Thursday
Feb072008

Learn To Ride, Just $199

By Jimmy Vee & Travis Miller

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Ah…they joys of fatherhood. My little girl, Ella, just turned 1. One of the best parts about having a first birthday party is that you get to attend the parties of all the little friends who attended your party. Last weekend I had the pleasure of going to two first birthday parties. How exciting! Actually it was almost excruciating. Oh well…

On the way to the first party (they were back to back, on Saturday, see) we passed a Harley-Davidson dealership. Now, Harley-Davidson is a marketing machine. The entire concept of Harley-Davidson is based in marketing. In fact, they've made their company NOT about motorcycles, but about 40 year old accountants having the opportunity to put on leathers and frighten somebody.

So, your typical Harley-Davidson bike will run you, what, between $15k and $30k? Sound about right? Now that's considered, in most circles, to be a high-ticket item. And a motorcycle isn't really like a car, in the sense that people spend the money out of necessity. That's what the Ford Taurus and Toyota Camry is for. No…people buy Harley's as a luxury or recreational item. It's like a wave-runner or a boat or a watch or diamond earrings or custom suits. People buy Harley's with disposable income—at least for the most part.

A lot of people in the car business will huff and puff about the price of their offering. "Woe is me because I can't market like other people can…my product costs too much." Or, "If I had something low priced to sell it would be a lot easier…"

Jim and I frequently suggest to people that they come up with something that’s either free or low-priced to offer in addition to their main product offering. This goes a long way when you're trying to either build a list or build up your customer base. And of course, once people spend money with you 1 time, they're far more likely to do business with you again. So frequently, the main job of marketing is to almost force that first sale so that you can do a good job and set up the second, more profitable sale.

Well, this Harley-Davidson dealership did exactly that and it really caught my attention. Most people would advertise a Harley like this: "[Picture of bike] Just $23,997!"

Yikes!!

Some may throw in a payment, or maybe something cute about feeling the wind rush through your hair on the open road.

But this dealership has a BIG banner outside along its interstate frontage that read: "LEARN TO RIDE: $199!"

Hang on a second!! They just transformed the woe-is-me $20,000 sale to a $199 intro. That's a drastic leap. In fact, if they led with that in their marketing, they would probably have a far great response.

Think about this…you're a 40-something white-collar gal or guy and you're feeling restless. You're thinking about maybe getting a motorcycle some day. Your wife threatens a divorce and your parents call you crazy, but you can't shake the idea of cruising down the road with "the wind rushing through your hair."

But there's no way you're ready to make that commitment yet. You're not even sure if you could ride a motorcycle. You've never been on one, and don't know if you'll even like it. And maybe this urge to ride will disappear as soon as you sit down on a bike. And then what?

Then you realize that for just $199 you can get the answer to all your concerns. You can eliminate all of your mental objections (good for you or good for them?). It's low risk, low cost, low commitment. So you decide that's a good first step to take.

Here's the best part: you are basically PAYING Harley-Davidson to give you a sales pitch. Think about what this "lesson" is really going to be. It's going to be a test drive—but you pay for it. How awesome!!

The next best part is this: Harley-Davidson knows that more likely than not, riding the bike will make the itch worse, not better, and you'll have been bitten by the Harley bug.

So when you come in for the $199 deal, a couple of things happen:

  • You become a customer…(that's better than a non-customer)
  • You get to experience the thrill of riding
  • You get a sales pitch
  • You go further down the rabbit hole with Harley

All good things…

So what does this mean for you? You don't sell motorcycles, after all. Well this means you need to start thinking of smaller sales you can make to your potential customers to encourage them to become customers in the first place.

Think about ways you can get your prospects to PAY YOU to hear your pitch.

Understanding this little twist can make a big difference in the response to your marketing and the cost of your sales process.

Thursday
Feb072008

Attention Auto Dealers: We Found We're All The Money Is Being Spent!

By Jimmy Vee & Travis Miller

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We hear excuses all the time about why business isn't what it should be. There are hundreds of different excuses. One thing all the excuses have in common is that they're externally focused. Meaning the excuses are never about things the business owner can control internally but instead about external factors the business owner can't control.

