Why Dealerships Must Embrace Changes in Customer Behaviour to Thrive

Consumer shopping habits have been rapidly changing over the past 10 years, with the ongoing penetration of smartphone usage being a considerable factor. With Statista estimating that smartphone usage in the UK will rise to 79% of all adults by 2022, potential customers are now interacting with your business in a 24/7 landscape.

This is no different for the automotive industry; through ClickEngage, dealers are able to offer their potential customers a 24-hour enquiry and reservation service, directly integrated into your website and DMS. Analysing ClickEngage enquiry data across 2019 showed just how your customers are engaging with dealerships, at what times, and why your dealership must embrace changes in customer behaviour to thrive in the future.

The reign of the 9-5 is over

Whilst many dealerships still keep to traditional opening hours, the reign of the 9-5 is well and truly over where customers are concerned. Across ClickEngage users, the average opening times for dealerships were between 9AM and 6PM, with customers able to make enquiries at all times through ClickEngage’s 24/7 enquiry and vehicle reservation service.

Within this timeframe, 52.5% of all enquiries to ClickEngage users came outside of these hours, and enquiries made between 6PM and 11PM account for a whopping 31.5% of all enquiries for the entire day. Night owls (11PM-2AM) and early birds (5AM-8AM) accounted for 11% of all enquiries, sitting at 7.5% and 3.5% respectively, with a further 3% of all enquiries being made between 8AM and 9AM, right before dealerships typically open.

In 2020, convenience is undeniably a key factor when it comes to customer satisfaction. In order to offer the best service possible, dealerships must be available to take enquiry requests on a 24-hour basis, lest they accidentally miss out on quality leads generated out of hours.

If you’d like to find out more about how your business could benefit from ClickEngage, then please get in touch with us on 01782 478 220 or by email using [email protected]

Drivers are in-market and ready to buy says Auto Trader

Used Car Stock
Auto Trader recorded a record month in January with 58 million cross-platform viewings which it says confirms its view that consumer confidence is growing in the market and more people are looking to change their vehicle.

The leading digital portal saw a 5% rise from its previous best set last March and as well as the number of visitors, it had almost 14 million downloads of its mobile app and there were 259 million full page advert views of its new and used stock.

Demand was up on Auto Trader year-on-year in January for vehicles of all fuel types too; diesel by 4%, petrol by 7%, AFVs by 72% and EVs by 110%. With demand increasing, prices are stabilising and although like-for-like prices – the difference in vehicles entering and leaving the market – were down 3%, the rate of decrease is slowing as they become more resilient. The average price of an advertised used car in January was £13,557 against £12,960 in the same period last year.
It says its own research matches that of others showing improved confidence to spend and Auto Trader’s surveys among car buyers showed that 59% feel more confident of being able to afford their next car than they did a year ago.

Ian Plummer, Commercial Director at Auto Trader, said:

“Following the general election in December and now that the light is starting to shine through the Brexit tunnel, it seems that the market is stabilising and hopefully will continue across Q1 and beyond. With increased consumer confidence too, retailers have a great opportunity to convert sales this quarter, particularly when audiences are so high on our marketplace.
Retailers are more confident too. Many of our retail partners have told us they’re feeling optimistic about 2020 and this is seen this through the volumes at auctions. Auction groups announced that in January weekly and day sales records were broken, this positive demand in the wholesale sector further confirms that retailers are experiencing higher levels of retail activity.”

Retailers should be in a happy position

Ian says that retailers should be in a happy position now with more impetus on EVs and car tax changes due in April perhaps pushing people into the market.

“Now’s a particularly good time for retailers; demand for electric vehicles skyrocketed after the government’s announcement to ban diesel and petrol cars in 2035, and retailers can use this time to capitalise on the car tax changes which come into effect on 6th April. Consumers could be left paying significantly more for tax on new cars – as much as £960 more for some models – so they’ll have the impetus to buy new cars this quarter.”

Earlier this week the SMMT revealed that the full-year used car market ended at 7.9 million units in 2019.

If you’d like to find out more about how Click Dealer can help your business, then please get in touch with us on 01782 478 220 or by email using [email protected]

Why Review Transparency Between Dealers and Customers is Necessary to Build Trust

Despite their best efforts to deliver excellent service to customers, some vehicle dealers are still trying to shake off an ofttimes negative reputation in the court of public opinion. That’s why the best tool at your disposal is one that you might never have even heard of: social proof. So, we’re here to tell you how we can help you to nail it with ClickRep, our online reputation management software.

