shoppers on eBay.”
The eBay Motors marketplace provides other tools to enable online deals. Shoppers have the option to get vehicles inspected, access history reports and sift through pricing offers from shipping companies. The site also has partnerships with finance and insurance companies such as Allstate, Progressive and State Farm, which could be a convenience for those buying from private sellers instead of franchised dealerships.
“We’re definitely looking at finding those partnerships where we can blend an important service to a purchase decision like a vehicle,” Josh Wetzel, eBay Advertising’s senior director of sales and marketing, told Automotive News.
Online research
The eBay survey also found that 87 percent of respondents use the internet to research vehicles. While that number is extremely high, Considine thought it would be even higher.
He said those who don’t research online likely have close relationships with neighborhood stores that they’ve always done business with.
“They have a trusted salesperson,” Considine said. “They go through a process that they’ve done many times before and they may still be happy with that cycle.”
More highlights
The survey had a few more highlights:
• The average length of the purchase journey is two months, which consists of researching, reading reviews, etc.
• Sedans and SUV/ crossovers were the most popular vehicles purchased.
• Women are more likely than men to plan to keep their vehicle until it dies.
You can reach Vince Bond Jr. at vbond@crain.com — Follow Vince on Twitter: http://www.twitter.com/VinceBond86
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Why This has Been the Slowest Year for Car Sales Since 2013 and How to Combat Low Sales
CNBC reports this has been the slowest year for car sales since 2013. Statistics show July is going to be the 7th consecutive month of declining sales according to Automotive News. Further projections show the final quarter of 2019 is expected to be no different as sales continue to drop. What has brought car sales to such a low? What can car dealers do to combat such dismal projections?
The low car sales were less than a shock to the automotive industry. Many economists blame tariffs, trends, and the longevity of modern cars. Firstly, tariffs have increased on foreign goods and the car industry seems to be the main target for such tariffs. These tariffs have led automotive manufacturers to close plants, open new ones, and relocate others. According to NADA, this has caused car prices to increase, particularly new cars which brings me to the second cause of the automotive slow-down: trends.
There are three main trends that are to blame for the decrease in automotive sales. The first being, the shift from buying new cars to buying used cars. According to NBC News, new car sales have decreased and this is likely due to the increase in new car prices caused by tariffs, the increase in car loan interest rates, and the longevity of cars on the road today. The lack of new car sales has made it nearly impossible for most dealers to meet their new car sales objectives and make way for next years models on their lots.
The second trend that has had a huge effect on the automotive industry is the shift in consumer tastes from sedans to SUVs according to the Wall Street Journal. This is another trend that has driven up new car prices due to the increase in manufacturing costs from transforming sedan producing plants into SUV producing plants. This trend has also led many car manufacturers to completely change their model line up and eliminate previously successful sedan models to make way for new, innovative SUVs.
The final trend that has impacted the automotive industry is the consumer push to fully autonomous driving cars. This has made R&D for many companies to sky-rocket as they race to find the technology that makes self-driving cars possible. Some manufacturers have invested billions at a time when car sales are slowing down hoping they make the first break in autonomous driving to create a catalyst for increasing new car sales and salvaging the car industry. “The automakers that can successfully build up their AV capabilities will be in line to take advantage of a lucrative opportunity — the global AV market is expected to grow at a compound annual growth rate of 39%, from $54 billion in 2019 to $557 billion by 2026”, according to Business Insider.
So, car sales are low and are likely going to decrease even further as 4th quarter approaches and the end of the year nears. What can you, as a dealer, do to fight the downswing in the automotive industry? There are 3 proven, fool-proof, solutions that always produce a high ROI, regardless of the state of the economy.
