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When deciding whether or not to purchase a car, today’s auto buyer moves through the consumer buying journey in much the same way buyers have done so in the past. At a high level, such a consumer becomes aware of a need or an opportunity and begins to conduct preliminary research on capitalizing on the opportunity or satisfying a need. Next, they begin to more seriously consider the opportunity and fully commit to researching and understanding the outcome of making a purchase. Ultimately, and after much deliberation, today’s auto buyer has made a decision and has devised a method to make their ideal purchase.
Such a process has become the industry standard when strategizing various elements within a marketing campaign to capture an audience and support each subsequent stage of the car buyer’s decision-making journey. However, what is certainly not standard, is the way in which auto buyers are collecting data, researching dealers and inventory, and ultimately, purchasing a vehicle. It is vital for dealerships to have the tools necessary to convert leads into sales within an environment that is unique and more competitive than ever.
When shutdowns began in March due to COVID-19, auto manufacturers were not spared. Due to personnel safety concerns as well as the transition some manufacturers made to producing medical supplies and equipment, new cars were simply not manufactured at the same rate. According to reports from Automotive News, North American car production was down 3 million units in the first seven months of 2020.
While new vehicle inventory seems to be making a comeback, the demand for new vehicles was replaced by demand for used vehicles. According to J.D. Power, auto dealers sold 2.1 million used vehicles in May and June of this year – 9% more than they did in those same two months in 2019. And the trend didn’t stop there. Consumers continued to buy used cars through July, clearing lots for dealerships that had long been stockpiled.
Yet as new vehicle production and inventory increases and the first-round picks of the used vehicle inventory are purchased, auto dealerships will have to begin planning ahead for the inevitable slow down. They will again be vying for the attention of auto buyers and competing for market share.
We talked about the auto buyer’s journey, the shift in buying behaviors and the issue of inventory. What if there was a way to connect the dots between all three in order to engage interested consumers and match buyer demand to meet dealership sales goals? Well you’re in luck! There is a way and it’s called Artificial Inventory Management (AIM).
By leveraging this state-of-the-art tool, dealers can place specific vehicles in front of people who have shown intent to buy the vehicle. This in-turn moves vehicles off lots quickly and in a very streamlined manner.
How It Works
Designed for efficiency, AIM aligns marketing and spending directly with the goals of a dealership. The product assists in reaching people via third party data (shopping habits, browsing habits, etc.) and connects them directly to their ideal vehicle via social media, display advertising and many other digital mediums. This in turn saves dealers margin and allows them to sell more cars.
In order to achieve optimal results, Artificial Inventory Management gets very granular. To begin, the tool takes inventory of what is on the dealer’s lot – make, model, year, trim, VIN, etc. Next, it determines whether or not the vehicle is being viewed online. A study by ACA Research found that 89% of consumers look for vehicle information online, using OEM and dealer sites, finance websites and social media. Our own studies have found that in general, there are many views against a small percentage of inventory, rather than even views across total inventory. Instead of raising demand by lowering price, AIM captures demand in the market to keep some of that margin for the dealer.
How does it do that you may ask? The artificial intelligence algorithm will identify what person is the best audience for the vehicle. The technology ensures that the vehicle on the dealer’s lot is placed in front of someone who is interested in all aspects of it. The tool is not concerned with where the consumer comes from, but is solely interested in getting them to the dealer’s site and to that specific vehicle.
The results of such a precise approach? Artificial Inventory Management consistently brings 70-80% net new consumers to the dealer’s site, exposing inventory to a brand-new audience. While retargeting is a fine marketing strategy for dealers, AIM’s standout ability to reach and provide a new audience makes it an effective and efficient compliment to other advertising channels.
The tool gives a dealership a much greater opportunity to sell cars. As such, thousands of American’s most successful dealers are capitalizing on it. Artificial Inventory Management aims (no pun intended!) to deliver spend evenly in order to capture market share rather than cut price, allowing dealers to allocate their marketing dollars efficiently.
Interested? Get in touch with us to learn more and engage with auto buyers *new* to your dealership today!