As states continue to loosen stay-at-home restrictions, will people continue to shop online for vehicles?

What I’m hearing from dealers is that digital retailing tools are a great research platform and the majority of consumers prefer to complete some purchase steps online. But, many  consumers still prefer to complete deals in the traditional way.

This may reflect a lack of comfort with a purely digital experience on the part of some consumers. Another aspect is that most states are not equipped to handle all forms digitally. Florida is just one example of a state where a wet signature is required for tag and title forms.

It may take years for consumers to feel comfortable completing 100 percent of a deal online. And even then, no one knows how long it will take state laws to catch up with a new way of doing business. But, market uncertainties don’t mean you should take a wait-and-see approach. Isn’t it better to get ahead of the curve? 

Digital retailing is an important alternative to offer consumers. Much like dealers offer purchasing alternatives such as financing or leasing. You wouldn’t offer just one financing option, so why offer just one path to purchase?

Your best bet is to offer an integrated omni-channel approach where consumers move effortlessly back and forth between your digital and physical showrooms.  

The first step towards this goal is to make sure your systems all work together. Information needs to move seamlessly between your online retailing tools, CRM and desking tools, so no information is lost and customers never have to fill out the same paperwork more than once.

Seamless information flow also ensures every customer action and interaction are tracked in one location and are accessible to your staff. When a customer poses a question online, or shows up on your showroom floor, everything they’ve done previously is easy to view so you can pick up right where they left off. This saves time, builds trust, and creates a better customer experience.

Transparency and trust are key throughout the entire process, but especially when it comes to calculating payments online. The digital retailing process must offer penny-perfect calculations. The payment seen online must match what’s seen inside the dealership, and it should include state and local taxes and fees, as well as the customer’s credit score in the final price.

Although consumers may say they don’t like negotiating over price, the irony is that the majority do just that when they enter your showroom. That doesn’t make accurate online pricing less important. In fact, it’s just the opposite. A real, viable purchase price builds trust before the customer enters your store and sets the stage for a better customer experience moving forward.

Another key to winning more business is responding to every Internet, email, and text lead within minutes. As I discussed in a previous blog, fast responses win business. If your response time lags due to staff constraints, consider an external BDC to help with overflow and after-hours inquiries.

Pay attention to how your team responds to leads. With so much information now available online, the majority of customers narrow down vehicle choice before they contact your store. These lower-funnel shoppers will likely recoil at a hard sell. They want information and will visit the dealership that answers all of their questions quickly and thoroughly, instead of one that immediately presses for an appointment. 

Timing is everything. Talk of an appointment should only come after every question is answered and rapport developed.

This shift in how customers research vehicles and educate themselves is why many dealerships have carved out new roles such as product specialists and/or digital concierges.  These employees are trained to guide online shoppers from initial contact to contract. Duties may include personally responding to digital retailing leads, controlling deal-making decisions, and strategizing the best deal for each customer.

As our industry prepares for a glut of lease vehicles to hit the market, strategizing the best deal for end-of-lease customers is more important than ever. Set your team up for success with a desking tool that includes solid rates and incentives integrations and allows for the display of multiple different financing and lease options for easy side-by-side comparisons.

Finally, promote your dealership’s modern, integrated purchasing approach. If consumers don’t know about it, how can they take advantage of it? Place digital retailing tools prominently on your website and social sites. Outline the path to purchase, including how customers move from online to in-store seamlessly, and place that on your website. Create multi-channel and targeted marketing campaigns to spread the word to current customers and prospects.

Digital retailing is not a silver bullet. You can’t plug in the tools and expect sales to just roll in. Success comes from shifting traditional lead responses and process, re-thinking some employee roles and wrapping it all in solid in-store processes.  Taking an integrated approach that seamlessly moves between your digital and physical showrooms creates an efficient and convenient customer experience that leads to more sales and loyal customers. 

Are you ready for the glut of lease vehicles about to hit the market?

