Yes, the title of this article may be premature, but hey, the vaccine is out and we can see the end of the tunnel. Hopefully, the word pandemic will soon no longer be part of our vocabulary and social distancing will become a thing of the past. Needless to say, dealerships around the United States have had to modify their car sales strategies throughout the past year. While at first we faced the great unknown, in time dealerships have successfully pivoted to meet the needs of the new shopper.
COVID-19 has had a huge impact on the automotive industry, both in the long and short term. According to a recent study by McKinsey, the automotive industry lost approximately $100 billion in 2020 in profit amongst the top 20 OEMs. The ripple effect of the shutdowns hit hard, with manufacturers left without needed parts and factories shut down, resulting in limited inventory at the dealership level. Retailers operated differently across state lines and those that were lucky enough to be deemed essential were kept open. Many dealerships have had to let people go and operate on a skeleton staff, with people wearing different hats within the dealership. All in all, let’s say it like it is, it was a cluster!
At a time when most Americans were scrubbing down their groceries in fear of germs, they were less excited about the prospect of spending hours at the dealership and being in an enclosed test drive with a stranger who could harbor the virus. Within our dealerships, we saw resilience shine and dealers adapt to the needs of the shoppers. They offered contact-free options for service, online assistance in purchasing a car, delivery of the vehicle, and communicated the steps they were taking to ensure the shoppers’ safety while at the dealership.
So what happens next once things settle and we no longer have to worry about COVID-19? While you may have adopted your newest strategies out of pandemic necessity, they may prove beneficial to propel you forward to the new age of car buying. Whether you modified your used car sales strategy to get more trades, modified your car sales marketing strategies, or moved to a digital buying process, you may consider keeping these new strategies in place because they’ll likely serve you well. We’ve outlined some specific strategies that our clients plan to continue long after the world returns to “normal.”
#1 Allow the shopper to complete part of (if not all of) the transaction online
Like it or not, the shopper has been wanting this experience for some time now and the pandemic simply accelerated this process. Until recently, there were only a few players in the online car buying space but with the health crisis, dealerships were forced to figure out how to make the online car buying process as seamless for the customer as possible. Earlier this year a survey by AutoTrader showed that 86 percent of consumers want to complete at least one step of the purchase process online. So, if the shopper can complete even a portion of the paperwork before arriving at the dealership, they’ll have more time to do the “fun” things like testing out different products, enhancing their experience in the showroom.
#2 Continue to be transparent
During the pandemic, you likely had to shift your car sales negotiation strategies to be more transparent with customers – and that’s not a bad thing. With today’s shoppers being savvier than ever and wanting above all honesty around their purchase, transparency is key – and yet another thing that the pandemic accelerated. Dealers have responded to this demand by adopting market-based pricing and minimal- or no-negotiation sales processes.
#3 Respond to leads in-house
This is critical to a dealership’s success. When you take any sales lead and outsource it to a third party, you’re essentially waving goodbye to your opportunity. Remember, no one is as qualified to handle your inbound leads, whether on the phone or digital, than your in-house sales staff, who know your inventory inside and out. Even an in-house BDC can have its challenges and that is why communication between the in-house BDC and sales teams needs to be airtight. You just don’t have that level of continuity when it’s outsourced and your leads are being handled by people who don’t know your dealership’s inventory, processes, or culture – which can make for a disjointed and – let’s face it – bad consumer experience. These are shoppers coming to you and a skilled salesperson at the dealership should be working with them. Now is the time to fine-tune your processes to make sure that your internal salespeople or BDC are trained to effectively respond to these leads.
#4. Continue to build used inventory
Inventory is highly likely to be an issue for the foreseeable future. Your team needs to have strategies in place to build up your used inventory to help mitigate these issues. Do your new and used car sales negotiation strategies include asking about the shopper’s trade each and every time? They should. Do you have the staff working the service drive? There are various strategies that your team needs to be consistently doing to build a healthy supply of inventory.
#5 Keep your staff sharp
We hate to admit it but this pandemic has allowed a lot of dealers to clean up their staff so that only the top performers are left standing. Your job now is to optimize your team and provide them with the resources and tools that they need to continue to be successful. Think about it, a coach is constantly assessing their team’s performance. Once they identify gaps they make modifications and optimise until their team is the best. Training is ongoing. To keep your team motivated and on point, you need to be continuously upskilling them in order to succeed, grow, and crush the competition.
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