Why Some Auto Dealers Survive While Others Go Out of Business

August 20, 2008 by

We’re halfway through Q3 and we are approaching the final stages of planning Q4. Certain industry factors have left some craters in the wake, but the moon-walking automotive direct marketer feels at home in such conditions. Let me explain.

Soaring fuel prices and economic uncertainty led to a sharp decline in U.S. auto sales in general, but truck and SUV sales in particular suffered the most. At this point there’s no need to recap this summer’s auto sales woes, but add in the stricter lending guidelines and loss of lease business, and we can say with assurance that the “car business” is hurting right now.

But from our perspective, our interaction with U.S. auto dealerships and what is being reported in the national media do not necessarily match up. For example, earlier this month a Hyundai dealer in Tennessee did a 5,000 piece targeted direct mailer, and from the first half (2,500) they got 36 responses (1.44%), which isn’t bad. It’s above industry average, and it yielded double digit sales. But there’s nothing too special about that (our direct mail has been called the best in the business, and over 90% of our programs have performed in this manner for over three straight years!).

The amazing thing is that with a tweak in the data for the remaining 2,500 pieces, the dealer got 175 responses (6.99%) and is still selling units to this day from the mailer we sent out! In the end, the dealer will probably end up with 30 or 40 retail deliveries. This is in addition to the traffic produced by other advertising mediums and daily walk-ins. This dealer will gross over $100k from a dinky little 5,000 piece Hill Marketing mailer; just one of the reasons our clients love us so much!

On the other end of the spectrum is a Dodge dealer in NC. Only the man that has been hiding under a rock in a dark cave isn’t aware of the ultra-suffering and hemorrhaging that Dodge dealers have had to endure this summer. But as a Hill Marketing client, this Dodge dealer has had a steady flow of quality traffic from our mailers. We got a call at the beginning of the month and the dealer “TRIPLED” their normal amount of direct mail (they run with us every month).

Now, why would a Dodge dealer triple their amount of direct mail? Our answer: because our mailers out-perform anything else on the market! This Dodge dealer is enjoying over 3% response rates and is not firing salespeople, rather, hiring more! Try to tell this Dodge dealer that the market is soft and he’ll laugh at you. His salespeople and F & I team will average over $10k on this month’s paycheck – because they’re selling units with good grosses.

Another example would be a GM dealer in Louisiana that runs our mailer religiously. In the midst of all the trepidation they are laughing all the way to the bank enjoying a 3.74% response rate from Hill Marketing direct mail.

Then there’s a Texas dealer that can’t stop putting in orders for our direct mail. He’s a Chevy store, and he uses us multiple times per month (anywhere between 10,000 and 30,000 pieces). For over a year we have been providing direct mail for this dealer, and in his eyes, we’re his hero.

So it is with a major San Antonio dealer (tough market). We’re the ace in the hole for them because we’re the only direct mail provider that can get 5.34% response rates! To a bunch of savvy car people, leads are of essential importance. That is why the GM down there picks up the phone and calls Hill Marketing and orders direct mail from us – every month.

Anyone can say anything online. That’s just the way it is. So if you’re a dealer reading this and are considering doing direct mail but think I’m lying, do like they did at one point and call me and ask for references. The above referenced real life cases have been informed of this article and are willing to take reference inquiries. Nothing beats a real life testimonial from a peer, and now is your chance to check things out. Q4 will be here soon, and there’s still time to book Q3 events.

It’s either that or you’ll just keep reading about other’s success!

Sincerely,

 

John Greenleaf

Marketing Director

Hill Marketing Group

(866) 572-4861 ext. 4127

INDUSTRY RUMOR: GM TO LAUNCH “BIGGEST SALE IN 100 YEARS!”

August 13, 2008 by

I’m not sure if this is considered “classified information,” but I have been told by three different GM dealers (in different regions) that on the 19th of this month GM plans to launch what they are calling “THE BIGGEST SALE IN 100 YEARS!”

We don’t know what it’s going to be yet, but as soon as we do, we’ll let you know. So if you’re a GM dealer, then you probably don’t need to use us for the rest of August. But if you aren’t a GM dealer, then you need to worry about market share.