According to J.D. Power, nearly 2 million vehicles are coming off lease over the next five months. Attracting and selling to end-of-lease customers is a huge opportunity to emerge stronger from the current market downturn.

Competition for these buyers will be fierce. Other dealerships, banks and captive lenders are all going to want a piece of the pie. Aggressive retail programs launched during the quarantine add to the competitive landscape.

It pays to increase your lease portfolio. Customers will likely come back to you for service, and the trade cycle is short. If you deliver a great customer experience, customers will happily return every couple of years to trade up. This means you not only get repeat sales, but also quality used inventory, potentially with a known service history.

We generally see that most dealership lease portfolios are around 5-10 percent of overall business, but you can double or triple that penetration with the following four tactics.

Update your website now with actionable information.

Customers may not be packed in your showroom right now, but you can bet they are researching vehicles online. According to J.D Power, as many as 14 percent of end-of-lease customers are thinking about their next vehicle a year before lease end. Only 3 percent were thinking that far ahead in 2017.

Therefore, now is the time to update your website with details of your lease program. Include options to defer payments and extend or terminate leases.

Out of necessity, car buying and leasing processes have moved online which makes online retailing tools a “must-have.” Implement or improve your digital retailing strategy with tools that are accurate and fully integrated with your CRM, desking, and inventory solutions. This gives the best customer experience, eliminates double entry of data and allows you to control the sales process while migrating some of your process online.

Transparency and trust are crucial to a successful online retail experience. Make sure your tools display penny-perfect calculations with a dynamic payment builder and provide complete information about F&I products and trade-in details. What customers see on deals online, they should see on deals in your store.

When a lead comes in, it’s imperative that you get back to the customer within one hour. As I highlighted in my last blog, companies that respond to a lead within the first hour are 7X more likely to have a meaningful conversation that can lead to a closed deal.

Create targeted marketing campaigns and follow up using your CRM.

Get out in front of prospects and end-of-lease customers with multi-channel, targeted marketing campaigns. When you proactively reach out with a relevant offer, you have a much better shot that customers will work with you instead of a competitor.

Lean on your CRM to segment your customer database. Create targeted lists for current customers who are coming up on the end of a lease or are on track to go over mileage. Another list should be populated with every unclosed lead in the last 90 days. Finally, create a list of customers who purchased a vehicle at least two years ago.

Follow-up is key and the best practice is to make seven calls and five emails per lead over a 30-day period. If that’s too much for your staff to handle, consider pulling in an external BDC for overflow. A trained automotive BDC will ensure proper follow-up and free up your sales team to concentrate on low-funnel opportunities.

Provide lease options to every customer early in the process.

Provide lease and finance options to every single customer early in the sales process. Earlier is always better because the customer has time to process and think about the benefits of leasing compared to financing before they make their final decision.

It’s easy for your sales managers to access lease information if your desking tool is integrated with rates and residuals. The best tools offer grid presentations so you can present up to nine different financing and lease options for side-by-side comparisons. This way, customers can see at a glance which option is right for them.

Another great strategy is to have your sales managers find the “sweet spot,” or lowest profitable lease offer, for potential lease vehicles on your lot. Print out this information for every salesperson to study, and display it prominently on your website. A great deal is hard to pass up. For example, I know a Honda dealership that’s offering a 36-month lease on a 2020 Honda Fit for under $200 a month. That’s a great opportunity to get into a new vehicle for a low monthly price.

Make the customer experience easy.

Customer satisfaction is the key to retention and loyalty. Studies show that the average overall satisfaction score is 862 (on a 1,000-point scale) among mass-market lease customers who leased again with the same brand. Overall satisfaction among lease customers who switched brands is 778.

So, what increases satisfaction? An efficient, fast and personalized experience. Set your dealership apart with tools and processes that help customers during these uncertain times as our economy recovers.

For example, implement technology that allows customers to schedule lease inspections and returns online. Consider creating a BDC leasing team equipped with information and scripts to answer questions about turning in vehicles, the steps to terminate a lease and other details about lease end. Blow your competition out of the water with a program where an employee picks up an end-of-lease vehicle at the customer’s home and leaves a new vehicle for them to test-drive.

