February Temperatures Heat Up As Auto Dealers Capitalize on Toyota’s Woes

As a direct marketing professional, I keep track of the causes behind the peaks and valleys of the automotive industry. For example, since my livelihood depends on the advertising dollars dealers spend on a monthly basis, I generally “feel” the impact in a personal and unique way. When the economy began to spiral downward, I noticed a sharp decrease in my orders for credit-related mailers. Dealers complained that their lenders were turning down many of the sub-prime loan applications they normally would approve, and because of that they were not able to justify paying me to send credit offers to bankruptcy lists, low credit score lists, etc. Well, in a similar way, I “feel” it when things turn the other way too!

Most recently, in light of the national negative publicity Toyota has received, many auto dealers (non-Toyota) have seized on their opportunity to capitalize and are winning as their gamble is paying high dividends. Here’s what’s going on:

Non-Toyota dealers are ordering all of the Toyota owners in their market from our Title List. They are sending them buyback letters and other offers, and local Toyota owners are flocking in to trade out of their Toyotas because they no longer want to drive them! In fact, just yesterday (2/3/10) Transportation Secretary Ray LaHood uttered the non nationally-broadcasted statement that received the highest level of media blitz:

At a congressional hearing, LaHood said his advice to an owner of a recalled Toyota would be to “stop driving it. Take it to a Toyota dealer because they believe they have a fix for it.” His comments prompted new questions and rattled Toyota stockholders, causing shares to plunge 8 percent before they recovered, declining 6 percent for the day.

Then, just this morning (2/4/10), a suspected problem with the brakes on the Toyota Prius (not included in original recall) has led to a national recall too! My intention is not to kick a man when he’s down, but do you realize the potential this brings to ANY non-Toyota store?

If you are intelligent enough to put two and two together, then let’s get rollin’ and put together a serious mailer and send it to all the Toyota owners in your market. You may not ever have another chance at this type of business again. It’s literally a plug-n-play market right now – mail them your offer and they’ll come in and buy. It doesn’t get any simpler!

Use our contact form, call, or email me at jgreenleaf@hillmarketing.com

And please, non-Toyota franchised dealers only. Thanks.

When Will The Credit Freeze End?

Many Auto Dealers are hopeful that lenders will loosen up on their restrictions soon and begin making auto loans to their secondary (Sub-Prime) applicants once again. Perhaps they are counting on the $700 Billion Bail Out, or perhaps they have confidence in some of the recent acquisitions made by larger financial institutions.

The hopeful outlook is in stark contrast to the feedback I received from dealers last month after the announcement of HSBC and Triad’s decision to discontinue making loans through auto dealers and focus on other markets. Cindy Savio, spokesperson for HSBC said, “The auto finance business has been under strategic review for some time…Our exit from the business will allow HSBC Finance Corp. to focus on its core businesses – credit cards and mortgage lending.”

Jack Tracey, executive director of the National Automotive Finance Association said, “HSBC’s departure leaves a hole for the dealer community that seeks to finance customers with less-than-perfect credit…That leaves fewer options for dealers in an environment where other lenders who are left are tightening credit.” (source: Automotive News, Aug. 12, 2008)

Many dealers have felt the breeze created by that hole and have had to turn away consumers that they could have easily converted into sales the month before. I noticed a decrease in orders for my bankruptcy mailers which I see as just a ripple-effect of these sub-prime auto lenders pulling out of the auto lending market. Some of my clients have had to actually postpone scheduled mail drops for sub-prime direct mail orders simply because they felt that they would not be able to provide financing for consumers that responded to my aggressive credit offers.

But since HSBC serviced approximately 7,500 auto dealers and Triad serviced about 5,000, when it became public that they informed their dealers that they would no longer provide auto loans, other lenders seized the opportunity and contacted these dealers vowing to fill the sub-prime auto lending hole.

With obvious caution and skepticism, dealers took the wait and see approach and slowly began to submit applications that HSBC and Triad normally would have received. Once they began to see approvals and actually got funded with little or no hassle at all, their confidence began to grow and it is my opinion that this is where their hope is grounded.

I say this to rebut the mass media’s claim that the U.S. automotive industry is severe trouble. I’ll grant that there are many difficulties, but as we saw a major GM dealer close its doors last week we also saw it reopen the next day under new ownership. This is clearly the case of one man’s failure being another man’s opportunity.

Confidence in the U.S. automotive sales industry goes against the media’s scare tactics that are seeping with political overtones (which I’ll not get into here), so it’s no wonder that the general report is one that is “all-bad.” But I am still receiving orders for direct mail, and these orders are substantially larger in volume than they were a few months ago. I believe that I am a good barometer for market conditions because I only exist if auto dealers use my services, and guess what??? They are.

In closing I quote the prolific “Public Enemy” – “Don’t, don’t, don’t believe the hype!”

