As we begin 2023, the lasting effects of supply chain shortages, lowered new car sales, and the rising cost of steady parts and materials are still being felt. Experts tell us that these challenges will continue well into the year.
Many dealerships today are experiencing stagnant revenue growth. While 2023 is expected to be filled with challenges, there are plenty of opportunities to help your dealership generate more revenue and scale its business.
Here are the top five opportunities your dealership can take advantage of in 2023 to improve its sales growth.
Invest in Quality Digital Marketing
Digital marketing is a must-have to succeed online. If your dealership has no online marketing presence, your customers won’t know you exist. To build the right marketing strategy, you must look at what digital tools and resources will work best for your department’s needs.
Standard marketing tools like email marketing, pay-per-click ads, and SEO implementation are all great starting points for the dealership. However, to truly have an effective marketing strategy, you need to have the right messaging that you can implement across all of these tools.
Going into 2023, dealerships should streamline their messaging to be more than just priced-focused. Focus on the dealership’s value across all departments, from easy online shopping to convenient delivery. Vehicle sales are important, and you want a solid marketing plan to sell more.
Don’t forget about fixed ops! The parts department is a great place to grow revenue and increase your absorption rate, but if you don’t market your parts department effectively, you’ll miss out on revenue. Unfortunately, 23% of dealerships are not marketing their parts department, meaning they are not reaching many potential customers. Fortunately, dealers using RevolutionParts have access to a team of parts marketing specialists to help drive more traffic and conversions for their parts web store.
Modernize the Customer Experience
It’s no secret; online shopping is the number one way to buy among many of today’s consumers. If your dealership wants to keep up with modern shopping habits, you must adapt to the online retail model–for the whole dealership. This is the year to empower customers to shop exactly how they want.
Start by taking a multi-channel approach. Sell cars, parts, and accessories in-store and online. You should also allow customers to schedule a service online. People are shopping online now more than ever, and many consumers would rather do the bulk of their vehicle shopping from the comfort of their homes. Others prefer to do some (or even all) of the buying experience at the dealership. You should offer both options to create a seamless shopping experience.
Finally, continue this online approach into the service lane. Make it easy for your customers to schedule services appointment online. Plus, by providing an option for customers to make their own appointments online, you can free up your service staff as they will spend less time on the phone.
Sell Parts on Multiple Selling Channels
New car sales are waning, and forward-thinking dealers are turning to other profit generators in the dealership. Drivers are keeping their vehicles longer. This means more of them are coming into your parts and service departments rather than purchasing a new vehicle.
Parts sales, in particular, felt a significant impact during the pandemic. Dealers felt a sharp decrease in their conventional parts business, losing close to $6 billion in parts sales. However, online sales weren’t decreasing in the same way but were instead increasing. RevolutionParts customers saw a 27% increase in parts sales by selling online in 2020.
Selling parts online is the new way to generate more revenue at the dealership. Selling at your parts counter alone isn’t enough to meet the demand for auto parts. To turn auto parts sales into a strong source of revenue, you need to be selling across multiple channels.
Selling online doesn’t just mean selling your parts on your dealership website. You should be selling on multiple channels, including your dealership’s website, a designated web store, online marketplaces (i.e., Amazon and eBay), or a combination of all three. The more places you have available to sell through, the better. Meet your customers where they’re already shopping.
Use Crowd-Sourced Services
Retailers across all industries are taking advantage of crowd-sourcing services. Companies like Uber, Lyft, and DoorDash offer cost-effective and convenient delivery services that can fulfill same-day orders to millions of consumers. Automotive retailers are beginning to use these services to deliver auto parts to local buyers.
Close to 112 million people in the U.S. reported using a delivery service app at least once in 2020. The use of these services is expected to continue to grow. With most consumers moving toward this kind of shopping model, automotive retailers will have to quickly pivot toward this buying experience to meet the demands of their local consumer base.
Another great way to use crowd-sourcing services is to use them in tandem with the service lane. Dealers can use services like Lyft and Uber to schedule rides for customers with cars being serviced. When they drop off their car, order a ride to get them to their destination and return later. They’ll be thankful for the convenience.
Improve Shipping Practices
For dealerships taking steps to grow their parts customer base beyond their local market, shipping auto parts can be the biggest hurdle to get over. Between the cost of materials, the cost of shipping carriers added insurance, and delayed delivery times, it can be a nightmare keeping track of all the moving parts to get products shipped out.
Dealers should simplify the shipping process as much as possible. With the right tools from RevolutionParts, dealers can print their own labels, use their own branded packaging, ensure that the right parts are shipped to the right customers, and ensure their packages are protected.
Get Ready for New Opportunities in 2023
Ready to start the new year off right? Get your eCommerce strategy in the water now and grow your dealership’s business. Gearing up for 2023 but want more insight? Download the 2022 consumer report to learn more about online parts buyers so you can include these insights in your dealership’s 2023 strategy!