Summer car sales are always important for auto dealerships’ annual results, and dealers have long depended on traditional summer car sales events, including always-popular Labor Day tentpole end of summer car sales events. 

However, there’s never been a summer quite like 2020 promises to be thanks to COVID-19 disruptions. Dealers need to combine tried-and-true with brand-new to capture as much auto market share as possible in an unprecedented summer car sales environment.

A big piece of that is pent-up demand. Americans have always shopped heavily for cars in the summer, but even with the expected decline in year-over-year car sales figures, this summer will see an unusual amount of pent-up vehicle demand hitting the market. Millions of consumers who had to postpone planned purchases thanks to family financial disruptions, closed dealerships and paused OEM production will be re-entering the market this summer.

In this blog post, we share a summer car sales guide of best practices for 2020, broken down into some topical themes:

– Capturing the bargain-hunting car shopper

– Prioritizing pre-owned

– Adapting to the “new normal”

Being Ready For Bargain Hunters

Car shoppers are coming back. We’ve noted recently that an AutoTrader study found 9 in 10 new vehicle shoppers believe this is the best time to get a good deal on a new car. Now, the benchmark University of Michigan consumer confidence survey finds that consumers are continuing to become more optimistic, with their view of current economic conditions improving 6.7% between May and June and their expectations for the economy increasing by 10.9% in the same short period. While both figures are still down notably from 2019, this rapid improvement in consumer sentiment suggests that car shoppers won’t be the missing factor in 2020’s summer car sales figures.

All the same, we should anticipate many shoppers will be deeply price-sensitive and searching for summer clearance car sales. Widespread job losses played a significant role in this: According to Pew Research, the U.S. unemployment rate skyrocketed from one of the lowest on record in February to the highest unemployment the nation has seen since the end of World War II just two months later in April. 

All told, more than 38 million Americans filed for unemployment as a result of COVID-19.  Auto dealers’ F&I teams need to be sensitive to this reality and make sure they’re up-to-date on lenders’ programs designed to work with consumers who had short-term job losses or other income limitations.

Bargain-hunting shoppers are also going to be sensitive to OEM programs, even as many of them begin to sunset or decrease in scope. Ensure that your sales and F&I teams are on top of what’s happening with your OEM(s) in terms of production, changing product mixes, captive finance options and other relevant news.

Prepare to Profit From Pre-Owned

One of the biggest auto industry themes in the wake of COVID-19 is the massive changes affecting the pre-owned vehicle market. For many dealers, the end-of-year bottom line for 2020 will depend on how well they can effectively leverage the changing used car marketplace to drive pre-owned summer car sales profits. 

In today’s environment, pre-owned profitability depends on centralizing customer and inventory data, simplifying marketing and sales processes and focusing on improving net profits through ROI gains. For more insights on these topics that you can use to improve your summer car sales profitability, see Mastermind’s whitepaper on the subject.

Adapting Your Dealership for the “2020 Normal”

You may have strategies that have served your auto dealership well in the past, such as summer clearance car sales or Labor Day sales events. In this most unusual of years, it’s critical that you re-evaluate what you’ve done in the past to ensure you’re connecting with shoppers how, when and where it will make the most difference in this new environment.

For instance, many dealers traditionally schedule marketing and sales pushes around tax time in April to connect with shoppers who have IRS refund checks in hand. But for 2020, Tax Day has been pushed back to July 15. While many taxpayers who expected refunds have already filed their taxes and received their refund checks, many others will procrastinate to the last minute out of habit and will be good targets for personalized marketing outreach. This year, Tax Day can be a summer car sales event.

Additionally, as many Americans begin to resume daily driving in the summer, business will begin to pick up on your service drive. Have you made sure your dealership’s service drive experience has been fine-tuned to provide an excellent customer experience in the wake of COVID-19 and that you’ve given it the structure and tools to play a critical role in loyalty sales and service-not-sold conquest?

Finally, it’s not just your customers who require some new thinking – your employees are dealing with the “new normal” as well. Is your team comfortable and ready to go? Do they feel safe in your auto dealership? Are they successfully executing a comprehensive reopening plan?

The state of the automotive finance market, like the rest of the automotive industry, is one of upheaval and complexity. The good news is the automotive industry is beginning to rebound, and car shoppers are returning to auto dealerships.

While a shifting marketplace adds complications for dealers who are trying to get their doors all the way open and their people back to work, it also creates opportunities to make up lost ground elsewhere by making gains in F&I in the new environment.

In this blog post, we’ll explore these opportunities and assess the state of the automotive finance market in 2020, including:

• – How consumers are re-entering the automotive finance market

• – What the shifting balance between new and pre-owned sales means for the automotive finance industry

• – What changing consumer shopping behavior means for online automotive financing

The Car Buyer Come Back

Predictions that consumers had largely only paused their car shopping, rather than cancelled their purchase plans, appear to be holding true as shoppers began returning to auto dealerships in May. According to Google, consumer search interest for “is it a good time to buy a car?” was nine times higher in March and April of 2020 than it had been in January and February.

Rising consumer interest appears to be driven by generous manufacturer incentives, including zero-percent financing. In fact, a recent study by AutoTrader found 9 out of 10 new vehicle shoppers believe right now is the best time to get a good deal on a new car. 

However, many of the most generous OEM programs are expected to sunset soon, as the lack of new-vehicle inventory limits their usefulness. That will put the onus of delivering attractive automotive financing back on dealerships, highlighting the importance of having an F&I team connected directly to your new and used sales teams and making a firm financing offer part of the car sales process.