This will be a ripe time to mail since auto buying will be on the mind, producing a consumer “monkey see monkey do” environment.

In our Hill Marketing office we play a radio in the background all day long. Today I have already heard several mentions of GM products from the DJ, not an advertisement, in between the songs. Someone’s getting paid!!!

Stay tuned, I’ll let you know as soon as I hear what this “BIGGEST SALE IN 100 YEARS” is all about.

Automotive Direct Mail Firing On All Cylinders

August 6, 2008 by

Since most automotive direct mail campaigns have a “hit-n-miss” component that sneaks up and appears when it’s least expected, a celebratory boasting is warranted whenever a solid run emerges. This latest string of successful automotive direct mail campaigns stretches back to the middle of March (of this year). The few minor adjustments we’ve made have resulted in a major impact in the overall volume of new and pre-owned sales for the dealers we’ve serviced.

So, if a sudden surge in sales is what you’re looking for, now would be a good time to call. Free consultations are offered between 8am and 4pm (PST). To reserve a free consultation, fill out our contact form completely and you’ll be contacted a.s.a.p. Media Kits with samples, pricing, etc., are available upon request.

No obligation

No purchase necessary

Discussion: Mass Media or Direct Mail?

August 4, 2008 by

Augustin Gohil, managing partner of Hill Marketing, has an interesting and informative post on his blog discussing direct mail vs. mass media. In fact, that’s the title of his post which can be read here.

He discusses how “media fragmentation reduces the coverage for individual stations and press,” and how that leads media owners to increase their prices in order to protect revenue. This behind the scenes competition raises the price on mass media while the mass media audience decreases. He shows how direct mail is unique because it does not operate in this way.

He asks, then answers the question: “How is direct mail different?”

Click here to read his article. Although it is not designed for the automotive industry per se, he discusses “shared principles” that are not industry specific. He also allows comments if you have any questions or input. I might jump in to the discussion myself. (SG)

FOUR MAJOR SUMMER SALES TOOLS

August 4, 2008 by

With Factory leasing no longer being an option for many dealers, a peek into the old marketing trick bag could be well worth the time. Our turnkey direct mail programs are virtually plug-n-play. If you’re ready for a big pay day, then browse our featured programs below. Every one of these programs will be available in August, 2008.

 1. Severe Traffic Builders (for emergency situations)

  • Giant Key Mailers – 17X22 full color w/$50k in prizes (recent events include 54 units sold off 30k pieces). Prices starting at only $0.79 (30kp).
  • Gigantic 9X12 Jumbo Postcard w/high quality key affixed. Full color double-sided key mailer on card stock w/multiple prizes. Prices starting at $0.69 (50kp).
  • Giant 11X17 Tri-Fold Saturation Key Mailer. Double-Sided full color on 80lb. gloss w/high-quality key taped to inside panel. Multiple prizes to drive traffic. Prices start at $0.69 (50kp).
  • All Key mailers are fully insured for prizes: 1) $25,000 in cash, 2) Vehicle giveaway ($20k), 3) 42″ Plasma TV, 4) 4-Wheeler ATV, 5) $100 in cash. For additional saturation traffic builders, call or email us for samples and prices.

2. Title List Mailers (for targeted trade-ins for pre-owned inventory)

  • Mail the piece of your choice to our title list that catalogues current owner with the current vehicle at the current address. With variable data printing, mailers can reference the owner’s name as well as vehicle. This is an insider’s secret that every successful dealer is using below the radar. Great for toggling between dealer database and title list. Best for buyback and conquest. Highly effective, no nonsense mailing list.

