Imagine allocating only 15% of your marketing budget to newspaper, print, online, and radio. And not advertising any payments or price on those ads. Not only that, you encourage people to shop your number and give them a “Car Buying Guide” explaining the best way to approach an auto dealership. Now invest the other 85% spent on sponsorships, donations, and gifting. Do you think your traffic would increase or decrease? Do you think the quality of that traffic would be stronger or weaker?

In the fall of 2016, we modeled this approach and are on our way to the strongest retail sales year that we’ve had in the 32-year history of the company. What we’ve done is simply invested 85% of our advertising and marketing budget back into the very people that came here to experience our dealership and purchase our product. We re-invest the money into buying their 4H Steers, sponsoring their curling bonspiels, hockey and baseball tournaments, donating to important causes in the area, and the biggest change was we started sending personalized gifts to our clients after they purchased. We paid close attention to what their hobbies were and based our gift off of that information. We also sent hand written custom thank you notes. Here’s an example of one that we did recently.

A client of ours needed a pre-owned SUV, and we happened to have what he was looking for in stock. You couldn’t help but notice the San Jose Sharks Hoodie, Key Chain and hat he was wearing, clearly a fan. At this time, the Sharks were on their way to the NHL Playoffs. After he picked up his vehicle, I immediately went online and ordered him a new Sharks Hoodie and Hat. The way we customized it for him was we put his nickname on his hat and hoodie, “Casper”. When he received it in the mail, he was beside himself. It was completely unexpected but it made him feel important and valued. No matter how big your budget is on marketing, that feeling can’t be bought. We felt great for doing it, and he felt great for receiving it. A win/win. We don’t have our logo on our gifts anywhere at all. We focus on gifts that the client will value and ideally see every day. We do gifts like custom cutting boards where we get the family name engraved on them and the clients will love them so much, they’ll have them set up in their kitchen on display which leads to a great conversation piece at dinner with friends and family. People are often shocked that a dealership would pay this much attention to detail. In an automated society, now more than ever, it’s important to have a personal touch because people will value the extra little effort you put in.

Running cheesy gimmicks in an attempt to get clients in the door is easy and requires virtually no skill set. Plus, the vast majority of dealers are constantly promoting some sort of gimmick ad to get their floor traffic up, so if you’re doing your advertising this way, how are you separating yourself from the competition? From what I’ve experienced in the past, free hot tubs, big screen TV’s, “free” trips (they usually require the client paying a registration fee that they weren’t informed about), may have got us some people in the door but the quality of the client was low and thus our profits were low as well. The end result being, a lot of work and money for a low R.O.I. and retention rate.

We asked ourselves, what if we approached advertising from a completely different perspective. What if we encouraged clients to shop our numbers and gave them a guideline on how to purchase our product? I’ll give you an example. We ran a full page color ad in a few newspapers and advertised on our local radio stations about a “Car Buying Guide” which gave a guideline for clients on how to purchase a vehicle. The ad included shopping our number with 2 other competitive dealerships, asking the right questions when at the dealership and on the test drive, and helping the client be as prepared as possible before they got to the dealership or even made first contact with their Salesperson. The response to this ad was exceptional. In what should have been our slowest 2 months of the year (January and February), we exceeded expectations and crushed our goals by 68%. Clients are going to shop you anyway, we all know that, but the majority of businesses seem to be naïve and would rather blow a bunch of money and hope that people come in the door with speculative marketing. What we found the result by changing our approach to advertising is higher traffic, higher quality clients, higher retention rate, and the referrals were starting to flood in. Ultimately, the client respected our honest approach and started telling friends and family about our company.

When you see an ad in the newspaper for a vehicle, what do you typically see? Low Payments, Huge Savings, Payments as low as, Prices have been slashed, etc. The information is the same with every dealership but with different colors or pictures, the message is the exact same. We found that by creating an image for our dealership and promoting why we are in business completely separated us from the competition and made people take notice. Although I believe there is certainly a time and place, it’s now extremely rare for us to advertise prices in print or radio. Our focus has shifted to informing the public about why we come to work every day and creating a culture that they would want to be a part of. People don’t buy initially based off price, they buy off emotion, connection with your business, the overall experience, the product and then the price.

By focusing on our core values and advertising them freely, it has undoubtedly been the driving factor behind our company’s success as of late and will continue to be moving forward. Our advertising budget has decreased but our business has increased and we have the numbers to prove it. We’ve increased our new Retail Sales Volume from 134 in 2013 to 216 by the end of our fiscal year in 2016. The client acquisition cost at our dealership is an estimated 75% lower than our direct competitors.

I would encourage you to take a serious look at taking a different approach with your advertising moving forward. You tell your employees about your vision and what type of culture you want within the dealership, so why not tell that to the public rather than simulating what the vast majority of other dealerships are advertising which is “the lowest price”. Price became less of an objection after we stopped advertising it. Weird eh?