Before the pandemic, affordability was consumers’ greatest concern. Widespread layoffs, furloughs, salary cuts and other household economic shocks have made that an even more immediate issue for many shoppers. Prioritize proactive F&I involvement in the early stages of the car sales process, starting with your first marketing touchpoints.

Using Used Cars to Grow F&I Profits

The pre-owned market will increase in importance for the rest of 2020 thanks to a combination of OEM production disruptions, increased used-vehicle supply from massive rental car defleeting and consumers being more cautious with their spending. That means dealers must ensure they’re taking pre-owned automotive financing more seriously than ever before.

According to NADA’s annual surveys, dealers have been making steady progress at capturing pre-owned automotive finance business, growing their used F&I market penetration share from 54.5% in 2010 to 77.8% today. That’s approaching the 80-90% average figure for new vehicle F&I that has been the benchmark for the past decade and beyond, and it’s a reason why F&I gross as a percentage of all pre-owned sales is up industry-wide almost 25% from 2010.

To capitalize on current automotive finance trends, focus on marketing F&I products such as extended warranties and wrap coverage to offer price-conscious consumers longer term peace of mind. 

Putting Automotive Financing Online

While three-quarters of pre-owned sales were financed through dealer F&I in 2019, that doesn’t mean 2020 will follow suit. That trend was already being challenged by the growth of online shopping. A 2019 FICO study found that 28% of consumers plan to apply for automotive financing online for their next car purchase, while 32% plan to visit a financial institution and 40% plan to use the dealership. 

Since then, the COVID-19 pandemic has pushed many consumers into new comfort zones of handling more and larger transactions online, as well as limiting the appeal of physically going to a bank or credit union to take out an auto loan. 

This highlights the importance of making sure your “digital dealership” prominently includes automotive financing options. Ensure your dealership’s BDC is prepared with the tools and information needed to seamlessly connect customers to your F&I team. Consider ways to simplify and improve the digital F&I experience, such as offering options like e-signing or video chats for customer interviews. 

Getting your car dealership’s digital retailing process up-to-speed may require investing in new dealership solutions, but in today’s highly competitive market, the potential benefits can’t be ignored. A study by NADA found F&I profits rose 58% on new vehicles in April compared to February among respondents with a digital retailing process, versus 35% at dealerships that didn’t offer digital retailing. 

There haven’t been many years in history where the auto industry outlook has gone through such wild swings as 2020. Auto industry trends – and especially auto industry sales trends – have been thrown into disarray by broader societal factors.

This makes predicting the rest of 2020 a difficult challenge, but one that dealers need to closely follow and consider as they plan their own operations for the remainder of the year. There are new opportunities in the evolving automotive marketplace for dealers prepared to take advantage of them. 

In this blog post, we look at some of the big questions surrounding auto industry trends in 2020, including:

• – What are the industry-wide predictions for new vehicle manufacturing and sales numbers in 2020?

• – How is the COVID-19 pandemic changing automotive consumer behavior and preferences?

• – What do these auto industry trends mean for dealers?

Finding Silver Linings in Auto Sales Outlooks

It’s not news to dealers that shocks to both consumer demand and manufacturer supply have driven auto industry sales downward, creating a challenging auto industry future outlook for the rest of 2020.

In April, IHS Markit released a global light vehicle sales and production forecast for 2020, predicting a 22% drop in sales across the worldwide industry from 2019 levels, with a 26.7% drop in North America alone. While this is obviously not news dealers want to hear, the worst seems to be behind us, with a 47.9% SAAR decrease in sales in April improving to a 29.8% deficit in May. This same trend applies to service drive profits, with major auto groups reporting some improvement in service profits in May as compared to April and March.   

Adapting to Vehicle Inventory Challenges

That current auto sales decline is tied into a predicted 19.6 million vehicle decline in global manufacturing from 2019’s 88.9 million vehicle production total. In North America, that production decline was on full display in April, as OEMs built just 4,840 new vehicles. 

By now, most automakers have gotten at least partly back to work, with automakers like GM and Ford cancelling their annual summer shutdowns in an effort to make up lost production efforts. However, new vehicles are still slow to trickle into dealer showrooms, creating inventory challenges for dealers as customers try to take advantage of attractive 0% financing options.  

This auto industry trend comes at the same time as used vehicles are flooding used car lots from rental car companies impacted by COVID-19 closures. These newer and lower-mileage cars entering the marketplace are creating an attractive opportunity for dealers as defleeted vehicles usually have low reconditioning costs and can be a source of solid profits while the new vehicle pipeline refills.

Looking at the Bigger Picture of US Auto Sales Trends

The larger reality is many U.S. auto industry trends in 2020 are the result of broader societal trends related to how and where people are working – and how they’re getting around. For instance, at various points over the past few months, public transit ridership has been reported to be down 90% in New York City, 70% in Los Angeles, more than two-thirds in Salt Lake City and Seattle, more than 50% in the Tampa Bay area and Indianapolis and 25% in Houston. The question for the auto industry's future outlook is how many of those riders will return to transit, and how many will instead purchase cars to meet their mobility needs.

The U.S. Centers for Disease Control and Prevention is currently adding to the complexity of this issue. The CDC has released guidance that suggests workers drive themselves to work rather than take transit or carpool as the safest mode of commuting.

Changing Consumer Car Buying Behavior 

Beyond where and how much Americans drive, it remains to be seen how the pandemic will change Americans’ product preferences, but some trends are beginning to arise. 

While much of the news surrounding U.S. auto sales is grim, the reality is there are still going to be millions of consumers in the marketplace for a new or used car. Many consumers only postponed their shopping during stay-at-home orders, and as cities and states begin to reopen their economies those shoppers are broadly going to be re-enter the marketplace.

