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sales & training solutionJimKristoff

Let’s review some customer retention facts (with statistics directly from NADA, the National Automobile Dealers Association). Ninety percent, and I repeat, 90 percent of the average dealership’s advertising budget is spent attempting to acquire a new or pre-owned vehicle customer, while the remaining 10 percent of the budget is spent in the service and parts departments.

Considering that the average dealership spends $384,000 per year on advertising, this means that the average dealership only spends $38,400 per year on retaining its customers. That statistic is disturbing.

The easiest and least expensive customer to sell to is the one that has already bought from you. The auto industry is working too hard and spending too much money constantly trying to acquire new customers.

While acquiring new customers is important, dealers already have thousands of customers in their database who are theirs to keep once they develop the right retention plan.

According to NADA, the average new-vehicle customer is keeping their vehicle approximately 40 months before trading it in, and regular service customers are 17 times more likely to buy their next vehicle from their servicing dealership. Read that again: 17 times more likely. Not twice as likely, or five times more likely, but 17 times more likely.

Did you also realize that 30 percent of your customers have a friend or family member that will purchase a vehicle within the next year?

Wouldn’t you like to have an opportunity to sell a vehicle to those people?

Very few dealerships track their marketing and retention efforts. Most cannot tell you with a definitive answer what is working and what is not and, more often then not, they do the same thing year after year. That fits my favorite definition of insanity: “Doing the same thing over and over again and hoping for a different result.”

So, what measurement instrument are you using to track customer retention? If you have to stop and think about it, you probably are not tracking it very well.

Are your service and parts departments using specific operation codes to track your marketing efforts? You can be specific with these operation codes to help you track what is working and what is not.

Are you offering any special incentives to your customers to remain loyal? You don’t need to give away anything to keep your customers loyal; all it requires is a little attention and a little consideration. Isn’t that what we all want?

There are countless ways to retain your customers, but you need to manage and measure these ways. No program is good or bad until it is measured.

Investing in retention is an investment in the future and cannot be underestimated. So if you haven’t already, I strongly encourage you to take retention seriously. Adopt a program to help you achieve results and measure and track how the program you choose works for you. If not, you’re losing customers, and money, to your competition.

Jim Kristoff is a dealer, trainer and speaker. He can be contacted at 866.429.1532, or by e-mail at jkristoff@autosuccessonline.com.

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As I’ve mentioned several times in recent articles, local search optimization is vital to your dealership’s continued success online. Your competitors have Websites too, and they’re exporting to the same sites, and they’re posting on eBay and Craigslist — so search engine optimization is “the next big thing” that will give you a competitive advantage.

While most providers offer SEO services, many dealers choose to go the do-it-yourself route. They rely mostly on the built-in optimized features of their Website platform, and have limited knowledge about SEO strategy.

Keyword research is one of the most important pieces of the search engine optimization puzzle, and it’s the part that most do-it-yourselfers leave out. If you want to rank high in Google searches, you need to understand how people search and tailor your site content to match those search patterns.

The best example I can give is “used” vs. “pre-owned.” In our industry, both franchise and independent dealers prefer to say that they sell “pre-owned” cars since it’s a general consensus that “pre-owned” carries a more positive connotation than “used.” Many dealers even go to great lengths to make sure that the word “used” doesn’t appear anywhere on their dealer Website. Positive phrases equal “warm fuzzies” from potential customers, right? So, what’s the problem?

The big problem with this strategy is that when the general public searches for a vehicle,

they don’t type in “pre-owned car” – they type in “used car.” In fact, according to Google’s keyword research tool, which provides an average number of monthly searches on a global and local level, there are more than one million global searches a month for “used cars” – but only 12,100 searches for “pre-owned cars.” Have I got your attention now?

If you look at a local level, at searches only in the United States, there are 673,000 searches every month for “used cars,” but only 8,100 searches for “pre-owned cars.” That’s 83 to 1 in favor of “used cars.”So, while you might have the warm fuzzies because of the keywords you’re using on your site, you’re missing out on a massive amount of potential traffic by excluding the term that people are typing in to try to find you.

Think of it this way: Google’s goal is to serve up the most relevant results for each search that a user conducts on their site. If you’re in Denver and you want to show up for “used cars Denver,” you have to be sure that you’ve got the phrase “used cars” on your Website. When we explain this to our clients, they usually reply that “Google should be smart enough to know that ‘pre-owned’ means ‘used.’” Actually, it’s not that Google isn’t smart enough – it’s that Google is too smart. Remember, Google is trying to provide the most relevant results, and it’s going to be literal. If someone is searching for “used cars,” Google will show them sites that are relevant to “used cars.”

In closing, if you’re managing your own SEO, start with a solid foundation and conduct a thorough keyword research. Use Google’s Keyword Tool (under the “Reporting and Tools” tab in adwords.google.com) to see how many searches there are every month for the terms and phrases you’re using on your site. Choosing the right keywords will lead to more visitors, more leads, and ultimately more sales for your dealership.

Chad Polk is the CEO of AutoRevo. He can be contacted at 866.873.0031,or by e-mail at cpolk@autosuccessonline.com.

marketing solutionChadPolk

“used” vs.“pre-owned”the importance of Keyword research for seo