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How Should I Work with Dealer Rating Sites? 
If I Tell More, Will I Sell More
My last post talked about how dealers can embrace upfront pricing as a way to cut costs across the board, to survive these tough times. This time I’ll address the other side of that coin: increasing sales volume.
As any dealer can attest, it is impossible to “floor” or display every car or truck in inventory. What’s most critical is increasing sales velocity and selling more vehicles more quickly. Yet it is often just as impossible to fulfill every buyer’s ideal choice of car from available inventory. This translates into inventory that fails to turn over. What’s more, cars that aren’t being floored are depreciating by the day and must be financed—resulting in additional “carry costs” for the dealer.
Dealers need to have a sufficient pool of in-market customers to whom they can quickly sell cars, so those cars are not depreciating on their lots.
This is done via access to volume marketing channels. The throttle to making this happen is reaching consumers where they are: online. And, reaching consumers through organizations they already trust, through buying programs with companies that already have an auto-related conversation with their members: insurance companies, credit unions, etc.
Again, committing to the model of upfront pricing becomes crucial. Organizations with buying programs are protective of their brands and their customer relationships. Becoming a “preferred” dealer requires a commitment to excellent pricing and a high-quality customer experience.
Lest you hear “excellent pricing” and think that means smaller margins, keep in mind that a tipping point exists at which it is better to reduce per-vehicle price to realize volume gains. Selling more units for a little less – through channels, like buying programs, which are more efficient and reduce marketing costs – enables dealers to achieve overall higher profits across their operations. These gains are solidified by the fact that moving inventory also reduces carry costs and earns higher factory allocations from manufacturers.
Because of the brand equity and trust they enjoy with their members, these partner organizations can give dealers what they seek: access to the sales volume they need through a trusted portal for reaching online consumers – but dealers must be committed to excellent upfront pricing and a better customer experience.