When it comes to digital advertising, Ken Kolodziej, co-founder and chief executive officer at String Automotive, says the challenge for dealers starts with aligning their inventory with the vehicles consumers are actively searching for in their specific market.
And once the merchandising (photos, pricing, etc.) is done right, “then you’re going to want to, of course, get in front of the right eyeballs.”
Kolodziej’s company has a dealership intelligence platform (Dealer Positioning System, or DPS) that aims to consider the intricacies of a local market and then help dealers make the most profitable and proactive decisions based on what each unique situation calls for.
He talked with Auto Remarketing recently about the digital advertising process, including how to get used cars in front of the right audience.
“And used inventory … it’s tricky,” Kolodziej said. “Used cars aren’t a commodity product. Every used car is unique, and you have to treat it as such.”
Which is why, he said, there have been so many strong digital advertising solutions come up in the industry that aim to “really get down to that VIN-by-VIN level,” and either push shoppers directly to the vehicle details page or having VIN-specific digital ads on search engines, “where you’re letting the used car speak for itself.”
He added: “You’re letting that used car shine, so to speak, and driving those eyeballs, those click-throughs, to the dealer’s site … That’s a relatively cost-effective method of getting the right used inventory, once you have it in stock, in front of relevant shoppers at the right time from a digital perspective.”
We also asked him about the opportunity for dealers going outside of their local markets to find buyers, and that, he said, typically is best looked at on a case-by-case basis.
“It depends on the dealer,” he said. “But from a conquesting perspective … the consistent trend that we’ve seen over the years, looking at not just digital visitors, but also where dealers have actually sold cars — looking at the data from the DMS and geo-plotting that on a map — used cars have always had a broader geographic range than new cars.”
Again, this goes back to each used car being unique and each having its own very specific story.
“I think the smart dealers, they’re making sure that they’re matching up with what customers are looking for and then at that point … you’re able to loosen the reins a little bit, just because someone will drive farther. Or they’ll have a car shipped to them from across the country or across the state or what have you,” Kolodziej said.
“So, you can loosen the reins a bit and you can use those digital advertising methods to be really, really well targeted, so that way you’re not just shotgunning your ad budget and spending 10 times what you would from a focused campaign just to get some more eyeballs on it,” he continued.
“Used inventory is unique in that you have that ability to sell, almost by definition, to a broader geographic range because used cars are more unique,” Kolodziej added, noting that the trick for savvy dealers, again, is to make a targeted approach.
Editor's Note: This story appears in the Nov. 15 print and digital editions of Auto Remarketing, which hone in on the top Used-Car Advertising Ideas for Dealers.
Video marketing provider Flick Fusion has announced the release of InstaVid, an automated video-production service. For dealers with video-producing needs, InstaVid is designed to instantly create and distribute video of dealer inventory.
Brian Cox, the president and chief executive officer of Flick Fusion, commented on the swift nature of the tool.
“InstaVid helps dealers move metal faster,” Cox said. “Within hours of a vehicle arriving on a lot, dealers can have videos of that vehicle all over the Internet, generating immediate video SEO. Why wait days to market your inventory when you can begin to attract video views and website visitors instantly?”
The program automatically generates a stock-photo video when a VIN is entered into a dealer’s DMS, featuring a professional voice-over and dealership-specific advertising specials via banners. Each video is VIN-specific, and keywords are added prior to being uploaded to YouTube and other third-party inventory listings.
Dealer photos and videos, once uploaded into inventory feeds, will automatically be update to the videos by InstaVid and replace stock photos. If a dealer decides not to update the photos, the stock photos will remain with the video as long as the vehicle is on the lot.
Twitter: It ain’t just for hashtagging your favorite pumpkin-spice whatever or Grumpy Cat pictures.
That’s right, perhaps one of the most important uses of Twitter this fall, at least for folks in the used-car business, is the #DealerChat from your friends at Used Car Week.
