Most sub Prime buyers have been in this position for some time realized their car buying experience is different from that of their more credit-worthy peers. Some due to circumstances beyond their control are experiencing the sub Prime process for the first time. These buyers still warrant respect. Despite credit woes, their dignity remains intact and they want to be treated fairly and professionally.

To give you an idea of just how Sub Prime can impact your business, this Past February versus the same month a year earlier saw purchasers with FICO scores below 550 shoot up 48.3 percent year-over-year.

In fact, analysts found that the trend toward lower FICO scores among used-car buyers resulted in an average of 561.3 in the opening days of April. The added  share of sub-670 credit score buyers increased to 46.9 percent from March's reading of 46.37 percent and the year-ago mark of 35.22 percent.

Subprime is the most profitable segment in the pre-owned vehicle segment for which you must be equipped to compete.

 

Go to Dealer Monthly for the Stats


Author Bill Cosgrove
DealerNet Services 

First I want to thank Jim Ziegler and Manny Luna and others for their due dilegence in the Autogate affair that is currently unravelling and have made it possible for me to get some attention on a topic close to my heart.

I want to take advantage and seize the moment concerning all the controversy surrounding Cars, com among others with hints of more to come.

Why? Because I hope that finally YOU the dealer who is following this mantra will come out of the ether and realize that the medicine that the giant classified Ad and Services Companies have been prescribing Dealers is showing its nasty side effects and is WRONG.

Let’s take a look at some numbers to see just how much these churn and burn marketing strategies can affect Dealers. One side effect of this strategy is that you are always chasing inventory to sell more to make less money – who does that benefit?  

Another side effect is management and salespeople are working harder to make the same or less money and if you have worked at a dealership in the past few years these guys have more responsibilities than ever before. This leaves the possibility of losing conversions and inventory purchasing errors. Plus, you are probably spending more money to drive that traffic to churn those cars and - who do you think benefits from that.

Another side effect is that you start taxing you facilities ability to do the MPI (Multipoint Inspections) reconditioning e.t. and unless you spend more to fill the gap you chance having other problems with Inventory presentation. WHO DO YOU THINK THIS AFFECTS?

Sure there are dealers that sell for one take or leave it price and do well but how long do you think it would be when this becomes the rule and not the exception. There will be more consolidation and small and medium size dealers will be put out of business by the churn and burn stores that need to gobble up more and more market area to survive. And who do you think this will benefit? –

I am not a conspiracy theorist by you can’t help but see the correlation here especially with what has been surfacing over the past couple of weeks.

According to FirstLook, total sales in April climbed 0.7 percent vs. year ago to 3,819,127 units. vs. 3,792,604, transaction prices across all three channels were down 6.46 percent to $8,928 from $9,545 in 2012 excluding aftermarket product.

So let’s do the math.

$9,545.00- $8,928.00 = $617.00. Let’s say on the average you sell 50 pre-owned units per month. Let’s say you could have sold just 25 of those 50 units and grossed $309.00 more per unit.

$309.00

X 25 units

$7,725.00

Let’s say that you could have made another $800.00 dollars per unit on the back end.

$800.00

X 25

$20,000.00 Let’s add it up

 

You just made at $27,725.00 more in gross that in a year adds up to $332,700.00 plus what you have just saved on all the added costs of churning and burning units and the costs of potential Presentation of inventory and inventory purchasing errors, losing conversions in the rush to churn e.t. in the rush to churn.

 

Let’s say that you sell an additional 10 cars a month with the churn and burn method. Using $1200.00 as an average gross and gross $800.00 on the back end you would have grossed $20,000.00 Dollars or $240,000.00.

 

$332,700.00

$240,000.00

($92,000.00)

 

You grossed ($92,000.00) less plus all the additional overhead it took to Market, Buy, Prep and sell them. -Who is does this benefit?

If you need to go outside your market area to gain market share and have the population density within you geographic market area for growth YOU need to look inside not outside and fix the problems  within- Who will benefit from this?

If you set your goal of growing within your market area the benefits are greater and put those additional resources you are using to draw in people from outside your market area you will be better for it. People who purchase from outside your market are price buyers only because you have no value to offer them.

So think about it and do what you think is the right path for you to take. For most of you-you will realize the only ones that are getting feed are the Dragons.