Some frequent excuses include:

  • Business location
  • Credit availability
  • Rising interest rates
  • Gas prices
  • Weather
  • Season
  • War
  • Election
  • Postage
  • Spam

The number one all time biggest excuse is: THE ECONOMY. The funny part is, it doesn't matter if the economy is good or bad. It's always bad to the people who aren't doing as well as they want to be. And it's great to those who are prospering.

Well we have some exciting news for you! The economy is alive and well! You heard it here first.

How do we know? We just made a quick trip to NYC to meet with a client. Afterwards, we did some shopping on 5th Ave. Our wives accompanied us on this little jaunt, you see. Now, we've been to NYC a number of times. But what we saw on this trip was unreal.

The lines were unreal. We're talking about 4 hours waits for restaurants at lunch time…a line around the corner for FAO Schwartz, standing room only on the subway, no cabs to be had, an endless line to ice skate at Rockefeller Center or Walden Pond in Central Park, all shows sold out, hotel rooms starting at $500 per night. Demand, demand, demand, demand. Want, want, want. Spend, spend, spend.

For many people this may have been a real pain. But we had huge grins on the entire time.

What we saw more than anything else was MONEY BEING SPENT. Spent without prejudice. Spent without argument. We paid $9.50 for a side of broccoli at one restaurant. We spent $20 on banana split at an ice cream shop. And we were just 4 in hundreds of thousands. It was an utter frenzy.

You know what was lacking? Excuses. Nobody seemed to be crying about the economy. The economy was perfectly fine on this weekend in NY.

In fact, one of the days there was a protest against police brutality right down 5th Ave. There must have been 100,000 people in the march. It literally shut down blocks of traffic right down one of the busiest shopping corridors on one of the busiest shopping days of the year. Complaints? Nope. The lines still persisted. People still pushed and shoved their way into stores that had no room left.

Gosh, later that day we saw protesters walking down the streets with their sign in one hand and a Bloomingdales bag in the other. Even the protesters were spending money!!

Why? Why did it happen? Well there are two forces at work here. Both can be used to your advantage.

The first is the principle of demand and desire. 5th Ave had something the public wanted. They weren't trying to jam something down consumers' throats that they didn't like. Oh no. People were getting a big fat mega dose of exactly what they wanted!

Right now, look around your business. Have you designed an environment of a frenzied sale? Is your marketing focusing on what you want to sell or what people want to buy? You gotta ask yourself those questions and come up with some serious answers.

The other force at work here is the fact that people are willing to spend money no matter what you think. It's been said that people don't like to be sold … but it's been proven that people LOVE to buy. What's the difference? Perception … positioning …

The sales people at Bergdorf-Goodman weren't trying to be pushy. They were simply facilitating the transaction. This is largely due to the first point (that they were selling what people wanted) but it is also helped along by the fact that people are more than willing to spend, spend, spend.

We witnessed, first hand, the separation of tens of thousands of people from millions of dollars. Most of the separation was performed by low-paid sales people with little motivation.

So at this point you're undoubtedly saying, "but my business is different … I don't have a store on a crowded street … I don't sell Christmas gifts … etc." Thus start the excuses. We're back where we started.

The bottom line is people are as willing to spend money today as they ever have been. That spells o-p-p-o-r-t-u-n-i-t-y for dealers.

What we've all got to figure out is how to tap into these forces … how to tap into the flow of money. But before that can happen, you need to stop with all of the excuses.

You see, those excuses won't get you anywhere … and they're just false negativity. There really is nothing to be negative about. Money is being spent at a breakneck pace and the marketplace is begging to be separated from its cash. Your job is to stop whining and make the separation occur by figuring out what people WANT (not need) and delivering it.

You need to understand that people WANT Lamborghinis, Ferraris, Mercedes, BMWs, particular trucks, etc. They don't want a Taurus, a Camry, an Accord, a Civic, a Sable, etc. Does that mean that you shouldn't sell those cars? Of course not!!! Those cars are the basis of the transaction.

But what people are really buying is peace of mind, safety, a ride to work, a way to take their kids to school, etc. And the big thing to remember is that all dealers can sell the cars. So the cars don't set you apart. What sets you apart are the things you do differently … potentially better than anyone else. You must keep that in mind.