However, they may not make the same purchase decisions as they would have before the pandemic. Lost income and lagging economic uncertainty are leading to changes in car buying behaviors. For instance, a Cox Automotive survey finds that 31% of buyers have reconsidered their preferred vehicle body style due to COVID-19, citing better gas mileage as the leading influential factor. These same economic limitations are ushering some customers into the pre-owned market who otherwise would have been shopping for new vehicles. 

These changes in automotive consumer behavior spell big opportunities for auto sales conquesting efforts in the coming weeks. According to data from IHS Markit, 9 million nomadic households, defined as shoppers who have no meaningful brand or dealer loyalty, will be in-market for a new car in 2020, but dealers need to act fast to take advantage of these opportunities.

What This Means For Dealers

If 2020 has taught us anything, it’s the degree to which even the best and most thoughtful auto industry trend predictions can be upended by the reality of the next morning’s headlines. This creates obvious challenges for car dealerships trying to make plans for their business and devote resources to the future.

One immediate step dealers need to take is investing time, effort and resources in building a customer experience-focused dealership culture supported by tools and capabilities that allow your people to be as efficient and effective as possible. Is your marketing based on data and real-time insights that predict consumer behavior, or are you just “spraying and praying?” Does your dealership reporting give you the insights you need to be an effective manager and leader? Are your digital tools up to the demand of being the new “front door” of your sales operation? Have you connected your service department to sales and are you effectively marketing your service drive to increase your service conquest leads? Does your F&I experience make your customers more or less likely to want to do business with you?

Rather than betting on one auto industry trend, dealers have the opportunity to focus on what they can control by ensuring they have the fundamentals in place that will carry them through whatever the future may hold. 

Fact: conquest auto sales help dealers hit sales targets at the end of the month. That’s never been truer than right now, as the unprecedented disruptions to new and used vehicle supply and to consumer demand have dealers scrambling to identify and connect with every possible quality prospect they can find.

However, conquest auto sales are a double-edged sword. Just as you’re trying to conquest your competitors’ customers, they’re doing the same to you. There are a lot of nuances to consider, but with the right conquest marketing strategy, there is tremendous opportunity for conquest sales – beyond hitting end-of-month numbers.

In this blog post, we discuss:

• – Identifying and attracting “nomadic” car shoppers

• – What the changing used car marketplace means for conquest opportunities

• – Connecting the dealership service drive to the showroom floor

• – Turning conquest customers into loyal customers

Creating a Home for the Nomadic Shopper

“Nomadic” consumers are car shoppers who have no meaningful brand or dealer loyalty and jump from brand to brand when buying a car. Even with brand loyalty at an all-time high, these nomadic consumers are still a powerful force in the marketplace. According to data from IHS Markit, 9 million nomadic households will be in-market for a new car in 2020 – more than brand loyalist and “super-loyalist” households combined. 

This is why knowing the unique car buying factors that drive nomadic buyers’ car buying  decisions is critical. In general, nomadic shoppers are heavily price-sensitive, which means they are a critical audience for leveraging your OEM incentives. This is where analytics-driven predictive conquest marketing is an incredibly powerful tool, thanks to its ability to factor in the specific offers your dealership has available and identify the consumers most likely to respond to what you have to offer at any given time. 

Using the Used Car Marketplace for Conquest

The massive changes in the used car marketplace have an impact on both new and used conquest auto sales. Even before Hertz filed for bankruptcy and increased the likelihood it would sell off more of its fleet, auto rental companies and other major fleets were going through an unprecedented defleeting that flooded the used car marketplace. As a result, J.D. Power predicts that used vehicle prices could drop by 7% before recovering this summer, depending on what happens with the broader economy.

But with an increase in supply comes a potential increase in demand. Tens of millions of American households have experienced unemployment during the COVID-19 crisis, with almost 41 million unemployment claims filed across the country. While almost all these job losses are expected to be temporary, the combination of economic uncertainty and the supply disruptions to OEM new vehicle manufacturing will push many would-be new vehicle shoppers to consider pre-owned options in their next purchase cycle.

This is where having your predictive conquest marketing tools connected not only to your new vehicle sales operations but also to your pre-owned inventory and DMS will pay dividends. 

Used conquest auto sales are even more heavily product-driven than new, as they’re powered by the specific inventory you have on the lot and your ability to quickly identify high-quality prospects and touch them with an actionable offer for a specific vehicle. Leverage your DMS, CRM and dealership sales platform to identify prospects likely to be in the market for a used vehicle, and structure an offer that takes advantage of OEM CPO programs, financing terms and your dealership’s available inventory. 

Driving Conquest Leads Through the Dealership Service Drive

Service-not-sold conquest auto sales leads have always been valuable to dealerships, but there are a few broad trends that suggest dealership service conquest will only continue to grow in importance. One is that the average age of vehicles on the road continues to increase, meaning consumers are even more likely to have the service drive, not the showroom door, be their entry point to a dealership. 

We find the most effective service conquest operations typically dedicate a salesperson to prospecting their upcoming service appointments for sales leads, engaging them with personalized offers to trade-in their vehicle or similar offers. 

Turning Conquest Customers into Loyalty Customers

Conquest marketing will be integral to maintaining market share and accelerating recovery throughout the remainder of the pandemic and beyond. However, as you focus on capturing consumers returning to the market, you must also protect your current customer base against competitors trying to do the same. 

The evidence is clear that a dealership customer experience (CX) strategy is your most powerful tool for building customer loyalty and protecting against conquest losses. Simply put, when you know your customers’ needs and deliver great CX, they are much more likely to stay loyal even in the face of aggressive competitive conquest efforts.