Increasing lead penetration rates is a solid strategy to help your dealership succeed now and as business returns to normal. Refresh your website with lease information and online retailing tools, mine your CRM for multi-channel marketing campaigns, train your sales staff to always present a lease option and get creative with new tools and programs that give customers the easy and fast experience they want. Increase your lease portfolio to 40-50% and you’ll have a book of business that is virtually pandemic-proof.

Your dealership likely spends a lot of money each month for internet leads. Are you responding to each lead within minutes? If not, you’re throwing money away.

Fast responses win business. According to a study from the Harvard Business Review, companies that respond to a lead within the first hour are 7X more likely to qualify that lead (defined as having a meaningful conversation with a decision maker) than those who respond even an hour later.

Those who respond within an hour are 60X more likely to qualify a lead than companies that wait 24 hours.

As showroom visits decrease due to social distancing, internet inquiries are a crucial part of your business. The same is true of emails and texts. Responding to all leads in real time is critical to your success.

Ready to speed up your response time and deliver a better customer experience? Implement the following strategies.

Capitalize on every lead with BDC services that track inside your CRM.

An experienced automotive BDC is your best bet to ensure every lead is followed-up quickly and completely. Leaning on your BDC also frees up sales and service staff so they can focus on low-funnel opportunities.

Make sure your BDC is tracking all activity in your CRM to manage leads more effectively and provide an integrated customer experience. 

Many dealers prefer using internal BDCs so they can control leads and processes. But an internal BDC can be expensive in today’s circumstances and you’re typically not getting after-hours coverage. Going with an external BDC, or taking a hybrid approach, helps with overflow and after-hours inquiries, particularly in times where showroom visits are slower.

Outsourcing to a virtual BDC is not a silver bullet, but an additional tool to improve the experience customers have with your dealership.

Respond faster with texting.

All customers want information fast. So, how do you ensure your leads are getting the information they want at the speed they require?

Don’t sleep on text messaging. Texting is faster than a phone call and on average results in 78 percent higher open rates than email.

More than 90 percent of texts are read within three minutes of being received. It’s an excellent form of real-time, two-way, contactless conversation.

Texting is an efficient way for sales to stay connected to customers, but it’s just as helpful in your service department. It’s a fast way to send status updates, respond to inquiries, and get approval on service work – all while techs stay in their bays getting more done in less time.

It is a bad business practice to allow personnel to conduct any dealership business on their personal phones, which are not tied to your CRM. You can’t capture conversations, review texts for training purposes, or monitor what employees are really doing if they’re using their personal phones. An employee may look busy, but is that a customer exchange or a chat with a friend?

The high turnover in the auto industry also means you’re risking that employees will take valuable customer information with them if they decide to leave your dealership.

The easiest way to mitigate risk is to purchase business-only mobile devices for employees that tie into your CRM. You incur upfront costs, but those pale in comparison to safeguarding customer data and conversations. 

Customize communications.

Customers practicing social distancing are turning to phone, text, email, and digital retailing tools to interact with your dealership. Though they may not be in your showroom, they still expect a personal and efficient experience.

A personal interaction strategy makes customers and leads feel seen, heard, and valued. Ensuring your CRM has the tools to customize communication to each customer’s preference means happier buyers.

For example, if a customer sends a lead through your digital retailing tools, don’t pick up the phone and give them a call. They’ve indicated they want to work with you online. Calling them may make them feel pressured and turn them off to working with your dealership.

The more data you have, the more personal and targeted you can make your communications. Take advantage of advanced CRM functionality to aggregate, view, and analyze all customer data in one place. Then tailor follow-up processes to an individual buyer’s wants and needs. This gives you a much better chance of keeping customers happy and buying from your dealership.

Examine current Internet lead performance.

