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Are Industry Best Practices Killing The Car Business?

Are they? I think, in a way, they are. You hear about it all the time, in every forum, every dealer twenty group and in all the industry magazines. Best practice this, best practice that, this is what you should be doing if you want to sell more cars!

I say, take it with a grain of salt. Look at where the auto industry is today, we're behind the times, it's always been that way, many times it has been said, "The auto industry is a late adopter of any new technology." I think the reason why this is, is because there are too many auto dealers out there that are always looking for industry best practices without thinking about their own dealerships best practices.

Wikipedia defines best practices as a technique, method, process, activity, incentive, or reward that is believed to be more effective at delivering a particular outcome than any other technique, method, process, etc. when applied to a particular condition or circumstance.

Wow, that doesn't sound bad, now does it? No, it doesn't. In fact, it's not the actual best practice idea that I want you to think about, it's about the idea of blindly following what another dealership has done with the assumption that it will produce the same results for you. Now, I'm not saying that you shouldn't look into these so called "best practices," because you should. But instead of looking at them as the holy grail, use them to create practices that are best for your particular dealership. In other words, test, measure, test some more, measure again then rinse and repeat. This testing process should never end, in fact, you should make it a habit to continually improve upon your own numbers by measuring and testing on an ongoing basis.


The 5 Fundamentals Of Developing DEALERSHIP Best Practices

Embrace The Chaos and be proactive. Times change, people change, and culture is always shifting. The most important aspect of any marketing strategy is to make it flexible enough so that it won't break when things don't go according to plan. Adhering to industry best practices and not developing your own dealerships best practices is the quickest, surest way to failure.

Be a student, but surpass the teacher. Be proactive in your pursuit of knowledge but a master of adaptability.

Don't Let Fear Stop You from taking on new challenges and trying new things. I see a lot of dealers that won't try anything new because they fear they will lose market share, they are content with doing what has always worked, then lose their minds when it doesn't. In order to grow your business and take over market share, don't be afraid to adjust industry best practice by testing and measuring what works best for your particular dealership.

Use industry best practice, but mold it to fit your needs. Being fearful prevents growth, proceed with caution but don't let fear overtake you.

Put Your Ear To The Wind and pay attention to what it says. Predicting what's going to happen, in most instances, is near impossible. But if you listen to the constant change that is going around you and adjust business practices accordingly your dealership will always stay relevant. People are buying differently, mediums have changed and they put more emphasis in what their peers think than ever before, are you listening to them? If you are, then creating dealership best practices will be a much easier task!

Listening is one of the greatest business practices not being utilized today, what are you listening to?

Communicate Up and Down and Inside and Out. Open communication has been preached on forever but it's something that rarely occurs, good communication anyway. Instead of this being about internal dialogue I want you to think about external dialogue and listening to what your customers have to say. I encourage you to open up dialogue with them, get their opinions on what you can do better, believe me, if you ask they will tell! The best way to turn an industry best practice into a dealership best practice is by asking your customers how THEY would like to purchase a car, get service, or buy parts, then adjust accordingly.

Effective communication is more than a fundamental, it's the bedrock upon which ALL successful businesses are built.

Add Value. Everything you do, every email you send, phone call you make, ad you place and every time you talk to a customer should add value to their lives. If you care passionately about your customers it will become much easier to add value. Take a look at what you're doing now, which processes can be adapted so that they add value?

Adding value builds a stronger win-win relationship with your customers. Stronger relationships equal more sales, more referrals and more repeat customers.

Conclusion

While these fundamentals will get you started never forget that you must always test, measure, then test again. Never be comfortable with where you're at, always push the envelope, be creative and grow. Keep in mind that just because a specific email is working now doesn't mean it will ALWAYS work, the same can be said for a phone script, a liner ad, or a radio spot. Adapt and grow.

Views: 396

Tags: automotive, best, pratices

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Comment by David Johnson on September 11, 2012 at 7:11pm

Wow, you took it WAYYYY back Tom! LOL

You are so true about the conferences, these ideas need to be thought through before they are implemented because some "expert" told them they should. I subscribe to the test, test, test mentality and always striving to be better than you were the day before.

Comment by Tom Gorham on September 11, 2012 at 7:00pm

David, you are as always, on point. I favorite the phrase, "there are too many auto dealers out there that are always looking for industry best practices without thinking about their own dealerships best practices." 

That is profoundly true as dealers who took the Internet lightly discover it is their entire business today and want to take charge of their destiny.  They go to seminars and conferences and hear 5 different experts give them "best practices" (sometimes contradictory) and try to make sense of it from their traditional experience.

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