After a successful debut #DealerChat hosted by Equifax last week, it’s time for Auto Remarketing to host the second installment of this series — which takes place Wednesday from 2 p.m. to 3 p.m EST.
Today’s #DealerChat will hone in on providing you the info you need for this year’s CPO Forum and SubPrime Forum, part of the Used Car Week conferences set for next month in Las Vegas.
Over the course of an hour, the Used Car Week team will answer questions about this year's speakers, sessions and networking opportunities.
Have specific questions about the conferences? Tune in and use the hashtag #DealerChat on Wednesday (again, between 2:00 p.m. EST and 3:00 p.m.) Conference organizers will be on hand to answer all of your conference questions, quandaries and inquiries
If you've never participated in a tweet chat before, it’s easier than finding the bar at one of our conference!
We recommend you filter #DealerChat through TweetChat.com, which will make following the conversation easy as pie. An example of how we will be asking and answering questions throughout the chat can found here.
J.D. Power released the results of its recent report on customer reactions to their interactions with automotive mobile sites on Thursday. The J.D. Power 2014 Automotive Mobile Site Study found that smartphone users are more likely to share vehicle information on social media when they are satisfied with the experience they had on either a manufacturer’s or third-party’s automotive website.
In its third year, the study was redesigned to collect details on content and tool usage while measuring which content was the most effective during the vehicle-shopping process. Website usefulness was measured in four ways: information/content, navigation, appearance and speed, while calculating satisfaction on a 1,000-point scale.
While it’s probably not surprising that customers tend to share on social media their most positive experiences, several key findings were derived from the most recent iteration of the ongoing study, according to J.D Power. The company listed them as follows:
- Shoppers who share vehicle information on social media are more likely to share imagery, such as exterior images (48 percent), interior images (42 percent) and videos (40 percent) than other less visual content, such as payment/lease (18 percent) or dealer information (25 percent).
- Use of videos, interior 360-degree and exterior 360-degree tools has a significant positive impact on satisfaction among smartphone shoppers when researching how a vehicle looks on both OEM and third-party websites.
- When researching vehicle information shoppers who access an OEM website on a smartphone are much more likely to use a build and price tool (43 percent) than those who shop on third-party sites (30 percent). However, vehicle shoppers accessing a third-party website on a smartphone are more likely to use an inventory search tool (36 percent) than those on an OEM site (32 percent).
- The largest gap (90 points) in satisfaction between OEM (806) and third-party sites (716) is in appearance of the website.
“When vehicle shoppers have a positive experience on an OEM or third-party site, they are more likely to share the content they find useful or interesting with others,” said Arianne Walker, J.D. Power’s senior director of automotive media and marketing. “This provides auto brands a great opportunity to get their content out in front of consumers through social media. The challenge is not only having great content to encourage sharing, but also ensuring that consumers have an outstanding experience no matter what site they are accessing on their smartphone.”
The report also outlined several manufacturer websites that customer responses said they had the best experience viewing. Topping the list was Acura with a score of 811, followed closely by Cadillac (803), Porsche (802) and Chrysler (801).
Along with co-host Jennifer Reid from Equifax, Used Car Week held its first-ever DealerChat via Twitter on Wednesday.
Reid and her team from Equifax, along with other Twitter Chat participants from the remarketing space, fielded a variety of questions about top dealer trends, finance, Used Car Week and more.
Here are five of the top key takeaways from Reid and others during the debut DealerChat:
- It’s vital that dealers put the customer first; emphasize the value you bring and focus on a customer-friendly process.
- Given the intense ramp-up of regulation from the CFPB, compliance management is huge for dealers.
- The Web has created a greater emphasis on transparency and demand for more channels for purchasing — these are (and will continue to be) part of the evolution in car-shopping.
- Nearly a third of auto loan originations are from subprime customers.
- The Millennial generation is one with its own set of car-buying behaviors and preferences.
To see the complete conversation, filter your Twitter search by #DealerChat.
Stay tuned to Auto Remarketing and follow @UsedCarWeek on Twitter for details on how you can get involved with the next DealerChat.