In our previous blog on personalized marketing , we discussed the basics of what personalized marketing is, what types of personalized marketing capabilities are available for dealerships and how we use big data at Mastermind to help dealers understand and target consumers. We also provided a case study of how this all works in a real-world dealership.

This post serves as a “part two” of that narrative, diving deeper into the complex topic of personalized marketing and why it’s more important than ever for auto sales after COVID-19 disruptions. In this post, we’ll discuss: 

– The importance of personalization in the increasingly digital automotive customer experience

• – How to effectively personalize your entire car sales process

• – How personalization helps your dealership’s bottom line

The Importance of Personalization in Dealership Marketing

Fact: By the time today’s auto buyers get to the dealership, much of their shopping is already over and done with. 

Even before the COVID-19 pandemic, consumers were increasingly doing their auto shopping online. In 2019, according to Cox Automotive, consumers spent 61 percent of their time online while auto shopping, compared to just 20 percent of their time at the purchase dealer and 14 percent at other dealers.

As consumers increasingly opt for shopping online over in-person, personalized customer experiences delivered by brands like Amazon have become the norm. The more shopping someone does online, the more touchpoints and data points they create to help you identify and understand their wants and needs – if you have access to that data and the tools to turn data into actionable insights. 

Effective personalization in digital marketing is dependent on high quality data. Ensure your dealership’s customer insights can be collected and analyzed in a single environment, integrating data from your CMS and DMS to identify customers in the early stages of their car buying journey so you can tailor your outreach.

Not all marketing is digital. That’s the point of personalized marketing – some consumers are digital-first, and others are not. Your job as a marketer and salesperson is to ensure you’re connecting with them through the most effective channels for that specific car buyer at the right time to maximize engagement. 

This becomes even more critical as dealerships compete for few higher quality auto sales leads in the post-pandemic market. Your marketing efforts need to account for the myriad facts impacting consumer buying behaviors to create a cadence that is sensitive to concerns and entices consumer engagements. At its core, personalized marketing is customer-driven marketing. 

Personalizing Your Entire Auto Sales Process

Effective personalized marketing becomes personal selling if you manage the interaction between marketing and sales functions effectively. Today’s car buyers don’t want just a great deal – they want a great dealership experience and want to feel comfortable during a post-pandemic time where they may not feel comfortable with other things happening in their lives.

This is where dealership marketing support and an automotive marketing platform such as Market EyeQ makes a huge difference by creating a seamless transition between marketing and sales, arming the salesperson with the same insights that powered the personalized marketing campaign that turned the consumer into a prospect in the first place. 

By utilizing predictive analytics to offer personalized customer recommendations, dealers can create a car sales experience that is centered around their customer’s individual wants, building off that first touch point.

This approach goes beyond the sales department. The most effective personalized marketing campaigns have a strong F&I component, with a targeted and actionable offer based on household financial data and other factors. With affordability continuing to play a huge role in auto shoppers’ decisions, personalized F&I needs to be an integral part of your dealership’s marketing and sales process.

Benefiting Your Bottom Line

In our interactions with auto dealers all over the country and in every kind of market, we see a consistent competitive advantage for dealers who have meaningfully integrated personalized marketing into their dealership as part of an overall customer experience-focused strategy and culture.

Dealers who have embraced this business model have more and better auto sales leads, spend less money on ineffective marketing campaigns, generate more leads with their personalized marketing touchpoints and are more effective at closing both new and used car sales. 

They also increase loyalty retention rates, capture market share through service-not-sold conquest and are even increasing service drive revenues.

When you reduce your auto lead generation costs, decrease your marketing spend, increase your marketing campaign’s effectiveness and improve your sales closure rate, the results will show up in your bottom line. That’s why the average spend-per-car-sale with Mastermind is $115, versus $624 for the auto industry as a whole. 

As we’ve discussed before, digital analytics have changed the traditional balance of quality versus quantity in auto sales leads. Automating the auto lead generation and analysis process means dealers can focus solely on the best car sales leads without wasting time on prospects who aren’t ready to buy.

However, digitizing car sales lead generation has never replaced the need for skilled marketing and salespeople in an auto dealership. This is truer today than ever before but making the most of those auto leads right now requires that marketing and sales teams understand and effectively engage their marketplace, customers and the economy.

In this blog post, we’ll cover: 

• - Understanding what the COVID-19 crisis has done to the broader economy

• - Adapting to the realities of your local marketplace

• - Personalizing your marketing and sales for each individual prospect

• Understand and Adapt to the Current Economy

  A new car sales lead doesn’t live in a vacuum. It’s part of a broader economy, and making the most of your car sale leads requires your marketing and sales teams to be engaged and thoughtful in how they factor broader economic influences into how they work their car sales leads and interact with prospects.

  Most importantly, the U.S. economy just had its single biggest one-month increase in unemployment since the federal government started tracking those figures after World War II, jumping from 4.4% to 14.7% in April. A total of 23.1 million Americans are out of work, and a historic low of just 51.3% of Americans of all ages are working right now.

  The bright side of this massive economic downtown is almost all those job losses are categorized as temporary. The U.S. Bureau of Labor Statistics expects 18.1 million workers to get their jobs back at some point, compared to only two million who have permanently lost their positions due to the crisis.

  The obvious impact of this current reality on car sales lead generation and management is that individuals or households who would have been high-quality leads two months ago may suddenly not be today. But they may revert to one of your best auto leads in just a few short months. 

  This is a driving factor for why consumer research is finding that while many consumers are planning on delaying a new or pre-owned car purchase, few are cancelling their plans altogether. Your marketing and sales efforts should factor this in and combine a cadence that is sensitive to consumer concerns with offers designed to alleviate uncertainty and entice action sooner rather than later.

