Social Marketing, Car Dealer Reviews and Dealership Ratings
Despite so much turmoil and disruption in the automotive marketplace today, it’s becoming increasingly clear that the dealers who will survive, and then prosper as the American economy rebounds will be those that learn to leverage the overwhelming growth in consumer use of Web 2.0 types of online sites and activities, such as Social Networks. Right now, in the second quarter of 2009 we are already seeing a small but significant amount of franchised car dealers (5 - 10%) who are utilizing or leveraging some form of User Generated Content (Web 2.0) to develop their Social Marketing and Reputation Management Strategy. These dealers and in some cases their employees, have implemented varying degrees of online social marketing and reputation management efforts that utilize “Positive Word of Mouth” amplified with the power of the Internet to enhance their good reputation, create top of mind awareness and elevate their dealership’s brand in a more cost effective manner than either CRM or advertising alone. The dealerships are easy to spot, because they are the same 5% to 10% in most markets that are the few who are maintaining profitability and holding their own on revenue and sales targets.
I find it interesting that there is so much correlation between the the dealers who are somehow managing to be successful under the current market condition are also the same ones who have figured out how to tap into consumer adoption of Social Networking and User Content Creation. In several cases these dealers are the also the same ones who are creating their own online community of customers, employees and suppliers. Many of them have online community websites filled with high quality content such as Videos, Photos, the latest reviews and road tests, interviews and articles supplied by car companies, enthusiast publications and consumers.
Customer Ratings and Dealer Reviews
Customer generated dealership reviews are changing the way people buy and the dealers they buy from. One of the fastest growing segments of what customers research online prior to visiting a dealership, are online Dealership Reviews. Dealers who are successful at implementing processes designed to drive positive feedback from their customers are not only helping set the stage for future business, they are driving additional business today.
Getting online customer reviews increases dealership presence within search engines results, drive more traffic to their websites, and generate more phone calls from consumers in the market to buy, who are increasingly turning to online reviews when selecting a dealer to do business with.
With Consumer Generated Reviews, Dealers can create a system that ensures they:
* Are Notified Each Time Their Dealership Receives A Reivew
* Have An Opportunity To Respond To Consumer Reviews
* Encourage Feedback From Customers
* Help Build the Dealership's Brand And Online Reputation
* Set Themselves Apart From Other Listed Dealers
Yahoo! and R. l. Polk Sponsored 2007 Dealer eBusiness Perfomance Study
Towards the end of 2008 Yahoo! and R. L. Polk & Co. presented their 2007 Dealer eBusiness Performance Study, one of the the larger marketing research initiatives in the automotive industry.
Findings from the study include the positive and negative impact of dealership lead handling and Internet sales performance and how online resources like search and consumer generated media influence shopping behavior.
The study incorporates several research methods including:
* Two Internet-based surveys: one of 550 vehicle shoppers and purchasers, and one of 1,000 car purchasers
* Analysis of 1,000,000+ leads from 1,140 dealerships and 35 brands to assess sales rates and time to close
* eMystery shop campaign of over 2,100 dealers encompassing 20 brands
* Onsite interviews with 20 top performing dealers
The report takes a closer look at car shopping from the consumers’ perspective to understand what has emerged as new buying influences, and the impact those new factors have on how car buyers use the Internet to select a dealership, and why they sometimes switch brands in the middle of their shopping process. The report shows a stunningly significant increase in the use of online dealership reviews, and the impact those consumer generated reviews have on which dealership, and what brand of vehicle they are going to buy. The research shows that their is a high degree of value placed upon the transparency within customer interaction with dealership sales staffs.
Shown below are a few examples of the results, and what we believe to be the key takeaways this study provides:
* 88% of consumers use the Internet for research prior to visiting a dealership
* Over 30% of Internet leads sent to dealers go unanswered
* 21% of purchasers switched dealerships based on consumer reviews they read
* Of those that purchased a different brand, 23% did so because of poor dealer interaction
* Online “location” and brand is as important as the “brick and mortar” dealership
* Dealers can increase gross by implementing email response procedures
* Positive consumer reviews definitely attract and retain customers
* Investing in sales staff training and cultivating consumer reviews will drive increased gross profit margins