Does It Sell More Cars? No, You Do: Defection and Marketshare

“Bring war material with you from home, but forage on the enemy. Thus the army will have food enough for its needs.”–General Sun Tzu (545-470BC), Author of the Art of War

If you’re not crazy about robbing your future self (Part II) to chase a minute fraction-of-a-fraction of car buyers in your market (Part I), I don’t blame you one bit. The one thing we do know is that some other dealership is trying to sell a vehicle to that tiny fraction at the exact same time.

There is no shortage of competition. That competition could be selling your brand, a different brand, or even a smorgasbord of pre-owned brands. In that context, instead of one giant pie, it’s a bunch of different flavors of pies that come in different sizes. Instead of stealing pie off your own future plate, should you steal a few slices of theirs through defection? Hell yes, you should.

Larger Portions

By maintaining a mindset of getting a bigger piece of the overall pie, you maximize your ability to stay fat, while understanding that car sales fluctuate with the economy and consumer sentiments. The number of vehicle sales don’t matter nearly as much as the percentage of sales that are captured. By adding a bite here, and a bite there, you stay full. But, this takes much discipline in terms of not trying to buy market share. By trying to buy market share, especially when conquesting through paid search, it’s easy to overspend on customers who will not pay you back. When you’re throwing extra thousands at customers you will not retain, you are still robbing your future self.

In the case of real pie, cheaper isn’t always better. This is especially true when going after alternative makes. Thankfully, there are technologies and methodologies to help dealerships compare, as well as contrast, every model, option for option. This prevents the inevitable price war that typically ensues. Many dealerships have experienced great success with video comparisons, boosting their search rankings with “us vs. them content,” while many more have used tools to optimize used inventory to maximize brand defection opportunities. I know I sold more Chrysler Town & Countries off of Toyota Sienna leads than actual Town & Country leads by making my brand sound just as sweet. Build value in what you’re offering before you erode it.

This same car sales training strategy can be used for your brand of vehicles. A finite number of people will be selecting from your brand at another dealership. Much like all Hostess Apple Pies taste the exact same, so do all beige Toyota Camrys. They all roll down the same assembly lines by the hundreds of thousands. Since anyone can buy both products virtually anywhere, you need something else to do the talking.

Once again, there are technologies available to dealerships and, in turn, advertising agencies to assist dealerships in acquiring more same-brand customers. The same “us vs. them” strategies and car sales training tactics can be employed, but in this case, the dealership is the product. You can offer digital retailing, while the folks down the street don’t bother. You can go old school and offer free home delivery, while using hyper-targeting technology to post videos of the delivery on social media. You can even optimize your unique value propositions to mirror what your core customers are looking for. Most of this would be impossible without the use of emerging technologies.

Capturing defectors can help sell more vehicles. But, please go back and read the begging, borrowing, and stealing section if you don’t remember it. Don’t lose money on someone else’s customers while still losing money on your own. If someone has the propensity to defect from another brand or business, we know one thing about them: they aren’t inherently loyal. Don’t plan on these customers coming back. If they just bought a car, and not your dealership, then the vehicle sold itself. You got several slices of different flavored pies, but no nourishment. What exactly did YOU do to sell them?

For the penultimate part, Whole Pies and Retention, we’ll take a look at a far more sustainable strategy. Does it take technology? Probably more than what’s available today. Does it sell more cars? That’s up to you.

Part I: A Story of Pies
Part II: Beg, Borrow, and Steal From the Future
Part III: Defection and Marketshare
Part IV: Whole Pies and Retention
Part V: Conclusion