The Five
Most Dangerous and Expensive Advertising Mistakes Dealers are Making in 2009 - By Bill
Running a
highly successful advertising program has never been more important for your
dealership. Gone are the days when wasting fifty percent of the ad budget was a
running joke, and not knowing which fifty percent was the punch line. Having a
well-planned and executed advertising program is crucial--in fact these days it
can make the difference between failure and survival.
Turning a profit in 2009 is proving to be harder and more complicated than
ever. Owners face obstacles ranging from age-old challenges like finding and
retaining good staff, to new and complex hurdles like maintaining floorplan
financing and becoming Red Flag compliant. Even with a firm handle on those
areas, no aspect of dealership management is more critical--and potentially
treacherous--than advertising.
Tier III advertising always has been a tricky business. But for years,
thousands of dealers have done a perfectly good job handling their own
programs. Now, with the automotive world and the media world both turned inside
out, more and more dealers are making the same critical advertising mistakes.
With stakes this high, the mistakes couldn't come at a worse time--unless you're
the competition!
How can dealers avoid such mistakes? Understanding them is the first step. Then
planning a consistent strategy to avoid them is the next step. Enlisting the
help of a top-flight ad agency also can be an enormous help--but be careful.
Some agencies still promote self-serving interests of their own like
overspending, so caveat emptor.
What follows is a list of the five most dangerous and expensive advertising
mistakes dealers are making in 2009. If one or more of these situations applies
to you, consider taking a long, hard look at your program--and work to change
your ways. You'll be glad you did!
Mistake #1: My Customers Listen to THAT??
Do you really know your customers? Consider for a moment you may not know them
quite as well as you think. Sure, you probably know dozens, if not hundreds of
customers by name. But do you know their favorite radio and television
stations? Do you know how many visited your website prior to purchase, or their
favorite cable networks or their favorite sports? Do you know your dealership's
number one vehicle purchased by women over 45 with household incomes below
$75,000 who didn't consult a newspaper prior to purchase?
You're not alone if you don't have this information at your fingertips. But did
you know you could easily have access this kind of data? Consider the enormous
benefit of setting up a modest, in-house customer research program that would
provide you with all the above information and more. Think about how valuable
this information would be in deciding where to direct your precious advertising
dollars. Is such a research program expensive? Not necessarily, and it's much
more accurate than a dartboard.
With ad budgets tighter than ever--and with more than ever riding on every
spending decision--it's imperative dealers know everything they can about their
customers' demographic profiles and media habits. Imagine discovering where
you're wasting that fifty percent of your ad budget... and where you're not.
Mistake #2: Never, Never, Never Give Up.
An alarming number of dealers these days are deciding their best approach to
advertising right now is to shut it down completely. Bad idea! No matter what
the state of the economy and no matter how slow your sales may be, giving up on
your advertising is a deadly mistake. It's like not watering a plant and still
hoping it grows.
The severe and lasting effects of advertising asphyxia on your dealership brand
can take months to reverse--and you'll probably pay extra in the long run to buy
back the mindshare you gave away for free. The most important aspect of any
successful ad program is consistency. Notice how most successful dealers always
seem to be 'out there' with their advertising? It's no accident. But when you
break your consistency, it's like waving a white flag to the competition and saying,
"Here, come take my customers--you can have 'em!"
Mistake #3: Online Overkill
Without a doubt, the Internet has revolutionized the way people buy cars. And
without question, dealer websites and a growing number of online enterprises
have forever changed the way cars and trucks are sold. What's alarming,
however, are the growing number of dealers devoting most or all of their
budgets to the Internet.
It's a mistake to view your website as advertising--because it's not. Instead,
think of your website as your online sales arm--an electronic extension of your
showroom--a portal for sales, service and financing. Traditional advertising is
what drives traffic to your website--the same way it drives traditional foot
traffic to your front door.
Similarly, online pay-per-click and search engine marketing programs are
legitimate ways to increase your presence on search engines like Google and
Yahoo, and online lead providers like Autobytel and Cars.com match buyers
directly with your inventory (usually for a hefty price). But it's arguable
that even these services aren't really advertising--as technically they're
structural enhancements to your online sales arm.
Regardless, what's important to know is this: dealers who move their ad budgets
'100% online' are essentially canceling their advertising. Moreover, such moves
generally seem to be connected with a budget reduction--as if this maneuver can
completely take the place of traditional advertising while saving fifty cents
on the dollar. No matter what the motive, it's a dangerous and misguided
move--like a major league baseball team deciding to put only catchers on the
roster. If you're thinking about this measure, think twice!
Mistake #4: Media Missteps
Making a killing at the auction is one thing, but getting killed by your own
media buy is something else.
Many dealers are at their best when wheeling and dealing, yet in no way does
this ability automatically qualify them as good media buyers. Skilled media
buyers are highly trained professionals who are worth their weight in gold when
negotiating with media reps.
Why? Simply put, they regularly and routinely save clients thousands of
dollars. They make media buys go further, they bring added value to the bottom
line, and they put precious dollars back in clients' pockets. And the best
buyers make it look easy.
Media buying, however, is anything but easy. More and more dealers have come to
learn this the hard way. What's more unfortunate are the many dealers who
continue to believe they're media buying magicians, when in fact the trick's on
them.
Negotiating with the media is like walking through a minefield riddled with
trade agreements, sponsorships, contracts and packages. One misstep can cost
thousands of dollars--all the more reason to leave the media buying to a
professional. Need one final good reason to hire a media buyer? You won't
believe the time it saves you!
Mistake #5: Playing Favorites
Finally, it should go without saying that allowing personal factors to unduly
influence advertising decisions is extremely ill-advised. Unfortunately, it's
also quite common, and therefore bears mentioning here.
Think twice before devoting a big chunk of your ad budget to a particular radio
or TV station simply because it's what you like. You or your sales staff may
listen to Sports Talk all the time, but how often does your average customer?
The answer just might be never!
Also, set strict, personal limits on accepting tickets, gifts and trips from
the media. After all, why would you want to promote even the hint of a quid pro
quo arrangement?
Be very careful becoming outspoken on political matters as there's no telling
how many people you'll endear and how many you'll anger.
Should you be thinking about hiring a celebrity spokesperson, think twice, then
a third time, then a fourth time. Then proceed with the utmost of caution. Even
with a very popular athlete or entertainer, you must honestly consider the
downside risks of associating this individual with your dealership. Remember,
anybody can look pure as the driven snow today, then tomorrow have compromising
pictures turn up on the Internet, become embroiled in a messy divorce, go
through a lengthy drug trial, or get traded to your team's evil cross-state
rival.
Bottom line, maintaining a creative, consistent and cost-effective dealer ad
program is no small task. Yet having effective advertising month after month is
absolutely essential. Avoiding these five mistakes will greatly improve your
probability of success--and in 2009, success is the only good choice left.
--Bill Park is CBC Advertising's Senior Account Executive and a 17-year
veteran of retail automotive advertising. CBC (www.cbcads.com) is a
full-service ad agency working with dealers large and small throughout North
America.