And be sure to register NOW for Used Car Week and save $200. The early registration deadline is Friday.
Edmunds.com announced this week the launch of its new feature for its car-shopping mobile application. Lot Buddy, a location-aware feature for the company’s existing mobile app, allows car buyers to unlock “Price Promise,” no-haggle offers from anywhere, even on the lot. According to Edmunds, this car-shopping tool is the first to offer locked-in pricing without requiring buyer information.
Seth Berkowitz, president of Edmunds.com, believes the feature fills a void in the automotive purchasing market.
“Mobile is increasingly the tool of choice for car shoppers,” Berkowitz said. “At present, mobile makes up 36 percent of all Edmunds.com traffic. We are paying close attention to shoppers and we’ve found that the task done most often on the dealer lot is looking up pricing and using calculators in order to answer the question, ‘Is this a good deal?’ We are offering the easiest path to an answer.”
According to Edmunds, its site saw a 39 percent increase in mobile usage between 2013 to this year. Based on its own study, Edmunds says that 100 percent of shoppers with access to a smart phone say they use a mobile device at some point in the purchase process while 63 percent say that mobile tools to assist at the dealership are lacking.
The Edmunds.com app itself shows users actual new and used cars for sale near the shopper while also granting access to consumer and expert reviews. Other features include price comparisons, video and photo galleries, as well as financing and leasing calculators.
I’m not here to tell you your dealership needs to embrace social media. Every dealer’s heard it; most dealers have come to believe it; and many are already actively engaging customers in a variety of social channels. I’m here because out there, it’s getting more and more competitive by the day.
Customers are gaining more control and more transparency, and above all, they know exactly what kind of dealer they want to do business with. Gone are the days when you could rely on your best interpersonal skills to make shoppers glad they walked into your showroom. They like you — or don’t — before you even know they exist.
Understandably, this environment leaves many dealers feeling like they’re scrambling every day. Which brings me again to why I’m here: There’s a simple way for dealers to regain control over sales and overall success, store-wide, and that’s by becoming the exact kind of dealer your customers want to buy from. It’s something that’s always been at the heart of this business, and now, in the most pressured and fast-paced era of automotive sales, we have tools at our disposal that we’ve never had before.
That’s right. Your social channels are your superpowers. And I want to help you use them to their full advantage. I want to see more dealers rip off their Clark Kent glasses and become all-seeing, all-selling, all-succeeding superheroes. You just have to master these five social skills:
Capture attention
It’s not about your favorite time, place and way to have a conversation. Your customers have control of that. And be ready for them to change it up on you — often. They’re on a one-way street to the best purchase they can find. If you can find them early in their search, make a connection and take full advantage of their frequent use of social channels, you’re in.
Use your CRM to log your customers’ preferences, and target them accordingly. Don’t assume everyone’s using Facebook or Twitter exclusively; segment your database according to actual activity, and go from there.
Remember, you have 24/7 access to your customers’ attention span. Be direct, purposeful and personal — no blanket messaging. Catch their attention, and get ready to show them how much you know about the things they care about.
Be a know-it-all
Your customers never need just one thing from you, no matter what they’re coming out and asking for. Every shopper needs to make a purchase at some point, and every buyer will need service on their vehicle. But none of them will want to do business of any kind with any dealer who doesn’t know what they truly need, and talk to them accordingly.
Being a know-it-all isn’t just about knowing cars. It’s about knowing customer wants and needs, and knowing how and when to capitalize on them. All of your outbound content should be targeted and relevant. And all of their comments and clicks should be captured, and quickly. So, use your channels to know what buyers want before they do. Offer the best solution before they ask for it. And give them a seamless experience through every point in the lifecycle.
Win the popularity contest
Yes, welcome back to high school. Your job now is to be a buyer magnet. And step one is to start seeing what many dealers consider a disadvantage as a huge bonus: Your customers are all talking to each other — directly and indirectly. They’re reviewing your team and your services in every part of your store because they’re encouraged to and because they can, easily. You’ll never again talk to a customer who hasn’t done their research and read all the reviews out there.