3. Pre-Screened Credit Offers (for high-gross sales)

  • US Capital MasterCard Credit Sale. This piece is a pre-screened credit offer backed by a real auto lender (you can switch financing) that has an actual US Capital MasterCard affixed to the piece. This extremely official looking piece generates a large volume of credit applications by pre-screened Beacon-filtered customers interested in obtaining an immediate auto loan. All events are exclusive and customer must physically appear at dealer location to take delivery. Prices start at $1.39 (10kp) and $1.59 (5kp). Larger volume discounts are available. Price includes first class postage, credit data from TU/XPN/EFX, toll free # with IVR/CRM and 24/7 call center and appointment setting.
  • Live Check Mailers – Send pre-screened credit offers to qualified prospects in your market area. Piece includes a funding check already made payable to your dealer. All customer has to do is register online or call IVR to secure funding code. Then they walk live check into your dealership and you match their credit approval with a vehicle from your inventory. Strong advances such as 120% of MSRP or retail blue book makes it easy to roll no money down deals, or absorb negative trade equity. Prices as low as $1.29 (10kp) and $1.57 (5kp). Great grosses are continually reported.
  • Credit Mailers are best for dealers with strong finance departments. The above programs allow dealer to use any lender they choose. No demand for first right of refusal are ever made. Dealers have total freedom and are never restricted or boxed in.

4. Ongoing Lead Programs (for Spec-Fi depts.)

  • Current top-rated lead program is our BKLeadXpress, a daily BK trigger program that sends US Capital MasterCard mailers to every discharged BK the same day it is discharged. This program focuses on the customer’s need to establish positive post-bankruptcy credit to enhance their future credit rating. Using your auto loan as the catalyst, this program makes a strong run at every discharged bankruptcy in your market area and gives them strong reasons why they should buy a vehicle from you right now instead of waiting for their credit to get better first. Program requires dealers that have lenders to finance fresh discharged BK’s with as little as $2,000 down payment with strong employment history.  
  • Facts: 37% of consumers purchase a vehicle within the first 30 days of their discharge. 70% of consumers will purchase a vehicle within 90 days of their discharged bankruptcy. These “ready-to-buy” prospects are the hottest commodity in the Special Finance world, and they’re available immediately upon set-up.  
  • Depending on size of dealership and aptitude of Special Finance manager, one time investment is approximately $2500 to $3500 for 6 to 8 months worth of leads. Manifest with phone numbers are sent daily to dealer for immediate phone follow up prior to mailer’s in home date. Ample opportunities await the sales and finance professional with auto lenders to buy this paper.

 5. Internet Lead Services and Online Applications (disc.)

  • Due to the highly frivolous, unscrupulous, and fraudulent nature of many lead providers and their leads, we have indefinitely discontinued offering internet leads to our clients. Our reputation is too valuable to blow for a quick buck, and so we give internet leads away for free to dealers that we do business with. Whether it be 12 leads or 496 leads, we do not charge for them nor do we stand behind them as authentic or exclusive. We apologize if this hurts anyone’s feelings, but our long-term outlook on our business always takes precedent over short-term profit. Our decision is final.

Media Kits, samples, and price cards are available upon request. Just email or call and request.

When Every Door Looks Good: A Primer to Contextual Marketing

July 11, 2008 by

Contents of this article:

1. See Jane Dream

2. See Jane’s Mind

3. Meet Jane

4. Sell Jane

1. See Jane Dream:

Behind her are six paths to her future. Each path is represented by a non-primary color door. From the look on her face we can see that her imagination is contemplating which door to open. Based on her facial expression, her clasped hands in front, and her upward left looking stare, we can know that she is logically calculating the memory of a positive past experience.

2. See Jane’s Mind:

Eyes don’t lie. Ancient proverbs from many cultures in one way or another acknowledge that the eyes are windows to the soul. A trained body language expert would be able to analyze Jane’s body position and conclude with scientific precision what she is psychologically experiencing “inside her head.” Experts agree that up-left eye-movement indicates the visualization of a “remembered image” or “experience.” Whereas an up-right eye movement indicates the [creative] construction of an idea, image, or concept. Since Jane is looking up-left, we can conclude that although she has many unknown futures through the doors behind her, she finds more comfort and security interpreting those unknown future opportunities in light of her past positive experiences. This is a shocking discovery; a marketing and advertising breakthrough in anthropological research. And until robots become our customers, we need to understand people much better than our current advertising methods indicate.

3. Meet Jane:

Jane is a 28 year old dental assistant that makes $40k/year.  She lives with a roommate and she recently upgraded her wireless plan online to unlimited text messaging, and visited a few dealer sites just to get the flavor of what’s out there in case she ever wanted to trade in her ’04 Matrix.  Many women want to be her and most men want to be with her.  She represent the culture-at-large and guess what, she would rather stay home exfoliating than deal with a car salesman (type). One more fact about Jane, she’ll buy a new car this summer from someone.

