Merchandising Matters:
Telling More to Sell More
DealerADvantage LIVE, June 8, 2007
In working
with independent stores to advertise their listings on Cars.com, we typically
see these dealers playing a very active role in merchandising their inventory
and promoting their stores. Compared to their franchise store counterparts,
independent dealers are 61 percent more likely to include descriptive seller's
notes and 8 percent more likely to include competitive pricing with each
vehicle. Paying attention to these key elements and actively merchandising
inventory drives results, directly contributing to more contacts and more
sales.
To
learn more about how dealers who tell more sell more, Cars.com recently teamed
up with NIADA past president Mike Cunningham to bring you tips from three top-performing
independent dealers: Glenn Conklin, Matt Corey and Jim McMullin. In this
month's DealerADvantage
LIVE webinar, these online merchandising masters discussed how their stores
take full advantage of online opportunities by using multiple,
high-quality pictures, competitive
pricing and descriptive seller’s notes.
The
following excerpts
from that conversation outline how they use their stores' websites and
internet advertising to drive more ready-to-buy traffic to their listings and
desk more deals.
General Merchandising: Stand
Out Online
Webinar
moderator Mike Cunningham got things started by asking our dealers how they
stand out online. From pricing to pictures, here’s what they had to say:
Cunningham: What tactics are the most
successful in merchandising your inventory online?
McMullin: We find that price is key. We are
not the lowest priced, we’re not the highest priced. We try to position
ourselves in the market somewhere in the upper average-priced range. We select
our cars very carefully. We make sure they all have clean vehicle history
reports. We’re looking for immaculate vehicles for a highly educated market and
a very selective market.
Cunningham:
What are the
things you do to make your vehicles stand out?
McMullin:
The descriptions
really help, taking a little bit of poetic license—explaining how the breeze
blows through your hair with an Audi A4 convertible, for example, or describing
situations in the vehicle that make it more exciting really seems to work for
us.
Corey: Having a good-looking car
definitely helps—and including lots of pictures—and then also the price point,
obviously. Internet buyers are more educated as far as searching and trying to
find the right-priced vehicle, so that definitely is a key component. To make
our vehicles stand out online, we go for the eyeball. It really comes down to
finding the nicer-looking cars, the flashier cars.
Conklin: Pricing and multiple photos. We
find that multiple photos lead to a lot fewer questions, and it’s a lot easier
to sell people when they’ve already attached themselves to the vehicle before
they’ve even talked to you. Pricing: We try to stay $1,000 to $1,500 under
retail on every unit, and that seems to give us quite a response.
Cunningham: How do you use your online ad
campaigns to position your dealership?
Conklin: We have a complete website: It
shows our 40-year history, everybody you need to talk to at the dealership,
maps and directions. We realize that the fewer questions customers must answer
on their own, the easier they are to sell.
Corey: We definitely have an all-in-one
website, so you can pretty much get all the information about who we are. Our
credit applications are available. Pricing is available. Maps and so forth. By
using Cars.com, we're hopefully directing people back to our website.
McMullin: Like Glenn and Matt are saying:
pictures. We always like to have the cars parked in front of our building so
that when customers make it in the door they recognize us from the photos.
Everything we have has to run at right around wholesale. Everybody in this
market seems to be stuck on buying things at wholesale, so we’ve really got to
pick our cars right. We really have to take high-quality pictures. We use a
third-party company to do that for us, to place them online and to help us
manage them, and I have a full-time internet manager that just focuses on
descriptions. The cars are immaculate.
Cunningham:
What do you think
are the advantages of working with a third-party service provider?
McMullin:
Uniformity, and
everything is standardized. It’s an assembly-line process. All of our
information goes up, that day, out to the internet. We get 16 to 32 pictures;
they look the same every time. The cars are positioned the same way every time.
There’s no chaos; it’s a very focused and easy approach.
The Price Is Right: Tips
for Online Pricing
The panelists
agreed: Effectively pricing vehicles is key to online success.
Cunningham: Jim, you said you include pricing
as one of your main ways of getting consumer interest. Do you include a price
with every listing?
McMullin: Every car; we’ve got to. The only
exceptions are exotic cars: our Maseratis, our high-end Porsches, our specialty
cars. Those are the cars that we will not put a price on—initially. We’ll run
those cars for so many days before we actually put a price on them to clear
that inventory out. Those cars seem to drive more traffic and interest; people
that just want to come by and look at that Ferrari on the lot. That’s their
dream car. They can’t necessarily get into one of those, but we can show them a
BMW 5-Series that they’ve also seen on our site or with one of our online listing
providers.
