hands switching a car for money
Servicing Your Customer

We’re approaching the light at the end of the tunnel when it comes to COVID-19, but the automotive retailing industry will feel the pandemic’s after-effects for a long time to come.


One such after-effect is the global computer chip shortage, which has limited manufacturers’ ability to produce new vehicles and is showing no signs of ending any time soon. Even when it does, there’s no guarantee that vehicle production will return to pre-pandemic levels. OEMs could instead focus on pressuring retailers to handle their inventory more efficiently.


Either way, for dealers the gist is the same: OEM-directed production cuts and layoffs. As a result, they’ve had to get creative in finding new revenue generators in the dealership.


The most obvious way to offset decreased new vehicle sales is beefing up used vehicle sales. In fact, you have a great source of quality used vehicles immediately available that you can and should be making money from: your existing customer base.


The trick is encouraging a trade from someone who may not be thinking about upgrading yet.


Activating Potential Upgrade Customers

Consider one interaction with your customers that is consistent: routine service visits.


The purpose of a service visit is, of course, to perform the necessary maintenance work as well as recommend additional maintenance the customer may need. However, this moment also represents a key opportunity to activate a potential upgrade customer and secure a valuable trade to boost your inventory.


Why? You have your customer accessible in person for as long as their vehicle is in service, and you have their current info and vehicle history immediately available. In other words, your sales person is perfectly positioned to pitch an attractive upgrade offer.


“Instead of waiting for us to complete maintenance on this aging car of yours, why don’t we get you in something a few years newer that still meets your needs, for a comparable monthly payment?”


Not everyone will jump at this opportunity. Some people don’t like sudden change no matter the circumstances, and some may feel like they’re being held hostage since you have their vehicle (it’s important to balance the value of your offer with a non-aggressive approach). But some will jump at the opportunity, and maybe a lot will if you put in the effort to construct truly attractive trade offers.


In other words, you can turn the waiting area in your service department into a catalyst for event-based targeted marketing. If successful, the customer gets a new vehicle without the usual stress of a major purchasing decision, and you get a sale plus a valuable addition to your used inventory in a time when every vehicle acquisition makes a difference. A win-win.


But, is there an opportunity to be even more proactive here? Instead of simply waiting for trade opportunities to come to you, you can take full control of the process by implementing a specialized email and direct mail cadence to draw in-market buyers to your aging inventory.


This is an excellent place to partner with a proven vendor who can conduct the relevant market research on your customer base, recommend specifics for the offers you make (such as options for model year upgrade, equity trade-up, interest rate reduction, and vehicle buy-back), and help you focus on your most promising leads.


Ultimately, whether you go it alone or enlist third-party help, the goal remains the same: maximizing revenue from your existing customer base while boosting acquisitions in the middle of an inventory shortage.


Pull that off, and you’ll have a blueprint for weathering more inventory shortages in the future – and making more money while you do it.

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