I’ve recently been talking to various dealers around the country about promotions. I am always curious about the strategy and planning that is involved in marketing promotions. Many dealers have become extremely skilled at what time to run a promotion, where to run promotions, and track their return on investment on a real time basis.

Dealers implementing heavy promotional advertising typically see an increase in opportunities and sales. This is probably stating the obvious, but the bottom line is dealers have hard data that shows promotions are effective. And skilled and experienced dealers are able to turn up or turn down promotions depending on how many opportunities they are able to execute.

As far as the goals of a promotion, it is easy to say the foremost goal is increased opportunities. But these opportunities all need to fit into a specific percentage of marketing costs. Some promotions may run at a higher marketing cost, but if the ROI is there, dealers are willing to run them. In interviewing different dealers around the country, marketing costs should run between 15 percent to 17 percent. These numbers are a solid baseline in measuring ROI.

In addition, the frequency of promotions seems to get a more varied response. Some dealers will run a promotion every month of the year, while others will focus in on holiday specials or specific times of the year. The common denominator with promotions is flexibility. Dealers will change their promotions when necessary and will do this on a daily basis if necessary.

Finally, with promotions, the overwhelming comment from dealers is this: Customers wants to feel like they got the best deal, no matter when they are purchasing. By offering promotions, this is accomplished.

Great Selling!

Tyson's Take

1 Comment

  1. Great blog Tyson. Promotions work by creating a sense of urgency. It’s that simple.

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