Whether your dealership has been trading for 20 years or 20 hours, customers are becoming increasingly savvy when it comes to where and with who they’ll do business with. When considering a purchase, over 90% of consumers say that they read online reviews before visiting a business, with 70% going on to look at multiple review sources and 84% believing that reviews older than three months are irrelevant to their experience.

So, what is social proof? In a nutshell, social proof is the act of looking to others within your peer group to reinforce a behaviour. For automotive customers, this could be reaching out to existing customers to reinforce their purchasing behaviour- ultimately informing whether they should they go ahead with a purchase from your dealership or not.

Managing and nurturing your dealership’s reputation is a task that your team needs to be on top of to maximise its leads. In fact, even negative reviews can be a good thing as 97% of review readers said that they take a business’ responses into account meaning that the way your dealership is seen to manage online reviews, of all scales, is key to your reputation.

Take the stress out of reputation management with ClickRep

With online reviews now a cornerstone of the customer journey, and reviews being spread out to all corners of the internet, ClickRep makes it easy as one, two, three to manage your dealership’s reputation.

Built directly into your business’ website, ClickRep monitors around 90 review sites, including hard hitters such as Google and Facebook , to create a rolling feed of customer reviews for all of your potential customers to see.

Taking the stress out of reputation management, ClickRep will prompt customers to leave a review after making a purchase at your dealership and will automatically feed any new reviews directly onto your website. It can even broadcast five-star reviews directly onto your social media feeds with its innovative ‘Social Broadcasts’ function.

If you’re curious to see how ClickRep can help to boost your dealership’s performance, then please get in touch with us.

Why Many Dealers Are Now Offering the Option to Reserve Vehicles Via Their Websites

Before the advent of the internet, the way that customers bought their vehicles had remained relatively unchanged for decades. Nowadays things are a bit different.

With 81% of consumers conducting research prior to making a purchase, and 57% preferring to shop online, the landscape of buying and selling automobiles is changing every day. By the time a customer arrives at your website, there’s a high chance that they already know what they are looking for and are ready to reserve the vehicle that most closely matches their needs.

Data analysed across ClickEngage users in 2019 showed that 63.7% of vehicles reserved online went on to convert into sales. This suggests that by the time a customer has chosen to reserve a vehicle they are already committed to their decision, with the quality and lifestyle fit of the vehicle itself being the deciding factor thereafter.

While vehicle dealerships still have a firm place in the retail landscape, the way in which consumers engage with dealerships is changing; customers expect 24/7 availability, and the option to reserve a vehicle at the time of their choosing is now part of that expectation.

Dealers must meet consumer needs

Allowing dealerships to be more contactable than ever is a key feature of our ClickEngage service, allowing dealerships to offer 24/7 vehicle reservation and enquiry options to their customers. In turn, this allows dealerships to generate quality engaged leads. When looking at conversion data from dealers who used ClickEngage in 2019 we found that online enquiries to dealers with ClickEngage converted 3x as often as those who did not use the platform at all.

 Having the ability to reserve their vehicle of choice outside of a dealership’s traditional opening hours benefits both the dealership and the customer, as this allows customers to meaningfully interact with the dealership whenever suits them best and in a positive manner.

With used vehicles especially, giving customers the ability to reserve a vehicle outside of opening hours also removes the worry of losing out on their chosen vehicle, simply because they struggle to make contact during the working day.

To find out how Click Dealer can help you to offer in-demand services to your customers, then please get in touch with us on 01782 478 220 or by email using [email protected]

Manheim sees healthy demand for used vans but warns of stock shortages for cars

Dealers are paying slightly more for second-hand vans at auction knowing that strong retail demand will soon move them from the forecourts with a good profit margin.

Auctioneer Manheim says that last month LCVs were selling at an average of around £6,500, some £350 up on December, and four out of five sold the first time around.

Stuart Peak, its LCV specialist, said:

“It’s safe to say that buyer demand hasn’t slowed at all since the start of the year, with our auction halls jam packed with buyers wherever you go. Dealer confidence has risen and when I speak to our buyers they’re telling me that retail demand is excellent, meaning they can go out and spend at auction.”