When sales staff don’t follow best practices, leads get dropped or never enter your CRM. Take advantage of the current drop in customer demand to do a benchmark audit of the health of your processes.

Take a look at your CRM sales data for the month before our current disruption hit (when business was still “normal”).  Benchmark your data against the industry standard that for every 100 leads, 40 percent should set an appointment. Of those 40 people, 50 percent should show up. Of those that show up, 50 percent should buy. That nets you a 10 percent closing ratio. The other five percent of buyers submit information online and show up at the dealership without setting an appointment.

Check employee contact reports if you are not hitting these benchmarks. Employees should make seven calls and send five emails per lead over a 30-day period to achieve these numbers. If they’re not, it’s an opportunity for coaching and improving your team.

When demand returns, keep an eye on those benchmarks. Still not hitting the right numbers? Consider adding an outsourced BDC or take the hybrid approach mentioned above. Dedicating more of the heavy lifting to a BDC can reduce your inquiry handling times up to 40 percent and ensure customers receive fast, quality responses.

It’s more important than ever to evaluate how fast you’re providing information to customers, especially internet inquiries. The shift away from in-person interactions may continue after this change in climate subsides, so take the time now to examine your processes and analyze your operations. Updating and modernizing your business means you will hit the ground running when demand surges back.

Good selling!

Various industry studies show over 80 percent of customers want to start the car buying process online. So, it makes sense that more dealerships are implementing digital retailing tools.

Today’s customers expect an Amazon-like online shopping experience that is connected, seamless and easy. If your digital retailing tools and process don’t deliver, customers will choose another dealership that can accommodate their needs.

The right experience is more important today as people distance themselves from each other to stay healthy. If proven valuable, the big shift away from physical stores to online shopping and buying may continue after health concerns pass.

It’s important to note that just having online shopping tools doesn’t guarantee success. Are the following three digital retailing mistakes costing you money? Now is a crucial time to evaluate your processes to ensure you are providing the online experience customers want.

Mistake #1: Implementing inadequate shopping tools.

Your digital retailing experience should allow shoppers to build a deal online that reflects a realistic car-buying scenario. Essential tools include penny-perfect payment calculations that include taxes and real lender programs, accurate trade-in valuations, credit app submission, and F&I product information and pricing.

It doesn’t do any good if customers have to repeat what they’ve done online when they enter your store. The online and in-store experience must be seamlessly connected or your customers will get frustrated with the inefficiency. Synchronizing your digital experience with your showroom CRM, desking software and a complete set of integrated shopping tools delivers the fast, connected experience that is crucial to winning online business.

Mistake #2: Running the same old sales model.

Digital shoppers need nurturing, not a hard sell. That’s because they are much further down the sales funnel than traditional Internet customers. When they call your dealership or send an email, they’re often looking for more information on their vehicle of interest.

Running the same old sales model of pushing for the appointment before providing the information requested or answering every customer question signals your dealership is aggressive or hard to work with. This can make customers eliminate your dealership from consideration.

To win sales, focus on rapport and building a relationship. Two new sales models will help you do this.

In the first, a sales manager handles every aspect of the deal from start to finish - including F&I. In the second, a product specialist nurtures the customer until he or she is ready to come into the dealership; then, a manager takes over in-store and transacts the deal in one sitting.

Both of these models respect and honor the work customers have already done online and limit the number of transfers between salespeople. They also make it easy and comfortable for customers to transition from online to in-store for a faster and more convenient experience.

Mistake #3: Limiting your knowledge of customers.

Creating rapport and relationships is difficult when salespeople have a limited view of what a customer needs and wants.

That’s why flexible shopping intelligence technology is gaining speed as dealerships use it to maintain a 360-degree view of each customer’s overall online browsing behavior inside the CRM.

With shopping intelligence tools, you’ll know what vehicles your prospects and customers are looking at and on which sites they are shopping in real time. And when you know what they’re searching for as they’re searching for it, you can communicate smarter.