  Know Your Market

  There’s always been a tremendous amount of diversity in dealers’ businesses across the country, but the variation in infection rates and different policy responses to COVID-19 have created even more differences between what challenges dealers face and what options they have to address those challenges. 

  For instance, a dealer in urban Michigan, with more than 45,000 confirmed cases and an unemployment rate over 21%, will have a different marketplace than one in rural Montana, a state with fewer than 500 reported cases and where 20 of the state’s 56 counties have yet to report a diagnosed infection. Those two dealers cannot and should not interact the same with a new car sales lead.

  In addition to practical factors such as limitations on dealer operations and higher unemployment rates in states with stronger stay-at-home orders, auto dealers also need to recognize the different cultural impact that COVID-19 has had and ensure their marketing and sales engagement is respectful of regional cultural variations. For instance, consumers in hard-hit communities where it is common to have lost friends or family to the disease are going to be understandably more sensitive to messaging that implies the pandemic has created a great opportunity for them to save money. 

  Personalize Your Marketing, Nurture Your Leads

  Your marketing and sales efforts cannot presume that what was true about your dealership’s prospects two months ago is still true today – or that their current challenges are disqualifying in the long term. Even households that get back to work are going to be impacted by three to six months of unemployment or underemployment. 

  As an example, a new car sales lead may suddenly become a pre-owned sales lead. With economic uncertainty ahead, the glut of de-fleeted used vehicles on the market and the disruption to new vehicle manufacturing by OEMs, many consumers may choose to purchase pre-owned rather than new. This will require your car dealership to seamlessly transition those prospects between new and used sales teams to maintain a consistent dealership customer experience. 

  Another way to personalize your sales cycle – and not waste resources on car sales leads that have suddenly become ice-cold – is to encourage your sales teams to learn more about where their prospects fit into the broader recovery. 

  In general, states that have limited economic activity for public health reasons are planning on reopening on an industry-by-industry basis, which means workers in some industries will generally be waiting longer than others to go back to work. A new car sales lead employed in the tourism industry, at an airline or at a concert venue is more likely to postpone or downgrade their purchase plans than someone in road construction, agriculture or another essential business.

  In the coming weeks, the quantity of quality auto sales leads may potentially decrease, which means it’s more incumbent than ever for auto dealers to make the most out of every valuable sales lead. This requires taking a data-driven approach at lead generation and qualification and continuing to use those customer insights to nurture leads and deliver a deeply personalized customer experience. 

  If you’re struggling with adapting your lead generation process to the current environment, please contact us. We’re here to help.

It’s challenging in the best of times for dealers to keep sales and service connected. When large portions of your auto dealership are operating virtually, it’s even more complicated – but critically important. 

When operating as a virtual car dealership, possibly with your sales staff at home and your fixed ops team on-site serving customers, how do you keep them connected, delivering consistent customer service and taking advantage of opportunities to create value together?

As auto dealership operations continue to change due to the COVID-19 pandemic, we’ve shared numerous dealership tips and considerations, spanning from virtual dealership best practices and what your dealership’s BDC needs to be doing differently, to improving customer experience in the service drive and preparing to kickstart auto sales after the immediate disruptions end. 

Your ability to utilize these best practices inside your dealership hinges on one critical consideration: Ensuring your entire organization stays connected and your teams can support each other, wherever they may be.

In this blog post, we share how to keep the two key engines of your dealership, sales and service, connected and engaged by:

• - Working from the same information and insights

- Communicating effectively

• - Strategically managing the change process in your dealership

Common Systems, Common Experience

One critical question to ask yourself is whether your dealership’s sales and service teams are interacting with the same customer, and if so, are they on the same page? Does information and insights about the customer consistently flow back and forth between your teams and your systems, ensuring there’s a consistent customer experience no matter where they might be in the dealership? This requires you to ensure your DMS and CMS, sales platform and other dealership tools are all integrated effectively. 

We’ve talked before about how critical service drives are to the customer relationship, especially for generating auto sales prospects through building loyalty relationships or starting new ones through service-not-sold conquest. In the current virtual car dealership sales environment, it’s more important than ever that the service department’s interactions with customers be captured effectively and that you have the systems in place for your sales team to turn service interactions into high-quality sales leads.

One way many high-performing auto dealerships keep their sales and service teams connected is by dedicating a salesperson to service conquest. This salesperson’s sole role would be to use your dealership sales platform to identify and engage with high-quality service-to-sales prospects with scheduled service appointments. Now is an excellent time to consider creating that position and getting that person to work on mining what will likely be your auto dealership’s best source of sales leads for the foreseeable future.

Shoot, Move & Communicate

It’s not enough for your sales and service team members to be doing their individual jobs well. If your people are not communicating effectively with each other, your dealership’s customer service and bottom line will suffer.

The U.S. Army’s basic training manual boils down the myriad responsibilities of soldiers in combat into the deceptively simple phrase, “Shoot, move and communicate.” Whether it’s with fellow squad mates, their leadership or supporting units, military trainers hammer home the fundamental truth that communication is critical to mission success. The same is true for the teams in your dealership.

In the current environment, people have turned to a wide variety of communications tools to stay connected to friends, family, coworkers, customers and others. The challenge for a dealership manager is not that there aren’t enough communication tools. Rather, the issue is often that there are too many options, and many of them operate outside your auto dealership’s control, which means they do not engage with your CMS, DMS or other systems.

While operating remotely or as a virtual car dealership, it’s critical that as a leader, you emphasize the importance of your sales and service teams communicating effectively through the channels and processes you identify and manage on their behalf. 

