Marketing to your existing customer base is critical in today’s shrinking auto industry where new customers are few and far between.  Unfortunately, the auto industry has a well deserved reputation earned over many years by fast talking car salespeople who relied on buy or die selling systems that ignored the importance of relationship based transparent negotiations to earn - and keep - a customer.  Experience has proven that if you make a friend you are more likely to make a sale.  More relevantly to this post, if you plan to market to your existing customer base it is critical that they are more than customers.  If you hope to earn their future business in sales and service they must be friends, not just previously sold leads.  After all, what are friends for!

Human nature drives every aspect of our lives - especially when buying a car - so it always amazes me when auto dealers implement a selling system or design an automotive advertising plan that doesn’t consider it.  This post will provide some insights from the customer’s perspective that must be addressed before you can presume to market to them as a long term customer vs. only a single sale. Read the rest of this entry »

The auto industry has always reflected the economy that supports it and most auto industry insiders agree that the recent consolidation of new car dealerships was necessary to maintain the equilibrium between supply and demand.  Unfortunately, the sensitive balancing act between new car supply and consumer demand was thrown off by the “success” of the Cash For Clunkers Program which artificially depleted new vehicle inventories.  Auto dealers had already cut back on new car orders to accommodate reduced sales volumes, and floor plan limits capped by shrinking working capital reserves limited the amount of new and used cars that auto dealers could keep in stock.  As a result, car dealers have not been able to timely replenish their sold inventory to maintain sales momentum and preserve profitability.  More urgently, dealers are scrambling for a way to stay ahead of fixed expenses that have already been cut to the bone.

Many automotive advertising agencies predicted that the Cash For Clunkers Program would produce an artificial wave of business with the associated “peak” in new vehicle sales during August followed by the “valley” in September that could continue through the balance of 2009.  Recent SAAR statistics project an adjusted annual sales rate of 8.8 million new vehicles in September proving that their worst fears have been realized.  Successful auto dealers focus on solutions rather than problems.  As a result, used cars have taken on a new importance with a number of creative techniques being applied to acquire used cars with a priority of selling used cars vs. new cars that are in short supply. Read the rest of this entry »

A lot of bubbles burst over the past two years besides those on Wall Street, the Banking Industry and Real Estate.  Auto Leasing companies absorbed losses in off-lease vehicles due to overly optimistic residual values, (the guaranteed amount that they agreed to buy back the vehicles for at the end of the lease which was factored in when the lease was originated), when the auto industry shrank along with the economy.  The resulting losses in the wholesale market and lack of ability for auto dealers to retail out of the lease returns forced domestic manufacturers and independent leasing companies to either cancel their leasing programs completely or to reduce their residual values so low that the payments were more than conventional financing.  Basically, for most lenders and customers, leasing effectively died last year but it is staging a recovery of sorts that shows some life in the option that might interest payment buyers and automotive advertising agencies anxious to find ways to offer more for less - per month that is.

Chrysler, for example, has announced that they will be putting their toes back in the troubled leasing waters with some sub-vented leases, (subsidized residual values above expected resale at lease end and reduced money factors), that will offer competitive payments on some of their new models.  All of the details haven’t been released but the story has been announced in the mainstream media and you can expect factory marketing campaigns to start mid-September. Read the rest of this entry »

Everyone knows that Certified Pre-Owned Vehicles are late model used cars or used trucks that have the same - or even better - warranties than new cars.  Car dealers are responsible to inspect certified cars to confirm that they have not been in an accident, have no body damage or paint work, are within established year and mileage limits set by the factory that is sponsoring the certified used cars program and that the dealer has reconditioned the vehicle to look and perform like a new car.  Special auto financing terms are offered on many certified vehicles and customers who want to buy used cars with all of the benefits of buying a new car have found that certified used cars represent the best of both worlds for the car buying public. 

Well, if you were one of the few that didn’t know about Certified Pre-Owned Cars you do now! Now that we are definitely all on the same page, let’s discuss why certified pre-owned cars are the best way to go for consumers who are buying cars and for auto dealers who are selling cars. Read the rest of this entry »

Don’t tell anyone, but the economy is in the tank.  Home sales are down and property values are falling.  Auto sales are also down and auto dealers are faced with excess inventory and reduced profits.  Wait a minute - let’s think about that last line!

I may be wrong, but if sales are down and dealers have more new cars and used cars than they can afford to stock wouldn’t that be a good time to buy one?  The answer is - YES!  Of course buying a car can still be a challenge but if you were selling a car right now wouldn’t you be more receptive to an offer - any offer?  Sure you would and car dealers are people too! Read the rest of this entry »

Having worked in the trenches of auto dealers, I would like to share with you what I told every pre-owned shopper that I’ve ever spoken to.  “If I were going to purchase a pre-owned vehicle, I would make sure it is certified.”

This was not some salesperson’s ploy to charge customers more.  Truth is, the cost of a certified vehicle opposed to a non-certified is not a significant difference, but there is the potential to be a major difference mechanically.
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The summer is upon us.  That means it is time for legions of parents to grab the kids and embark on the annual summer getaway.  With the downturn in the economy, more and more people are choosing to take the age-old road trip opposed to flying.  So is it that easy to just pack up the family roadster with luggage, hop in, and set off?  Not so much.

Family motoring is an art form.  If you are taking a long journey with the kids, here are some useful tips to keeping the kids entertained.

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