The first solution is direct mail. Although, many perceive direct mail as an outdated form of marketing direct mail is 36 times more effective than email according to Forbes. Direct mail also has a higher ROI than any form of digital marketing. You may think “well, my dealership wants to target millennials and direct mail won’t reach them the same way digital marketing will.” You may be surprised to learn, according to Forbes, direct mail is more effective on Millennials than any other generation. Millennials have become nearly immune to digital marketing the same way many people become immune to billboards on a road trip; once you see so many of them you start to see none of them. Direct mail is different, unlike most forms of marketing, like TV, radio, SMO, email, and SEO, you can physically touch direct mail and that is what makes it so effective and memorable.
The next solution is community involvement. Getting your community involved and familiar with your dealership builds trust, increases customer retention, and improves brand awareness. There are many ways to be involved in your community, from sponsoring local sports teams to attending community events; but the most effective way is to bring them to your dealership with your own event. Open your doors and offer something of value to your community; like a screening of a movie, a season kick-off family event, or a small prize giveaway of some kind. All of these will strengthen your connection with your community and help you beat out the slow season.
Lastly, the most effective way to combat the upcoming slow sales is to combine direct mail and community involvement with a staffed event. A staffed event with Pinnacle Sales and Mail allows dealerships to bring in up to 100 potential customers a day with a direct mail campaign and build community relationships with the offer of a free gift to those who bring the mailer into the dealership. Our events can also triple new car sales and move up to 50% of your used car inventory in a single event.
Give us a call at 888-524-4563 to schedule your next Pinnacle event today and turn the slowing season into a growing season! Visit our website to learn more about what we do, meet our team, and watch video testimonials from our satisfied clients!
Works Cited:
https://www.autonews.com/retail/us-sales-may-fall-7th-straight-month
https://www.nbcnews.com/business/autos/automakers-start-sweat-new-car-sales-continue-lag-n988511
https://www.wsj.com/articles/america-has-fallen-out-of-love-with-the-sedan-1535169698
https://www.businessinsider.com/vw-ford-hyundai-uber-autonomous-vehicle-push-2019-6
6 Reasons Staffed Events May be Right for Your Dealership
One of our staffed events is definitely right for you if any of the following apply to your dealership.
1. You Have Aging Inventory
Our salesmen are experts at matching customers to their perfect vehicle and selling inventory that has been stagnant for months. We give our clients the ability to sell up to 50% of their used car inventory.
2. You Need a Boost to Start or End a Slow Month
Our sales are capable of bringing in over $250,000 of gross profit in a single 5-8 day sale. Many of our clients have even exceeded these outstanding numbers, including a Chevy dealership near Atlanta and a Ford dealership in southern Indiana.
3. You Want to Meet Your New Car Sales Quota
New car sales have been on the decline for over a year now, making them more difficult to sell. We are able to triple new car sales and help our clients reach new car sales goals they haven’t been able to reach in years.
4. You Want More People in Your Showroom
All dealers have been faced with an empty showroom at some point. Our super sales events bring in over 100 opportunities a day to sell a car. That fills your showroom, keeps your sales staff busy, and allows them to sell more vehicles.
5. Online Marketing Isn’t Working as Well as it Used to
Online marketing can be a very useful tool for your dealership, but now most dealerships have online marketing and it becomes all about getting the price for customers. Not only does this drive you to bring down your price, but it also diminishes your profits. Staffed events are different. There is far less competition in customers’ mailboxes than on their phones or computer screen, making it easier to reach them.
6. You Have a Lot of Competition in Your Area
Today, competition can be everywhere. Not only do you have to compete with other car dealers in your area, but now dealers are forced to compete with online car dealers that can be accessed from anywhere. A staffed event is something that potential customers in your market can’t ignore, thus driving them into your store.
Don’t worry about the size of your dealership, we have worked with dealerships of all types, from some of the largest dealerships in the country to a family operated dealership. We custom tailor events to fit the dealership, market demographics, and dealer preference. Just give us a call to see what we can do for your dealership.
