April 20th, 2010 | Written By: Chuck Patton
Recently I had a perfect storm conversation with a general manager of a dealership group. This dealership not only had their GM store pulled but also their Dodge store. The stores were turning a profit, had great customer loyalty and were moving cars. Overall there were about 17,000 customers in the database that were affected. The dealership was devastated.
The silver lining was this dealership had been investing its marketing efforts into a group strategy. Even though they had gone from eight dealerships to six and lost two of their strongest stores, the dealership had its own brand value to fall back on. This value helped retain employees, provide their community with long-term solutions and avoided putting a family-owned operation of 40 years out of business. The lesson that dealer groups like this have learned is that there is safety in numbers when marketing your stores as a group.
Where are the opportunities?
How can we find safety in multi-point numbers? How can I take advantage of the power of my dealership group to achieve more than I would as a single point?
Opportunities unique to group dealers fall into three categories:
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Posted in: Group Programs, Marketing Plan
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April 7th, 2010 | Written By: Chuck Patton
Do you have a company vision to address today’s market? If you are like most dealerships, you probably don’t have just one vision, but rather one for each manufacturer within your dealership. And, if you are like many other dealerships, you are also part of a larger dealer group—meaning you have more than one dealership point, each acting independently.
For years each manufacturer has fought for its independent identity in the public and on your lots. This can create conflict within your dealership or dealer group because you carry multiple manufacturer brands. Your interest lies in getting your customer more focused on loyalty to your dealership or group rather than to just a single manufacturer. Fortunately, the make of vehicles you sell is probably not among the strongest factors that influence your customers’ decisions to buy and service at your dealership or group. Rather, factors such as reputation, value, proximity, cost, convenience and relationship exert a stronger influence. This is good because you can’t control the overall reputation of the make, but you CAN control your own dealership brand and work to maintain your good reputation. This is also true if you are part of a group. So, for some dealers, it makes sense to develop a group strategy.
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Posted in: Group Programs, Marketing Plan
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September 27th, 2009 | Written By: Chuck Patton
The whole is more than the sum of its parts. -Aristotle
How can all of the service departments in a group work smarter together than they do working individually? Will it save them money? You are ahead of the curve if you have spent time thinking about these questions. There are some very strong benefits to acting as a group such as cost savings, a consistent message, efficiency and the ability to manage the goal of growing a dealership. The payoff can be big, but not every dealer group has the resources to pull it off.
Elements you must have in place to make a group promotion work:
- Strong leadership – A good leader over each of the dealerships who can sell the benefits to the service managers and execute with success.
- Flexibility – A company that can take into consideration different co-op requirements, varying demographics of product lines and the ability to gel multiple service managers into one strong mission.
- A big picture plan for the year – You can do more damage than good with a “Let’s try it once” mentality.
- Open culture of change – More than likely many of the franchises are going in different directions. If they are to join together, somebody has to do something different. That is not easy.
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Posted in: Branding, Group Programs
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August 23rd, 2009 | Written By: Chuck Patton
In a national press release published in March, the AAIA (Automotive Aftermarket Industry Association) reported vehicle repairs cost an average of 34% more at a new car dealership than at independent repair shops. They argue that this is leading to 11.7 billion dollars of excessive costs annually to consumers. Foreign nameplates were even higher than that at 36.8 billion. The same argument is being made once again. The dealerships cost more! But this time they are making the argument in the middle of a recession when everyone is listening to how they can get more for less.
The new angle on this old argument is that now the excessive cost gap is predicted to become one of the widest in history. Consumers are looking for cost alternatives to address the economic woes and the aftermarket “low-cost” brand is the mindset of your current and perspective customers, like it or not. How do you plan for this impact when your service department is currently knee-deep in issues? Internal work and warranty is down, cars don’t need servicing like they used to and the pressure is on for you to handle the burden of the decrease in dealership profits.
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Posted in: Best Practices, Group Programs
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