Spending the Same Money Differently To Make More Money

I was talking with a salesman at a local dealership that I have known for a long time. He told me that sales are way off and in fact, the worst he has seen in over 20 years. As I am listening, I am in the showroom and I am looking around. He's right, I think--there's no customers in the showroom, just salesmen looking out the window. I am introduced to the sales manager and he is in his office looking at the computer. I see the finance manager sitting at this desk looking at his computer. We go have lunch and come back an hour later and it is the same.

I came back for another reason several days later in the afternoon and said hi to the sales manager and asked how they were doing today. He said they have yet to see their first customer. It is 2pm.

The weekend comes and I decide (very rare) to look at the newspaper. I see a full color, full page ad for this dealership on Friday, another Saturday, and another on Sunday. I'm thinking. . . do they really think this is still working? Did it ever work well? I was in the car business for 25 years and I don't remember it working well. Some may say it did, but is it now? I think that they just think that's what they are supposed to do. In my 25 years, the ads were never tracked, so who would know what works?

The ad has lots of vehicles and prices--a lot of big SUV's and expensive metal, along with a much larger selection of pre-owned vehicles. I see the other ads in there do the same. Is it working? This ad has a box that says 0% is back, and of the 40 vehicles in this ad, one of them has a payment. Tell me that makes sense to you. It doesn't make a lot of sense to me. Few pay cash, so price is not the main issue of interest. So, I would think that this is a large amount of cash to spend on full page ads to try and make some money with give away prices.

This kind of mass market advertising has seen better days. Even if a few people responded to it, it would be a challenge to have it be a profit. Maybe I'm wrong about all this, but I think there is a better way--especially with the climate when the first customer has not even come in at 2pm. Let's explore some ideas.

That one full page, full color ad cost over $1,000, so over the weekend, I'm sure there was $3,000+ spent just for these three days. Here's some ideas of where to better spend that money and really get some results and be proactively building your business at the same time:
  • Hire a new salesperson. That will take care of one week's worth of advertising. You previously cut back, but now you need at least one more.
  • Get a database going of customers of the salespeople you have and hire someone to manage it full time. Don't ever let the salespeople manage it because it will be far too valuable. If you don't already have the database, pull out the deals from the last few years and get that information put into the database program quickly.
  • Buy some small give away trinkets like post note pads with the dealership name, letter openers and other small items to leave behind. This will cost about $1500 or so and last a few months.
  • Get the salespeople to contact their key clients and centers of influence and make appointments to go visit them. Give them a company credit card or cash to go take those clients to eat. Make sure that they have breakfast with one and lunch with another and maybe even play golf with another. Get them out there talking with clients and the best way to do that is while breaking bread together or having a little break on the course. (I learned this in the body business. For ten years I worked calling on dealers and the best money we ever spent was breakfast and lunch. Most the the best sales were made at one of those. At one lunch appointment I sold 110 units to one client. Still a record, I'm sure.)
  • Set this up as a prospecting system so that you have coverage at the store, but most of the salespeople are out and about and spending your advertising money by actually talking with clients and potential clients and building relationships.
  • As you start seeing new sales being made, do not let them stay in the dealership. Get them back out there after making some new appointments.
  • Another way to break bread with them in a great way if you can't get the main person to go out is to bring pizza or sandwiches in and feed their crew. This creates some great interaction with many more potential clients. While they are eating you have a captive audience to make a few quick points and maybe hand out a nice flyer or something.
  • Another way is in between meals, drop by a business and leave off some inexpensive give away gifts with the dealership name on it. The post note note pads are great ones.
  • Make sure the person hired to manage the database is updating all the new information generated. The best way to do this is to have a paper form that the salesperson fills in.

Now your sales manager has something to manage. Your database will have some meaning and constant use. Get the finance manager involved. He can do some classes on finances offsite. Pay your salespeople to do your advertising. You'll be spending the same amount, but you'll have healthier salespeople by taking care of their needs (give them a salary--yes, the s-word, or a guarantee or something to demonstrate that you are wanting their valuable assistance to rebuild your business and you will be relieving worry and keeping them busy doing fun things while they are making business happen. Of course it will be somewhat more of a challenge to manage this kind of sales program, and, yes, this does require courage and tenacity. You will have to think way outside of the box (really not that far). Yet this will work and you can take charge instead of waiting and hoping. When the demand outstrips the supply again sometime in the future, you can easily go back to the old way. But, you might find that the old way is no longer a good way. . . It could happen.

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