Visit our website for more information about what we do, watch testimonial videos from some of our clients, and even meet the team that makes our events so successful. You can also give us a call at 1-888-524-4563, to speak to our owner, Joe Cox, about creating the perfect event for your dealership. Or email us with any questions you may have regarding staffed events and direct mail!
3 Ways to Fill an Empty Showroom
All dealerships have faced an empty showroom at some point. Ultimately, empty showrooms indicate a lack of sales and customer traffic. To prevent that from happening, action must be taken. The following is a list of 3 surefire solutions to an empty showroom.
Staffed Event
Staffed events are one thing that cannot be ignored by potential car buyers in your area. Not only are they great for increasing gross profit, but the additional sales staff are a great way to accommodate for such an increase in showroom traffic. The supplementary staff also organize and set up the event to decrease the amount of stress and worry for dealers.
When you choose an event with Pinnacle Sales and Mail, you receive these benefits and many more. We can provide a BDC to accommodate the high volume of sales calls during the event. The BDC also works as a means to track the event’s traffic and overall performance.
At Pinnacle, you also receive peace of mind that our events will not only increase gross, but it will increase customer satisfaction and merge well with your current sales staff an process.
Community Involvement
Community involvement is a great way to increase brand awareness trust in your area. Community involvement can range from sponsoring a local event, such as a 5k, or host an event at your dealership. Hosted events at a dealership are most successful when paired with something of public interest. In other words, give those who attend the event something of value. This can range from a small prize, to a giveaway, or even something as simple as complimentary food.
We have seen the great success of giving such prizes to the community and find that it greatly increases customer satisfaction and even if a potential customer doesn’t purchase a car at that time, they are now aware of your dealership and will consider it when it does come time for them to purchase a vehicle.
Direct Mail
Direct mail campaigns are highly effective tools to increase customer traffic. Direct mail has been proven to have a higher response rate than digital marketing, including email and social media marketing. According to Swimmer Integrate Marketing by Design, “The response rate to direct mail pieces is 3.7 percent, as opposed to 2 percent mobile, 1 percent email, 1 percent social media, and 0.2 percent internet display.”
Some suggest the reason the response rate of direct mail is so high is that businesses have less competition in the mailbox than any other marketing strategy (like email or social media). This is particularly true in the automotive industry, as less and less dealers utilize less mail and more digital marketing tactics. Another reason it is so successful is that it is more difficult to ignore a physical ad in your hand than it is to scroll past an ad online.
Direct mail also pairs well with some marketing strategies you may already be taking advantage of. According to Nonprofit Pro, “Direct mail with digital ads yield 28% higher conversion rate.”
Here at Pinnacle Sales and Direct Mail, we send out hundreds of thousands of mail pieces every week, which allows us to offer competitive prices and the experience to know what is effective in different markets. Direct mail is also more targeted than you may think. We are able to analyze your market demographics and target areas that will be the most beneficial to your dealership to yield the most effective campaign.
Pinnacle Offers a Combination of all 3 During Our Events
Pinnacle Sales and Direct Mail offers dealers a way to combine all of these to make for a significant increase in gross profit. We provide direct mail campaigns with prizes to incentivize potential car buyers in the community to visit your dealership and offer additional staff to organize the event and provide supplemental sales associates to accommodate for the increase in customer traffic.
Our events have been proven to sell up to 50% of our client’s used car inventories and triple their new car sales. Additionally, our events can bring in over 100 opportunities a day to sell a car, this is on top of traffic from repeats, referrals, and digital marketing.
We have been in the industry for 20 years and send over 25 million pieces of mail every year. We are endorsed by many national companies including Proactive Dealer Solutions, the BDC industry leader. We continue to maintain a professional reputation among dealers and pride ourselves on being the industry’s only corporate staffed event company.
Visit our website for more information about what we do, watch testimonials from dozens of happy clients, and even meet our Pinnacle team.