The van market is strong generally at the moment and franchised retailers have seen two consecutive months of growth now, up 6% in January according to the SMMT. 69-plated small and mid-size vans up to 2.5 tonnes, in particular, saw exceptional growth in January although pick-ups dropped by 10%.

Manheim says the healthy start to the year in LCVs is matched by cars too. It says conversions are around 90% and CAP results are close to 100% although the market is still adjusting after a big drop in CAP prices mid-2019. However, it warns that too many vendors are pushing cars described as CAP clean when they are nowhere near that standard.

Dealers scrapping for cars to sell

Andy Conde, its cars specialist, said:

“The good news is that demand remains as strong as ever. We’re all scrapping for cars to sell and buyers are scrapping for cars to buy. Irrespective of the volume on offer, buyers are willing to travel across the country.”

However, he repeated earlier warnings that a weak new car market will restrict stock supplies later on:

“The majority of our manufacturer vendors are enjoying 100% conversion successes at the moment but have reported there could be shortages of stock by the middle of the year. This will only increase demand for this type of premium stock.

Why the shortage? Well consumer demand for used cars is on the increase and this is having knock-on effects to the delivery of new cars. Dealer part-exchanges are also decreasing with many dealers either selling their ‘swappers’ on their forecourts, or retail buyers are disposing of their old vehicles via a different route prior to buying a new one.

We must make sure we keep a close eye on supply and react accordingly, but for now the market is in a very strong place. Long may it continue.”

If you’d like to find out more about how Click Dealer can help your dealership to acquire and manage stock, then please get in touch with us on 01782 478 220 or by email using [email protected]

Margins under pressure this year say independent dealers

Business costs - lead management
Independents in the second-hand car and van market face a triple challenge this year which will squeeze margins and make it difficult to grow profits this year compared to last.

In its annual ‘State of the Nation’ survey of both franchised and independent retailers, Cox Automotive says that used car dealers will battle three interlinked issues during 2020: competition for retail-ready used stock with the franchised sector, no room to get economies of scale, and increased third-party and aftermarket costs.

Although not new problems themselves, Cox says many dealers it spoke to expect them to become more significant as the year unfolds. Philip Nothard, Customer Insight and Strategy Director said:

“Dealer part exchanges are not making it to the auction halls quite so often and we’re seeing more consumers selling, rather than part exchanging, their old car before buying new – or even used because the wait times are often long. Overall, this is likely to push dealers, particularly independents, into a position later in the year where good quality used stock at reasonable prices becomes harder to acquire.”

One dealer, David Bilsborough, who owns and manages Cheshire Cars, backed this up, adding:

“Margin stability is dependent on the supply and demand of the used car market. The increasing age and mileage due to retention has a direct impact of reconditioning costs and therefore profitability. In a market of ‘price indicators’, retail competitiveness is ever increasing.”

Cost of servicing and individual components continues to increase

Although there is plenty of restructuring of networks in the franchised sector to squeeze greater efficiencies from the properties and staff, independents don’t have that flexibility or room to manoeuvre.  Phil said:

“It isn’t a new phenomenon, but the lack of shared resource and multi-site cost sharing will likely present even more of a challenge for independents in the coming 12 months, as other external pressures start to bite.”

Turning to third-party costs, Cox says that growing demand for out-of-business services and aftermarket repairs is forcing a rise in costs for independents. Mr Nothard said:

“With cars becoming increasingly complex and reliant on technology, the cost of servicing and individual components continues to increase. This is likely to disproportionately affect the independent sector, leading to higher pressure on margins, delays in securing ‘retail-ready’ stock and a reduction in ROI.”

There is a fourth challenge to come this year which will affect every dealership, franchised or independent, which is the FCA’s new rules on Discretionary Commission, which is due this spring. Cox said:

“Whatever the specific outcome, it is clear some dealers will need to rethink their finance model. Transparency in commission disclosure, the reduction in types of acceptable commission and the banning of commission linked to interest rates will all have an impact.”

If you’d like to find out more about how Click Dealer can support your business, then please get in touch with us on 01782 478 220 or by email using [email protected]

Dealers need wider range of finance options

Finance Options
Dealers should be pushing for their lending panel to include a wide range of options as the traditional binary prime/sub-prime model offered by more than half of them no longer fits buyers’ credit profiles.