Awesome Memorial Day Weekend Sale and How Automotive Direct Mail Saves the Car Business Once Again!

I am sure that more vehicles will be sold this Memorial Day Weekend than last year’s.  I am so excited at how receptive and pumped up everyone is about our Memorial Day Weekend 2008 Sales Event!  Putting these sales together has been extra fun this year so I just want to say thank you to all you car dealers out there that signed up.

They told me that it was sheer genius how I wrote my new sales letter using our Title List Data to go after those old gas hogs and make purchase offers for trade-ins for something a little more economical.  Many car dealers that called me for the first time did not know that I had access to massive lists of trucks, vans, SUV’s, etc.  When they saw my sales letter they just about flipped!

Here’s my reasoning.  Follow my thought process and see for yourself if this doesn’t make perfect sense.  Everyone knows about the gas price problem (I won’t argue for that here).  I attended a conference last month that had a session regarding the high demand for web developers and I.T. personnel in religious organizations (churches, ministries, etc.).  Since gas prices are forecasted to reach $7 per gallon in less than two years, these religious organizations anticipate losing much of their commuter attendance (people that drive a long way to get there). 

Many of these organizations have multiple gatherings on different days of the week (i.e. men’s groups, women’s groups, youth meetings, etc.).  With the economical pressure being experienced by American families, many of them will need to “cut back” on attending except for Sunday, or whichever respective day.  So the need for web developers and I.T. personnel emerges.  Why?  Because the plan is to accommodate those unable to attend by making services and meetings available online through streaming video and other interactive formats.

The point of mentioning all this is to direct your attention to when and how I got the idea.  I thought, “If these large organizations see such an impact on their businesses due to gas prices, then that could be huge for my dealers!”  (I’m always looking out for you guys!)

I got back to the office and pulled some counts in some suffering areas of the country (those most likely to be effected worst).  I queried 1981 to 1999 trucks, vans, and SUV’s from Chevrolet, Ford, and Dodge (gas hogs) within 20 miles of a particular store I do monthly campaigns for.  I came up with 185,000+ titles!  This means that I can send a purchase offer to the owner that is relevant to his needs while making an offer for a gas-saver!

Plus, because I can use variable data printing, the letter can be made out to the owner’s name, regarding his exact vehicle (make, model, year, color, etc.), at his current address, from the sponsoring dealer.  So it can say (sample, not actual direct mail offer):

Scott,

My name is John Greenleaf, Used Car Manager at ABC Motors and I want to make you an offer on your 1992 Chevrolet Suburban.  With gas prices on the rise, I thought it would be worth a shot to write you because you may be interested in selling or trading now more than ever before. 

To be sure I win your business I’ve hired three independent appraisal companies to compete for your trade-in, just in case you want to want to trade for a more economical vehicle.  These appraisers will be at my dealership this Memorial Day Weekend only between 9AM and 6PM.  Give me a call if you can make it…

Initially I thought that I would write this as an additional product for Memorial Day only.  But now it seems that most dealers want to run this program till the end of the year.  With over 100k titles in our database for most PMA’s, you can run 10,000/month till 2009 without mailing to the same person twice!  This means that you can overcome the car dealer blues that this recession is causing.  So stop crying (the blues, that is) and start selling!

Automotive Direct Mail has saved the car business once again.

Sincerely,

John Greenleaf (takes a bow)

Marketing Director

Hill Marketing Group

MasterCard Mailer: Special Finance Heaven!

Beginning to make some serious noise, our MasterCard® Mailer by US Capital is unquestionably the most cost-effective direct mail program in the country world.  That is quite a statement!  Best part, it’s TRUE.  With response rates of up to 6% (900 leads / 15,ooo pieces), NOW up to over 7%!!! (1,059 leads/15,000 pieces), this automotive direct mail program by US Capital has earned its way to first place!

To celebrate, ALL ORDERS in October, 2007 – get the special price: $1.39 each (5k min.)!  That is an AMAZING DISCOUNT of nearly 30% OFF retail!!!

Order yours today by clicking on the “Buy Our Stuff” tab located at the top of this page.

With prices this low, it’s even easier to upgrade your order with HMG’s add-on’s:

• First Class postage: add $0.09
• IVR and online CRM with premium lead forwarding (fax/email) only: add $0.09
• 24/7/nights/weekends/holidays call center to capture additional information and set appointment with customer – added to IVR option for only: $0.07

At no additional cost, you can: 

• Drop all 15,000 at once to flood your floor and create a salesperson feeding frenzy.
• Do a split drop: 7,500 now and 7,500 in 2 weeks for a month long sales surge.
• Do 4 drops: 3,750 each over 2 months for smaller stores or Special Finance deptartments.
• Do 6 drops: 2500 each, dropping every other Friday (ideal for 2 man Special Finance tag-team or smaller store with less than 5 salespeople).

