If your dealership does not yet have a vehicle acquisition strategy in place, consider this your flashing neon sign to start building one.
Why is a vehicle acquisition strategy so critical, you ask?
Simply put, the chip shortage has created market scarcity over the last few years and, with over 3 million vehicles being cut from automaker production schedules worldwide in 2022, there is no immediate end in sight. Additionally, customers who would have previously considered purchasing or trading in their cars are now holding on to their vehicles for longer due to new vehicle inventory shortages. This means that using strategic vehicle acquisition to create an additional revenue stream for your dealership is more important than ever before.
Car in, Car Out
In the past, dealerships were completely dependent on hiring the world’s greatest used car guy to get vehicles on the lot. That salesperson was the most valuable asset the dealership had as he could attend auctions to source vehicles and get them at the right price. But when you think about it, between price hikes and added fees, auctions are an expensive endeavor, with the real money-waster being the time and attention spent by your high-level executives and sales people to study up and bid at auction rather than focusing on making sales.
Times have changed. Auctions are no longer the best place, or the best strategy, to source vehicles. Vehicle acquisition is now about more than just getting more cars on the lot; it’s about creating a continuous flow of inventory by understanding shopper behavior to ensure your acquisition and sales strategies are working in tandem to reach the right people at the right time – vehicle in, vehicle out.
So, how can you create that flow? It all stems directly from your data strategy. If you can acquire vehicles passively by mining your first party data, that’s less time, effort, and money that your dealership needs to waste at auction.
Understanding Shopper Behavior
Over the last decade or so, shopper behavior has changed drastically. In the age of digital shopping, customers are looking for a personalized, one to one advertising experience, where marketing efforts feel more like a conversation than an ad campaign.
This presents a unique opportunity for dealerships. Rather than creating widespread, general advertising campaigns, dealerships can directly market to potential leads using hyper specific campaigns based on first party data.
Turning Data Into Dollars
Imagine this scenario: a potential customer calls or comes into the dealership to inquire about a specific vehicle only to be told the car has been pre-sold and is no longer available. This is a missed opportunity to both add another vehicle to your pre-owned inventory, and to make a sale. That customer joins the growing list of non-buyers – people who didn’t buy in the moment due to a lack of inventory.
These are qualified, ready-to-buy shoppers with a trade-in. These are shoppers that your dealership needs to continue to actively engage so that when the right car becomes available you can reach out to them specifically and close that deal.
Your dealership’s data strategy will directly impact your ability to close that circle, taking it from a missed opportunity to a sale using relevant and timely touch points.
Let Tech do the Rest
The solution to the entire cyclical problem of sourcing and selling vehicles lies in your first party data. Your overall dealership data strategy must include vehicle acquisition as your data is the key to actively engaging with customers looking to sell their vehicles and to matching incoming inventory to previously interested buyers.
While in the past your dealership may have relied on the memory of your sales team to draw the connection between a newly acquired vehicle to previous inquiries, that strategy leaves a whole lot of room for human error and it doesn’t take into account the data you are pulling in from digital touchpoints.
Technology has changed the way modern dealerships do business. Implementing a CDXP (Customer Data and Experience Platform) can enable your dealership to gather all your data into one place creating a single source of truth. Once your data silos have been eliminated, the platform can then automatically reach out to your customers and encourage them to trade in their vehicles with personalized and timely touch points, ensuring your dealership stays on top of the market despite the shortage.
This blog is based on a webinar hosted by AutoLeadStar entitled “Vehicle Acquisition: Turning Insights into Actions.” Click here to watch the full webinar for additional insights and information.