A better understanding of the customer’s challenges or needs enables salespeople to stay in touch at key points in the customer lifecycle. You will have insight as to which vehicles the shopper is researching. This means you can deliver the perfect message – for example, a list of similar vehicles that the customer is searching for - at the perfect time for better results.

Ultimately, digital retailing is a powerful channel for selling more vehicles – if you do it right. Avoid these three common mistakes to create an experience that is connected, seamless and easy. As shopping behaviors change due to health concerns, you’ll be prepared for digital customers and your bottom-line will reflect that.

Good selling!

In our digital world, it can be easy to discredit direct mail – but that’s a mistake.

According to the Direct Marketing Association, direct mail has a response rate of up to five percent versus just under one percent for digital.

That makes sense when you consider that it’s not unusual for the average person to receive 300 emails a day, half of which they delete without even opening. On the flip side, the average person may receive only three pieces of actual mail a day, all of which they at least scan.

After all, people don’t take half of the mail out of their mailbox and throw it away without even scanning it. There could be a bill in there!

Mail may still end up in the garbage or recycling bin. But at least your customers see it and process the message. Here are three reasons why you should still involve direct mail in your marketing mix.

Direct mail is a team player.

Every great marketing strategy uses multiple channels. In a digital strategy, you can’t just run Google ads and call it a day. Similarly, direct mail is a great team player to combine with digital, phone campaigns and BDC follow-up.

Consider this example of a large dealer group in New York. They ran two separate sales campaigns and saw very different results.

In the first, 4,500 Kia store customers received a direct mail offer followed-up with a live call from its BDC. In the second, 6,500 Nissan store customers received a direct mail offer with no BDC follow-up.

The Kia store sold 158 cars. The Nissan store sold 116. The Kia store saw a 36 percent increase in sales simply by combining direct mail with live calls.

That’s the power of multi-channel marketing. The direct mail gets you in front of customers. The BDC follow-up spurs them to act.

Direct mail is a relationship-marketing tool.

Your dealership likely spends a lot of time emailing and calling customers, which are both very viable methods of communication. But sometimes customers get tired of one particular channel. Direct mail is a great way to surprise them with something different so they actually read and digest what you’re sending.

Remember that everyone at least glances at their mail. A customer who has a relationship with you will be even more likely to read a letter or postcard. After all, it could be important information about a recall or service issue. In this way, direct mail keeps you front-of-mind.

Just like with other channels, it doesn’t make sense to send the same mail to every customer. Irrelevant messages lead to frustration with and distrust of your dealership.

Use your CRM to create targeted lists and create a message for each customer segment. For example, a customer coming up on a lease end would be a good target for information about newer vehicles of the same make and model. A customer coming up on 50,000 miles will look more closely at an offer for shocks and struts.

A final thought:  It costs your dealership up to five times more to acquire a new customer than retain one you already have. Same with retention - it’s more than 350 percent more profitable to sell to an existing customer than a new one.

Direct mail is a great way to nurture existing relationships to create lifelong customers.

Direct mail is tangible.

Email may be easy to send, but it’s also easy to ignore. Direct mail is tangible. Customers actually hold it in their hands and scan it.

According to research company Mailmen, the average household keep advertising mail for 17 days. They may tack coupons to the fridge or leave a pile on the kitchen counter where everyone in the family has plenty of time to review it and act on it. 

Unlike emails that get deleted or filed away somewhere never to be seen again, direct mail has a great shelf life.  Households see it and hold onto relevant offers and information. You’re marketing the driveway with one piece of mail, instead of multiple emails and/or phone calls.

Every time a customer walks by the fridge or counter, they see your dealership name and branding. What could be better for keeping you top-of-mind?

Direct mail is dead? Don’t believe the hype. In our age of digital overload, it’s more alive than ever. Add direct mail into your marketing mix to help retain customers, increase the shelf-life of your advertising and keep your brand top-of-mind.

Good selling!

We all know new leads are important and you always want to keep that pipeline full. But attracting new customers is expensive, and making more money while spending less is something that every business wants to do.

