auto dealership marketing

4 Things Dealers Can Do Right Now to Succeed Despite Car Shortage

Several brands are facing challenges with low Inventory, yet in April 2021, auto sales were up more than 100% year over year (Yahoo! Finance).  The microchip shortage that forced many brands to slow down production combined with record sales have left many dealers with the extreme new and used car shortage.  

While in some ways the situation may seem dire, there are four things you can do to drive revenue in the short term and to get ready to ramp up sales when you have more cars on the lot.  

1. Focus on Service 

Everyone knows margins are great in the service bay. Keeping customers coming in for service will help you maximize revenue during this period of low inventory. Here are a few tips to keep your service bay full

  1. Pull lists of high engagers with service content at least once a month to follow up. 
  1. Filter by Lapsed Servicers to find consumers for targeted outreach who previously serviced with you. 
  1. Update service offers quarterly, if not monthly, and make sure your communications highlight why to service at your dealership. 
  1. Highlight any perks of servicing at your dealership, such as a free car wash or loaner program. 

Effectively marketing to current and potential servicers requires an omni-channel approach. Not able to reach someone through email? Target them through social. Not seeing any returns from social media? Consider sending a direct mail piece.  

Automation tools powered by artificial intelligence can also help you focus on in-market servicers to avoid wasting marketing spend and extend your dealership’s reach beyond a single channel or profit center. 

In a comprehensive, multi-year data study conducted with RXA and Experian, Outsell found that dealers who engage consumers with A.I.-driven marketing automation saw a 31% increase in service visits. Whether the consumers had previously serviced with the dealership or not, getting them to service earlier in their ownership lifecycle saw an even bigger return. 

2. Find More Trade-Ins 

With the shortage of new cars, many shoppers and dealers are turning to used car sales to satisfy demand. However, this too might become an issue as used cars become less available. One positive from this is that customers can get a lot more for their trade-ins—and may be looking to do just that. 

An average dealer has over 1,800 consumers that are trade-in targets to both acquire used vehicles and move available new vehicles. 

There’s also just 38 days’ worth of inventory at dealerships,” Kelsey Mays, senior consumer affairs editor for “That compares to the usual 65 to 70 days’ worth.”

Outsell’s platform utilizes two equity-based features that encourage customers to consider buying and trading in their vehicles. The Find-a-Trade-In feature helps identify potential used vehicles when inventory is hard to come by. This tool helps prioritize outreach to customers who may be interested in making a change and allows dealers to stock inventory by acquiring that used vehicle. The Similar Payments feature shows customers cars for which the monthly payments would be the same, encouraging customers to use their equity to make a new purchase. 

It’s about seeing which models are moving off your lot the fastest and that might be most desirable and finding more as you seek new trade-in deals with existing customers.  

3. Keep Your Consumers Engaged!!! 

The microchip shortage is expected to impact vehicle production through the end of summer or early fall (and possibly longer), but that doesn’t mean you should sit on your hands until you have more cars on the lot. Now is the time that you need to be keeping your consumers engaged so that they are ready to buy when you have inventory available.  

You should be engaging both unsold leads (a lead that that hasn’t purchased yet) and sales defectors (customers who have made a purchase in the past but have not returned).  

To maintain engagement levels for unsold leads you can change your messaging to focus more on brand awareness, lifestyle, and service content instead of focusing on urgent selling messages for models that are in low supply. 

Industry average indicates that you’re going to retain about 50% of your customers. But really, there is no such thing as a retained customer. As soon as a consumer drives off the lot, you can’t assume they’re ever going to come back.  

Now more than ever, customers are going to defect if only because the higher prices on vehicles that have been more affected by the shortage will cause them to explore other options. 

For both unsold leads and defectors, the previously mentioned strategies hold true for targeting in-market servicers and seeking trade-ins, but there is another level to consider.  

Dealers should not give up on trying to engage defectors. They bought from the dealer once and can easily buy there again when the time is right if the connection to the dealer is strengthened,” said Valerie Vallancourt, Vice President of Marketing at Outsell.”

Outsell regularly augments the VINs of a dealership’s sales and service customers with change of ownership. When a change of ownership is detected, and there wasn’t a purchase from your dealership around that same time, it’s likely the consumer purchased elsewhere to replace that vehicle.  

When Outsell artificial intelligence determines that these likely defectors are back in market, automated content from Outsell tries to win them back.  

4. Play the Long Game

Outsell reported in February of last year:  

Current retail trends suggest that, by the end of 2020, customer experience will supersede price and product as the key brand differentiator. In other words, a well-connected omni-channel experience will no longer be an option but a strategic necessity.” 

We had no idea at the time how drastically that would be proven true.  

According to BDEX analysts, March and April of 2020 saw a precipitous 40% decrease in consumer traffic to auto dealerships in the United States. As the pandemic continued to spread, by May those numbers dipped below 50% and have mostly stabilized in that range since.” 

While car shortages remains unpredictable, dealers need to plan and spend for the long term rather than putting Band-Aids on broken processes that don’t fit today’s market.  

F&I and Showroom said it best: 

The truth is, the automotive industry has been long overdue for a digital transformation. The past year has made it abundantly clear that consumer behaviors have changed, and things may not be going back to normal any time soon. To succeed in this new normal, dealerships will need to evolve and leverage the modern technologies available to them in order to meet consumers where they are – in their homes.” 

The ideal time to implement a data-driven, personalized omnichannel marketing strategy with artificial intelligence was yesterday. The second-best time is today.  

Contact Outsell today to learn how you can utilize Lifecycle Marketing to remain the preeminent service provider of choice every month.