|
Solutions for a desperate auto industry
Fueled by the recent success of the employee-discount programs, sales numbers for automakers was strong for the summer of 2005. Customers were driven by discounts of up to 5 percent below invoice and this translated into huge sales for automakers. However, with the end of the summer bonanza many auto dealers are faced with the difficult task of attracting new customers. Furthermore, many customers are expecting discounts, rebates and incentives that will compare to the employee-discount promotions. To address this issue, automakers are offering new programs with incentives and rebates, but if a customer wants to get a great deal it is back to the "old fashion" haggling method. Importantly, this is going to prove difficult for customers to accept. As a result, automakers are going to see profits from sales fall to even lower levels during the fall and winter months. What is considered a soft market now, will be even softer in November and December. Thus, if auto dealers do not immediately address this auto market analysis, there will be empty pockets and empty showrooms.
Despite the bleak outlook for auto dealers, there are some solutions to a potentially desperate financial situation. Specifically, dealers need to adhere to an attitude of "Action NOT Reaction." The pro-active dealers will not wait for their numbers to sag further! It will be these active dealerships that find there are still a plethora of car buyers willing to spend their money for a new or pre-owned vehicle. Through innovative and creative marketing, some dealerships will profit during the fall and winter months. Specifically, General Motors analyzed the soft market conditions and began switching to so-called "value pricing" during September. However, this was a case of too little too late and their sales still slumped in September. Thus, to bring profits up, GM began offering $500 gas cards to buyers of its sport-utility vehicles and $500 rebates on 2006 full-sized pickup trucks. Recently, Ford began to address this issue too. Currently, Ford is offering zero-percent financing or as much as $5,000 cash back to boost sales of some 2005 models.
Automakers are marketing with hopes of enticing the public to visit their showrooms. However, the smart dealerships are searching for additional resources; and it will be those auto dealerships that will find profits where others may not. The big winners during the fall and winter months are going to be the auto dealers who work with an auto promotions company. Specifically, auto dealerships need to aline themselves with a promotional company that can create an auto promotion event that incorporates: radio, t.v., direct mail, newspaper ads, saturation ads and internet marketing. Moreover, for the dealerships that inquire before their competition does, they may be fortunate enough to find an auto promotion company that can offer market exclusivity. The potential customer traffic and profits from this type of pro-active auto dealership will be worth its weight in gold. However, the auto dealership that is considering this attack needs to use a promotional company that is experienced, knowledgeable and legally allowed to guarantee such an event.
Importantly, few auto promotional companies have the ability to hold such accolades. Many auto promotion companies are inexperienced, lacking the proper knowledge for generating the huge numbers that are potentially available when a promotion is done right. However, one company that has been doing auto promotions right, for over 15 years, is Caliber Promotions; Caliber has been mentioned for two reasons. First, Caliber is able to provide references from the United States and Canada that have statistics about the profits generated from previous sales. Second, Caliber can offer market exclusivity for their clients. In a brief interview with Dan Ryan (CEO of Caliber Promotions) he said, "Recently, Caliber has been awarded exclusive rights for their Slash-It events. This is HUGE for our clients! Now, Caliber can protect all our auto dealerships and their markets from any other auto promotion company trying to imitate our success." Dan Ryan added, "I will be happy to provide anyone a list of referrals if they call our offices in California, at #877-752-7448; or they can visit Caliber on the internet at CaliberPromotions.com." It is this type of guarantee and experience that auto dealerships must consider before hiring an auto promotion company.
As with both the new and pre-owned car markets, the reality of a soft market is apparent. Today, auto dealerships will need to circumvent the potential for dismal profits by finding an auto promotion company that has a proven track record for conducting a profitable event. Specifically, it will be the pro-active dealerships that will generate profitable sales during the fall and winter; and, it will be companies like Caliber Promotions that can help any auto dealership maintain a profitable income.
by;
Gary Reichel
|