One lender, Startline Motor Finance, says the market needs more sophisticated options and a much wider range of them to suit many customers who want to buy a used car but perhaps have a worse credit rating than they expect. Although not putting a figure on how many stages there should be in the lending spectrum, it says the two available in the binary system is nowhere near enough to fit customers’ needs.

Paul Burgess, chief executive, said:

“What is clear to us is that there is a much wider spectrum of finance needs in the market. Quite how many is difficult to say but it would not be a stretch to suggest that the market should perhaps be operating over at least five identifiable levels that are easily understandable to dealers and car buyers.”

Over the past several months it has undertaken a study into the sector focusing on what dealers need and what lenders offer. Towards the end of last year it published a report – The Future of Used Car Finance – which said that while around a third of dealers have a near-prime option from their lenders and an overwhelming majority see it as a core part of their business, more than half the finance houses still only provide the binary choice. It also says that many dealers anticipate lenders tightening up on which applications they will approve throughout 2020 as the appetite for risk drops.

Market needs more innovative products

While Startline is one of those with a wider choice of packages, Burgess says the industry as a whole needs to react to a changing and challenging economic background.

“What the market really needs is more innovative products. As you would expect, we have plans ourselves, but there are other customer demographics and characteristics where opportunities lie and it is up to motor finance providers – both new and existing – to meet them.

“We believe that this is especially important at a point in time such as now when economic conditions might be quite difficult over a relatively a long period of time, depending on how leaving the EU and other factors play out.

“Acting to enable car buyers to make the purchases they want to make will become an ever more important factor in maximising sales – and the right finance products are needed to do that.”

If you’d like to find out more about what Click Dealer offer, then please get in touch with us on 01782 478 220 or by email using [email protected]

How to boost your sales figures with Google advertising

Digital Marketing
Google has stepped up its advertising game by providing more tools to help the automotive industry connect with potential customers online.

If you’ve never done any Google advertising before then it can be a daunting task to start delving into the various features, it offers. Why is it worth your time? Because you will see real rewards by increasing your sales numbers and profits.

Here is a straightforward three-step process to help you get started:

1. Building your account

So you’ve set up a Google Ads account, but now what? You want to identify keywords that consumers are actively searching for. ‘Used cars for sale in Stoke-on-Trent’ is a search term you definitely want to be ranking high up on Google for if you’re a dealership in Stoke-on-Trent. But you can also remove negative keywords which will help you keep costs down. If you’re a dealership who only sells cars, then you can make ‘vans’ or ‘trucks’ negative keywords so you don’t appear in searches containing that keyword.

Before you take the plunge and make your adverts live, get your Google Conversion Tracking set up. This way if someone fills out a form on your website via paid activity you can not only determine how much your cost per sale is, but also discover which keywords are the best to target.

2. Optimisation

One thing you can do is add an audience tag to your website, this way anyone who visited your site but didn’t fill out a form can be retargeted with an offer or reminder. As well as focusing your keywords as we’ve touched on already, you can also look at what times of day you’re getting the most traffic from your ads after you’ve been running them a week or more and determine when the best times are. Between 12am and 8am you might choose to not run your adverts at all. But if you have a large amount of traffic on a Wednesday for example, you could increase your bid.

3. Taking It Up A Gear

Now once you’re feeling more confident and a real Google pro, you can try leveraging your data by showing them ads that are relevant to that individual person. By uploading your inventory data, which will involve a feed on the back end with your latest pricing information, plus a bit of coding in the text on your ads and Google will automatically pull through relevant information for what that person is looking for. Improving your click-through rate and reducing cost per lead.

Google now allows you to create ads which display images similar to a Facebook gallery. All you’ll need to do is keep your Google My Business up to date and linked to Google ads. This is a free feature but Google is putting more emphasis onto these listings and encouraging people to click them.

You can also increase the number of customer reviews you get by adding a QR code to your handover process. After you take a photo of the customer and their new car, get them to scan a QR code that will take them directly to your Google review page. This way they don’t forget later and they do it there and then.

If you need any support with Google Advertising or want to know what similar products Click Dealer offer, then please get in touch with us on 01782 478 220 or by email using [email protected]

Sales of three year old low cost/low emission cars signpost budget-conscious 2020 market says Auto Trader

Low Emission Cars
Dealers should be stocking fuel-efficient superminis – ideally 2016 cars back from a PCP – smaller SUVs or EVs to fit in with the trend for low cost or green cars.

