In a recent episode of Inside Automotive, Jim Fitzpatrick welcomed John Fitzpatrick, President and CEO of Force Marketing, to shed light on the evolving landscape of automotive marketing. With the industry facing significant shifts and increased competition, Fitzpatrick offers insights into how dealerships can adapt and thrive in this new environment. From tackling lead quality issues to re-evaluating marketing strategies, Fitzpatrick’s expertise provides a roadmap for dealers navigating these challenging times.
Key Takeaways
1. As the automotive industry stabilizes post-pandemic, dealers face increased competition and fewer opportunities. This shift means that selling a vehicle is becoming more challenging. Dealers are now competing in a market where buyer interest has decreased compared to the height of the pandemic when demand and inventory were low. This environment requires dealerships to adapt their strategies to maintain sales volume and profitability.
2. Fitzpatrick stresses the importance of viewing marketing as a strategic investment rather than a cost to be cut during financial strain. In an environment where fear and uncertainty might lead dealerships to slash marketing budgets, Fitzpatrick argues that effective marketing is essential for achieving a good return on investment (ROI). He suggests that, like managing personal finances, dealerships should invest in marketing to drive sales and maintain visibility, particularly when the market becomes more competitive.
3. Fitzpatrick identifies a key issue where dealerships are seeing a decline in closing rates despite a stable or growing number of leads. This trend points to potential problems with the quality of leads or the effectiveness of sales processes. He also advises dealerships to assess whether their leads are high-quality and whether their sales teams can handle them effectively. Moreover, he suggests evaluating how well vehicles are priced and if inventory matches market demand.
4. Integrating data and technology is highlighted as a major factor for success. Fitzpatrick notes that dealerships often struggle with fragmented data from various vendors. To address this, he promotes comprehensive data platforms like Audience IQ, which consolidates data from multiple sources. This approach helps dealerships make informed decisions based on accurate, unified data and ensures all team members are aligned with the same information.
5. With the focus shifting from new car sales to aftersales and service departments, Fitzpatrick points out that optimizing fixed operations can significantly impact a dealership’s profitability. Historically, a large portion of dealership profits come from service departments. By improving the efficiency and performance of these departments, dealerships can boost their revenue and enhance their ability to attract trade-ins and sell vehicles, creating a synergistic effect that supports overall business health.
"Marketing is an investment. Yeah. And so, just like you would with a wealth management advisor, look at it as an investment and see where you are getting the best ROI." – John Fitzpatrick
