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AUTOMOTIVE ADVERTISING & MARKETING

Target Audience

You Need a Thorough Knowledge of Your Target Audience

In advertising, a target audience is a group of people identified as the intended recipient of an advertisement or message. In an automotive advertising campaign, identifying and understanding your target audience of consumers is absolutely crucial. Without knowing who these people are, you cannot realistically expect maximum success as you market yourself and your dealership […]

Radio and Automotive Advertising

Radio and Automotive Advertising are an Ideal Match

There are many great reasons why radio and automotive advertising are joined at the hip … and I’m not using this space to refer to live remotes, which have been an integral part of car dealers’ ad campaigns millions of times over the years. I’m talking specifically about the automotive dealership advertisements you hear on […]

Automotive Newsletter Advertising

Reasons Automotive Newsletter Advertising is Effective

While the quest to acquire new customers never ends, it’s also of utmost importance to regularly strengthen the relationship with your current customer database. In today’s automotive advertising world where repeat customers are more important than it has ever been, newsletter advertising is a highly effective yet sometimes overlooked way to help you retain your […]

Automotive Advertising Functions

Four Important Automotive Advertising Functions

Today’s blog is all about automotive advertising functions. Automotive advertising can be found all over the place … on radio or television, on the Internet, in print and even on billboards. If someone asked you why you advertise, you might reply with a simple answer that talks about enhancing your dealership’s bottom line. While that […]

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Post-Pandemic Dealer Gross Profits are Down – But They Don’t Have to Stay There!
March 13, 2024

It is no secret that dealer gross profits per vehicle are down sharply in the post-COVID automotive world. According to a recent article in Automotive News, gross profits of the six largest publicly traded dealership groups plunged significantly from Q4 2022 to Q4 2023. One of them was actually down 35% per vehicle!

The article explains: High interest rates, more expensive vehicles and a steadier post-pandemic supply chain continue to soften demand and bring it closer to pre-pandemic levels. Still, new-car buying has remained strong overall …

This means that, while sales volume is similar, overall bottom lines are lower for many dealers due to the reduced gross profits. What about your dealership?

Being Realistic
It’s time to turn the page! The time for dealers to simply be order takers for people willing to pay MSRP for a vehicle (and in some cases more) has passed and dealers have to work hard once again to achieve acceptable gross profits.

Selling a high volume of cars doesn’t control gross profits, no matter how much you wish this was the case. Correct processes and menu pricing – and strict adherence to them – do!

What kind of processes?
∙ Slow down the transaction! Your sales staff has to once again sell the customer on the features and benefits of every new and pre-owned vehicle on your lot.

∙ Your salespeople and managers should devalue the customers’ trade-in value (politely, of course) as much as possible. After all, if the customer expects you to lower your price, shouldn’t you be able to do the same on their trade? Remember, you’ll have to fix it up, put your name on it and resell it to someone else with all the tenacity you would a brand-new car. So make sure you buy it right … because the profit is made when you buy it, not when you sell it!

∙ To that end, management should be ready and willing to leave the desk and do thorough walk-arounds on each trade to ensure the best outcome for the dealership.

The Cure for Low Gross Profits
If you are like a lot of dealers these days, you could use some good news. Here it is: while you may not have the capability to achieve profit margins similar to those you enjoyed during the pandemic, they could likely be improved. JKR’s clients enjoy the benefit of attracting not only more customers, but better ones, too!

If meeting and exceeding your sales goals (and increasing gross profits at the same time) sounds great to you, you need to call us. Don’t settle for reduced gross profits when help is out there to get you closer to where you’d like to be.

Want to know how we do it? Reach out to Senior Partner Richard Brauns (407) 701-4233 or Partner/Vice President Jon Albert (407) 718-2494 today.

JKR Automotive Advertising: We Move Cars.

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