The road ahead

DIGITAL MARKETING WIZARDS, USED VEHICLE FINANCING GURUS AND AUCTION EXPERTS BRIEFED ATTENDEES AT THE 2015 AUTO REMARKETING CANADA CONFERENCE ABOUT WHERE THE USED VEHICLE MARKET IS HEADED

A panel discussion tackles used car supply relief at 2015 Auto Remarketing Canada

It’s a good time for a new car dealer to be selling used cars in Canada.

Auction experts are starting to see an increase in used vehicle supply, with the return of off-lease vehicles in the auction lanes. Dealers are also getting more creative in the ways they source used vehicles.

An increase in used vehicle prices has resulted in more demand for used car financing, and CPO programs are gaining more traction.

These were some of the key messages dealers heard at the eighth annual 2015 Auto Remarketing Canada conference, for everything related to used vehicles and the auto remarketing industry.

WHAT THE FUTURE HOLDS
About 700 dealers and industry players filled the halls at the Westin Harbour Castle in Toronto, Ont. April 20-21st for informative workshops, keynote speeches and panel discussions about the current used vehicle market and what the future holds.

Attendees were also able to walk the trade show floor — the biggest the conference has seen according to organizers — and visit the booths of more than 30 vendors.

Canadian auto dealer attended both days and listened to various keynotes and workshop sessions.

FIND YOUR BRAND STORY
Kevin Gordon always asks his dealer clients for their Unique Selling Proposition (USP), or what sets them apart from their competitors. Dealers usually respond with the lowest prices, the best inventory or the best customer service.

But he never gets the right answer, since dealers can’t prove any of those attributes. To Gordon, that signals most dealers are missing a brand story.
Gordon, the co-founder of Convertus, a digital automotive marketing agency based in Vancouver, B.C. says dealers need to figure out what value they bring to their customers.

“If you can’t brand yourself and position yourself in the market, you won’t have an opportunity to close in the first place,” said Gordon in his workshop session with dealers.

There are some dealerships that are creating a strong brand that resonates with customers.

One that Gordon came across is Subaru of Wichita, which has put itself on the map following some clever tactics to get its name out there. The small dealership located in Kansas lists tangible USPs on its website, including “non-commissioned salespeople,” “golden rule dealer,” and “money back guarantee.”

Gordon says that customers are also treated to the same kind of uniform experience when they leave the dealership‘s website and walk into the store.

The dealership even managed to turn around issues like labour disputes into more positive messages that helped promote their brand story, using social media effectively and gaining national media attention.

Gordon concluded his presentation by saying that even the smallest stores can come up with their own brand. They can also whip their websites into shape and use video to help them tell their stories.

(From left to right) Bryan Leaitch, Manager, Certified Pre-Owned, Mazda Canada Inc., Luigi Fiorino, Manager, Used Vehicle Sales, Volkswagen Canada, Paul Potratz, COO, Potratz Advertising and Jaime Tekela, Director, Pre-Owned Operations, Pfaff Automotive Partners

CAPTURING SUBPRIME CUSTOMERS
In her presentation on closing online credit leads and creating lifelong customers, Kim MacPherson said dealers are often losing out on business from their subprime customers.

MacPherson, President of MAC Automotive Sales Training Inc., often sees subprime customers, or those designated with bad credit, go through the sales process, only to walk into the F&I office and then walk out unhappy because they’ve been slapped with a high interest rate and monthly payment.

If that happens, there’s a big chance that subprime customer will never walk into that dealership again, says MacPherson. And that means lost revenue opportunities for trade-ins and any customer retention.

MacPherson talked about what dealers should be doing when confronted with a subprime customer.

As soon as dealers discover they are dealing with someone with bad credit, they should stop selling the vehicle and start securing financing for that customer, says MacPherson.

Any subprime online leads should be handled immediately. Before scheduling an in-dealership visit, ask the customers for any relevant paperwork to help them secure financing before they visit your dealership.

While the customer might have a vehicle in mind, you can suggest alternative vehicles that are cheaper and might be more suited to their needs.

PUSHING FOR CPO
A panel discussion moderated by Paul Potratz of Potratz Advertising tackled the topic of whether or not Canada is ready for a CPO boom.

Representing the OEM perspectives were Luigi Fiorino of Volkswagen Canada and Bryan Leaitch of Mazda Canada Inc. Jaime Tekela of Pfaff Automotive Partners took the dealer side.

The panelists agree there is a demand for CPO vehicles in Canada, as shown by more than 423,000 searches online in Canada for CPO vehicles.

OEMs think dealers need a digital strategy in place to embrace the traffic and track metrics. They also feel dealers need to increase awareness about the CPO programs.

One big issue is that many dealers are hesitant to fully embrace CPO programs because they find it hard to see the value.

KNOW YOUR MERCHANDISE
Dealers also heard from Alan Bird, President and Chief Executive Leader at SCI MarketView, and Jay Radke, chief business development officer at cDemo, on how to best merchandise inventory in today’s digital environment.

Bird talked about how much the Internet has changed, but how online merchandising has yet to evolve. Dealers need to determine the best ways to showcase their online inventory to appeal to consumers.

Radke and Bird shared some of their best practices:
• Own your vehicle detail pages: Radke advises dealers make their vehicle detail pages machine readable, a format which makes it easier for the computer to extract, transform and process data. He says this format not only helps consumers find a dealer’s site but also it will help dealers protect their data from being exploited by third party listing sites.
• Stay updated: Dealers need to check and track their websites daily so they remain current. “That’s your digital front door,” said Bird. “You wouldn’t leave an old promotion sign for an oil change on your front door,” he added.