3 Things Negatively Impacting the Automotive Industry
2018 was a year of changing consumer trends, competitive automakers, and and the race to fully autonomous cars. But what are the driving forces affecting the automotive industry today? It is no secret that the automotive industry has seen significant change over the past year and sales have begun to plateau over the last six months. The following is a list of some of the reasons for the decline and how they are affecting your dealership today.
1. Increasing Auto Loan Interest Rates
According to CNBC, car loan interest rates have been steadily increasing for years and this trend doesn’t seem to have an end anytime soon. This is causing car buyers to hesitate before making a purchase, thus extending the sale time and delaying profits. This, among other causes, is also resulting in less showroom traffic.
This is also leading buyers to purchase more slightly used cars than usual. According to Forbes, “the game-changer is the surge of 2-to-3-year old leased vehicles pulsing through the nation’s used car auctions.” Although this shift in buying habits doesn’t necessarily effect the amount of car sales or profit, it is a notable trend that seems to be growing in popularity.
2. Technological Advancements Increasing the Longevity of Vehicles
According to CBT News, technological advancements have led to an increase in quality and durability of nearly all vehicles. This means vehicles are lasting much longer the time between new car purchases has greatly increased, thus leading to a drop in overall sales. All of the time between sales also increases the amount of money spent on customer retention in order to ensure customer loyalty. Although, the investment is well worth it because we all know it is much more expensive to get a new customer than it is to keep an existing customer loyal.
3. High Gas Prices
Finally, rising gas prices seem to be having an effect on some buyer’s purchasing decisions. According to CBT News, a steady increase in gas prices has many waiting to purchase a new car, especially consumers on the west coast who are seeing great spikes in fuel prices. Although this trend is particularity effecting the west coast, most likely due to fuel transportation costs and the devastating effects of the recent wildfire, it may be just a look for what is to come for the rest of the US in 2019.
So, With all of These Negative Affects, How Can You Increase Your Bottom Line this Quarter?
One thing that potential car buyers can’t ignore is a direct mail campaign and staffed event. When used properly, they have both been proven to be highly effective, particularly when paired together. At Pinnacle Sales and Mail we pride ourselves on professionalism, maintaining our excellent reputation, and the effectiveness of our super sales events.
We are bringing the dealerships we partner with over 100 opportunities a day to sell a car, tripling their new car sales, and selling over 50% of their used car inventories. All of this is achieved in just one sales event with us.
Email me, the marketing manager, at alyssa@pinnaclesalesandmail.com for a quote on a direct mail campaign, staffed event, or both! Visit our website for more information about what we do, testimonials from dozens of happy clients, and even meet our Pinnacle Team.
What Tax Time Means for Car Dealerships
Tax time is almost here! According to the IRS, over 154 million people received tax returns in 2018. That means roughly ⅓ of Americans will receive an average of $2,899 this tax season. Starting as soon as mid-February more customers will be in the market to buy a vehicle. With millions of consumers actively searching for a great deal on a car this tax season, how can you ensure they choose your dealership?
First, you have to begin with understanding the type of customer that is interested in buying a car during tax time. The tax-time buyer has different needs than the average car buyer. Typically, tax-time buyers wait months on their refund to be able to purchase a vehicle and use their refund as a sizable down payment. Because they have been waiting to be able to purchase a car, this often means they are looking to upgrade and purchase a car quickly. They also have a different buying situation. Rather than searching for a vehicle with the lowest price, they are looking for a dealership that will be able to help them finance a car and give them a variety of payment and buying options.
Being that this is a unique time of year and a unique buyer that dealers are faced with, it is only appropriate that dealers approach this situation in a unique way. Many dealers are going to treat this time of year like any other and continue to utilize digital marketing strategies. Don’t make the same mistake. Choose a marketing tactic that will ensure your dealership stands out from the competition. Choose a direct mail campaign.