One of the rules of value creation is: if your actions don’t create value, then your actions decrease value. If your sales or marketing presentation does not increase the perceived value of your products or services, it decreases the value your customers or prospects perceive they get from you.

Author Bill Cogrove
DealerNet Services

If you the Dealer think you could or should be doing better, you need an experienced independent Consultant.

 

If you the Marketing Company are putting your reputation on the line and driving traffic to a Dealer who is not prepared to sell them you need  an Independent Consultant in there first.

 

Remember you as the Dealer or Marketer are in the Driver’s Seat So Take the Wheel -When you’re going straight ahead-you get there faster-and safer so take control and win the race. If you are not committed and prepared 1000% It is time to GET OFF THE TRACK.

The blame always lies with you. Before you blame your vendor or (presumably) competent staff- look in the mirror- maybe they are not the incompetent ones.

 

Customer Acquisition Cost (CAC) is determined by customer visits. Your bottom line lives or dies by IT- BOTTOM LINE.  And it is crutical to design your marketing campaigns and structure your staff to do what works best for YOU at YOUR location in YOUR geographic area.

 

If you're not Marketing to the Latino/Hispanic market-YOUR LOSING A LOT OF MONEY. The Latino/Hispanic population of the US is the 20th largest economy in the world so is not to be ignored. Please go to the more section above and follow the link "ENGAGING THE US LATINO MARKET" at Autospeak (Engaging the US Latino Market) to get a better understanding of impact this market segment represents.

 

 

  If someone isn't willing to tell you this to your face- Get another Consultant.

  If you didn't already know all of this -YOU BETTER GET A CONSULTANT

 

        Bad Medicine-Who's Really Getting Better?                                             Posted By Bill Cosgrove    DealerNetServices

One of the most important elements of any marketing plan is the ability to track the effectiveness of new initiatives.  

• Long-term results—Automotive closed loop analytics can provide
    results throughout the lifetime of your company.  Once you have
  implemented an  analytics system that integrates your email or direct mail
  campaigns with your  CRM system,  you can
  continuously receive insights.  As your needs or objectives evolve, you
    can modify the resolution of your analytics to help identify the most lucrative
    consumer markets.


• Agile system—Most closed loop systems are easily modified to allow 
  virtually immediate results from an email campaign.  If you would like to
  know  how many people clicked on a Call-to-Action (CTA) in the latest batch of
  emails,  then you only need to click a button.  This type of responsiveness
  may require  additional investment up front, but the data available can help
  make your  dealership a success for years to come.


• Identify key marketing ideas—One of the most elusive objectives in
    any marketing strategy is identifying the marketing message that is most
    effective. Automotive closed loop analytics can instantly identify those
    components and help you understand why they are so successful.  For
  example you  may find lifetime service options are a key to maintaining customer
    relationships which bolster sales.


• Unique metrics—Measuring ROI on direct mail has been difficult in the
    past, but with the use of new techniques like showroom controls or dedicated
    phone lines, you can accurately measure how effective your new initiative
  is.   Using a phone number exclusively for direct mail responses and
  coupons with RFID  tags can indicate the precise number of reactions with a
  relatively low  cost.

• 
  
• Long-term results—Automotive closed loop analytics can provide
    results throughout the lifetime of your company.  Once you have
  implemented an  analytics system that integrates your email or direct mail
  campaigns with your  CRM system,  you can
  continuously receive insights.  As your needs or objectives evolve, you
    can modify the resolution of your analytics to help identify the most lucrative
    consumer markets.
• 
  
• Agile system—Most closed loop systems are easily modified to allow 
  virtually immediate results from an email campaign.  If you would like to
  know  how many people clicked on a Call-to-Action (CTA) in the latest batch of
  emails,  then you only need to click a button.  This type of responsiveness
  may require  additional investment up front, but the data available can help
  make your  dealership a success for years to come.
• 
  
• Identify key marketing ideas—One of the most elusive objectives in
    any marketing strategy is identifying the marketing message that is most
    effective. Automotive closed loop analytics can instantly identify those
    components and help you understand why they are so successful.  For
  example you  may find lifetime service options are a key to maintaining customer
    relationships which bolster sales.
• 
  
• Unique metrics—Measuring ROI on direct mail has been difficult in the
    past, but with the use of new techniques like showroom controls or dedicated
    phone lines, you can accurately measure how effective your new initiative
  is.   Using a phone number exclusively for direct mail responses and
  coupons with RFID  tags can indicate the precise number of reactions with a
  relatively low  cost.