So stay on top of it. This is not the time to hide under your blanket out of fear of hearing the worst. You have to look your reviews dead in the face and take advantage of the fact that they’re there. And really, it’s easier than you’d think.
Here’s a secret we didn’t have in high school: Popularity is all about listening. Listening to the feedback. Listening to the buzz. Listening and learning and realigning your efforts with what will make you more popular, not less. Remember that social media is a two-way street; it doesn’t stop with sending information outward to customers. Give your best attention to what’s coming back in, and be ready to make changes.
Don’t be an overachiever
Spreading yourself too thin across too many social outlets won’t work. You have to be the best at something, and that has to be something buyers care about. Not every conversation out there is worth your time and effort because not every conversation will affect an ultimate purchase decision. Be choosy, be in control and be ready to catch the conversation threads you need most.
Be close-minded
This is where it all comes together. Social selling doesn’t end with making friends. It’s about making deals. No one will buy from you if you don’t listen, aren’t connected and don’t care about what they do. And no one will buy from you if they don’t like what they see and hear in your reviews.
I’m urging you to be a winner in your social channels because that’s what gets you the wins you want. And because you can develop winning social skills without adding new tools or undue expense. Simply leverage what you have available to you now in a new and more targeted way, and watch the new success roll in.
Sean Stapleton is the vice president of sales and marketing for VinSolutions.
Flick Fusion announced this week its video marketing platform for dealers, offering what it contends is the first of such platforms to automate the video production process, including inventory videos, video emails and other various dealer-related videos.
Brian Cox, the president and chief executive officer of Flick Fusion, says his company offers to dealers the digital platform for their inventory that they need to maximize sales.
“Many dealers want to incorporate video into their marketing plan, but don’t have the resources or expertise to create dynamic videos for all their marketing needs,” Cox said. “Our platform offers a simple, cost-effective method for creating a video marketing strategy proven to attract more web site visitors and convert them into leads.”
Flick Fusion utilizes the power of Google by avoiding Flash and publishing videos in “SEO-friendly” formats and uploads them to YouTube, increasing exposure to a wider market.
“Flash videos can’t be indexed by Google and therefore they don’t boost SEO rankings,” Cox said. “Additionally, many third-party sites don’t accept Flash so dealers can’t benefit from video syndication, which also boosts rankings.”
In addition to the video format, the program also utilizes VidMail, which allows dealer employees to customize videos for individual lead inquiries, which can be custom-made on request with video greetings, vehicle walkarounds and other related dealership videos.
For more information about Flick Fusion, visit their site here.
As used-car supply continues to increase, consequently, used-car prices are slumping. The seasonal summer slowdown continues to push prices down, and RVI Group reported late last week it expects used prices to drop by 10 percent by 2019.
When describing last week’s auction price movement, Black Book’s Ricky Beggs said the only difference from previous weeks is the price drops continue to grow week-over-week.
Hitting a the biggest drop seen in the past 12 months, the 10 car segments fell by an average of $86 last week, he said in the latest “Beggs on the Used Car Market” video report.
This comes in as a total price decline of 1.7 percent for cars in July — which is slightly over traditional pre-recession monthly change levels.
And there are three segments, in particular, that are trending softer than most.
For example, the prestige luxury cars, which declined by an average of $183 this past week, have a four-week average decline of $131, according to Black Book data.
Next up is the premium sporty cars, which saw a decline of $184 last week — the largest drop for the week — and touts a four-week average drop of $121.
Lastly, the third segment to see a larger-than-average price drop were the luxury level cars, which saw a prices fall by $110 this past week, with a four-week average decline of $87.
Why the significant drops in vehicle values this past week and month?
“Part is the adjustments to get ready and create a space for a new model year of vehicles to come into the market,” said Beggs, editorial director at Black Book.
