There is a startling way for most dealers to double their business – fire their advertising agencies. Dealerships spend an enormous amount of money on advertising for new customers. Unfortunately, often that money is wasted. The money is wasted because the agencies are strictly placing ad dollars in media and doing production. Often, the ad dollars are spent without any knowledge and use of direct response marketing, and the game plan that will be used towards keeping those customers.
Before you spend one dime on getting new customers, try putting a fence around the ones you’ve got. First define who your active and inactive customers are. Your active customers bought from you and service with you. Nationwide, these active customers only account for an average of 19 percent of your total customer base.
Next, identify who your inactive customers are and begin a campaign to make them active. You may send a cycle of three letters with the same theme. Maybe the first letter is something to the effect of “We Miss You,” the second might be “You Must Have Not Gotten Our First Letter,” the third would be “We Are Sending Out a Search Party.”
Each letter would contain a significant reward and bonus if they become your customer again. It’s not enough to sell them every four or six years; we have to create a continual relationship with contact that encourages and creates servicing and purchasing other goods and services.
Don’t spend one more penny toward new customer acquisition until you have designed an ongoing continuity program to keep them active by rewarding them. You can keep those customers by actively designing an ongoing automated contact and reward system. Don’t buy a Business Development System or a Customer Relationship Manager System and expect this to be a magic button to do this for you.
You must first decide what results you want and work backwards to design the steps to accomplish it. Let’s say that you want to reward your customers and create an ongoing personal relationship. Design a whole year’s worth of contacts based upon a theme or several themes, offers and added value.
Use multiple media to deliver the message, such as postcards, letters, dimensional mail, e-mail, e-mail newsletters, voice broadcast, free recorded messages, special reports, coupons and others. All the media should have what my colleague Nido Quebin calls “Intentional Congruence.” Each choice of media should feed the other and connect the dots between each other. Each department should intentionally feed the other.
Many dealerships contain four or five different businesses within a business, such as new vehicle sales, used vehicle sales, F&I, service, parts, and body shop. Each department in your dealership should have its own marketing messages, tailored to fit its unique services. Try breaking your database down into active, inactive, different departments, different make buyers, different model buyers, different year purchases and more. Segment your database and talk to them differently.
It costs seven times the amount of money to acquire new customers as it does to keep the ones you have. It is also the surest and best way to grow your business exponentially while also insulating your company from so-called bad economies, mistakes from manufacturers and new buyer behaviors and patterns.
When you have designed a system that touches your customer base a minimum of 48 times a year, you can now begin to work on your mass merchandising. Mass merchandising for new customer acquisition is also vital to the health of your company.
I would invite you to think first in ways that cost a lot less dollars. Try creating coupon swaps with other businesses such as dry cleaners, coffee shops, restaurants, car washes, etc. Try creating alliances with other companies where you can do a mailing to each other’s businesses that introduces each other as a trusted source and offers a large inducement to take action.
Think lead generation in your mass media advertising at first. Create a “Free Special Report: Seven Things Everyone Should Know Before They Buy a Vehicle.” Create an e-mail, fax or toll-free telephone line auto-responder system to deliver this report to people who request this from your ads. This will create a two-stage lead generation source that asks potential customers to raise their hand and show interest instead of asking them to make an instant buying decision.
If you use an advertising agency and they are not talking to you about your overall marketing plan that contains elements for your existing customers, lead generation and how to create continuity programs, you should fi re them and get someone who has the correct knowledge of marketing. They should create a plan that creates a healthy and wealthy business for you now and in the future.
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