Stiletto Networks are about becoming the biggest, boldest, bravest version of yourself that you can be.”

Claudia Batten, serial entrepreneur


Watch this video - Stiletto Network

 

Stiletto Network is a story of female friendship—disguised as a business story, a tale of women banding together to improve lives and companies and communities, to realize their dreams and change the world.

Women like Kim Moses, who created the most downloaded app in the history of Warner Bros. Or Jennifer Nason, who oversaw the largest high-yield bond offering of 2010. Or Mallun Yen, who joined the founding team of RPX, one of the fastest-growing start-ups in history, and steered it toward a $1 billion IPO. Or Joan Amble and Marilyn Alexander, who were fast-tracked to corporate board seats. Or Shauna Mei, a go-getter in her 20s who launched a company and got John Mack, the former Chairman and CEO of Morgan Stanley, on her board. Or Bonnie McElveen-Hunter and Melanie Sabelhaus, who created the most successful fundraising pilot in the history of The Red Cross.

What do they have in common? They’re all members of Stiletto Networks.

During the past few years, women’s groups have been coalescing in every major American city. Formidable ladies across industries are convening at unprecedented rates; they’re forming dinner groups and networking circles, and collaborating not only to achieve clout and success, but also to create a more just, equal society.

Stiletto Network is about those groups: the “Babes in Boyland,” “Power Bitches,” and “S.L.U.T.S.: Successful Ladies Under Tremendous Stress.” It’s about what happens when bright, caring women—from captains of industry to aspiring Millennials to moms launching businesses in their basements—come together to celebrate and unwind, debate and compare notes. But it’s also about what happens when they leave the table, when the talking stops and the action starts.

With engrossing narrative marked by compassion and wit, Stiletto Network is the first book to shed light on this groundbreaking movement.

DealerNet Services

I cut my teeth selling at an early age selling door to door. From delivering newspapers to Fuller Brush to Cash is Best, for which Ted Turner was a fugitive from the US holding offshore on his yacht in international waters for purporting a pyramid scheme, to selling the original wind up fire and burglar alarms for the home.

After having had my foot caught in the door many times I eventually found my way into Automobile sales. I was so excited to have this opportunity because here were people coming to me looking to buy what I had to sell.

I felt like a kid is a candy store and never looked back. This business allowed me to experience owning my own businesses but I always came back to what I always loved.

When I think of all the advice available to train a good salesperson I think of why salespeople would not all be superstars. After years of being around commissioned sales and salespeople both in and out of the Automotive industry it is apparent to me that the art of selling (and it is an art) is a talent that few people ever master.

I have seen so many techniques that salespeople use to make a sale that works very well for them but would never work for me. As a matter of fact, Some I could not even fathom how they even made so many sales with their “Style” of selling but it worked for them.

What worked for them would never work for me or you.. You can only observe and take those observations and find a “Style” that works for you and make it your own.

This “Style” for the fortunate ones something that comes naturally making selling for them almost effortless. Sales must be looked at as a challenge- the more difficult the sales is to make, the more satisfaction you get from the experience.

That challenge is something that the truly gifted crave, need and look forward to each and every day in every aspect of their lives. It is like a game of chess that is played and each move determines an eventual outcome that a true salesperson is driven to win by reading each move of the opponent before it is even made.

We are all actors on a stage in our journey through this wonderful life but only a few can mold and manipulate the parts they play.

There is and always has been a misunderstanding or maybe even a lack of respect for these truly gifted people. Only a secure, talented and gifted manager who driven to hit that next level knows that he must let these salespeople work their craft using their own “style” to make the relationship rewarding and successful.

These are the type of people that one needs to make a business truly successful. The ones who are in it not just for the money but because they are driven to succeed. Don’t settle for mediocrity. Constantly be looking for the people that will take, maintain and always be looking for that next rush that only these people get from their work.

If you have all the tools and have not found your “Style” as an owner, manager or salesperson unfortunately you probably never will. But if you know all this and never stop looking to surround yourself with these truly talented people you will have your battle plan and will eventually win the war.

Author Bill Cosgrove
http://dealernetservicesonline.biz
 

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