Make effective communication a regular topic of discussion with your teams and highlight best practices with praise or other more tangible rewards. The goal is to both show and tell your sales and service teams that their ability to deliver on customer experience expectations in the current dealership environment is dependent on not letting physical distance interfere with effective communication.

Manage Change – Don’t Be Managed By It

If there were ever a time for what business schools call “change management,” this is it. Making significant process changes without a clear definition of what you’re changing and why runs the risk of not being successful – or even causing more problems than it solves.

In fact, researchers report that three-quarters of corporate change efforts fail to meet their goals, or end up abandoned altogether. 

This shouldn’t dissuade you from the critical effort of looking at the ways in which your service and sales teams usually interact and then defining how those processes must change to meet the needs of the current environment. 

This should be both a top-down review by leadership, as well as bottom-up from the people in the trenches who are trying to make things work. Even if you’re certain that you know exactly what needs to change and how, you’ll have a much stronger acceptance of change if your teams feel a sense of ownership in the process.

Once you’ve identified what needs to change to strengthen the connection between sales and service or in other areas of your auto dealership, the next step is to define exactly how those processes will change. Make sure you can draw a straight line between what you learned from your review about what needs to be done differently and how the changes you’re making address those identified issues. All too often, once organizations start contemplating making changes, the instinct is to make huge changes, or more changes than are needed. It’s easy to fall victim to “scope creep” by trying to change everything all at once. 

For the best chance of success in your efforts to improve the connection between sales and service, you must be able to define what you’re trying to accomplish, explain what you’re changing (including how and why) and then be able to identify when you’ve accomplished that original goal.

Most importantly, don’t get discouraged. Change isn’t immediate. Things go wrong, and it’s easy to get skeptical and frustrated or bail out too early. This is why Harvard Business School professor Rosabeth Moss Kanter, one of the world’s leading experts on how businesses can successfully reinvent themselves and their operations, coined “Kanter’s Law” – “Everything looks like a failure in the middle.” 

Keep being thoughtful, keep communicating, keep listening to what your team has to say and keep focused on what you’re doing to ensure the best customer experience possible – particularly when customers move through the service-to-sales process.

If we can help you work through the best path forward for your dealership, please contact us.

Despite uncertainty over the exact details of how the automotive industry will respond to and recover from the current public health crisis, one certainty is that digital retailing currently is, and will continue to be in the future, more important than ever for auto dealers.

Whether it’s simply a question of unexpectedly accelerating the existing automotive digital retailing transition or driving more dramatic changes in the automotive industry (such as encouraging more customers to skip the dealership visit altogether through OEM delivery programs), the automotive retail marketplace will almost certainly take a dramatic digital shift in the aftermath of the COVID-19 crisis. Dealers need to consider where their own challenges and opportunities lie in the months and years to come. 

In this post, we share insights into COVID-19’s impact on automotive retail trends, including:

• - Auto sales trends post COVID-19 disruption patterns in Asia
• - The rise of home delivery of new vehicles during and after the pandemic
• - Choosing the right automotive digital retailing solutions for success

Accelerating the Online Dealership Transition

One early sign that the COVID-19 crisis may have accelerated preexisting digital retail trends is seen in Asian countries that have recently begun to reopen closed sectors of the economy. 

In China, shoppers didn’t come back the instant the country’s automotive retail showrooms reopened. In the first week China’s dealers reopened their doors for sales and service, showroom traffic and parts and service department revenues averaged roughly two-thirds of normal levels. 

According to J.D. Power, U.S. auto sales markets had already begun to fall by as much as 80% in March, even in states that were allowing car dealerships to remain open. Consumers clearly are not relying solely on government guidelines when making the decision to visit their local auto dealership, and that is likely to continue in the future when states begin making the decision to reopen.

With buyers potentially hesitant to return to in-person car buying experiences, dealers must be ready to identify and engage consumers in a sales process that is largely online-based if they are going to compete in what could be a dramatically tighter sales market for the duration of 2020 and beyond.

Eliminate the Auto Showroom? 

Many automakers and dealers have launched or reinvigorated programs for home delivery of new vehicles during the pandemic – and it’s likely that at least some of those programs will continue in the aftermath. 

Automakers aren’t alone in this. Home delivery services are exploding in popularity across the country, including products like cars that had largely been retail-only and alcohol. 

While many consumers may take every opportunity to leave their homes in the immediate aftermath of lockdown orders being lifted, in the long term it’s likely that at least some will have gotten in the habit of moving every component of a traditional retail transaction (except product delivery) online.

For dealers, this means making your participation in your OEM’s delivery program something you’re planning on doing in the long term, rather than just doing in the interim.  when there are social distancing orders in place. It should involve considering how you have it staffed and managed, what metrics you’re watching, how your customer experience culture should inform and interact with those services, how you integrate it into your dealership’s loyalty marketing program and much more.

Forward-looking dealers can also take investments in delivery programs and use them in concert with data-driven loyalty and conquest marketing programs. If your analytics identify consumers who are likely to be in the market for essentially the same vehicle, consider proactively offering them a hassle-free delivery as part of the offer. This may not only work for loyalty customers, but also as a potential conquest option for customers who may have moved into your market or do not have an existing dealer relationship with your brand.

Review and Update Existing Investments for Digital Retail

Dealers have invested in a variety of capabilities to be as effective as possible in their digital retailing efforts – from strategic investments in Business Development Centers and predictive analytics tools, to tactical efforts to keep up with technologies, such as voice search or video trends. 

This is a good time to look at what investments you’ve already made and consider whether you’re getting the most out of them. Additionally, this is the right time to look at whether those tools and technologies you put in place a few years ago have kept up with the state of the technological art. 