What if I told you that you could save both time and money by nurturing the relationships you already have in your CRM?

Research suggests you should spend only 20% of your time acquiring new leads, and spend the other 80% nurturing your existing relationships.

Mining your CRM for unclosed leads, customers with equity in their vehicles, or sold customers who did not convert to service - your biggest profit center - is a huge opportunity to increase profitability while keeping customer acquisition costs down.

These three strategies will help you properly utilize the data and reports in your CRM to profit from the relationships you already have.

Target and market unclosed leads.

Unclosed leads are a reality for every dealer, and success winning business sometimes depends on how you plan to handle them long-term.  To take these opportunities from leads to customers, you have to re-engage them on a regular basis with messages that intrigue them or make them want to take action. Use advanced search functions in your CRM to create a list of every unclosed lead in the last 90 days, then create personal, targeted marketing messages based on where the customer was in the buying cycle when you last engaged.

What good are your email campaigns if no one is reading them? Untargeted email open rates are only in the teens, whereas you’ll get an open rate of around 30 percent if you personalize those messages. Using targeted marketing messaging lowers your costs, increases customer engagement and ensures relevancy so customers open your emails.

Leverage the power of multi-channel marketing by following up with a phone call. If your salespeople don’t have the time to properly execute phone campaigns, engaging an external BDC is a no-brainer. It takes an average of four attempts to get a hold of a customer. Stressed out salespeople will give up after a call or two, but a dedicated BDC will stay the course until the call connects.

Finally, continue to market to customers who opted to buy a car at another dealership or who purchased with you but aren’t using your service center. They are not lost opportunities. Stay in touch with service specials, seasonal tips, holiday greetings, etc. Even though you may have lost one deal, they’ll have automotive needs in the future and you have the opportunity to become their go-to “car guy” just by staying in touch and providing value.

Create an equity mining strategy.

I’ve written about equity mining a lot, and for good reason: it’s a proven way to earn more sales while sourcing the pre-owned vehicles you need.  And these are leads you already have a relationship with inside your database.

When combined with a strong BDC, equity mining delivers an ROI of 10 to 1. In other words, for every $1,000 you spend, you get $10,000 back. Not a bad investment, right?

But like any investment, you must have a solid strategy to succeed. You need to dedicate one salesperson to your equity mining efforts. Have them look for customers in a position of equity, or those coming up on the end of a lease or loan, with a vehicle that your dealership needs. It could be beneficial to also post a used car manager in your service drive to provide immediate vehicle valuations and proof of incentives to trade up.

Set clear parameters for eligible prospects. For example, a customer who hasn’t purchased a vehicle in at least two years, or a customer coming up at the end of a lease. Don’t bark up the wrong tree and call a customer who bought within the last 12 months to encourage a trade-in.

Remember to highlight the benefits of trading up to good prospects , and offer service coupons or other incentives to sweeten the deal.

Get to know your customers better.

Technology has advanced to track a customer’s online behavior and we can now use shopping intelligence to make relevant purchase suggestions. Customers are conditioned to this level of personal engagement from companies like Apple and Amazon, and they now expect it from your dealership.

Flexible CRM tracking technology allows you to maintain a 360-degree view of each customer so you can engage at the right time with the right message to meet their specific needs. When you know what they’re considering buying, you can send them information on that vehicle, as well as additional, similar options before they reach out to competitors.

You can receive alerts within your CRM when the customer performs relevant activity, like researching vehicles on your website or a third-party site. Think of it as digital breadcrumbs that allow you to follow where a customer is in the buying cycle.

All of this data is aggregated in your CRM so you have one centralized location to view and analyze a customer’s profile. These insights enable you to develop a strategy for salespeople to stay in touch at key points with relevant messages. Customers feel more seen, heard, valued, and happier. And you increase your chances of closing deals faster.