Direct mail has been proven to have a higher response rate than digital marketing, including email and social media marketing. According to Swimmer Integrate Marketing by Design, “The response rate to direct mail pieces is 3.7 percent, as opposed to 2 percent mobile, 1 percent email, 1 percent social media, and 0.2 percent internet display.” Not only does it get a higher response rate, but it gets more impressions as well. “80 to 90 percent of direct mail gets opened, while only 20-30 percent of email gets opened on a good day.”
Dealerships have come to utilize the benefits of direct mail less and less over the years, meaning there is less competition in the mailbox than there is online. Not only that, but direct mail is much more likely to leave a lasting impression and have much higher conversion rates than digital marketing tools. Swimmer found “70 percent of Americans say physical mail is “more personal” than email.” Direct mail campaigns also lead customers to spend more money at your dealership. “The USPS found customers who receive ad mail spend 28 percent more than those who don’t.”
So make sure the millions of additional customers tax-time brings, choose your dealership. Connect with them in a way that other dealers aren’t. Choose a direct mail campaign with Pinnacle Sales and Mail and increase your bottom line.
To make your direct mail campaign even more impactful, pair it with a staffed event. Our staffed events include a team of skilled professionals that have been working in the staffed event industry for over 15 years. Our teams don’t just include supplementary sales staff to help with the increasing volume of new customers in your dealership, they also include managers who understand the inner workings of the super-sales and ensure your event is organized and flawless.
Our events have been proven to triple new car sales, sell 50% of used car inventory, and some of our clients have even seen over $300,000 in gross profits with just one of our events.
Email me at alyssa@pinnaclesalesandmail.com or give me a call at 888-524-4563 for a quote on a direct mail campaign, staffed event, or both! Check out the rest of our website for more information about what we do, testimonials from dozens of happy clients, and even meet our Pinnacle team.
Tax Season is UPON US! What is your plan?
For the average American consumer, the holiday season is one of long lines and credit-limit increases. For auto dealers, it signals a sales boom that arrives about a month after Santa’s sleigh. That’s because January is tax time, and every year, more and more taxpayers are taking advantage of early-refund programs and electronic filing — and they’re filing onto your lot to pick out their own presents: new vehicles for a new year.
Because this very special time of year offers so much promise, especially in these troubled economic times, you don’t want to leave anything to chance. It’s time to make a list and check it twice! But where to start?
Know your subprime lenders
With the way lenders have come and gone over the past year, you have to reposition your dealership with the kind of lender spread that will allow you to handle any credit challenge that walks through your doors. This is important any time of year, but nothing spoils the post-Christmas spirit like refunding a customer’s down payment. By establishing and maintaining relationships with the right lenders, you’ll ensure delivery on every deal.
One subprime lender that has weathered the storm is Crescent Bank of Metairie, La. Crescent sometimes gets a bad rap for being an equity lender. But having done business with them for many years, I know how to make their program work, and so do their dealer clients. What I like about Crescent’s program is that it gives dealers the chance to talk to a living, breathing buyer who has the ability to actually make decisions. I recently spoke with one of their executives, Jeff Owens, and asked him what they’re doing to get ready for an increased flow of applications.
“Our buyers know that this time of year is not the time to take vacation,” he said. “This is always our busiest time of the year, and we try to make sure our customer service to our dealers does not slip. We’re also making sure that our funding department is ready to go and adequately staffed.”
As with many other aspects of subprime sales, dealers and lenders experience the same highs and lows. Take Jeff’s advice and get ready for an incline!
Stocking up
The next item on your list should be your inventory. Prices on used cars typically go down before the first of the year, then jump back up immediately afterward. Dealers who have the cash to do it should be stocking up on special finance units.
What is the ideal special finance unit? Whatever you can buy! I don’t get stuck on any particular manufacturers when looking for inventory. I want vehicles that I can buy back-of-book for between $7,000 and $10,000. They should be big enough for a family, and they should have some curb appeal and basic power equipment. Compacts, old body styles, and stripped models will make the job of landing a customer on a vehicle much more difficult.