Sell Jane:

In order to sell Jane, Jane must feel like she’s buying. In other words, unless she feels that she is self-initiating the buying process; all attempts to advertise to her will simply be ignored and dismissed as irrelevant. The trick here is finding a way to proactively foster enough of an influence on her so that when she responds, she does so in such a way that she considers on her own terms.

If she feels corralled and cornered, she will interpret the situation in light of a positive past experience and you will end up in her mind-space reserved for negative experiences inefficiency and overall ineffectiveness.

In just a few short words, I’d like to debunk the myth of feminine design as well as warn of the long-term dangers. Women are less likely to respond to feminine design, and are more likely to appreciate transparency. If you can get them to appreciate your transparency (i.e. up front price, etc.), then they are most likely to respond. Don’t put the cart before the horse! If they feel like you’re trying to treat them differently because they’re women, that’s a good enough reason for suspicion.

In today’s media, your mailers can’t look like everyone else’s. The same old tired pieces you’ve been running is the same as everyone else, and it no longer works. If you want to be noticed, your mailers have to be fresh, different, and inspiring. That is why Hill Marketing is currently designing 80 brand new, fresh and exciting mailers. Today, we must look different, talk different, think different, and sell different. Since the retail car business (at best) is always about six years behind the times when it comes to trends, technology, and marketing philosophy, Hill Marketing is dedicating to revolutionizing automotive direct mail by creating copy that competes with Verizon, Microsoft, Apple, Vonage, etc. Industry experts have predicted that Hill Marketing will lead the charge in saving the direct mail industry.

The same old thing you have been doing is the same as everybody else, and it no longer works. To be noticed, you’re advertising needs to be fresh and different.

Sarah black and white

Sarah black and white

Sarah Gundry is Creative Coordinator and Research Professional for Hill Marketing Group in Orange, CA. Her experience and background in studying the philosophic turn to postmodernism and its direct relation to contemporary marketing and advertising makes her a valuable contribution to the team at Hill Marketing Group. She is currently participating in the contextual marketing think tank established by John Greenleaf and will be featured as a prominent speaker in upcoming seminars and conferences.

Meeting the Challenge of Automotive Direct Mail and Online Marketing

June 11, 2008 by

Rock and Hard PlaceAuto Dealers are truly between a rock and a hard place (see image of auto dealer to the left). On the one hand, they know that good direct mail works, and on the other hand they know that some good online marketing works too. This forces some dealers into having to make a decision because since neither is free, and since most dealers don’t have an unlimited advertising budget, most stores will be able to only utilize one or the other. But if the decision needs to be made, which should they pick?

First, let’s take a quick look at some of the features of each that make them successful. Then we will consider a proposed solution of integrating the two and synthesizing the successful features of both direct mail and online marketing.

Automotive Direct Mail: There isn’t a conceivable scenario in which direct mail can become obsolete all together for the automotive industry. Think about this, if everyone decided to stop doing it, it would create an open market with no competition and before you know it everyone would be mailing again. Unless some kind of law or restriction on who can mail what is legislated, direct mail isn’t going anywhere and will still remain one of the more preferable means of automotive advertising.

Successful Features of Direct Mail: 

  • Delivery is straight to prospect in the home
  • Tangible means that can not only be seen, but felt, handled, etc.
  • Direct Mail is received and reviewed at a specific time of day allocated for such things as opening and reading mail
  • Variable printing makes offer personalized
  • Control of geographic distribution
  • Results are immediate compared to other means

Online Marketing: This can be a broad descriptive category, but for our purposes here we will limit the term to include email blasts, third-party leads, SEO, microsites, and spots. This medium has potentially unlimited possibilities and is limited only by the imagination of the developers. It is obviously inevitable that the day will soon come when a nationwide de-sensitization of internet users will lead to the ignoring of such ads that say, “Click Here For A Free Vehicle Delivered To Your Home!” With so many unlimited opportunities for marketers online, internet users are quickly becoming aware of scams, tricks, and “specials” that are perceived as over-promising and under-delivering. The skill for online marketers will be in separating dealer ads from the rest of the online ads that users will become conditioned to viewing as literally invisible.

