EVs, Gas, and Targeted Marketing: The Future of Car Dealerships, According to Stirista
Car dealerships, like many MULO (multi-location) businesses, are evolving. You can now buy used cars online, some dealerships are opening showrooms in shopping centers (rather than on traditional lots), and consumers are shopping around for the best deals nationwide.
About 18K car dealerships exist in the U.S. today, but how consumers shop at them (and what they’re looking for in vehicles) has evolved.
Bernice Lopez-Smith, a senior director for Stirista, an agency that specializes in data-based targeted marketing, spoke to Street Fight about how this sector has changed and how dealerships can use data to build traffic and sales.
What are some of the biggest challenges car dealerships are facing today?
- Power uncertainty: The upcoming presidential election has caused uncertainty in what the manufacturers will do with electric vehicles (EVs) and gas. For example, two years ago, the industry was moving to all EVs and now, because of consumer hesitation (charger anxiety along with the lack of infrastructure for chargers), the industry has taken a sharp turn back to gasoline-powered vehicles.
- Security and technology: The CDK cybersecurity attack was a huge awakening on how dependent operationally the dealers and the industry have become on technology. Technology offers an enormous advantage but also exposes them to vulnerabilities. 15,000 dealers were affected by the CDK hack and now the entire industry knows how vulnerable it is and how fast things can change.
- The ever-changing customer journey: In the past, the customer journey was very set and predictable and the dealers had a blueprint. Now, we know that 92% of all customers start their shopping journey online, but their journey isn’t linear as prospective buyers’ media consumption has been flipped upside down and all over the place. In particular, Gen Z uses the same platforms that entertain them for comparison shopping and virtual test drives and jumps from one platform to another. The marketing and consumer buying and shopping funnel has been disrupted.”
How do data analytics and targeting fit into the marketing mix?
“They fit more now than ever. Data analytics and targeting are now front and center for the CMO and/or marketing director’s plan from the get-go. Savvy marketing executives understand that and have embraced data and analytics due to the fragmentation in their media buys.”
Can you give us an example of how this can be applied?
“Reaching in-market buyers (in other words, people who are actively car-hunting) is critical for dealerships and particularly multi-location ones. However, dealerships often use the same marketing playbook from years ago. Rio Grande Valley-based Clark Auto Group (Clark Knapp Honda, Clark Chevrolet, and the Downtown Express service center) approached Stirista to reimagine its marketing program and through our omnichannel data-driven approach, Clark Auto has achieved significant brand lift including:
- Nearly 40% increase in leads for Clark Knapp Honda and consistent lead generation for Clark Chevrolet and nearly 60% reduction in overall cost per lead and positive Return on Ad Spend (ROAS)
- Low cost, high ROAS on English and Spanish language CTV campaigns including a 97% view-through completion rate
- Nearly doubled email open rate for Clark Knapp Honda.”
What are some of the obstacles to car dealerships engaging professional agencies with your skill set?
“Today, there are many marketing companies out there to choose from and partner with. Dealers already have to contend with a multitude of dealer vendors and dashboards to manage. By partnering with a data-first MarTech company that can provide an omnichannel approach in a rapidly changing customer journey environment, rich campaigns can be activated that will alleviate many of these obstacles.”
Any predictions for the future of car dealerships?
“The gap between sales and their business development department will continue to narrow and the lines will continue to blur thanks to the massive migration of shoppers beginning their journey online. In addition, there is a whole developing segment of buyers that want to conduct their entire shopping and buying experience without ever stepping into the dealership which translates into richer, more integrated digital sales and marketing approaches.”
We can all agree that the traditional “visit to the car lot” is being disrupted by a wide range of options and marketing solutions. And we’re eager to follow Stirista on the road ahead (whether it’s gas and/or EV-powered!)