FAO Schwartz offers the same basic toys as KB and Toys R Us. And while those stores are undoubtedly busy during the holiday season, it's unlikely you'll see a ¼ mile line to get in. FAO Schwartz on 5th Ave does it differently. Perhaps it's 5th Ave itself. Maybe you need to take a trip to NYC and see for yourself. Take a pad of paper and sit on a bench and think of ways to emulate to process and environment in your own business.

Whatever you do, just stop putting the responsibility of your success or blaming your lack of success on anything but your own actions.

Thursday
Feb072008

Two Big Myths Of Used Car Marketing

By Jimmy Vee & Travis Miller

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Myth #1: You Can’t Expect Results Overnight

If you can’t expect results overnight, how can you expect to stay in business?

There are two kinds of advertising: branding and the kind most dealerships can do. So for you there is only one kind of advertising and that is hardcore, retail-oriented, direct-response, lead-generating, low-cost, overnight-results-getting advertising.

Building a strong, lasting, competitive brand image takes a long time. It’s usually built over generations with lots of clever creative and TONS of advertising dollars. If you don’t have cola company money to spend, you can’t have a cola company brand. If you don’t have theme park money then you can’t have a theme park brand. It’s that simple. That’s why you don’t and can’t spend money to directly brand your business.

What you need is results. Although you can’t develop a brand overnight, the good news is…results can happen overnight!

If your system is sound, your ads are positioned correctly and your marketing uncovers the emotions of your customers, the results will be immediate. You can turn it on and off like a light switch. If you don’t see results right away, one of these factors was faulty.

Brandscending

More good news! Branding can be achieved – without even paying for it. Many people misunderstand our position about branding and believe we’re saying “branding is bad.”

Not so. Paying for brand is bad – unless you have the time and cash to do it properly. Most dealerships don’t. And for those who do, it’s becoming increasingly difficult due to the mass segmentation of the market.

However, building brand for free is a wonderful and very real thing. We like to call it “brandscending.”

Brandscending is the process by which your company carves out a clear and definite place in the minds of the people who care most.

There are several things involved.

  • Learn who your prospects are and what they want and give it to them. That’s being interested.
  • Have a consistent and unique image that’s attached to all of your “results” oriented marketing. Over time, this can help build residual brand effects.
  • Offer an experience that is fun, unique or risky. Do something that is worth noticing and worth talking about. As people start to notice and talk, your brand value will increase.

The key is this: never, never, never, never, never buy an ad, say absolutely nothing in it and believe that you “built a little brand” or “got your name out there.” You did not.

Myth #2: “You Can’t Control Word-of-Mouth Advertising”

We genuinely feel sorry for anyone who believes this.

We’ve polled thousands of people and over 90% agree that the ideal form of marketing is word-of-mouth advertising.

Don’t you agree?

But almost everybody also agrees that it’s impossible to control. That’s nonsense proliferated by the pay-per-advertise media. They don’t want you to find out that there’s a way to control the best advertising process of all – the one that’s 100% free.

We’re here to tell you that you can. We won’t lie to you and tell you that it’s easy. It’s not. But it is free, and when it works, it works in a BIG WAY.

To start controlling word-of-mouth, you must be sensational. There are seven key attributes a dealership aspiring to be sensational must be:

  1. 1) Fun
  2. 2) Unique
  3. 3) Risk Taker
  4. 4) Interested
  5. 5) Visible
  6. 6) Credible
  7. 7) Spreadable

The ability to control this elusive and desired form of advertising is only available to those who have flushed their systems of all of the traditional garbage and started putting their money and their effort into smart marketing.

That’s good news. Controlling word-of-mouth advertising can only be done by the best of the best. By reading this information this far, the probability is high that you are in that category. Most people don’t do what you’re doing right now. If you take this information and use it, people will notice you. People will TALK ABOUT YOU! People will start to gravitate toward you.

So, it’s not easy, but it’s not impossible. How do you do it? Well, the truth is that it almost happens on its own when you position yourself as an expert, start marketing to people who want to hear from you, solving their problems, building emotional bonds with them, connecting with existing emotional anchors and having fun while doing so.

