My best friend in high school was a wild and crazy guy who lived the last 20 years of his life in Key West, Florida. He often used the saying “Don’t panic and never follow the crowd,” when it came to evacuating the area to avoid approaching hurricanes. He never left Key West when the news media started their “run for cover” broadcasts.
Advertising is and will always be the great mystery of the automobile business. It didn’t get easier with the advent of the world-wide web, that is for sure. If anything, it has further complicated it.
Even with the sophisticated tracking of Internet leads, it’s still no piece of cake to figure out what works and what doesn’t.
When industry leaders such as Mike Jackson of AutoNation make comments in Automotive News that they are pulling away from third party leads then it creates a panic in the industry and some will say “Well, if it’s good enough for AutoNation, it’s good enough for me.”
But is it? AutoNation operates over 200 dealerships. They have an economy of scale that most of us can only dream about. When you have those numbers you can exercise experiments and do things that are impossible for a single or small group of stores to do.
There’s no argument that the power of the Internet is here to stay. Customers will sit right in your showroom and shop another dealer on their phone or iPad. Driving all over town is a thing of the past. Who remembers those days of finding newspaper ads lying in the front seat of a customer’s car as you did the trade appraisal? Not so much anymore.
When I hear dealers talking about dropping third party lead providers due to cost or the perceived lack of leads, the first thing that comes to mind is how powerful is your exposure on those sites? Generally I find several things:
1. You’re not stocking what the market wants. Maybe it’s time to re-evaluate how and what you stock?
2. Over-pricing, not market competitive. In many cases the worst person to price your used car inventory is the used car manager. They are often prejudiced because they either appraised or purchased the unit.
3. Infrequent price changes. In some cases units haven’t been re-priced for 30 to 45 days. Did I say the used car manager was the worst person to do the pricing? They have too many things to do to be able to keep your pricing up to date.
4. Lousy photos. If 80 to 90% of all people who shop for a used car shop the Internet how do you think you can be competitive by taking photos outside? You are shooting yourself in the foot by not having a photo booth.
So, before you jump on the Mike Jackson panic bandwagon let me suggest you take a hard look at those things you can actually control.
And always remember, “Don’t panic and never follow the crowd.” That’s all I’m gonna say, Tommy Gibbs