Experience the best in automotive direct mail for yourself!

US Capital MasterCard Mailer from Hill Marketing Group.

MasterCard Mailer Sample

This is what your customer sees when they open the envelope.  Notice the US Capital MasterCard that is affixed to the top right corner.  This is a 30mm PVC Embossed card, which simply means that it is the same size, weight and thickness as a standard ATM or Bank Card.  To see a physical sample of the US Capital card, reach into your back pocket, pull out your ATM card or any standard credit card, then hold it up against your computer monitor.  Voilà!  There’s your sample 😉  (Imagine the US Capital logo)

Click Here To View The Sample of the US Capital MasterCard Mailer by Hill Marketing Group.

From the Desk of John Greenleaf…

The biggest challenge that I face in direct mail is getting the recipient to open the envelope and read the offer.  For instance, if I signed up a car dealership to do a 10,000 piece mailer with a 50% discount on everything in stock, this weekend only, and only a handful of customers showed up, I could reasonably conclude that the mailer either had a really weak open rate or the offer wasn’t aggressive enough.   

I could also reasonably conclude that if the offer had nearly a 100% open rate (if almost all the 10,000 were opened and read) that the dealership would have been flooded with thousands of shoppers looking for the 50% discount! 

In most cases, the problem isn’t the offer – it’s the packaging. 

I’ve done some lengthy research as to why good automotive direct mail pieces don’t seem to draw the crowds it used to.  I’ve narrowed it down to a few factors that I’ll post about later, but today I want to tell you what I see as the numero uno problema (number one problem). 

If everyone else is remotely close to the way I am when I look at my mail, then they subconsciously split their mail into two major categories: Important and Junk.   

Important includes: bills (utilities, mortgage, credit cards, car loans etc.), and personal (birthday cards, Netflix, family, church, etc.).  There’s more, but I think you get the point. 

Junk includes: not bills or personal (Important), furniture store ads, cable ads, unsolicited advertising (mortgage, auto, and the new Chinese restaurant down the road), carpet cleaners and things of the like.   

There is certainly a division of mail into these two categories with two different reactions.  One I open and read, and the other I don’t (at least not immediately). 

So, the trick is to get automotive direct mail offers out of the Junk category and into the Important category.  If I can accomplish that, then I can provide my dealers with direct mail pieces that are certainly worth the money they’ll pay me for it!  

 Packaging counts, because most folks like me give the mail a quick visual scan and judge in a split second which category it falls into.  I think that knowing this and solving this is the reason that we rock so hard with the dealers we work with.

-JG

There’s more to mail than just credit data…

The Title List, by Hill Marketing Group.

 

Our Title List is basically a really sophisticated owner list.  The database matches the current owner with the current vehicle at the current address.  So when you send out a mailer, your message is targeted with precision to the exact person you want it to go to.  

For example, if a Honda store wants to run a promotion to sell Odysseys, they can send out invitations to all of the van and minivan owners within a particular radius of their store, regardless of brand. 

This is extremely valuable to the Honda dealer because our Title List will give them a premium database of owners across the brand lines for them to put their Odyssey special in front of. 

This type of exposure leads to new business that may not have been captured otherwise. 

  Another example would be a Toyota store looking to build pre-owned inventory.  The Toyota store could send a buyback letter to all Toyota owners (i.e. 97-04 Camry, Corolla, Tacoma, etc.) within 20 miles of their store.  The letter can announce Factory Specials as well as a “we need your trade” message.   

Our Title List is a great alternative to credit data, which in some markets has been so saturated that the response rate has decreased, making credit mailers sometimes infeasible and ineffective.   

Every credit mailer that is sent out legally must disclose the FCRA’s Prescreen & Opt-Out Notice.  This gives the recipient a bold notice that they can choose to stop receiving “pre-screened” offers of credit in the mail by calling a toll-free number.  As more and more consumers “Opt-Out”, the pool that dealers mail into becomes smaller and smaller, resulting in a heavily saturated market with multiple offers from multiple dealers.  Our Title List can be extremely effective if your market is in this type of condition. 

As a courtesy, although not mandated by any law, Hill Marketing Group provides a toll-free Opt-Out number for customers to be removed from our Title List.  We also provide all dealers with an Opt-Out fax notification form for customers to be removed in the event that one desires to do so.   This rarely occurs, but is just another illustration of how all of HMG’s programs are extremely well thought out, with the dealers CSI and reputation always in mind. 

We are not saying that credit mailers don’t work anymore.  In fact, as a previous customer of HMG, you may already know that we have the best credit mailers in the country!  All we’re saying is that there is life after credit data; Our Title List. 

Ask your Marketing Consultant for samples of the latest Title List pieces and see for yourself why dealers keep coming back to Hill Marketing Group.