When you put all of the pieces together, you start to glow. And people talk.

Thursday
Feb072008

High Tech, Low Gross

By Jimmy Vee & Travis Miller

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There’s a lot of talk these days in the car business about the Internet. Lot’s of people getting very worked up and overly-excited. Recently we read an article that positioned the Internet as no less than a panacea, a cure-all, for the car business.

“Traditional media is dying!” they hail loudly! “Direct mail doesn’t work!” they proclaim triumphantly. “Newspaper spending is down!” they trumpet. “And the Internet is up!”

Stomping their feet wildly, herds of dealers are following the crowd like lemmings to the sea…hoping, praying, demanding that a car buying renaissance is taking place right before our very eyes and that finally ad budgets can be cut to their knees and with a few wiz-bang emails and a fancy flash website customers will arrive in droves.

And woe for the dealer who just can’t afford the fancy flash program. What is he or she to do?

If only it were true.

It all smacks of 2000 and is reminiscent of the rush to buy up all the dot com stock. How many of you lost in that deal?

For those of you who are interested in shelving the magic bean stalk beans for a few minutes and talking about reality, the rest of this article is for you.

Here’s the real deal. The Internet is a tool, not a business. Many will rush to point out the scattered few dealers whose business is entirely online. And that’s fine. Just as we can point out the latest power ball winners. It can and does happen, but is it a wise business decision?

The article we read recently pointed out that the cost per sale from Internet-generated leads was about half the cost per sale from advertising-generated leads. We won’t argue with that. But consider this…how was the gross? So you save $250 on acquisition cost, but your gross was thinned down to $500 (from your normal $1500). Did you come out a winner or a loser?

Studies show that consumers are exceptionally price-conscious (read cheap) while online. That’s because web surfers have at their disposal a host of price comparison tools. The Internet turns any market into a commodity market, with the lowest bidder winning. Just look at the commercial successes found online: eBay, Amazon, Priceline, Overstock. They’re all focused on delivering deep, deep discounts. And so they should be.

Companies who operate solely online enjoy reduced overhead (no store, fewer employees, etc), so they can and should cut shoppers a deal.

But if you’re one of those “dinosaur” dealers who still runs an actual dealership, with sales people and everything, the Internet can be a dangerous place filled with an army of gross-slashing soldiers.

So how should you use the Internet? As an additional tool, not a replacement or a cure-all. Don’t go out and begin hacking your newspaper buy to bits and canceling all your commercials. Keep doing what you’re doing (if it’s working) and begin using the Internet as a tool to acquire new, incremental business. And your primary goal while marketing online should be to get the shopper offline and into the dealership – where the grosses are high and you control the environment.

Incremental sales are cheaper sales because your fixed expenses are already covered by your existing sales. So you can afford thinner deals from the Internet if you choose to accept them.

Are we saying the Internet is bad? No. Are we suggesting you shouldn’t take advantage of the online marketing avenues available? Not at all.

What we’re suggesting is that the Internet is not the end-all, be-all of marketing media. It’s another way to reach potential buyers. When the radio was invented they said it was the end for newspapers. Television was supposed to trump radio. And cable was to be the nail in the TV coffin. And so it is believed with the Internet. But just as it has been in the past, consumers will add the Internet to their lives and keep the media they already know and love. As long as people are watching TV, reading the paper, getting snail mail and listening to the radio, you should be advertising there as well.

Thursday
Feb072008

How To Get Dramatically Higher Response From Your Advertising, Better Quality Ups, Higher Closing Ratios and Increased Sales And Profits

By Jimmy Vee & Travis Miller

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Pretty bold title for a simple article, don’t you think? But here’s the thing...what you are about to learn doesn’t stop at the end of this article. Once you start digging into this concept you will end up head-over-heels, face down looking into a rabbit hole that goes VERY deep. You have to decide whether to take the leap of faith or stand on the outside while your competition jumps in with both feet and reaps the rewards that come from being on the cutting edge.

Wait – did we say, “cutting edge?” Oh, this must be another article about the Internet right?

Wrong!

