Dealerships had to drastically change their digital marketing strategy and spend during the COVID-19 pandemic. States across the United States have begun opening up businesses. With guidelines from the federal government, they have classified dealerships as an essential business, leading to many states allowing car dealerships to reopen with some restrictions.
Four scenarios to consider during a time of uncertainty
Variations in Public Policy and Consumer Sentiment result in four different scenarios. Public Policy refers to local and state government mandates such as stay-at-home orders. Consumer Sentiment is how confident each consumer feels in leaving their homes and choosing to purchase goods.
These scenarios include:
- Weak Demand - No restrictions in public policy and Low consumer sentiment
- Capture Market Share - Market demand is back with high consumer sentiment and no restrictions are present
- Complete Shutdown - Stay-at-home order is in place and consumers are not making any purchasing decisions due to low consumer sentiment
- Stay At Home - Consumer demand is back, but stay-at-home order is in effect
The four scenarios can be applied to two types of customer targeting and campaign options. These suggestions are to help you and your team understand and decide the next steps for your digital marketing strategy. By recognizing the status of your dealership, you can take advantage of when your shoppers are ready to purchase a vehicle.
Customer Targeting: The two customer targeting options are conquest or existing customers. With conquest, your dealership targets customers that have not visited or submitted a converting lead from your website in more than 90 days. Targeting existing customers involves reaching out to those who have recently visited the dealership website or are already in your CRM.
Campaign: The campaign strategies used for these customer targeting options include branding or general types of campaigns in one spectrum and vehicle-specific advertisements in the other spectrum. Branding advertising campaigns are for dealership awareness and make campaigns. Dealers should be creating display ads or paid search advertisements under the dealer’s name. Vehicle specific advertisements are make-model specific offers or vehicle specific ads that redirect shoppers to the dealership’s website. The four scenarios mentioned above should help your dealership determine how to spend your advertising dollars and when it is the best time to begin advertising again.
- Weak Demand
With the Weak Demand scenario, there are no restrictions in place but the consumer demand remains low. In a Weak Demand scenario, dealerships should be focusing on conquest advertising to raise awareness about the status of the store (whether open, closed, or online). With a weak demand scenario, it will be important to conquest customers who need to purchase a vehicle now.
Conquest advertising should be targeted to those who are in the market for a vehicle currently. Using branding advertising, your dealership can provide a message to your shoppers with the steps you are taking to provide safety to both your employees and customers. Using VIN specific or offer-based advertising can be used to generate action for those looking to buy that specific vehicle.
- Capture Market Share
With the Capture Market Share scenario, the market demand is back and there is no restriction present. This scenario allows for all the targeting options and campaign strategies as the stay at home orders might have lifted and there might be additional pent-up demand in the market from the lack of sales.
Spending even more than your normal budget during this period could be important in capturing your share of sales in your market. A balance of branding and vehicle/model specific advertising should be used to capture all types of shoppers.
- Complete Shutdown
If there is a complete shutdown scenario, there is a stay-at-home order in place and consumers are staying home. With this scenario, your dealership should do minimal advertising and focus on existing customers through email or other means that do not take up too much budget on digital marketing. Retargeting ads are used to attract existing shoppers with branding campaigns to raise awareness of your dealership’s status. This is an excellent opportunity to show your customers that you are ready to provide a safe route to purchasing a vehicle.
- Stay at Home
The stay-at-home scenario is presented if there is consumer demand but stay-at-home order is still in effect. If consumers are required to stay at home, but there is also the capture market share scenario, your dealership can place advertising into targeting both existing and conquest for branding campaigns. This is to remind your current and future customers of your dealership’s current status and to create more awareness for your dealership.
These four scenarios should help your dealership decide when it is the right time to start budgeting into advertisements. It is vital to keep track of your local policies and to analyze how engaged your shoppers are on your website. The shoppers that are recently engaged should be reached out by your sales or BDC team. If the market demand is back up or if there is weak demand, using conquest targeting advertisements can help bring back customers that were once interested in your dealership. But remember to keep track of your website traffic and communicate with your teams to decide the best next steps for the dealership.