New Year's Resolution for Your New Car Department
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Transcript of New Year's Resolution for Your New Car Department
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New Year’s Resolutions for your New Car Department
J a n u a r y 5 t h , 2 0 1 7
Brian Finkelmeyer | vAuto | Director of Product and Business Development for Conquest | [email protected]
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Interesting Mix of Variables for 2017
Sedan Recession – imbalance of inventory vs. demand
Record levels of Incentive Spending
Record levels of Inventory
Low Interest rates and Fuel Prices
Most Analysts projecting a slight sales decline for 2017
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“The manufactures have
changed the game, saying
to retailers, You can’t make
money selling new cars”
Mike Jackson, AutoNation CEO
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Stair Step
Programs
Additional Production
Capacity
Pricing Transparency
3 Key Drivers of Margin Compression
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3 New Car Resolutions for 2017
Precise Inventory
Management
Create Customer
Trust with
Transparency
Efficient
Marketing
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Inventory Management
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How can we manage our inventories more efficiently?
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Smarter Ordering and Dealer Trades
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Be careful about what you order!
2,900 unique combinations in
Dealer inventory
1850 combinations have one or
zero sales in the past 90 days
65% chance of getting it wrong!
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Retail 90 Sales
Days Supply
Days to Sell
Ordering Desirability
Weighted
33.3%Weighted
33.3%
Weighted
33.3%
Scoring System to Rank Orderable
Combinations
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Vehicle Ordering AnalysisTRIM Exterior Interior Sales Rank Days Supply Rank Days to Sell Rank Desirability2.5S Gray Black 1 22 2 22.5SR Black Sport 2 25 7 52.5SR Gray Sport 3 17 7 32.5S Black Black 4 23 3 42.5SR White Sport 5 34 9 72.5S Silver Black 6 38 16 102.5SR Blue Sport 7 15 1 12.5SV Gray Black 8 38 33 142.5S White Black 9 31 9 92.5S Red Black 10 29 9 7
2.5SV Black Black 11 51 40 232.5SR Silver Sport 12 55 24 18
2.5S Blue Black 13 27 4 62.5SR Red Sport 14 40 19 132.5S White Black 15 52 20 162.5SV White Black 16 62 36 272.5SL White Beige 17 66 50 372.5SV Silver Black 18 67 54 392.5SL Gray Black 19 77 45 412.5SL Black Black 20 87 50 51
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Clear Visibility to Challenges and Opportunities
142248
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Assessment of Price vs. Age and Market
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Automation of Pricing Rules
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Impact of having an Aging Policy
0-75 76-120 121-180 181+
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Polling Question
What is your biggest New Vehicle Inventory Challenge:
1. Understanding how to price your new vehicles to market
2. Ability to obtain the “Right” vehicles from your manufacture
3. Aged Inventory Management
4. Handling Dealer Trades
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Customer Experience
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“We’re not competitor obsessed, we’re customer obsessed. We start with what the customer needs and we work backwards.”
Jeff Bezos, Amazon CEO
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What does today’s
new car customer
want?
Speed and Transparency
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Customers Prefer Your Website vs.
Your $20M Facility!
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Provide
Buying Tools
“The More You Tell, The More You Sell”
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Re-think BDC Departments
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Win Customers with Speed
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Marketing
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Polling Question #2
How do you currently allocate your monthly marketing budget? (% should
add up to 100%)
Digital/Online
TV
Radio
Print/Direct Mail
Other
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Customers are only visiting
1.6 Dealerships
The game is being
Won and Lost
ONLINE!
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Two Key Marketing Challenges
Budget Allocation
Execution
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Are We Allocating $$’s Correctly?
25%
Budget
75%
Budget
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Where Should I be Investing?
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Improving Digital
Marketing Execution
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$7500 Per Monthwith Autotrader
$5500 Per Monthwith Cars.com
180% less likely to click on MSRP Vehicles!!
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Vehicle Descriptions
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Listings Management
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Resolutions are never easy to keep….
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Measure What You Manage
Key Performance Indicator Target
New Vehicle Inventory Turn 6+
Showroom Closing Ratio 65%+
Advertising Expense Per Vehicle $200-$300
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Accountability Tracker
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3 New Car Resolutions for 2017
Precise Inventory
Management
Create Customer
Trust with
Transparency
More Efficient
Marketing
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