I’m not saying these vehicles don’t ever work, but the days of telling customers you are their only chance of getting approved are over. Even as many of your competitors have shut their doors, the dealers who are left are all in the special finance business, at least to some extent.
Another price group that works well — especially if you do some buy-here, pay-here — is the under-$5,000 actual cash value (ACV) vehicles. These are often hard to find at the auction, but by planning ahead, you can start to hang onto trades that you may otherwise send to wholesale.
Christian Stogner is a sales manager at All Star Automotive in Baton Rouge, La., and he’s been in the game long enough to stay ahead of the annual cycles.
“Every year, around the end of October, we quit wholesaling any vehicle that’s mechanically sound,” he says. “By the time customers start getting their tax money, we usually have 40 to 50 cars that we can sell for cash or hold the note. We’ll run them through the shop, make sure they’re safe, change the oil, give them a good detail and line them up in the cash corral.”
One last thing to remember about inventory is that it’s important to know the demographics of your customer base. If you have a higher-than-average median income walking in, it’s OK to buy units that are a little more expensive. You may still want to stay under $13,000, but statistics show that the majority of lenders are cashing contracts that have a payment around $400 per month, on average.
OK, you have the right lenders and the right inventory; now all you need is customers. So where do you find them?
Mining the market
When tax time comes, it’s extra important to try to think outside the box. You won’t see bigger down payments the rest of the year. Even novice special finance dealers can hang most of this paper. Cindy Christianson, general manager of Herbies Auto Sales in Greeley, Colo., characterizes this time of year as a “treasure hunt.”
“We’re diving deep into our sold customer base,” she says. “Our buy-here, pay-here portfolio is where we try to create our own business and not leave it to chance.”
That’s easy enough for a dealership with the kind of longevity and outstanding customer care that Herbies displays. If I were writing a customer service article, I would spend a lot of time talking about Herbies. But I’m not, so let’s talk about something every dealership can do: Make up some fliers and drop them off at your local tax preparation offices. Offer anybody in the office a spiff if they send someone to you that buys a car.
Another idea is to enlist the help of a tax preparation service in the dealership. Nowhere is this used more effectively than at Seattle’s Pierre Money Mart.
“We’ve been using an online tax preparation service for the last six years,” says Curt Bush, the company’s general manager. “This way, we get first crack at the customer’s refund, even before they do. Starting in December, we advertise this service hard. We offer to pay for the filing. It’s important to remember people can use their last check stub to file for rapid refunds, so you need to be prepared as early as possible.”
Seamless operations
The last item to check off your list is your processes. These are obviously important any time of year, but the holiday season is a good time for a re-evaluation. I recommend doing it every December, so that any changes that need to be made are done before the tax season gets into full swing.
How effective is your lead-handling process? Any leads are good leads as long as they are worked properly. Calling leads early and often ensures contact with the customer. Send e-mails as well, if you have the address. When working third-party leads, a lot of customers will prefer to communicate by e-mail until you’ve established some level of trust.
It’s important to realize the psychology of an Internet lead. Special finance customers are under stress because they’ve been turned down in the past and may still have credit issues. “Stress” can be defined as a force that can distort something’s true shape or form. Customers can lose sight of their objectives.
To get them focused and into a vehicle (and a loan), ask yourself some key questions about your sales process. How are you working customers in the showroom? Are you showing them vehicles first, or are you gathering information upfront? This is especially important if you really want to move the needle in special finance. It is critical that you pre-qualify customers first. You only want to show them vehicles that you both know they can get approved for.
I recommend completing a needs-analysis sheet and a five-line credit application. The salesperson should take this information to the desk with any stips the customer may have on them. While at the desk, ask your customers to fill out a reference sheet. (If nothing else, you’ll get six to 10 references for your database!) The sales manager can pull the bureau and make a credit decision. Then he or she will be in a position to recommend vehicles.