Auto Trader says analysis of its marketplace this month shows that Renault’s ZOE EV, 2016 superminis and a sprinkling of smaller SUVs of the same age are the fastest-selling used cars so far this year and their performance could set the tone for 2020 as buyers search for low cost, good value or low emission cars.

It says that despite greater consumer confidence from post-election political stability, buyers still retain a degree of austerity attitude and are being pushed towards fitting in with the green agenda. Aside from the pure EVs, it doesn’t seem to matter which fuel type they are with sales evenly split between diesel and petrol.

In its first Fastest-Selling Index of the year, its data show the ZOE could take around 25 days to find a buyer with the second-fastest mover, the 2016 Mazda CX-5 (diesel/manual) needing just three more. Superminis take the lion’s share of the top ten – all of them 2016 versions – with the Toyota AYGO, Ford Ka, Volkswagen up! and Audi A1 in there.

Underlining the prevailing mood for a good deal, budget brand Dacia has three of its models in the list.

Buyers Being Cautious With Their Money

Karolina Edwards-Smajda, Auto Trader’s director of commercial products, said:

“We can see a clear demand for 2016 vehicle variants, which are reaching the used market after three-year finance cycles. Despite consumer confidence increasing post December’s General Election, these newer and low mileage second-hand cars offer cautious consumers excellent value; almost the same quality as their brand-new counterparts but at a much lower price tag.”

Adding further weight to the argument that buyers are being cautious with their money there seems to be a turn away though from nearly new stock with 2019 bigger models from Audi, Volvo and Subaru taking up to 150 days to shift and being the Index’s worst performers.

2020 could be the year where second hand EVs really take off though. Karolina added:

“Despite a slight increase of traditional fuelled vehicles on the top 10, it’s impossible to ignore the huge shift in consumer perception towards low emission cars. Whilst we’re a long way from mass adoption, every metric on our marketplace indicates an ever-growing appetite for electric. Not only has the ZOE continued its reign into the new year, but over the last 12 months, we’ve seen a significant 78% increase in searches for EVs on Auto Trader. With more and more new generation models set to reach showrooms this year, coupled with fast-improving infrastructure, it’s looking increasingly likely that 2020 will indeed be the year of electric.”

For more information on Click Dealer’s products and services, you can get in touch with the Clickers via [email protected], 01782 478220 or via our contact page.

Strong Demand For Top End Performance And Premium Cars At BCA Sale

BCA / Performance Cars
Buyers were out in force at a dedicated sale of used Porsches as market insiders confirm there is a healthy demand for second-hand sports cars, as well as luxury and premium stock.

A BCA sale for Porsche Retail on January 8 saw new records being set for the vendor with its entry of 80 vehicles getting a conversion rate of 90% and generating proceeds of £1.9 million. The auctioneer said there were almost 550 bidders competing for cars online as well as having a packed hall from would-be buyers wanting to physically see the vehicles.

Among the strong sellers was a 2016 registered Porsche Macan 3.0 Diesel which went for £36,000 at 21,000 miles and another 16-plated Porsche 911 PDK Auto sold for £62,200. From a different marque, but still very much at the premium end of the market, a 67-reg Mercedes–Benz E220 Alpine Coupe made £23,800 at 35,500 miles.  In total, 79 vehicles sold for £1.9 million, generating an average value in excess of £25,000 and an average of 99.5% of Cap Clean.

Healthy Start For The Upper End

Suzanne Spencer, BCA’s Major Account Manager, said all the signs point to a healthy start for the upper end of the used car sector this year with good demand from dealers looking for prestige stock. Suzanne said: “Our customers know that Porsche Retail offer an exceptional choice of luxury, prestige and performance vehicles and these sales generate a genuine buzz with our buyers.  The used car market has started strongly at BCA in 2020 with significant demand for prestige and performance vehicles.”

Demand is not confined to the more expensive vehicles though. Earlier this week both BCA and Manheim reported an exceptionally strong start to 2020 across the board with cars and vans being snapped up. BCA says it set new records for itself, selling more in one week – over 26,000 – than at any other time before and Manheim said that it is seeing conversions of more than 90% with many vehicles beating their CAP Clean target values.

For more information on Click Dealer’s products and services, you can get in touch with the Clickers via [email protected], 01782 478220 or via our contact page.