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Cost, Efficiency and Targeting- Why Auto Dealers Love Direct Mail!

February 13,2015 04:34:53

Posted by Brian Berg Google+

When it comes to auto dealer and automobile mailing list marketing, the rallying cry for “digital everything” is heard far and wide around the industry.   It started with 3rd party leads, PPC and then SEO.  Now there’s a need to invest in reputation management, social media, and mobile and customized apps.  All of this digital emphasis costs dealers big bucks, about 33% of their total marketing spend, according to NADA.  With dealers spending so much time and money driving consumers to their websites, they often forget one of the oldest, tried-and-true marketing methods in the book: the humble direct mail piece.  It’s easy to think direct mail has little use in our digitally-enhanced world.  But a recent study of over 200 US dealerships using data mining combined with equity marketing direct mail campaigns reveals that this simply is not the case.  Not only do personalized and targeted direct mail pieces work, they also consistently deliver conversion and ROI rates that far surpass nearly every other marketing method.

Dealers spend $6161 advertising each car they sell - all this money typically goes towards attracting new customers, while often ignoring the potential profits sitting in their databases.  Yet, it’s easier and far less expensive to retain current customers than to acquire new ones. Not to mention the extremely high lifetime value of automotive customers - between car purchases, F&I, service and referrals, the value of a single customer can easily run into the six figures or even higher, depending on the nameplate.  Yet many of these customers are left orphaned in a dealer’s database with no salesperson reaching out to them and no motivation to come back.  Today’s technology gives dealers a wealth of data on each customer that can be turned into actionable marketing information to drive them back into the dealership.

And there is low-hanging fruit in that database – customers who are currently ‘inequity’ in their vehicle. This means they owe less than their vehicle is worth and are in a position to buy a new vehicle with little or no out of pocket costs.  These customers are ripe for a personalized ‘win-win’ offer.  Targeted direct mail’s complex data mining processes allow the creation a completely personalized message about a customer’s current vehicle and its equity opportunity.  Traditional direct mail featuring blanket offers on financing rates, oil changes, etc. simply can’t compare to these highly targeted automobile mailing lists.  To learn more about auto dealership marketing, contact an expert member of the BB Direct Auto Team at (866) 501-6273(866) 501-6273