Successful Features of Online Marketing: 

  • Large audience is online
  • Internet is used for research
  • Prospects prefer internet to respond online vs. calling toll-free
  • User controls the pace online
  • Internet is interactive

These highlighted features of the two mediums of direct mail and online marketing provide a framework for us to explore the consideration of a synthesis of the two. This consideration is what led to the development of Hill Marketing’s progressive line of automotive marketing tools. We have masterfully produced colorful customized mail pieces that maximize personalization while providing customer response options both by toll-free numbers as well as online.

The toll-free number doesn’t need explanation at this point, so I want to take a look at the call-to-action response online option. In addition to top-performing direct mail design, prospects are provided with a website to visit that contains their name in the url. This is bound to get their attention and worst case, due to sheer curiosity, provoke them to visit the site online. This transition from direct mail to online is prompted by the prospect’s own personal name in the url on the mailer. Example, if the prospect’s name is John Greenleaf, his mailer will have a url in big letters that says: Hey John, be sure to visit http://www.JohnGreenleaf.abc.com to get your personalized message from ABC motors.

When the prospect logs on to his personalized url, he will find a customized landing page that is designed to look like the direct mail design. This maintains the theme of the campaign and immediately strikes familiarity on the subconscious level of the prospect’s mind. The customizable, personal landing page will have a personal message in the prospect’s name and will correspond with any other pertinent information.

The landing page will feature an interactive section where the prospect will be able to fill out a form with survey and comment box. This landing page, due to the specific route the prospect used to get there, can employ many of the great tricks of the internet such as, “As soon as you complete the form below, you will be eligible to win one of the following prizes!”

The prizes will be the same prizes that are used in standard direct mail, the biggest difference is that instead of having to visit the dealership to become eligible to win, all the prospect has to do is visit his personal website from the convenience of his leisure. This will substantially increase response rates and allow dealers to capture valuable information that direct mail could never do.

For instance, the survey on the landing page can determine whether the prospect owns or leases, whether they will be in the market in the next 30 days, 4-6 months, over 1 year, or over 2 years, whether they prefer new or used, etc., as well as whatever comments the prospect wishes to submit. Over time, the data captured here can become the dealers most valuable list, and the web traffic to this page can far exceed the dealer’s own website, virtual showroom, online inventory, etc.

We will also offer a customizable “Thank You” page upon exiting that can offer a link to dealer website along with any message desired. We will also provide dealers with a stat page that tracks all the action (traffic activity) that the mailer generates. This comprehensive statistics page is a great tool for managers to follow-up with on leads given to the sales staff.

Now, I have leaked just about enough information to scratch the surface of the intelligent person’s curiosity. If you don’t get it, yet, you will soon – but probably in the mail from a rival competitor. What we have accomplished is the perfect balance between direct mail and online marketing without raising the investment one would have to make for a very inexpensive direct mailer. For samples and more information, or to quickly set something up at your store, click here and we’ll send you our media kit.

Automotive Direct Mail: Recent Results and “Across the Board” Averages

June 9, 2008 by

This is a record of eight recent sales events I did using automotive direct mail. I will list the response rate, dealership location (State), and an “across the board” average for a hard number on our automotive direct mail performance! 

  • 3.39% – TX
  • 2.50% – TX
  • 1.74% – TN
  • 2.22% – TX
  • 1.72% – AL
  • 4.95% – NH
  • 2.72% – OH
  • 2.04% – NC

The combined “across the board” average is 2.65% response rate. These do not include responses that circumvented the process in which leads are logged. We can reasonably add at least a half percent in non-logged responses, bringing our “across the board” average to an (unconfirmed) 3.15%ON AUTOMOTIVE DIRECT MAIL!

Do you see now how I can unashamedly boast of having the TOP-PERFORMING automotive direct mail products in the country? How is your mail company doing?

Automotive Direct Mail: Summer Solution?

May 28, 2008 by

If this past Memorial Day Weekend is any indication of how automotive direct mail will perform this Summer, then expect a “push” on certain mailers and a “whoa” on others.  Out of the three different pieces I mailed, one stood head and shoulders above the rest.  Was it (a) the saturation pieces?  Was it (b) the credit mailer (pre-approved)?  Or was it (c) the one I said would out-perform anything it came up against? 

