You’ve made cuts in Q1. You’ve thinned out your marketing — and maybe even your staff — as the market has returned to a pre-COVID competitive landscape and with new challenges. Have you reinvested those cuts into marketing that’s going to make you a winner in 2024? Or are you planning to limp your way through 2024 in fear of a pullback that clearly hasn’t come to fruition?
In my recent, popular AutoSuccess feature, “Scalpel or Machete,” we looked at identifying waste in your marketing and making smart cuts. This is crucial to your success, but just cutting your budget when your competition is not will lead to your market share quickly eroding. We need to use our budgets wisely, but we need to keep growing our market share if we’re going to be poised for big numbers in 2024 and ready for the economic surge that’s right on the horizon.
It’s time to get out of the mindset of cut, cut, cut, and into the mindset of spending wisely for your long-term success. Not only next month’s numbers but next year’s numbers depend on your choices today.
Fortune Favors the Bold
We’ve been helping our dealers understand the market and thrive in it for 15 years. Before that, much of our dealer-facing team was on the retail side of the business through 2008 and before. We’ve been helping our dealerships navigate rough market seas for a long time, and what has become crystal clear is that fortune favors the bold. Each and every time the market gets difficult, it’s the dealers who turn into the waves and say “full steam ahead” who exit rough seas far ahead of everyone else.
As you read this, I imagine — I hope — some skepticism is creeping in right about now. It’s nice to talk about being bold in rough seas, buying the dip and taking the bull by the horns, but is it more than clichés and platitudes? Sure is!
We looked at smart cuts in the article mentioned above. That should help you free up your budget, and now you can take those very real savings and reinvest them. Into what? I’ll give you a few examples of dealers who have been bold and won, what they’re doing and what they are not doing.
Winners Paybook
Before we talk about who’s winning, it’s important to mention that being aggressive and spending big money on marketing won’t always translate to a win. The common mistake we see is boldness without a plan. When you burn through seven different marketing vendors in one year, that’s not a winning strategy, that’s throwing toilet paper at the wall, harder and harder, hoping some sticks.
On the other hand, take one of our franchise dealers in a metro of 2.2 million people. Through 2008 and 2009, they averaged 151 cars per month. In 2010 they made a plan, implemented it and have only ever reinvested without ever pulling back their marketing due to temporary market factors — not even when COVID hit! Fast forward to 2023, and they finished the year averaging 795 cars per month in Q4 while everyone else was crying about a slowing market. This store has grown its sales volume by 427% since the start of 2010, while the other franchise dealers in their area of the metro have averaged just 27% growth over the same time.
Take another dealer, this time a franchise dealer in a rural county of just 35,000 people. They made a plan in late 2020 and have stuck with it since. They’ve grown their market share 70% in one specific area of marketing, increasing their sales from 75 per month to 150 and holding good gross in the process.
How about another, in a 1.1MM metro… They made a plan in mid-2022 and stuck with it through a tough 2023, now up 43% in showroom appointments/visits despite market challenges. This allowed them to hold sales volumes in a payment-driven market by picking up increased market share. Each of these stores has approached its marketing mix a bit differently, but each has focused on long-term marketing — namely, SEO that works — and has backfilled as needed through DigAd. Each made a plan and stuck to it through rough seas and smooth sailing, and are winning for it. If you could use a hand navigating, reach out!
