Seven top tips for succeeding during these challenging market dynamics
We’re once again in strange times. With a period that saw huge demand and high consumer spending being replaced by a cost-of-living crisis and the looming spectre of a recession.
But whilst this does mean there will undoubtedly be a squeeze on consumer spending, we believe that this is another challenge that we will overcome together.
We continue to see strong demand onsite with no drastic changes in consumer buyer behaviour onsite. In fact, 80% of buyers on our marketplace are just as confident in their ability to afford their next vehicle as they were one year ago, with 80% of users also looking to buy in the next six months. This is consistent with the usual pattern of consumer behaviour we see onsite.
It’s worth highlighting that unemployment rates remain low and that historically there has been no correlation between inflation and car sales.
This is not to say that it’s plain sailing from here on in. Consumer confidence is declining, and we can expect that consumers will be taking longer to decide what and where to buy their next vehicle. It's therefore vital that you continue the best practices that saw you through the pandemic, focussing as much on your digital forecourt as you do on your physical forecourt. We’ve seen indications of these behaviours slipping with the latest set of results from our ongoing mystery shopping program, which shows an overall decline in customer experience.
We’re here to help you through these uncertain times and to keep you on top of the latest industry insights and guidance. Be sure to speak with your account manager, complete our masterclasses and continue to tune into our regular webinars.
We've also collated our top seven tips to help you succeed on our marketplace, particularly during the current marketing conditions.
1. Reset your goals - have a plan for success based on current market conditions
Rather than looking back at year-on-year or month-on-month performance, it’s crucial to have a plan for success based on current market conditions, your goals and objectives right now. If your business goals are out of line with the market, it's time for a reset. Our experts are always ready to help you exceed your business goals and grow margin. Request a business goals and margin making consultation with one of our experts now.
2. Be brilliant at the basics – focus on your digital forecourt as closely as your physical forecourt
There has never been a more important time to review your digital forecourt, and to focus on this as closely as you focus on your physical forecourt. Great photos, a top attention grabber, supporting video and a clear description are all the essentials you need to master on your digital forecourt. Check out our Best Practice Guide for our tips on optimising your digital forecourt.
We have always encouraged great vehicle presentation and live market pricing. These are the basics of successful online advertising, as consumers become more selective, all retailers will have to work harder for those buyers. Watch the advertising Retailer Performance Masterclass to ensure your doing all the right things when it come to your adverts.
3. Optimise your days to sell – adjust your sourcing and pricing strategy
There continues to be over £122 million of lost profit from retailers not pricing vehicles to market. More than ever, real time market data is a crucial tool in helping to source the right stock and price it to the live market. There are still segments of the market and vehicles that are performing very well, the market is dynamic and pricing strategies need to reflect this.
Our award-winning valuations and tools, such as Retail Check and Retail Accelerator, are all designed to ensure that you’re sourcing the right stock and retailing them at the right price.
Find out more in our Retailer Performance Masterclass focussed on pricing.
4. Be where the buyers are - if it's not online, it's not for sale
Buyers can’t buy what they can’t see. If your stock isn’t visible and well-advertised online then chances are, you’ll miss out on sales to competitors. We can help you to understand if your current selling package is helping you meet your goals and explore how you can broaden your reach to new customers with products such as Market Extension.
To learn more about Market Extension , click here or talk to your account manager.
5. Maximise the margin opportunity on each vehicle through finance and other add-ons
We’re hearing from many retailers that they’re looking to finance as a strategy to support margins and sales performance. Unemployment levels remain low, and finance is helpful to consumers to manage cost increases. Finance penetration has grown over the last few months and we’re seeing record levels of engagement with our finance products on Auto Trader. If you’re not already one of the ~8,000 retailers promoting finance options in their adverts, find out how you can maximise your finance opportunities here.
Plus, don’t forget to make the most of your Retailer Store to showcase your exceptional customer service through extended warranties, money back guarantees and other peace of mind selling points. For advice on best practice with your Retailer Store, check out this helpful guide.
6. Make the most of all the tools available to you
Against the backdrop of an increasingly challenging market, many retailers are understanding even more focused on the value they receive from suppliers. You know Auto Trader brings you the largest and most engaged audience of potential buyers. But we also bring you so much more to help you increase margin and drive efficiencies. Products such as Vehicle Moves, which is included in your package helps you save time and money when moving vehicles, whether you’re delivering to customers’ homes or making B2B moves. Last year, retailers using it saved £2.6 million, with an average saving of £26 per move. If you’re spending too much time or money managing moves, simply click the ‘Moving’ tab in Portal to take it for a spin.
7. Stay on top of the latest market movements – with the help of our unrivalled market insight
As ever, we’re committed to supporting you with the latest data and insight, valuable sharing of feedback and market information through your account managers, our regular webinars, masterclasses and our Auto Trader Insight social channels. I would encourage you to follow these events and channels to ensure you have access to the most up to date information and to use the tools you have at your fingertips such as Market Insight.
Automotive retail continues to change faster than ever before, and our ongoing partnership has seen us through some of the most turbulent times in the history of the automotive industry. All of the ~850 Auto Trader colleagues are always working hard behind the scenes to bring more power to you. Because together, we do more. Discover how we’re partnering with these retailers to help them gain competitive advantages.