The pandemic years changed the landscape of many markets, especially the used car marketplace. According to an eLend survey, “Almost 80% of auto dealers said that the pandemic accelerated their adoption of digital path-to-purchase experiences – and 90% say they expect to continue or accelerate digital retailing at their dealership.” The unprecedented times pushed independent dealerships to intentionally leverage digital technology like never before. Whether it was sourcing used vehicles via online wholesale platforms or leveraging digital retail to allow consumers to start the car buying process online.
Supply chain challenges have created a competition that has become more cutthroat than ever. Used car dealers compete against franchise dealers for minimal inventory; even high mileage used cars fill new car dealer lots today. Moreover, Charles Chesbrough, senior economist at Cox Automotive, says, “Limited new-vehicle inventory has slowed the gently used segment due to fewer-trade ins and higher prices have slowed the sales of older model-year vehicles. Sales are likely to be slightly less this spring selling season.” Due to fewer trade-ins, the used vehicle sales volume also dipped yearly. This pandemic-induced challenge is just one of the reasons why there is a need to optimize the digital tools available to used car dealers. Dealership owners must be open to reorienting themselves and learning new strategies to ensure survival in this competitive market.
This article will discuss several techniques used car dealers can leverage to make their dealership stand out online.
Create a functional and user-friendly website experience
Does my website look great, whether on mobile or web? Is it easy to navigate and find financing options? Think of your dealership website as your digital showroom, and consumers are no longer going dealership to dealership; they are doing most of their shopping online and coming in with the intent to buy. Before customers even dig into the content of a dealership website, their attention must be grabbed visually. Crisp and professional inventory photos with additional photos of major dents or damage to be transparent with your customer base who may be purchasing out of state in this inventory shortage. Another critical aspect of the website that is important to help any dealership stand out in this competitive market is the accessibility of financing options. Most consumers would want to see this at the onset of their customer shopping lifecycle, and it can help determine whether to choose your dealership.
While most dealerships require the consumer’s vehicle to be physically present at the lot for an onsite appraisal, some larger used car dealers have innovated this process in such a way that the consumer would go to their website and enter their license plate number or their VIN to receive an instant trade appraisal; of course, each estimation considers the consumer giving an honest representation of their vehicle. An excellent example of this in action would be Carvana or CarMax. They have heavily advertised to consumers this benefit of their website and it reduces friction in the deal. Moreover, there are tools available to even small used car dealers with this same functionality without having to hire a data scientist. Again, it is all about convenience and improved customer experience that can help independent dealerships stand out.
Maintain a solid and integrated software tech stack
Are your dealership's software processes streamlined? Are workflows automated? Are your software products integrated to reduce duplicate entry? Streamlining and automation are essential for two reasons: Accuracy; the lesser the human intervention, the lesser the chances of errors. We only know salespeople’s many mistakes in recording VIN and DL information when using pen and paper. Efficiency reduces duplicate entry and tedious tasks through software automation, which gives managers and salespeople more time to focus on selling cars.
Technology is a formidable ally in the challenging 2022 market; by integrating your website, CRM, DMS, and inventory management system, you can be competitive with larger used car operations with more infrastructure. To provide more context, here are the critical software components of an effectively integrated tech stack:
Customer Relationship Management (CRM) Software - Allows dealerships to control lead nurturing; improved communication management, including tracking customer communication through phone calls, texts, and email messaging; transparent reporting, including following every lead from prospect to a closed deal. Choose a specialized CRM for used car dealerships with direct integration to your DMS system to reduce human error through duplicate entry.
Dealer Management System Software (DMS) - The central nervous system for any dealership is used to print forms, run OFAC or red flag checks, process credit, and manage accounting. Integrating with the DMS is very important for other critical applications like CRM.
Inventory Management Software - Manage inventory photos, wholesale vehicle pricing, syndicates inventory to 3rd party marketplaces, and offer lot management capability for different phases like recon. Some DMS platforms offer inventory management as part of a core capability.
Dealer Website - Responsive or adaptive mobile-first dealer website integrated with your CRM system, so every lead has the correct template (finance versus trade, for example). During the pandemic, some dealers have enabled an e-commerce-like experience on their VDP’s (vehicle display page) where customers can do a lot of the work of purchasing a car online, including determining financing options and receiving an online trade appraisal. Some dealers take it a step further and use a Digital Retail tool, which often will not integrate with used car dealer software solutions as many were initially built for new car dealerships.
