For dealers who pride themselves on running honest businesses, the idea of hiring an outside company to come into the dealership to hold a sales event can have little appeal.
Some sales event companies have a not-so stellar reputation. Typically, a company will bring in its own sales crew and run roughshod over the dealership sales people and customers. Aggressive crews, with little knowledge of the state's financing regulations, know how to get the deals done. The problem is that several of the deals can skirt ethical and legal guidelines, and have no business getting done. And the dealership gets left holding a bag of legal risks and customer dissatisfaction.
But if a dealership can find the right company to partner with, holding sales events can jumpstart traffic, increase sales and create satisfied customers.
Gary Creese, the general sales manager for Harvest Ford Lincoln Mercury in Klamath Falls, OR, has used RPM Communications, also in Oregon, to host several sales events for the dealership. RPM focuses on used-car sales, but the benefits can extend to the new-car showroom and the service department by providing more contacts throughout the year, says Creese.
He declines to provide numbers but says the most recent event was the best the dealership has had. “We see people come in that we normally wouldn't see. And the events pay for themselves,” he says.
He did ask RPM to send one of its sales people home, though. “A little too aggressive for us,” he says. “RPM lets us control the event. Many of these companies don't care if you own the place — it's their event and they're running it.”
That is one of the things he likes about RPM. “The experiences haven't all been great,” he admits. “But they always respond to my criticisms and suggestions.”
RPM Partners Michael Cole and Tim Bailey admit their biggest concern is with the crews that represent the firm. The partners have put much effort into making sure they act ethically and responsibly. The sales teams all have backgrounds in automotive sales and consist of a finance manager and as many sales people as necessary to handle an event. RPM keeps up to date on each state's specific regulations. “We've never had a dealer fined and we've done more than 300 events,” says Bailey.
RPM charges $8,500 to $17,000 for the sales events.
Cole believes one of RPM's strengths is how it markets the events. The company uses demographic information and the dealership's customer database to determine the marketing parameters.
Targeting the right type of customer for the sale is critical. “It's important that the people who show up to the event can afford the vehicles,” says Cole.
“Otherwise, deals don't get done, and if they do, often it's because the salesperson is forcing a square peg into a round hole. If you're not dealing with the right candidate, you end up pushing the sale through and end up creating a bevy of problems for the dealership.”
RPM produces video mailers and sends them to the target customers. They also do direct mail and newspaper inserts. All of the advertising is clean and has a call to action.
Often, the call to action asks the customer to come to the dealership to collect a prize — anywhere from $5 to $50,000. That's to create excitement for the event, says Cole.
Chris George, general manager for Brad's Cottage Grove (OR) Chevrolet, says his dealership has held 10 or 11 events that have been marketed by RPM. Getting 200-500 people into the store over the course of a 3-day event is typical, says George. He uses RPM only for its marketing.
He cautions the dealership needs to be prepared. “There's a lot of traffic and people wanting to claim their $5,” he says. “If you don't have a process in place to slow them down, you can burn through the ups real quick.” Cottage Grove closes 12-15% of all of their ups during an event.
George says the first RPM-marketed sales event Cottage Grove held, customers were lined up out the door like they were getting ready to buy movie tickets.
He has had one shopper win the $50,000: retired truck driver George Bouche. But he didn't buy a vehicle, says George. “We haven't seen him since we gave him the check. I think he wanted to buy a boat.”