Boost Your Close Rates with Data
Increasingly, car buyers are visiting dealerships not to work a deal but to conclude it, having made their brand and model selection beforehand, according to a 2015 AutoTrader.com report.
Given this shift in the consumer shopping process, how can we can take more control of our success? One avenue is to generate sales proactively, mining your dealership’s big data repository of warm leads residing in your customer database.
A recent article by the online magazine Data Informed about monetizing big data might have had data mining in mind when it called for “tools to enable smarter business decisions.”
“As decision complexity in the sales environment increases,” the Data Informed article noted, “Sales managers need to provide sales reps with tactics that are most likely to improve their effectiveness in growing and retaining existing customers.”
Data mining technology enables dealers to sell and retain more vehicles and customers. It does so without associates having to take showroom ups or field traditional leads. More importantly, it does so before the customer has a chance to engage with your competition. In the hands of capable, trained users, this data mining tool can extract lucrative revenue out of a dealer’s big data.
In fact, dealers using this technology report results as high as 80% appointment show rates and 50% close rates. On average, dealers are selling an additional 10 to 30 vehicles a month using this proactive selling strategy. As both a strategic and tactical sales tool, data mining identifies the right existing customers likely to buy again now—and equips associates to convey compelling presentation facts that move inventory. Consider these data mining success examples:
- In one year, a New York Honda dealer sold 599 additional units to existing customers identified as “ready to buy now” and took in 600 trades, retailing 257. Overall, the dealer grossed $1.8 million.
- By sourcing its own warm leads from its customer database, a California multibrand auto mall achieved an 80% appointment show rate and a 50% closing rate.
- A North Carolina Ford dealer sold 248 vehicles in four months for $500,000 in gross, and retailed 107 of the trades for an additional $200,000 in gross. As a companion campaign, it used data mining-centered direct marketing that on average sold 10 units for every 1,000 mailers, a 1% sold rate, compared with traditional direct mail’s 0.5% response rate.
Brian Skutta is CEO of AutoAlert, Inc., North America’s premier data mining and sales opportunity provider. Skutta brings to AutoAlert more than a decade of leadership in helping auto dealerships sell more vehicles and retain more customers. He has a proven history of successfully managing innovation and growth. Reach him at firstname.lastname@example.org or visit www.autoalert.com.