With today’s troubled economy negatively impacting almost every dealership across the country and the ink on monthly financial statements turning from black to blood-red, why do most owners and upper management teams advertise the same way they did five, 10 and even 25 years ago? The simple answer is they just don’t know any better! I am an active general manager in a highline domestic dealership and I didn’t work in a car dealership in the 1980s or the early 1990s, so I just don’t understand why almost every car dealer has this grand idea that spending thousands of dollars every month advertising in the newspaper, on the radio or on television is a good idea.
Some of us call radio, TV and newspaper advertising ego marketing! You see, we have the opinion that a lot of dealers would rather have their names all over the radio, TV and newspaper and sell fewer cars than advertise effectively and partially anonymously to generate more business. This is because their ego gets in the way of sound decision-making, and it happens all the time. Don’t get me wrong; I do believe that you should have some top-of-mind-awareness (TOMA) ads, but like everything in life, you must have good balance be successful.
I have a few questions about this ego-driven marketing strategy.
Radio and Television Advertising:
1. How do you know what time to run your ads?
2. How do you know what station(s) to run your ads on?
3. How do you know if you’re even targeting the audience you hope to attract?
Newspaper Advertising:
1. How do you know what day(s) should you advertise?
2. How do you know which page you should advertise on? Sports? Classifieds? Obituaries?
3. How do you know if you’re even targeting the audience you hope to attract?
The answer to all these questions is the same! It’s because your ad representative told you so.
I always get a kick out of the weekend newspapers, the flashy television ads and the catchy radio spots with all of the dealerships trying to advertise their cars, trucks and sport utilities cheaper than the next guy!
Why do so many dealerships pay thousands of dollars in advertising to see who can sell a vehicle for the least amount of profit or even lose money just for the privilege of making a sale?
I am a man in my very late 30s and my wife is a woman in her very early 30s (lucky me!). Like all of our friends and family, we either listen to a CD, plug in an iPod or listen to one of the 240 channels on satellite radio while we drive our cars, and when we’re at home watching TV we surf the numerous channels on DirecTV.
How are all the 80s- and 90s-style advertisers out there ever going to find the people of my generation and the generations that follow? We don’t watch very much local TV and when we do it’s recorded on DVR or Tivo, which allows us to fast-forward through the commercials. We also get our news online and don’t listen to local radio stations at all!
The answer is simple—the Internet!
It’s absolutely amazing how so many upper management teams will pay tens of thousands of dollars every month on ego ads that don’t work, but they refuse to spend appropriate amounts of their budget on special finance leads that do work. It all goes back to a general lack of knowledge! Wouldn’t you rather have someone who goes online, fills out a full credit application and asks for your help, rather than hoping your low price giveaway ad brings in that customer?
Granted, there are plenty of lead providers out there that don’t work that well, but if you look hard enough, you will find one of the handful of reputable special finance lead providers that are left and can deliver you quality leads at a fair price. If you don’t know how to find one of these reputable lead providers, feel free to call or e-mail me and I will be glad to help steer you in the right direction!
Special Finance Insider Vol. 3, Issue 1