Cunningham:
For those units
that you do price, how do you determine that price? What do you use for
research?
McMullin: We look at Cars.com and
AutoTrader.com. We’re working within a 100-mile radius: We get a lot of business
from Maryland, Delaware and West Virginia. Being centrally located, we can have
a bigger internet market that’s like our local market. We try to buy the cars
right, obviously, and then we try to position those cars somewhere right above
average—just a little bit higher than the average price we’re finding online.
Cunningham: Do you offer a special, internet
price that is different from the price that a walk-up customer would be quoted?
McMullin: Absolutely. Internet customers are
some of the toughest customers; they’re usually over-educated about what they
want and what they need. So we do have internet pricing. Usually, that price is
a set price. It is lower than our list price.
Cunningham: Let me just say here: There are
compliance issues with separate internet pricing in several states. You must be
very careful. You should check with your state dealer’s association or with the
national, if you have trouble getting an answer to that question, because
there are states where you can have problems if you offer different pricing.
Jim, how often do you update your online pricing?
McMullin: It’s a constant, almost daily
thing. Sometimes we’ll see a jump in the market, say on the Audi A6, so we will
actually, in some instances, we will raise our price online line just as often
as will lower the price on a car. We have a bucket system: We get the car in,
we have it for x-price, it doesn’t move, it goes to the next bucket, we drop
it. We have the internet clearance price, and we just try to turn things within
30 days. We don’t anything sitting longer than 30 days.
Cunningham: Matt, as I understand it, you
price every listing?
Corey: Yes. We don’t really have that
much of an aging problem because we’re usually turning over our inventory every
30 days. We do put specials out there on the web, mainly for people that are
out of state. When we have someone who walks on to the lot and they saw a
different price, then we obviously honor that price.
Cunningham:
How do you decide
what the vehicle’s worth to the internet customer when you post it?
Corey: It’s based on market value. We
usually try to shoot below retail price by using resources such as Kelley Blue
Book.
Cunningham: Glenn, do you price every listing
you’ve got on the internet?
Conklin: Yes, we do. We don’t have any
difference between print and internet pricing. The same price that’s on the
windshield is in print and on the internet. There’s no confusion. It helps our
customers. Everything that we price usually starts out at the lower end of the
pricing scale. Granted, some of our inventory has a little higher mileage, but
we’re able to purchase at a point where we can almost always be in the top 5
percent, pricing wise. Then we don’t make any changes unless it’s an aging
unit.
Cunningham: Now when you set your price, do
you base it on your cost or the market value?
Conklin:
On our cost versus
the market value.
Cunningham:
How often do you
change your prices or update them?
Conklin:
As we see a unit
age a little bit, we’ll definitely induce more activity by lowering the price.
Probably 60 days is what we’re looking at. At that point, we really want to
move it.
A Picture's Worth a
Thousand Words
Pictures
are at the heart of online marketing, helping car shoppers to fall in love with
a vehicle before ever stepping foot on your lot. In fact, using multiple photos
of a vehicle can drive 31 percent more contacts. And 83 percent of dealers
agree ads with multiple photos drive higher quality contacts. Our panel of
merchandising experts agreed photos are key to their success.
Cunningham: How many pictures do you typically
include with each vehicle?
Conklin: We use between 16 and 20, and we
use a third-party that shoots our photos for us. We definitely stand at all
four corners of the vehicle from the exterior and then directly from the front,
directly from the back, all four seats, the instrument panel and any special
options the vehicle may have—say a DVD player. We always take a close-up of the
vehicle’s name and any identifying trim level. And then, of course, we take a
picture of the tires to show the tread.
Cunningham: Jim, I know you have a higher-line
inventory. How many pictures do you usually include?
McMullin: We’re at 31 pictures now; we’ve
gone up a little bit, and we get every angle that we can possibly get. Our
customers are professionals or in the military, or they work down in D.C., and
they’re very busy folks, so they need to see as much as they can, right there
at their desks, to get them to come in so we can consummate a deal. We get every
conceivable angle. There’s nothing left to the imagination for our cars—except
for the way they smell, and they come in for that.
Cunningham: We’ll get to that in five or six
more years, probably. Do you include pictures of your store?