You may not want to incur new IT costs or other investments right now, but the auto sales market is likely about to enter one of its more challenging periods in years. Hamstringing your ability to compete with outmoded automotive digital retailing solutions is a recipe for disaster. Dealers who proactively adapt to changing automotive retail trends will be better equipped to not only survive but thrive during COVID-19 disruptions and beyond. 

If you’re taking this opportunity to review your automotive digital retailing capabilities and are interested in what Mastermind’s predictive marketing sales platform has to offer, contact us for a free virtual demonstration.

It can be hard to figure out how to motivate employees in a business environment with so much uncertainty and so many challenges. As a leader, it’s easy to put all your focus on the practical day-to-day issues or on the bottom-line numbers, making it tough to prioritize something that may seem non-critical, like your dealership’s employee morale. 

“It’s a crisis,” it’s easy to think. “Nobody’s happy. Everyone needs to rally together and get the job done.” But falling prey to that mindset would be incredibly harmful to your dealership’s culture, its ability to deliver for your customers…and ultimately for your bottom line. 

We’ve talked in the past, in simpler times, about the importance of employee happiness to employee motivation, and by extension to your dealership’s ability to deliver a great customer experience. Keeping your dealership’s employees positive and motivated to do great work is a business-critical responsibility for a leader in any set of circumstances, and it becomes even more important in a crisis. 

With employee morale at its most fragile, dealership leaders need to be doing more than ever to ensure their team is motivated and ready to respond to challenges – and take advantage of opportunities. In this post, we share three tips for motivating dealership employees during COVID-19 disruptions, including:

• - Leading by example

- Creating a positive dealership environment 

• - Instilling a sense of trust in your team amid uncertainty

Lead by Positive Example

Frankly, you may be so stressed out and worried that you don’t know whether you have it in you to be a beacon of positivity for your team. That’s understandable, and you’re certainly not alone. But employee motivation stalls in the face of uncertainty, frustration or pessimism – and there’s no faster way for your employees to pick up those performance-killing conditions than if that’s what you’re broadcasting to them.

Positivity in the workplace starts at the top. So does negativity. It’s critical for you as a dealership leader in this kind of environment to focus on what can be accomplished rather than what can’t; to talk about what’s going right rather than what’s going wrong; to celebrate successes rather than obsess over failures.

To do this effectively, commit to highlighting the things you can be positive or optimistic about. With so much of the news focused on what’s going wrong, it’s easy to miss the opportunities. 

In the spirit of sharing our own positivity about the current environment and the future, here are some positive things to consider about the auto industry:

• Yes, the auto market is down and will likely be for some time. But people still need cars, they still need dealers to sell them those cars and they’re going to want to interact with dealers who demonstrate a genuine care for them in the current environment. They’re going to buy their car from somebody, so it should be you – not your competitor.
   

• There are a lot of customers out there who need your support through tough times. They may need to change their purchase intent from new to used, and they may need to lower their payments or figure out what to do with their lease. You can help people who need it right now by assisting them in making the right decision for their current situation. Doing that well and with empathy is something you should be proud of. You’re making a real difference.
   

• Changes to the used car marketplace are creating a huge opportunity for entrepreneurial and agile dealers to identify, engage with and close used car prospects. This is a new and unexpected opportunity that’s grown out of industry upheaval – and whichever dealers get ahead of it first  will be the ones who benefit. Get excited about this opportunity and share that excitement with your team.

Share the Good

There’s an old saying: “Happiness shared is happiness multiplied.” It’s important to remember that employee morale is a combination of both individual happiness and collective interaction. Your leadership should encompass both one-on-one and collective efforts to motivate your team.

From a practical perspective, this means you should intentionally create opportunities for your employees to share their positive stories or good news, whether those bright spots are work-related or otherwise. The more your people can share the happy things in their lives, the happier they will make both themselves and others. 

There’s even science behind this: Researchers have found that while there’s emotional value to spending time considering the positive things in your life, the greatest benefit to your happiness comes from sharing those positive experiences with other people. 

Take the time to find opportunities to be positive together as a team. You’ll be (literally) happy you did.

Trust Your People

Fortunately, as a leader you have one very powerful tool in your control to help your dealership employees maintain positivity in the face of uncertainty and unforeseen challenges: Trust. 

Trust and empower your employees to solve the problems they’re faced with on a day-to-day basis. Also, this is a great opportunity to ask for their input and advice on how to deal with the broader challenges your dealership is facing. This will not only boost employee morale but may also present ideas and opportunities you never would have considered. 

As one Harvard Business Review article put it, “When people are able to participate in making decisions that directly impact their work, their sense of ownership, and therefore engagement, increases.”

Your people want to do their jobs well. Empowering them to do that is one of the most powerful things you can do as a leader and one of the best ways to motivate employees to do great work, regardless of the circumstances.

Interested in learning more about how Mastermind’s training or solutions could contribute to your efforts to maintain a positive dealership culture? Contact us today.

Hey Siri, OK Google, Alexa – tell me, how can my dealership successfully market to prospects who are using voice search to shop for a new car?

Compare that sentence with the way you’d normally type a query into a search engine to find that same information and you’ll start to understand how much dealership websites and other digital content needs to change to be effective in the world of voice search. 

What you may not realize is how much we already live in that world – or at least, how much your prospective customers already do. Whether your dealership successfully engages with them is going to depend on how well you prepare for a voice search-driven future by reviewing, updating and expanding your dealership’s online content. 

Dealers know the number of prospects reaching them through mobile devices has exploded in recent years – in 2018, Google noted that the number of mobile searches for brand-specific “SUV models” had grown by more than 90 percent since 2016. That’s a core component of the automotive shopping experience today for consumers.

