The mood inside the National Motorcycle Museum was one of concern, but also hope. Dealers were not resigned, but keen to hear how they could, well, drive business forward. That’s just what they got from a superb line-up of speakers.
Chaired by EurotaxGlass’s president Kevin Gaskell, he gave the background. Sharpest recession in 20 years, according to Mervyn King – ‘and I don’t think even he really knows.’ It’s that unpredictable. Plummeting car prices have made it worse. But, he added, while it’s going to be a time of change, ‘it’s also a time of opportunity.’
Particularly for those who, said PriceWaterhouseCooper’s Chris Kent, ‘do what they currently do, but better.’ What’s more, ‘makers recognise the importance of dealers, and therefore will support. Without you, they have no shop window.’
The threat to dealers, he underlined, was ‘banks cutting off supply to businesses with too thin a capital base.’ But even here, he said there were opportunities. Where? ‘Acquisitions.’ How to avoid being prey? ‘Look at your balance sheet. Drive out your debt sources. Realise the cash in your stock. And, be more innovative in your marketing.’
Bear in mind what you should be marketing, said Frank McCaffery, MD of Exchange & Mart. Over half of customers are looking at better economy and lower tax cars. A quarter want a lower-CO2 car if they can afford it.
More generally, 41 per cent of people change their car at least every three years, with a fifth changing every year. Don’t forget, though, that while 70 per cent are adapting to the changing environment, a third still ‘want what they want – with no ecological or financial pressure.’ Don’t therefore paint your entire stock green…
Remember, instead, that automotive is the second highest performing sector on the internet. That’s according to Google director Adrian Joseph, who pointed out this was the first time the digital arena had experienced a downturn. How will customers react?
By, he said, spending more time on the internet than reading papers. Well, that’s what 85 per cent of them plan, anyway. Do your marketing budgets reflect this? Or the near-70 per cent who begin their new car research online? 41 million Brits are now online, and 59 per cent have broadband. Seven hours a week is the average online time. ‘It’s no longer ‘new’ media!’
If you don’t have an internet presence, you’re stuffed. And if you don’t consider search in designing your website, you’re doubly stuffed. ’80 per cent use a search engine during their buying process…’
In two years time, 80 per cent of internet bandwidth will be for video, said YouTube’s Luisa Mauro. If Google is the world’s biggest search engine, YouTube is the second-largest. Amazed? So was the entire conference.
As they were with the demographics. ‘As many over 50s as under 18s use us.’ And as well as a 110 per cent growth in automotive YouTube enquiries, there’s been a 237 per cent rise in searches for car-related videos. ‘Video is twice as likely to generate enquiries, and users will stay on your site for longer.’ Ignore video, which is now cheap as chips to produce, at your peril. Buyers, it seems, absolutely adore it.
Codeweavers’ Martin Hill spoke of a web utopia. You’ll engage customers as they research. Make it a stress-free, integrated web process. Increase the time they spend on your site, make your stock look affordable, push up sales enquiries and increase F&I awareness.
The latter has seen much work by Codeweavers, who have developed the ‘next stage in retail finance process’ – as Car Dealer columnist James Tew explains in this issue. It’s all clever stuff that, with increased use of video, can really make your website blindingly effective, said Hill.
Not that more traditional methods ought to be forgotten. Direct marketing guru Drayton Bird, he of best-selling book fame, entertained the audience with his 47 years’ industry experience. ‘It’s all about common sense.’
This means focusing on what customers want and like, not what you think is good. Your aim should be to get more customers, get them to buy more, and keep them for longer. Do this by analysing how you treat them. Look at why firms lose customers. ‘Never forget that, when things go wrong, people tell 12 people. When they’re happy, they’ll tell only five. People prefer to moan.’
He also stressed the fact that previous customers are ‘four to five times more likely to buy from you than non-customers. Even a previous enquirer is twice as likely to buy.’
‘All business is a gamble. But, direct marketing reduces that risk. That’s because you measure everything! If you can’t measure, you can’t manage.’
Robert Thurner of incentivated.com spoke of the coming world of mobile communications. Direct SMS marketing, as we’ve featured in this issue of Car Dealer, is another coming technology you should be aware of. As is, said Motors.co.uk’s Neil Adley, the fact that you can drive up internet site response by improving data quality, presentation and the quality of your response handling.
‘The way people negotiate has changed.’ Today, it’s all done online – information sourcing, competitor benchmarking, looking at close details of the car. Honing your website is thus absolutely crucial.’
Which took delegates back to the start of an inspirational conference. Dealers left brimming with ideas, packed full of tips on how to deal with the downturn. ‘Dealers remain key to manufacturers,’ closed Gaskell. And while it’s vital you shouldn’t ignore the changing world, he said, also never forget people are key. ‘Get them and retain them. At the end of the day, it’s all about loving the customer.’