Are you a dealer who’s tired of chasing customers who only want the bottom dollar and don’t seem to value loyalty?
Are you a General Manager who feels like you’re spending more and more on advertising but getting less and less in return on your investment?
Are you a sales manager who has given up on finding quality sales people who will stay at your store longer than six months?
I have a solution that will help with all three challenges. But before I share it, let’s examine what’s happening in these areas and how it’s causing your dealership to lose money.
Challenge # 1 – Lack of customer loyalty
Customers are becoming less and less loyal and shop around for the best deal.
This lack of customer loyalty has many negative consequences for dealerships. If there is no attachment to the business’ mission, all a business has is transactional relationships. A purchase is a commodity, not a relationship. It becomes a race to the bottom to win business and many dealerships are losing the price war.
Challenge # 2 – Growing ad budgets with fewer visible results
The cost to attract a buyer using traditional advertising and marketing is climbing, while bringing in the cheapest buyer. In addition, every $10,000 spent on advertising cannot be spent on other things, such as upgrading facilities, investing in training or hosting a customer appreciation event.
Challenge # 3 – High sales staff turnover
Turnover contributes to the overall cost of running a dealership because it incurs ongoing recruiting and staffing expenses. It also has a negative effect on the morale of the current employees. Finally, it negatively affects managers who develop a syndrome of learned helplessness: they start believing there is nothing that can be done.
What is a marketing approach that will be your solution for all three challenges?
It’s called cause-based and community marketing.
It will give your customers something else to care about besides price. It will create effective marketing campaigns at low cost. Finally, it will create a culture of engagement and success at your store.
What is cause-based and community marketing?
A dealership engages in cause-based marketing when its campaigns are designed to support a cause. It can be raising funds to find a cure for a disease, sponsoring a toy drive for under-privileged children or supporting animal rights.
Community marketing involves partnering with organizations in your local community, such as schools, churches or other businesses.
These types of marketing can be done at the dealership level as well as by individual salespeople.
Examples of cause-based and community marketing campaigns
There are so many ways to get involved in cause-based and community marketing and here are just a few examples:
- A dealership decides to help the local cancer society raise funds. The dealership pledges to raise $5,000 for the society and to promote its cause to its own database. In return, the cancer society names the dealership as the preferred place to purchase vehicles from. They create a reciprocal fund-raising relationship and campaign. For every car purchase because of the campaign, the dealership donates $100 to the cancer society.
- A General Manager is a member of the local church and decides to help an underfunded ministry. The pastor announces on a Sunday that the dealership has become the official sponsor of that ministry. Every time a church member buys a car from them, the dealership will make a donation to the church.
- A sales person becomes an official salesman for an apartment complex. He offers to sponsor a block or a holiday party for every 10 tenants who purchase a car from him. The relationship is mutually beneficial because there is no cost to the complex to participate in the program, and the salesman gets referral business.
What are the benefits of cause-based and community marketing?
- It increases customer loyalty and creates a positive buying experience
Customers will be attracted to your dealership and choose to do business with you, because you care about a cause they care about! If they know their purchase will make a difference, looking for the lowest price will not be the only consideration.
- It reduces marketing and advertising expenses
Many of these campaigns can be done at zero cost. And if there are expenses, they’re fairly minimal or are often after-sale costs. You don’t have to worry about spending money first and wondering if it made a difference.
- It reduces sales staff turnover
Because these campaigns are relationship-driven rather than price-driven, they create engagement and long-term success for your team. When salespeople get involved in their local community, they build a business based on repeats and referrals.
The bottom line is this: Traditional advertising and marketing methods are expensive and bring you transactional customers. Consider re-allocating some of the money you spend on advertising into marketing methods that are less expensive and attract customers who are excited to do business with you! Doing cause-based and community marketing campaigns will reduce expenses, increases customer loyalty, decrease your turnover, and create goodwill in your community.
Join me for my session a Digital Dealer 22 to learn more about how you can create a positive customer experience while making a difference and making a profit!
Author: Jonathan Dawson
Jonathan Dawson is an automotive consultant, sales trainer, speaker and coach. For 14 years, he has been helping dealerships improve sales, reduce turnover and implement effective marketing strategies. In addition to consulting with dealer clients, Jonathan frequently speaks at conferences (his most recent one is 2017 NADA), state association and 20 group meetings. He is a best-selling published author and a contributing writer for industry publications. Jonathan is known for his conversational teaching style and a common-sense approach. His information is fresh because he is in dealerships every month and still sells cars. His core teaching philosophy is known as Sellchology – Selling through Psychology. This approach is a combination of customer-focused selling, community-driven marketing and impact-focused leadership.