This is not about the internet at all. It’s about what the Internet has caused and why the traditional approach of hard-sell advertising isn’t as powerful as it used to be. For those of you who are doing hard-sell type advertising you are going to be shocked and nervous. For those of you who never embraced a hard-sell marketing approach you’ll be three steps behind and we suggest you pack your parachute and hold on tight.

The Internet has caused a massive change in the dynamic of our customers. They think differently today then they didn’t just three, two or even one year ago. They are more educated and because of that they demand and respond to information-based, value-driven marketing rather than the traditional hard-sell advertising tactics we’re used to using in our dealership marketing programs.

Some of you right now are raising the victory flag exclaiming, “Finally the hard-sell days are over,” and others are weeping over its grave while still others are trumpeting the coming of our marketing savior, spending all their time and energy moving their entire operation online, believing that the Internet is the second coming of Christ.

First of all, the Internet is just a tool, just another medium like newspaper, radio or TV. And one where price is king and the gross is low unless you really know how to use it.

Secondly, hard-sell advertising isn’t dead – it’s evolved. It’s grown a third leg and wings. That’s what good marketing concepts do. They are shape-shifters…chameleons. So what’s the reincarnation of hard-sell?

Education Based Marketing

Author and expert copywriter Robert Bly remarks that, “Traditional marketing approaches, especially hard sell, don’t work well on the Internet or with consumers in the information/Internet age. To get readership and response, marketers have to create marketing messages that look, feel, and sound like objective, unbiased, useful information.”

So, why does education based marketing work radically better than traditional marketing?

Because traditional automotive marketing is all about the dealership, the vehicles and the features and no one really gives a rat’s butt about that.

Education based marketing is about solutions. Solutions to problems your customers face right now that they want to alleviate. A well planned and executed education based marketing strategy delivers a much needed cure to the pain your prospect is suffering.

If you can give your prospects the information they need to eliminate their problem and ultimately provide them with a clearly defined set of steps to take you will win their business. You will become the expert in their eyes and they will flock to you and price concerns will be secondary to the solution they seek, making your profits soar to new heights.

But there is one caveat.

You must give your prospects a way to get this information easily and without obligation. You must believe in the concept we call giving value first. We’ve all heard of added value or value after the sale. But that’s easy. That’s for wimps! In today’s competitive marketplace you MUST deliver value upfront and your marketing (if done properly) should be your first touch-point and should start the cycle.

The value first concept is nothing new. It’s age old and timeless. It’s based in the law of reciprocity that states that others will reciprocate in-kind based upon the way you treat them. The world gives you what you give the world. Ultimately you are rewarded for the value which you bring to the marketplace.

Robert B. Cialdini, author of The Psychology of Persuasion explains, "One of the most potent weapons of influence around us is the rule for reciprocation. The rule says that we should try to repay, in-kind, what another person has provided us."

Many of our hard-sell brethren are probably asking, “Where’s the hard-sell in all this?”

Ahhh…that is a good question. You see it’s really a beautiful thing. The hard-sell sneaks in though the back door…unnoticed when your prospect’s guard is down.

What could be better than that? When has hard sell ever flown in “under the radar?” Maybe in the 80s, but that was a looong time ago.

Image a bobcat sneaking into your tent unbeknownst to you, and you only realize it’s sitting there licking its chops and sharpening its claws once you’ve closed up the tent and zipped yourself up in your sleeping bag.

It’s a little too late – you’re getting a butt-whoopin’ no matter what you do. That’s that same way education based marketing works, except your prospects ask that bobcat to come inside the tent thinking it’s a harmless little kitty cat.

This is cloak and dagger marketing…the kind of stuff that affects people emotionally but sneaks up on them logically. We know that all buying decisions are based on emotion and backed up with logic. But the Internet has screwed up people’s brains, especially when it comes to car buyers. They are seeking the logic first.

So through education based marketing we give them the logic and they invite in the emotional pitch and close. It’s really a perfect marriage and a sound system when you think about it.

But it’s not all fun and games. It’s not that easy. There are lots of pitfalls and trip wires that can derail your success and keep you from reaching the goal – more ups, better quality ups, increased sales and profits.