Not to pat myself on the back, but it was “c,” the one that I predicted beforehand to out-perform anything it came up against.  That’s right!  The greeting card I designed behaved just like I created her to do.  She was a good little animal this past weekend generating an average of 27 deliveries per 5,000 mailed!  At less than $180 per vehicle, General Managers, Principles, and those beloved bean-counters are all of a sudden paying close attention to those marketing folks over at Hill Marketing.

It makes total sense.  People love receiving greeting cards in the mail, be it a birthday, holiday, special occasion, etc.  Perhaps some sort of psychological satisfaction subliminally occurs when their fingers are carefully tearing open the edges of the sealed envelope.  Perhaps the anticipation of the unknown source of joy that awaits inside the envelope sets the stage in the mind that leaves it vulnerable and persuadable to a degree uncommon to standard automotive direct mail.

I really don’t know the exact reason.  But as far as reliable empirical evidence goes, dealers that run this mailer always sell many units.  If you have a favorite mailer that you run, I suggest you try it at least once.  Shoot me over the copy and I’ll get a proof out to you in the greeting card format.  If I don’t substantially increase your response rate, you can say so here on my blog in the comments section for the world to see.  But if you end up like everyone else – COMPLETELY SATISFIED – then we’ll keep it our little secret while you stealthily go into your PMA and snatch up all them deals, leaving your competitors in the dust.

Email for prices, turnaround, etc.  Also available: saturation, pre-approved credit mailers, buyback, title swap, customized, free consultation – no obligation.

Ron Cogan Gives Advice on Quick Ways to Cut Your Gas Bill

May 23, 2008 by

According to Ron Cogan‘s article “5 Quick Ways to Cut Your Gas Bill” at greencar.com, he says that many are asking when this [high gas prices] will end.  Cogan adds that some consumers get mad, while others “suck it up and just pay the price, figuring it will go away.”  Cogan bluntly adds, “[i]t wont.”  Then he asks the question: “But what can you do about it?”

I agree with Cogan that the gas price problem won’t go away.  In fact, I’d take it a step further and add that it will get worse.  I’m not trying to paint a bleak and negative financial future, but if experts are correct in predicting $7 per gallon gas prices, then Cogan’s advice should be taken with all seriousness.  Here’s a basic summary of his article’s 5 ways to cut your gas bill: 

  1. Don’t drive as much.
  2. Ease off the pedal.
  3. Resist the need for speed temptation.
  4. Avoid mid-grade or premium fuel unless necessary.
  5. Check tire pressure and maintain recommended PSI.

All of these ways except for #4 result in using less fuel which results in cutting your gas bill.  #4 cuts your bill only if you do not have a high-performance vehicle, or a vehicle that requires a higher octane fuel (i.e. 89, 91, etc.).  But this distinction between #4 and the others speaks volumes to toward solving a deeper issue – the vehicle you drive.

If two separate people followed Cogan’s advice to the tee in exactly the same manner, we would expect to have identical gas bill cuts.  But this would only happen if the two experiments were with identical vehicles, number of passengers, etc.  But if person #1 drove a 1999 Toyota Camry V6LE and the other a 1999 Chevrolet Suburban 2WD, the degree of savings would be affected by the degree of difference in fuel consumption and efficiency of each respective vehicle.  Bottom line, the Suburban would be more expensive to maintain than the Camry because the Suburban gets 12 miles per gallon while the Camry gets 22 (guess-timation).

So to further enhance the wealth of wisdom in Cogan’s excellent article, I would suggest that *if* you drive a “gas hog,” consider trading it in and leasing or purchasing a much more economical and fuel-efficient vehicle.  The intention of this article is not to suggest a make and model, just to suggest that you seriously consider the adjustment of your driving according to Ron Cogan’s advice, and to do so in the most fuel-efficient vehicle you can get into.  After all, if those experts are right, and if gas hits $7 per gallon soon, then many of our lifestyles will require adjustments if we can’t afford to drive anywhere!

Click here to read Ron’s article.