McMullin: Yes, beginning with the first
image of the vehicle. Every vehicle is parked at an angle right in front of the
building so you can see the store’s sign. If you’re driving by and you’ve seen
us on the web, you immediately will recognize our building and know where you
are, and it also helps our customers get to our location.
Cunningham: And your sales staff, is it
pictured on the website?
McMullin: We’re currently overhauling our
website, and we are putting up pictures of everybody, including the service
folks.
Writing Copy That Sells
Online Buyers
One of the
most effective yet underutilized features of an online ad is the sell copy. The
best dealerships take this opportunity to set their vehicle and their store
apart from the competition with compelling copy that showcases unique features of
the car and the philosophy of the dealership. Panelists shared their approach
to copy that sells.
Cunningham: What process are you using for
seller’s notes?
Conklin:
For the most part,
we just introduce the company: how long we’ve been here and everything that we
do here—the financing, the service. We pretty much emulate franchise dealership
in the services we offer so we make customers aware of that in the seller’s
notes.
Corey: More than the car, the main thing
that we try to stress is who we are and why you should buy a car from us. I
think, more than anything, people want to buy a car from someone they trust, so
we will put seller’s notes in to give them a brief description of the vehicle.
We also have our batch tagline that we feel is important to sell.
Cunningham:
So you also
include an institutional-type ad in every listing?
Corey: Yes. It gives car buyers a sense
of what we’re about.
McMullin: We have a staff of 12 writers
that… (laughs). Actually, I said that to be funny, but we do a lot of creative
writing, and we are looking to hire somebody for our internet side that has
some creative writing experience. We find that if you sell the dream to car
buyers, they can picture themselves in the vehicle. Or if you tell them
something exciting about the vehicle, it captures their attention on that car,
and it differentiates that car from the same, 10 other cars that they’re
looking at that don’t have that little paragraph that helps them see it in
their driveway or feel like they’re driving it. It sounds kind of crazy, but it
works. For people searching on the internet, their attention span is maybe 12
seconds. They look at it, and they move on, so we want to hit them with as much
stuff as tightly as possible in the 5 or 10 seconds that we have with them while
they're looking at the car so maybe they'll stop, slow down. Just like when
they're on the lot, you've got to slow the customer down, and you do that with
the writing.
Cunningham:
As far as a call
to action, how do you actually motivate customers to contact your dealership?
McMullin:
We give them as
much information on the car as we can, we include our phone number and invite
them to contact us. There is no magic bullet. We keep a really good mix of
cars, we know what's popular and we know what's rare. We keep a stable of 3-
and 5-Series BMWs that everybody wants, and then we have very unique cars with
the right color combinations that get people to call us because we have cars
that other dealers don't.
Driving Online Traffic
with Specials and Incentives
Once
you’ve hooked a buyer with the right price, multiple photos of the vehicle and
a compelling vehicle description, it’s time to close the deal. Using special
offers and online incentives can help you turn shoppers into buyers. Our
panelists discuss how they incorporate special offers into their online
marketing programs to get online buyers to take the plunge.
Cunningham:
As far as specials
go, how do you promote those on the internet?
Conklin: A lot of our vendors have specials
pages, and we take advantage of those. They're a good place to move aged
inventory.
Cunningham:
Do you use any
kind of incentives, such as free oil changes or discount coupons?
Conklin:
Every once in a
while, we’ll throw in a free $20 gas card. That and free detailing and free oil
changes; any incentive that will help.
McMullin: What we do sometimes—navigation
systems are very popular, so we will place an ad with our different listing
services, one at a time, offering a free navigation system with every car. We
do that not so much to drive traffic but to see where our leads are coming
from.
If
you're interested in learning more from these dealers, visit Cars.com’s DealerCenter for a
complete recording
of the June DealerADvantage LIVE webinar.
Additional
Resources
More
information about online advertising and internet sales processes is available
at Cars.com's DealerCenter. You can also
access previous DealerADvantage LIVE webinars to learn more about how
effectively merchandising your inventory helps you to sell more cars.
Panel
Information
 Moderator:
Mike Cunningham
Payless Cars & Trucks, Owner, Tucson, Ariz.
 Panelist:
Glenn Conklin
Beach Blvd. Automotive, Internet Manager, Jacksonville, Fla.
 Panelist:
Matt Corey
Auto Line, Co-Owner and Internet Manager, Atlantic Beach, Fla.
 Panelist:
Jim McMullin
Fairfax Motors, General Sales Manager, Fairfax, Va.
|