The next step for consumers is moving from typing “SUV models” into their phone to simply asking the phone for information on those models, and that’s already starting to happen: Google reports more than a quarter of the world’s online population is using voice search right now on their mobile devices. 

These searches will either connect with content on your website and drive those shoppers to you, or they won’t. The more voice searches that do connect, the more business you’ll be doing as a result. How much more business? Gartner, for one, predicts that brands that redesign their websites to support visual and voice search by 2021 will increase their digital commerce revenue by 30 percent.

In this post, we discuss how dealers can prepare for voice search marketing by first answering:

• - What is voice search and why is it important to dealerships?

• - How will voice search change the automotive industry and the car buying journey?

• - What are some ways automotive dealerships can prepare and optimize for voice search?

What is voice search? Why is it important to car dealerships?

When you search for information by speaking to Siri, the Google Assistant, Alexa or some other app, that’s voice search. While the search engines and algorithms that underpin the process are roughly the same, the way the queries are framed and presented to users have significant differences that can be critical to dealerships attempting to engage online car buyers. .

With regards to the query, people don’t format voice searches the way they often do with relatively old-fashioned text queries typed into search engines. Instead, they simply ask a question, such as “How much does a new Mercedes A-Class cost?” or “Where is the closest Lexus dealer to me?” or “What is the trade-in value on my 2012 Ford Focus?”

In return, the search engines look for trustworthy web content that answers the user’s question as closely as possible. If the user asks, “How much does a new Mercedes A-Class cost?” then the voice assistant is going to be searching for a web page that has the equivalent of, “A new Mercedes-Benz A-Class costs $33,000” and directing the user to that page – and that page alone.

This means dealers looking to have users directed to their website need to review their web content and look for opportunities to either replace or add to existing content that does not present important information in full sentences to answer potential questions. 

It’s also important to understand that while text search engine results present the user with a list of highest-rated results, voice search on mobile or on an assistant such as Amazon’s Alexa or a Google Home device will frequently only give the user the top-rated result. These devices are becoming increasingly common parts of shoppers’ everyday lives, with more than one in ten Wi-Fi enabled homes in the country hosting a “smart speaker” device.

This places a massive priority on dealership search engine optimization (SEO) for the local market – if you’re not the top-rated result for common searches referencing your local city or region, then shoppers are heading directly to your competitors. 

How will voice search change the automotive industry and the car buying journey?

Potential car buyers will be heading to those competitors more and more frequently because voice search is becoming an increasingly common method of shopping online.

It’s no secret that online research has quickly become a standard component of the automotive shopping journey. According to Google, 92 percent of car buyers research online before they buy. 

In response, dealers have adapted. They’ve transitioned resources from traditional advertising into digital channels, they’ve invested in tools such as Market EyeQ’s predictive marketing solutions and auto dealer software to engage with consumers in their area, they’ve built out Business Development Centers (BDCs) to lead their online engagement efforts and more.

But the combination of technological innovation and increased integration of online resources into virtually every facet of our lives means dealers can’t sit back and consider their digital evolution to be complete. Voice search is the next adaptation dealers need to embrace if they want to continue to meet consumer expectations, as it’s a different way of connecting with potential buyers that comes with its own requirements and opportunities.

How to Optimize Your Dealership for Voice Search

1. Audit Your Site: The most basic method of preparing and optimizing your dealership for voice search is to review your website’s design and structure to ensure that critical content is presented in plain language that answers the kinds of questions your key prospects might be asking. This means avoiding presenting key information in images, in sentence fragments, in tables or other formats that a search engine cannot return as a result to a natural-language voice search.

2. Create FAQ Pages: A great tool for engaging with voice search is the classic “Frequently Asked Questions,” or FAQ, page. When you’re looking to host content that asks potential questions that are commonly asked in voice search by car shoppers, a page designed to answer frequently asked questions is extremely well suited to fill that role. Consider creating multiple FAQ pages on your website that ask and answer questions a voice-searching shopper might ask, including not only brand, product and price but also F&I, service, body shop and other fixed ops and more.

3. Optimize for Local Search: Focus your voice search optimization efforts on geographic market localization, using both site coding and references to your local municipalities and region – including common nicknames – to increase the potential that your site is the top response to shoppers searching for local dealers in their community.\

4. Implement Schema: One way to support your dealership’s local search efforts is to make sure your web developers are using what’s called “schema” on your site. Schema are behind-the-scenes tags and structures that help search engines understand what your site is about and what it does – everything from automatically identifying it as an auto dealer to search engines to helping define the price range of your vehicles, what geographic areas you serve, what brands you offer, whether you have staff fluent in foreign languages and much more. 

Schemas are critical to helping search engines position your site in response to questions like “Where is the closest Buick dealership to me right now?” or “What local auto dealers are open after 6 p.m. on Thursday?”

1. Evaluate Your Speakable Content: In addition to the previous schemas,, Google is developing tools that allow web developers to identify content on their pages that is most suited for playback in a voice search response or other text-to-speech usage. Make sure your web team is up to date on these and other tools that are designed to improve your website’s performance in a voice search environment, as search engines will often prioritize sites that have been optimized in this manner over those that have not.

Car shoppers asking their phones to answer questions is only one way the automotive sales environment and dealership marketing landscape are evolving. It’s important for dealers to have an auto sales platform and marketing partner that is leading the way into that future, helping position you to take advantage of new digital opportunities and separate the trends of the moment from the best practices of the future.

If you’d like to learn more about what Mastermind is doing to help dealerships like yours thrive in the evolving automotive marketplace, contact us to set up a free demo.