To grow your business from within your CRM, remember to target and market unclosed leads, identify and nurture equity mining prospects, and get to know your customers better so you’re there to meet their needs and wants. These three strategies will help you profit from the opportunities and relationships you already have, instead of buying more leads.  

Good selling!

The vehicle sales forecast for 2020 looks strong, with S&P Global Ratings expect sales to hit a relatively healthy 16.8 million units. But earning your share of this market depends a lot on how well you manage your inventory: what you stock, when you stock it and how quickly you can get vehicles off your lot. The following inventory strategies will set you up for a profitable New Year.

Clear out the old and bring in the new.

Don’t waste valuable floor space with aging 2019 models. Establish programs, processes, incentives and aggressive targeted marketing to push out the old and make way for the new. Used advanced search functions in your CRM to create a targeted list of customers who purchased a vehicle at least two years ago and make another list of every unclosed lead in the last 90 days. Send a mailer or email and follow up with a BDC call to net up to a 24 percent higher ROI, according to CJG Digital Marketing. 

Lean on your inventory management solution to identify your best new vehicle sellers so you don’t overload your floor. Your solution should also offer real-time updates and market data so you can easily manage your inventory and price vehicles correctly.

Create a pre-owned stocking plan.

Focus on stocking the top 10 vehicles that move fast and have maximum profitability. To be successful at this, you must also pay attention to seasonality. For example, a 2x4 pick-up in the north won’t sell in the winter but in the south, those trucks sell all year long.

We all know vehicles are a depreciating asset. You lose money when you buy the wrong car, overpay for the right car, price vehicles too high for your market or fail to retail every unit in a predetermined time frame. Lean on your inventory management tool and market analytics to avoid these common pitfalls that cost you money.

Eliminate pre-owned “lemons.”

Every dealer has pre-owned vehicles that don’t move and become a liability. Investigate why they aren’t selling. Is the car dirty? Is there an odd smell? Is it stuck in the back of your lot with no visibility? Or is the dealership down the road offering better pricing? Solve whatever problems you can and then market aggressively. Your CRM should match current inventory to customers searching now – or in the past – for similar vehicles. Use that information to send out targeted marketing.

If a car still doesn’t move, cut your losses and sell at auction before you’re in a position of negative equity. Most importantly: Learn from these lemons. If a vehicle doesn’t move or bring in profit, don’t buy it again. Eliminate the problem up front so you don’t end up in the same situation again.

Stock strategically.

Sourcing pre-owned vehicles has become more difficult for dealers with companies like Carvana scooping up a lot of stock. Be very selective at auctions and get aggressive in your store to win trade-ins.

Equity mining is a smart way to get the vehicles you need at a cheaper price than at auction. When combined with a strong BDC, equity mining is a proven strategy that delivers an ROI of 10 to 1. In other words, for every $1,000 spent, you get $10,000 back.

Equity mining in your service lane is an especially sound strategy. After all, you see cars there all day long. You know the cars you service, the problems they have, and their service history. There are no condition surprises and no transportation costs. The benefits here are twofold – you acquire an inexpensive pre-owned vehicle, plus you move the customer into a new vehicle, giving you a sale.

Keep in mind that to reap the benefits, equity mining cannot be a part-time job. You should have a dedicated salesperson who understands what makes a customer a good prospect. A scattershot approach to boost sales at the end of the month will likely only alienate your best service customers, so make sure you implement a solid strategy to keep the process moving all month long. 

This new decade holds a lot of potential for dealers. Set yourself up with a sound inventory strategy now and reap the benefits all year – and decade – long.

Good Selling!

Instead of staying tethered to your cushy swivel chair, Bill Wittenmyer encourages managers to make it a point to wander a bit throughout the day to spot issues with your team.

Digital retail opens new possibilities and responsibilities for engaging with today's connected car shopper. As Bill Wittenmyer explains, being the "Go-To" person for your customers using digital retail is more important now than ever.

As Bill Wittenmyer says "Change your words and you'll change the result." Setting yourself up for success starts with eliminating words from your vocabulary that remove doubt that you will produce.