“If you always do what you’ve always done, you’ll always get what you’ve always got.” – Henry Ford

3-Reasons-Conquest_Blog_07

“If you always do what you’ve always done, you’ll always get what you’ve always got.” – Henry Ford

Henry Ford. Founding Father of the auto industry. Pioneering businessman. Innovative industrialist. His legacy was built by challenging the status quo, envisioning opportunity and leveraging innovation to maximize his business. I think Henry Ford would look at how dealers are approaching their business in today’s automotive landscape with a similar message.

The truth of the matter is, how people shop for, use and buy cars is changing at exponential rates, and doing what you’ve always done to grow your business no longer earns you the consistent sales you have seen in the past.

What does this mean for your conquest spend?

In a competitive market, dealers often pull back and miss opportunities to be aggressive with conquest shoppers. But the dealers who are seeing the shift in the market and responding are actually reversing that trend. The Compound Annual Growth Rate (CAGR) of digital conquest marketing has increased from $5 billion in 2013 to an estimated $12 billion in 2019.1 In 6 years, the spend in digital conquest has more than doubled, making the digital landscape as competitive as ever.

To win, dealers need to be moving with this trend, not lagging behind.

Here are three reasons your strategy must prioritize conquesting
new customers:

Henry Ford. Founding Father of the auto industry. Pioneering businessman. Innovative industrialist. His legacy was built by challenging the status quo, envisioning opportunity and leveraging innovation to maximize his business. I think Henry Ford would look at how dealers are approaching their business in today’s automotive landscape with a similar message.

The truth of the matter is, how people shop for, use and buy cars is changing at exponential rates, and doing what you’ve always done to grow your business no longer earns you the consistent sales you have seen in the past.

What does this mean for your conquest spend?

In a competitive market, dealers often pull back and miss opportunities to be aggressive with conquest shoppers. But the dealers who are seeing the shift in the market and responding are actually reversing that trend. The Compound Annual Growth Rate (CAGR) of digital conquest marketing has increased from $5 billion in 2013 to an estimated $12 billion in 2019.1 In 6 years, the spend in digital conquest has more than doubled, making the digital landscape as competitive as ever.

To win, dealers need to be moving with this trend, not lagging behind.

Here are three reasons your strategy must prioritize conquesting new customers:

In the 9 years we have been helping dealers precisely target pure conquest shoppers, we have watched the SAAR fluctuate all over the spectrum. The dealers that consistently win are the ones who are changing their strategy from trusting the market to taking control with conquest marketing.

In 2018 alone, sales of passenger cars decreased 13.1%, while light trucks/SUVs increased by 8%.2 Already in 2019, the industry is pacing below last year’s mark by 2.4%.3 Dealers need to pay attention and realize that they can’t wait for the SAAR to create opportunities for them. It is too inconsistent and unreliable to be your strategy for sales growth.

In the 9 years we have been helping dealers precisely target pure conquest shoppers, we have watched the SAAR fluctuate all over the spectrum. The dealers that consistently win are the ones who are changing their strategy from trusting the market to taking control with conquest marketing.

In 2018 alone, sales of passenger cars decreased 13.1%, while light trucks/SUVs increased by 8%.2 Already in 2019, the industry is pacing below last year’s mark by 2.4%.3 Dealers need to pay attention and realize that they can’t wait for the SAAR to create opportunities for them. It is too inconsistent and unreliable to be your strategy for sales growth.

Retention is a great place to start when trying to grow your sales, but statistics say – your retention is not strong enough to offset the need for conquesting.

For the majority of industry players, repeat customer sales rates are struggling to hit 33%.4 Shoppers are getting smarter and have almost unlimited options at their fingertips. They are getting bombarded with marketing and offers from OEMs and other dealers, not to mention the rise of less conventional, online marketplaces that will compete against dealers for shoppers.

If you are not using data-driven marketing to protect your database, while also engaging pure conquest shoppers before your competition, there is no way for you to gain market share.

Retention is a great place to start when trying to grow your sales, but statistics say – your retention is not strong enough to offset the need for conquesting.

For the majority of industry players, repeat customer sales rates are struggling to hit 33%.4 Shoppers are getting smarter and have almost unlimited options at their fingertips. They are getting bombarded with marketing and offers from OEMs and other dealers, not to mention the rise of less conventional, online marketplaces that will compete against dealers for shoppers.

If you are not using data-driven marketing to protect your database, while also engaging pure conquest shoppers before your competition, there is no way for you to gain market share.

