How to Reduce the Time From Trade-In Appraisal to Purchase
The average time from appraisal to purchase is 12.7 days—why are "ready to buy" consumers waiting?
Last month, I discussed the huge opportunity trade-in leads are for the dealers who work them well. Clearly, a shopper who requests an appraisal is going to be a low-funnel consumer looking to buy soon.
Now I want to share some data that proves that point—and sheds some light on who these consumers are—then offer some thoughts on how best to capture them.
According to data analyzed from more than 45,000 consumers using our trade-in tool, 74% indicated they were in the market to purchase a vehicle now. The average time from trade-in appraisal to purchase, however, ended up being a full 12.7 days. How can that be?
Furthermore, the data revealed that nearly 40% of the consumers using the trade-in tool were not current customers at the dealership they were engaging with online. This confirms something many of us already acknowledge: Today’s consumers are neither brand- nor dealership-loyal.
This presents a huge opportunity for dealerships to win these consumers over.
Times have changed
Trade-in calculators have evolved considerably in recent years, moving from old-school static lead forms to whiz-bang, real-time calculators delivered by third parties, including Black Book, NADA. and Kelley Blue Book. They’re now evolving further into trade-in calculators that can be white labeled or dealer-branded.
Today, the average consumer is likely to get multiple trade-in value estimates before even visiting a dealer’s website. In fact, data shows that consumers are submitting leads at an average of four other dealer websites.
Clearly, your dealership should be focusing on the best ways to guide these consumers into your showroom, rather than sending them down the street to visit a competitor.
Know thy customer
Ultimately, the best way of doing this is by having a complete understanding of who these consumers are, and, crucially, what they want.
Given that today’s consumers are shopping vehicle-first, versus dealership-first, being ahead of—and aware of—their needs can give your dealership a significant competitive advantage.
For example, consumer data points from our online appraisal tool (see sidebar) indicate consumers are putting more miles on their vehicles. These vehicles, however, are often fewer than five years old and have no loan on them.
Data also reveals dealership personnel should be on high alert on Wednesdays at lunchtime: It’s when the greatest volume of online appraisals occur. Be sure your website is designed to handle such appraisals, and funnel the leads appropriately to salespeople.
What can you do today?
Clearly, a key way to keep trade-in consumers engaged and buying at your dealership is through effective post-lead activity. Consider taking the following steps to better capture trade-in consumers:
- Be sure the trade-in process on your website offers an experience consumers trust.
- Transparency is king: Give a range of values to indicate you’re reasonable about trade-ins (which, in turn, gives you flexibility).
- If you’re using a third-party trade-in tool, consider switching to one that allows you to keep your dealership’s brand front of mind.
- Integrate the trade-in tool with your CRM so that follow-up is aligned with consumers’ recent online activity.
- Collect the right consumer information such as consumer contact data, versus often-erroneous vehicle data. An ideal balance is 20% vehicle information, 40% basic consumer info (name, number, purchase time frame, contact preference), and 40% expanded consumer info (additional questions that help personalize consumer profiles).
- Consider a move from static leads to dynamic, real-time conversations. Think of the Amazon shopping experience, where conversations change based on the consumer’s journey across your website.
By making sure consumers get the information and follow-up they need, you’ll make it easy for them to transition from being ready to buy to making a purchase.
With more than a decade of experience in the auto industry as a dealer, Russ Chandler has seen firsthand the problems dealerships face every day. As a product marketing manager for PERQ, Russ combines his expertise with powerful technology to provide his clients with increased response and conversion on their marketing.