Special marketing treatment is in order when a franchised dealer acquires a trade-in that's markedly different from the brand he sells on the new-car lot.
So say dealers who use “special” Internet ads and premier lot positioning to highlight vehicles with nameplates that aren't indigenous to their stores.
“If I take a Jaguar as a trade, I'm going to put it in the front of the lot so people can see it, because they know I sell Chevys but they might not know I have a Jag for sale,” a Chevrolet dealer says.
“Special” ads on third-party selling websites, such as Cars.com and AutoTrader, help sell used vehicles of brands a dealership usually isn't associated with, says Andrew DiFeo, general manager at Hyundai of St. Augustine (FL).
“I might want to use a special ad to feature a Porsche I took on a trade-in,” he says.
Internet specials are good for moving inventory, but they are no longer limited to so-called “brown bananas,” vehicles that are lingering on the lot.
“Featuring specials on Internet advertising is not just for aged vehicles,” DiFeo says. “For instance, used vehicles selling for $8,000 to $10,000 do well as specials.”
Still, among other things, “specials help eliminate aging inventory, says Shaun Kniffin, director-Internet sales and e-business development at Germain Motor Co., a 17-store, Columbus, OH-based dealership group.
“Specials turn inventory, drive visibility on website listings and increase awareness on search-results pages,” he says during a Cars.com webinar.
DiFeo runs such advertising on his own store website and third-party sites. “It's good to have that special button near the inventory display,” he says, adding that the word “special” drives 10%-15% more click-through traffic.
At his store, featured vehicles turn 20%-30% faster, which could be a consequence of their special status (a Porsche at a Hyundai store), the special treatment or both.
DiFeo and Kniffin actively use inventory-management software to help them competitively price vehicles. The systems determine regional market demands and values for vehicles.
“It will get you aggressive on pricing,” Kniffin says. “There is no secret sauce. It's about the right car at the right price. Our whole organization operates in that space.”
Most dealers use inventory-management systems to price used cars. But DiFeo uses it to set prices for new cars, too.
“It's the reason we've had great success with new cars,” he says. “Many dealers see it only as a tool for used vehicles.”
Dealer Mike Baker, executive vice president of Bob Baker Enterprises in San Diego, says the systems particularly help in pricing used vehicles that are of a different brand than the one the dealership represents.
Such systems help dealers “know what turns fastest for other makes and models,” he tells Ward's.