Local Dealers Have Company

Back when auto dealerships sold 90% of their cars to consumers living right down the street, very local print and radio ads were more than adequate.

Later, as dealerships moved to the suburbs to follow their customers, much of that same marketing plan was repeated: local ads for a very local car buyer.

After all, 80% of sales came from within an 8-mile (12.8 km) radius of the dealership.

Fast-forward to 2012.

Car buyers have gigabytes of global buying information streaming into their computers, smartphones, computer tablets and TVs. Suddenly, it’s just as easy to shop a dealer 2,000 miles (3,200 km) away as it is to shop two miles (3.2 km) from home.

Do buyers really want to buy from a dealership far away? Probably not. But no longer will they settle for being limited to just one dealer opinion or price quote. It’s too easy to cross-shop dealerships online. A dealer may not get a shot at that local customer simply by being close by.

What does this mean for marketing? Isn’t the goal of market spending to reach and captivate the local customer? Control pump-outs? Blunt other dealers from invading your local marketing with their sales messages? Yes, and no.

Auto makers want their dealers to stay local and control primary trading areas, but to really grow volume requires reaching beyond conventional territorial boundaries. It requires a much larger footprint in marketing plans.

If you really want to drive sales in this auto-marketing 2.0 world, begin with the hard fact that your local customer has all of those comparison-shopping options the Internet offers.

They can and most likely will shop other stores well outside of their traditional trading area because of the ease and convenience of information. So what to do? Spend even more hyper-locally trying to control your area? That could cost incrementally more per car, and it may not even work.

There’s a better method: Instead of trying to build a wall around your sales territory, seek a global-local media mix that affects your local area significantly while also extending across your region or entire state.

You first need to select low-cost-per-customer media combinations. That rules out glossy direct-mail pieces and local cable-TV ads. You’ll need Internet ads, mobile messages and broadcast TV. This trio drives down cost-per-car because the actual cost to use this mix is about two cents per consumer reached.

This approach is just as effective whether the dealership is close by or far away.

Make sure your mobile website is set up to do business and that your salespeople are ready to handle the cross-shopping crowd. When you advertise regionally instead of locally, consumers expect more from you. When you market yourself as a regional store, consumers expect you to be on your game.

Market with a larger footprint and be ready to watch the local, regional and distant consumer react.

Adam Armbruster is a partner in the retail and broadcasting consulting firm Eckstein, Summers, Armbruster. He can be reached at [email protected] or 941-928-7192.