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From: Jared Hamilton
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Allen Levenson

Allen Levenson VP Sales & Marketing

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Direct Mail Has Changed But It’s Never Going Away

7bab138088423de74663e687366c9f3c.jpg?t=1Direct mail might seem like an outdated and out of fashion marketing tactic, but dealers using it effectively are having the last laugh: consistently reporting an average of thirteen incremental new car sales per month by targeting customers who are “in-equity” in their current vehicle.

 

A recent study of over 200 US dealerships using personalized direct mail for strategic, targeted campaigns showed that, with a minimal spend and little hands-on work by dealership personnel, dealers are experiencing huge ROI – moving customers into new vehicles with little or no out-of-pocket spend and getting great trade-ins as a result.

It’s important to understand how best to find those customers who are “in-equity” – you can’t simply rely on length of ownership as customers are often upside down in their vehicles, instead it’s important to do extensive database mining to find those customers who’s cars are worth more than they owe, despite how long they’ve owned it.

All the dealers in this study used a full-service, turnkey equity marketing solution that initiates customer contact with personalized, targeted direct mail – followed by email and calls from salespeople. And the impact was huge.

The targeted direct mail campaigns that deliver the strongest results were customized to focus on the specific needs of the dealer. For example, a “Year-End Clearance Event” helped move end-of-year overstock; or campaigns focused on moving a certain model; and, if a dealer was looking to fill up their lots with certain used vehicles, campaigns would target these specifically.

The results were an average cost per sale of just $112 per new vehicle sold – far less than any other marketing channel. And the huge benefit is that by communicating these offers, you keep your current customers close and don’t lose them to other dealerships.

Targeted, direct mail to in-equity customers works because the messages are personalized and customers are provided a “go shopping” amount that they can immediately put to use. And, because you’re talking to current customers, gross profits end up being much higher than that of a first-time customer – averaging $422 more per vehicle.

Isn’t now a good time to reconsider direct mail in your marketing mix?

 

Grant Gooley
Great data and info! I laugh when I hear "Direct Mail/Print is dead". Here is the funny thing... Mailboxes aren't going anywhere, so either is MAIL! The second everyone jumps on the "Print is dead" bandwagon.. That gives everyone else a lot more breathing room to send people stuff. It's not going away EVER. I will say this though... It has a big brother (digital) that cannot be ignored! In fact when you p[air the 2 together, they go really nice :)
Lezlie Brannan
Grant, I'm fine if the dealers around me think that direct mail is dead. ;)
Alyson Sharron
Great article, Allen! I completely agree that direct mail - when done right - can be extremely effective. Especially when it's part of a targeted, coordinated multi-channel strategy. Just like any other media, the key to success is targeting the right audience at the right time with a relevant message.
Tony Wood
I believe we are using a company called Omni. We've had sporadic success. Some of our mailers blow the doors off and others just flop entirely. I know that the last mailer we sent out actually went out AFTER the deadline on the mailer. Not sure what that's all about. Other than that though, it'd hadn't been too bad.
Eric Mercado
Consistency is Key Tony. A well developed strategy should yield consistent success every month and an overall great ROI when the year ends on all direct marketing dollars invested. If your Cost Per Unit sold isn't under $360 everytime.. they are guessing. Private message me if you want a free market summary that will identify the highest-propensity prospects in your PMA. No Charge.. great advice. Eric Mercado VP of Business Dev. Force Marketing

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