From factory rebates to free upgrades to free car washes, new and used car dealerships nationwide use millions upon millions of incentives to boost sales each year.
Some new car operations question why they should offer any other kind of incentive beyond the factory rebate. The answer is simple. All dealers who sell the same badge as you have access to the same sales and lease incentives as you. To stand out from the crowd, you have to offer more, you have to be different. Otherwise, you risk losing a deal to a competitor over a $100 discount or a set of mud flaps.
Every day, sales managers, general managers, and dealers are inundated with solicitations from incentives providers. But over time, all the “me too” incentives begin to look the same. Here are three ways you might not be familiar with to close more deals with non-cash incentives.
Stop Giving Away Your Cash
Whether your dealership prefers to offer discounts by reducing a vehicle’s sticker price or by inflating the Actual Cash Value of a trade (or a combination of the two), you have to set and enforce limits or you risk devaluing the perceived value of the car or truck you’re selling. That might be fine on a limited basis, but over time it is sure to hurt your bottom line as well as your brand.
Instead of dropping your sale price to an uncomfortable level, offer incentives that come with a high perceived value to the customer but actually cost you very little. These incentives can come in several forms, including gift cards, merchandise rewards, and travel incentives.
Here are three ways to use incentives to close more deals.
1 Reward Loyal Customers with Invitational Events.
Send your customers an invitation to a special, event, just for them. In the invitation, make two things clear:
Every vehicle will be marked down for immediate sale.
The prospects will receive a special gift, just for attending.
The gift might be a merchandise premium -- such as an LED Flashlight or Roadside Toolset – that has a high perceived value to your customers, but doesn’t cost you much at all per person.
One of the beauties of a customer loyalty sale using non-cash incentives is this: while everyone who walks on your lot that day will be eligible to pay only the sales price, only your loyal customers will receive the gift. And they will be sure to appreciate that
2 Integrate Non-Cash Incentives into Your New and Used Car Advertising. Integrated advertising works, especially when you add a non-cash incentive that your target audience really wants.
If you’re located in an area that has tough winters, you might want to run a promotion in which everyone who buys a new or used car gets a Caribbean cruise. Similarly, if your area swelters in summer, advertise a mountain getaway, showing pictures of couples skiing.
The key to these programs is that travel incentives can be purchased at a very low cost, so you risk little when you integrate a travel incentive into your advertising.
3 Keep a Gift Card Offer in Your “Back Pocket”
People love gift cards, and they can be excellent closing tools. And, since there are high-value, low-cost gift cards available, you can use a gift card to close a deal and it won’t cost you much at all. Here are two problems gift cards solve.
Problem #1: A salesperson has made contact with a prospective customer via phone or internet inquiry. They’ve exchanged information and your salesperson has answered the prospect’s questions, but hasn’t been able to reel him in for a test drive.
The Solution: The salesperson offers to buy the prospect dinner if they will come in for a test drive. After the prospect comes in, they receive a dining gift card that will pay for their dinner at any of dozens of restaurants in your area.
Ordinarily, the cost of providing dinner at a restaurant for two people might cost too much for a test drive, but there are cards available that provide a great dining experience at a very low cost.
Problem #2: A car buyer is trying to start a bidding war between your dealership and another. You don’t want to lose the business, but you also don’t want to go any lower. Solution: Fortunately, you keep a supply of gift card bundles in stock for just such occasions. You offer the prospect a $250 Gift Card Bundle, a great value for them that costs you as little as $25.
Non-cash incentives provide automotive dealerships a variety of ways to increase the buyer’s value perception of the deal you’re offering without you giving away the store, so you can incrementally improve marketing performance at minimal cost.
Find out how we can help you implement any of these great ideas and receive 25 FREE gift card packages to get you started