So, you’re getting good news? Your Search Engine Optimization and Pay-per-click campaigns are working. They’re driving new customers to the showroom – and those customers are buying cars.

The bad news? Even with all this traffic growth and increased sales, gross profit is low. What’s wrong with this picture?”

Quite possibly, it’s low margin sales that are born from automotive customers’ commodity mindset that focuses on low price above all. Your PPC and SEO efforts have been successful at finding people who want to buy cars (now) but those shoppers are so far down the shopping journey, all they’re interested in is finding the dealership with the lowest price for the vehicles they want.

Following this model, your sales staff could be tied-up with too many of these low margin shoppers and potentially be missing more lucrative opportunities. To market to prospects more effectively and maintain margins you can be happy with, try these winning strategies.

Exit the “Race to the Bottom”

Too many dealerships opt into the “Race to the Bottom” primarily focusing too much of their advertising budget reaching out only to price conscious shoppers. Yes, these customers are needed as there are many of them out there. Yet, slugging it out with everyone else to make lots of low-margin sales doesn’t help the bottom-line. Instead, try staying competitive on price but stand out by putting more emphasis on services or add-ons that add value for the shopper and maintain a good profit margin for the dealership.

Connect Early in the Customer Journey

Build relationships earlier in the shopping journey before car buyers end up on third party classified sites to find the vehicles they want at the lowest price. Use your database and conquest lists to serve prospects marketing messages reflecting their unique interests and needs. The data is out there to target customers earlier in their journey and it’s extremely powerful if you learn how to harness it. Entering the conversation sooner and providing more personalized information will help your messages stand out from the crowd. It also means shoppers may start talking sooner about what they’re looking for instead of already knowing what they’re looking for and focusing solely on getting the best price. Your dealership’s sales team will then be able to build credibility and trust sooner, and guide shoppers down a path that’s beneficial for both parties.

Talk Experience and Expertise, Not Just Price

As long as car buyers must do business with dealerships for their vehicle purchases, dealers can communicate something very valuable third-party classified sites can’t: customer experience. This is a clear advantage with many demographics: especially valued by mature shoppers, time-pressed working parents with young children, and professionals on the go.

Most people expect a good deal, however, car buyers may be happy to pay a slightly higher price if they’re rewarded with something of value like convenience and time savings in return. Communicate with shoppers about how easy it is to do business with your dealership and prove it to them with tangible examples like video testimonials and reviews from other happy customers. It might just be the extra incentive needed to close a deal, even at a slightly higher price. That’s a win-win for everyone.

DRIVING IDEA:

Not every car buyer is going to be the ideal customer and dealerhips need to be equipped to successfully meet every shopper’s needs. However, it is possible to focus your dealership’s efforts to attract the best customers for your store’s needs. By targeting car buyers earlier in their journey, being competitive on price, offering value added services or incentives, and communicating how easy it is to conduct business with your dealership, you’ll be able to keep customers happy and make a fair profit in return.