On the other hand, the truck segment fared better this past week than the previous week, dropping by an average of $45. The four-week average decline for trucks came in at $49.
Used-Car Prices Expected to Drop by 10%
RVI analysts said in its latest Risk Outlook report they expect to see used-car prices drop from current levels during the rest of the year, as well, as supply rises.
“With strong current sales and more favorable economic conditions, the supply of used cars in the market is expected to increase steadily through 2019,” the report stated.
Lease penetration also continues to grown, RVI pointed out, and the company predicts this rate to increase even more for 2014 and 2015 model-year vehicles.
Illustrating the significant spike in lease penetration, Infiniti — which led the market in leases for the first quarter — reported 60 percent lease penetratsion in the first quarter.
Volkswagen had the highest lease penetration among non-luxury brands with a rate of 42 percent.
Interestingly, the new-car market is expected to have a downward impact on used prices, as well, as new-car competition increase and new-car prices decline. Click here to read more on this trend.
RVI predicts that with both expanding used supply and new-car market trends pushing downward, used-car prices will drop more than 10 percent by 2017. And though prices have begun dropping this year, RVI expects more dramatic declines to begin in 2015.
And one segment, in particular, is expected to exceed the 10 percent drop: small SUVs.
RVI predicts supply to expand significantly in this segment through 2019, pushing the expected price decline up to 10.9 percent by the end of 2017.
To view the latest “Beggs on the Used Car Market” report, see the video above.
As the digital age continues to develop, dealers have had to adapt at an ever-quickening pace to satisfy a perpetually evolving consumer base. For used-car customers, Penske Automotive Group announced during their second quarter conference call on Wednesday that one of their main conduits for sales is via their website.
Roger Penske, the group’s chairman and chief executive officer, believes mastering the digital side of the business is key to limiting competition.
“We have looked at our PenskeCars.com, and we have over 60,000 used cars online there, which seems to be generating quite a bit of traffic,” Penske said. “I think that’s working out from an e-commerce perspective.
“On the used car side, we were up $50,” Penske continued, in regards to profit per car. “When you look at it sequentially, there’s no question that we’ve been able to sustain our margins for the last three or four quarters, which I think is key. We don’t have the inter-brand competition on the new and I think with the used, with the execution of the Internet, if a person wants to buy a particular car, and if the process is efficient and we can get that customer in, we don’t have a competitor on that car.”
To contrast, Mike Jackson, the chairman and CEO of AutoNation, while speaking in his own company’s second quarter conference call last week, addressed a long-term but slightly different goal for the group’s online strategy. Though not referring directly to new or used sales, Jackson wants to get to the point where customers who shop for cars online can get all of the financial logistics squared away before ever setting foot into the dealership.
“Informational sites are useful. They’ve taken us to a certain point, but the customers are not interested in doing all of that work, disconnecting, and then coming to the stores and starting all over again,” Jackson said. “The sites need to reach into the store and transact on real inventory, real incoming inventory, with real pricing, with market data that validates that pricing. And the customer, when they see the car they want, at that price they want, are able to send us a deposit and make it their car."
Jackson noted that the company is investing $100 million, over the course of 2014 and 2015, into this effort, aiming at making the AutoNation website transactional by the end of 2014.
“I think we will have to see how skillful we execute and how the marketplace reaction is, but this was the reason behind why we rebranded the company coast-to-coast. We could not envision doing this with multiple names, we think it’s far more powerful with one name,” Jackson said. “It’s sort of like the Shared Service Center, which took us seven years to fully implement, that gave us both a cost advantage and a performance advantage and, also, in many ways, was a foundational element for this digital undertaking and that we need all the stores on the same technology platform for everything from database management to how we run the company day-to-day.
“It’s certainly not the end of the story over the next two years; there will be many more chapters,” Jackson continued. “But we’re in a very ambitious and exciting phase. I call it an investment phase, that we feel, in our ambitions to build a great company, and a great brand, in the long term, we need to make and hit the right vision for the company and win in the marketplace.”
