In the world of auto dealer sales and marketing, generating leads is just the first step. The true challenge lies in converting those leads into loyal customers.
According to a recent study by Urban Science, converting these hard-earned leads into loyal customers requires more than just a great product or service. It's about thinking from a car buyer's perspective and then nurturing those relationships.
Key Lead Management Challenges Dealerships Face
The Urban Science study highlights several crucial findings that every dealership should consider when refining their lead management strategies:
Leads aren’t buying due to economic pressures
Shoppers are taking longer to buy
Without good follow-up, leads will defect
To prevent defection, they need relevant content, options, and incentives for their buying decision
Leads are more important than ever, but dealers feel customers are not buying because of economic pressures
The study says that most dealers (75%) report that leads are more important now than five years ago, with 36% stating they are much more important. 86% of dealers believe that consumers are somewhat likely (54%) or very likely (32%) to change their purchasing plans due to financial concerns.
However, shoppers are very active, just taking longer to buy
The study states that economic pressures notwithstanding, consumer activity remains robust. While more than half (55%) of potential auto buyers surveyed agree that economic factors will alter their buying plans, only 15% are very likely to do so. In fact, auto shopper activity remains at the same rate as a year ago. This means the buyers are in the market longer, looking for the right purchase options, highlighting the need for long-term follow-ups.
Without a good follow-up strategy, leads will defect
The study states that well-qualified leads are likelier to defect. On average, they face a 17% defection rate, and leads earning over $75,000 tend to have higher-than-average defection rates.
To prevent defection, they need relevant content, options, and incentives for their buying decision
The study cites that the customer is looking for relevant information to help with their buying decision: Price (65%), dealership reputation (48%), and trade-in value (47%) are the three critical attributes buyers seek when looking for dealerships.
The study also cites that the customers consider multiple dealerships, and nearly half submit a quote request. In addition to budget-friendly vehicle options, shoppers are interested in exploring alternative financing and leasing options, finding lower interest rates, and considering new technologies such as EVs. Incentives move the needle; even a small $35 incentive can compel them to take a test drive.
4 Ways Dealerships Can Convert leads into Buyers
The findings from Urban Science underscore the importance of long-term follow-ups with relevant content in nurturing leads.
Implement a structured long-term follow-up strategy
Educate and inform leads
Invest in your product content
Pick the right technology and tools
Implement a structured long-term follow-up strategy
Dealerships should develop a structured follow-up plan that extends beyond the initial follow-ups. As stated, car shoppers seek specific information, so the plan needs to go beyond just keeping in touch. Instead, communication between the dealer and the shopper needs to provide valuable information about their vehicles, auto categories of interest, and dealer-specific updates around financing and incentives. Automation tools can be particularly useful in maintaining consistent communication without overwhelming your team.
Educating and informing leads
Leads often require more information before they are ready to make a purchase decision. This information should address the critical questions for the customer—why they should choose the dealership and brand, why it's beneficial to trade in their vehicle at the dealership, and what financing options, incentives, and alternative vehicles the dealership offers could meet their needs. By offering relevant content that guides leads through decision-making, dealerships can reduce friction, increase the likelihood of conversion, and reduce potential defections.
Invest in your product content:
Buyers don't just buy a car. They buy a car from a dealership and brand that meets their needs and financial preferences. As leads progress through the sales funnel, content is the key requirement. The key is investing in creating differentiation in each part of the lead's content and delivering it when needed. The article, How Dealerships Can Use Content to Nurture Leads into Loyal Customers, focuses on the content required to convert your hard-earned leads.
Pick the right technology, tools, and measures.
The holy grail of marketing has always been the right content for the right customer at the right time. Technology and automation are the keys to doing it at scale. You'll need three key capabilities from these technologies: the ability to segment and re-segment the customers, the ability to bring in the right content, and the ability to intelligently automate so that the right message reaches the right customer at the right time.
A subsequent article will focus on the tools and technologies the dealership needs to implement this change.
myautoIQ as the Catalyst for Conversion
The Urban Science study provides a comprehensive look at the factors influencing lead conversion in the automotive industry.
By understanding and addressing these critical areas—long-term buyer-focused follow-up, personalized incentives, relevant content, and vehicle variety—dealerships can significantly improve their chances of converting leads into loyal customers.
myautoIQ helps dealerships drive customer-focused follow-ups by providing the four critical elements needed to implement this change:
Customer Data Platform generates lead intelligence from dealership first-party data.
Automated Content Engine brings the right content from the dealer, OEM, and influencers.
Intelligent Automation creates dynamic cadence and mashies up the right content.
CRM and Workflow Integrations make it a zero-touch solution, and dealers don't have to do anything to get myautoIQ going.
myautoIQ empowers dealerships to personalize lead follow-ups at scale, maximize their lead conversion rates, and build lasting customer relationships.
How do your dealership lead follow-ups look to car buyers?
How does the study apply to your dealership? After analyzing lead follow-ups for more than 10,000 dealers, myautoIQ knows what goes wrong in most dealerships' lead follow-ups and why dealership CRMs become graveyards for dead leads.
Are you interested in seeing what we found for your dealership?
Get in touch, and we will walk you through our long-term lead follow-up analysis for your dealership.
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