What do you do when the market shrinks?

When the market goes south, which it most certainly looks like it’s going to do in the next several months, you can’t expect to sell more cars than you did during the up market of the last few years. You can survive with a few fundamental moves to take more than your present share of the market, no matter how small the market becomes.

Capturing a larger share of the available market

Strategically acquire used vehicles that are actually selling in your area. There is one absolute way of doing this; a used car report based on model and year for the last several months from REGISTRATIONS. If you don’t have AutoCount from Experian, get it. It’s not expensive and you need this information. By having the right vehicles, you will improve your turn rate and therefore, take a larger share of the market

Market consistently to households that are currently interested in buying. Pull back on broadcast (which is expensive and not quantifiable) and concentrate on narrowcasting. This needs to be done systematically and consistently otherwise you’re just spinning your wheels. Remember, people in their buying cycles could be there a day or a year, you have to be there all the time when they finally pull the trigger

Retention

F&I needs to offer loyalty products such as life time oil changes and other maintenance related conveniences that keep your retention penetration well beyond what you’re done in the past. Charge for it, so that it has value, but make that charge low enough so that it’s easy for customers to swallow and they see the value in the proposition.
Make improvements in your service drive including concierge salesmen working the drive, real-time updates to customers and reducing the time it takes to provide the services

Reputation

Address negatives on the web. You can’t always fix all complaints, but you can attempt to do something.

Train your salespeople to stop ‘controlling the intercourse with the customer’. Regardless of what you think, people buy when they want from whom they want. For each sale you make by controlling, pressuring, pressing and all those things that sale trainers preach, you lose at least 2 sales. And, you will never get referrals (so important to increasing your market share) from unhappy customers who feel they were pushed. Believe it or not, you’ll also improve your gross, because happy customers pay more than unhappy customers.

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About dealerite/in association with AP Level 4

National affiliations of professionals who are engaged in changing the culture of the automobile retail business. Associated with AP Level 4 and Edifice Group. These companies are bringing sustainable marketing which has proven quantifiable improvements in a dealer's market share performance
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2 Responses to What do you do when the market shrinks?

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