Based on our dealership data, 38% of contacts within a dealer’s DMS do not have email addresses listed. If the information in your DMS is not correct or is missing, your team or 3rd party vendors are going to find it difficult to create an opportunity with these customers.

Also, with the average time of car ownership topping out at 7 years,5 it’s likely your customer’s information has changed since purchase. An email address change or a move to a different address could cut you off from an opportunity to re-connect with a customer completely.

Service has historically been a dependable way to stay connected with your customers. Unfortunately, this has also changed. According to industry averages, fewer than one-third of repair orders are completed at franchised dealers.6 Even then, there’s no way to know if they will choose you over the four other dealerships on the way.

Without having a clear way to ensure your DMS data is accurate, conquest marketing becomes even more important. If you are not winning with all of your customers internally, you have to fill in the holes with new opportunities.

Based on our dealership data, 38% of contacts within a dealer’s DMS do not have email addresses listed. If the information in your DMS is not correct or is missing, your team or 3rd party vendors are going to find it difficult to create an opportunity with these customers.

Also, with the average time of car ownership topping out at 7 years,5 it’s likely your customer’s information has changed since purchase. An email address change or a move to a different address could cut you off from an opportunity to re-connect with a customer completely.

Service has historically been a dependable way to stay connected with your customers. Unfortunately, this has also changed. According to industry averages, fewer than one-third of repair orders are completed at franchised dealers.6 Even then, there’s no way to know if they will choose you over the four other dealerships on the way.

Without having a clear way to ensure your DMS data is accurate, conquest marketing becomes even more important. If you are not winning with all of your customers internally, you have to fill in the holes with new opportunities.

If you are not shifting the way you approach the market by conquesting new customers effectively, you’re going to lose to your competitors who are. With the SAAR’s performance, the increasing struggle to retain customers and your CRM’s accuracy being unpredictable, it becomes clear; the areas where dealers have relied in the past are unreliable.

The only sure bet is investing in data-driven, conquest marketing. We know the initial thought is that it’s hard to be aggressive with costs continuing to rise. But that’s just not true. The key to conquesting new customers is not outspending your competitors, it’s getting there first.

You need to know if a shopper is actively looking and have a methodical strategy to engage them before your competitors. Take your competitive edge back through conquest marketing to the right people as soon as they enter the market. If you don’t, you risk losing market-share to your competitors who are willing to put their money where your sales are.

If you are not shifting the way you approach the market by conquesting new customers effectively, you’re going to lose to your competitors who are. With the SAAR’s performance, the increasing struggle to retain customers and your CRM’s accuracy being unpredictable, it becomes clear; the areas where dealers have relied in the past are unreliable.

The only sure bet is investing in data-driven, conquest marketing. We know the initial thought is that it’s hard to be aggressive with costs continuing to rise. But that’s just not true. The key to conquesting new customers is not outspending your competitors, it’s getting there first.

You need to know if a shopper is actively looking and have a methodical strategy to engage them before your competitors. Take your competitive edge back through conquest marketing to the right people as soon as they enter the market. If you don’t, you risk losing market-share to your competitors who are willing to put their money where your sales are.

1 http://cdn.ihs.com/www/Automotive/auto-TL-Whitepaper-feb-2016.pdf?ocid=pc8113-1:social-network:01
2 https://www.marklines.com/en/statistics/flash_sales/salesfig_usa_2018
3 https://www.autonews.com/sales/8-first-half-sales-tales
4 https://static.ed.edmunds-media.com/unversioned/img/industry-center/analysis/2018-edmunds-loyalty-report.pdf
5 https://www.cnbc.com/2017/05/28/car-owners-are-holding-their-vehicles-for-longer-which-is-both-good-and-bad.html
6 https://www.autonews.com/article/20170619/RETAIL05/170619929/why-customers-stray-and-what-your-dealership-s-service-department-can-do-about-it

1 http://cdn.ihs.com/www/Automotive/auto-TL-Whitepaper-feb-2016.pdf?ocid=pc8113-1:social-network:01
2 https://www.marklines.com/en/statistics/flash_sales/salesfig_usa_2018
3 https://www.autonews.com/sales/8-first-half-sales-tales
4 https://static.ed.edmunds-media.com/unversioned/img/industry-center/analysis/2018-edmunds-loyalty-report.pdf
5 https://www.cnbc.com/2017/05/28/car-owners-are-holding-their-vehicles-for-longer-which-is-both-good-and-bad.html
6 https://www.autonews.com/article/20170619/RETAIL05/170619929/why-customers-stray-and-what-your-dealership-s-service-department-can-do-about-it