Optimize your Local SEO through Google My Business and targeted keywords
Arguably, the king of the internet is Google, and there is a lot that your dealership can benefit from leveraging best practices for Google My Business and organic SEO. According to Think with Google, “Even with COVID-19 temporarily shutting down businesses and leading to massive unemployment … Searches for “car sales” have grown globally by over 60% year over year, and searches for “best car under” have grown globally by over 80% year over year. And as distancing measures continue, 64% of new auto buyers said they would look for even more information online.” Many dealerships have failed to properly set up Google My Business, which costs them SEO opportunities and potential customers in a tight market. Used car dealerships should consider the following strategies to optimize their Google Business Profile:
Verify Dealership Google Business Page (GBP) - This will allow dealerships to have full access to tools and analytics that will help them optimize their listings and prevent misinformation or GBP sabotage.
Check that NAP is the same all across the board - If your business name, address, and phone number (NAP) are displayed consistently on your website and GBP, it prompts Google to display your dealership contact information for more search queries.
Specify the service of your business on GBP Categories - A clear business description and correct category can positively impact a dealership’s local ranking on search queries including Google Maps.
These are just a few strategies that are highly effective in improving a dealership’s GBP performance. Nowadays, most consumers have short patience before online information overload. Most of their mindshare is on the first page of Google; if you are buried on page two or three, you will have significantly less quality traffic. The following are strategies to build powerful SEO with any dealership website:
Do Extensive Keyword Research - Not all keywords are equal. Some have more buying intent than others, and people in your city might be searching for terms quite different from the rest of the US. There are various tools out there that make searching for these keywords easy. The most well known is Googles’ Keyword Planner, a free service that suggests keywords and lists them according to their search volume.
Write Interesting Content - Once you know what keywords you want to target, you need to provide the kind of content that the search engines index. You can include a mix of evergreen and topical content, but make sure that everything is up-to-date. That means regularly updating your existing content while continually adding more.
Optimize Everything but don’t overdo it - You want to use all the keywords you’ve found as frequently as possible, only if they seem natural. You’ll likely find it easy to run out of places to put those keywords without making your content sound forced. Many sites try to game the system by cramming as many keywords into every content box. If you’ve ever seen a site with content like, “For the cheapest cars in Atlanta, come down to Atlanta Used Cars for cheap cars! Our cheap Atlanta cars are the cheapest in Atlanta, Georgia!” You’ve seen keyword stuffing online. An alternative strategy to keyword stuffing would be to add keywords to the alternate text of your photos, in the URLs of various web pages, in title tags and meta-descriptions, and many other places.
Identify what’s different about your dealership experience.
Why buy at your used car store versus another store? What sets you apart from the rest of your direct competition from a customer experience standpoint? The answers to these questions are pivotal, and your website visitors should know this at the very onset of their digital interaction with you. Online dealers like Carvana have doubled down on that strategy by offering online car sales, hassle-free returns, and 360-degree photos of inventory listed on their websites. But there are many other ways to promote your dealership customer experience online that used car dealers can leverage without breaking the bank or running an unprofitable operation.
If your dealership has bilingual salespeople, make that evident to the consumer as one of your unique value propositions on your dealership website. Shoreline Auto Group was featured in Automotive News because they had nine bilingual salespeople; their value prop to consumers was they speak your language. If your dealership has recently installed a Digital Retail tool, make sure your website promotes end-to-end digital transactions and explains how to use these tools. Make your unique advantages obvious on the messaging of your homepage. May it be military or first responder discounts, home delivery options, an extended warranty from your store, or an out-of-state buyers’ program, flaunt it on your website. These differentiators can distinguish between a good dealership experience and a 5 star review dealership experience.
Resilience and Innovation
A crisis is the mother of innovation, and the problem we, as an industry, are still facing, has taught many dealership lessons to be adaptable and thrive in this new digital-first world. Since the onset of the pandemic, there was a production decline in the manufacturing of new vehicles, which also impacted everything from rental car prices to lease residuals. This pandemic-induced challenge is just one of the reasons why there is a need to leverage the digital tools available to used car dealerships. This article is just the tip of the ice burg and I would encourage dealership owners to start to think about how they can future proof their store and dealership operations as supply chain challenges are estimated to continue through 2023.