Thirty is the new 60 when it comes to a profitable turn of your inventory. The following best practices are designed to get your inventory merchandised faster and more efficiently.
By Judy Greeby
Merchandising is about getting as many eyeballs as possible on your inventory as quickly and for as long as possible. Smart digital tactics — such as great photos, robust descriptions, and rave customer reviews that help drive showroom traffic — are imperative. So is getting vehicles frontline ready as quickly and as efficiently as possible. These seven merchandising best practices can help:
1. Fast and Efficient Reconditioning
Unless a vehicle needs bodywork, get it through the reconditioning process within three days or less. In reality, reconditioning often takes a back seat to customer-pay work in many dealership service departments. To speed up the process, try the following:
- Devote one or two full-time service technicians to reconditioning vehicles for the used-vehicle department.
- Offer incentives to your service departments to get vehicles reconditioned quickly and without comebacks. Do this with outsourced vendors, too.
2. Do-it-Yourself Photos
An array of high-quality photos are essential to attract interest in listed vehicles. If your lot service company isn’t due back for a couple of days or your service department is tied up, do the following to get a non-frontline-ready vehicle listed online today:
- Use a mobile app to take four to six photos that can be posted online before reconditioning. Take shots of the vehicle’s left front quarter and rear right quarter. If the interior or tires are in good shape, get photos of them, too, and highlight features such as sunroofs and custom wheels.
- Take photos from farther away to minimize imperfections, such as a nicked windshield your service department can repair later.
- No photography booth? No problem. A clean, clutter-free area with the dealership’s name in the background works well.
3. Create SEO-Rich Descriptions
The quickest way to create a description is to use an automated description writer equipped on leading inventory-management tools. They simply require a VIN to pull vehicle details, such as make, model, model year, trim level, engine type. But manually written or manually enhanced descriptions are best.
- Over the past several years, Google has made adjustments to its search algorithm to put a little more emphasis on relevant content and a little less emphasis on keywords. Geographic references — for example, the vehicle was purchased and serviced at the dealership that is now offering it for sale — work well for SEO.
- Vehicle history matters to consumers. So, for example, if a vehicle was previously owned by a family who outgrew it, say so. Have salespeople and receptionists listen for and jot down such details to include in a vehicle’s description.
- Include features, technology advances, and a call to action. Awards, ratings, special offers, and whether the owner’s manual is available should be included, too.
4. Price Strategically
You don’t have to have the lowest prices in your market, but you do need a customized pricing strategy to boost overall gross income per vehicle retailed and reinterest customers tracking your listed inventory.
- Retail 70% or more of your inventory within the first 30 days, starting from the day a vehicle enters your dealership management system.
- Avoid profit erosion by keeping in mind that a vehicle’s market price could become outdated if it takes 10 or more days to get it frontline ready. The reason is dealers with similar models may lower their prices.
- DealerSocket’s Inventory+ offers a Health Report you can use to create customized price strategies that increase your dealership’s overall gross income per vehicle retailed. Complied daily, the report tracks inventory age, prices, third-party websites on which the inventory is posted, and the photos and descriptions accompanying those listings. Have the report emailed to you each morning.
- The Health Report also provides profit-per-day information for each parking space on your lot. Shoot for a minimum profit per day of $40 for each spot. Meet that milestone and then work to increase it.
5. Keep Tabs on Listed Vehicles
Vehicles are “marketed” when they’re offered for sale online with pricing and good photography — though descriptions are important, too.
- Make sure these elements accompany all inventory offered for sale on your dealership’s website and third-party sites. Check the websites once a week or more.
- As previously mentioned, third-party posting information is available in DealerSocket’s Inventory+ Health Report.
6. Drive Rave Reviews
You strive to satisfy your customers. So, strive to get great customer reviews by asking your customers to write them. Reviews help attract internet leads. The facts speak for themselves:
- Research indicates that more than 90% of shoppers read reviews. And of those who do, more than 90% use that information to make purchase decisions.
- Studies also show that most consumers trust reviews as much as they trust a personal recommendation from a friend, and they are willing to pay around 15% more for a vehicle purchased at a dealership in which they have confidence.
7. Leads Matter
The ultimate goal of effective merchandising is turning SRP/VDP views and internet leads into fresh “ups.” The more fresh ups you drive, the more chances you have to sell a customer your vehicle.
- Use your inventory management tool to keep tabs on the leads your listings generate is crucial.
- Keeping an eye on leads provides direction and opportunity. For example, if your dealership has a vehicle that isn’t attracting leads, try raising the price for a few days. This old tactic will usually draw out a customer who might be following it online in hopes of a price cut. However, if you don't get a bite after a day or two, you might have a vehicle with the wrong color, price, or equipment. Maybe the vehicle is just wrong for your market.
Bottom line, a vehicle doesn’t have to be frontline ready to be merchandised online. In fact, DealerSocket is partnered with very successful dealers who can have a vehicle they just took in as a trade merchandised on their site within two to three days. What they’re doing is giving themselves an extra week or two to sell the car. It may not be frontline ready, but it’s available virtually to everybody in their market.
Judy Greeby has been with DealerSocket for 13 years and currently serves as a Strategic Growth Manager. With an extensive experience in automotive industry, she partners with dealerships to make sure they get the most out of their inventory system. To connect with a Performance Advisor like Judy and learn more about Inventory+’s merchandising capabilities, call (888) 655-1435.