The topic of consumer data has been on my mind regularly lately. Today’s dominant businesses capitalize on their ability to gather and validate immense amounts of customer data. In fact, 6 of the 7 largest companies globally (by market cap) I consider to be “digital consumer data” companies. Although they are tech businesses with diverse product offerings, it is regularly argued that they are essentially building their business on the utilization of the customer data they control. While many agonize over how much private information these tech titans gather, the simple truth is that customers freely exchange their information for the incredibly useful experience provided by their products. Being a principled shepherd of customer data and providing utility are the keys to unlocking a successful digital consumer data business model. At NetLook, we focus our solutions on what can be done by the entrepreneurial franchise automotive dealership to become a contender in the digital consumer marketplace.
Truly, the age of digital consumer data dawned in the early 2000s and has rapidly matured since. Now, this data is the driving asset that separates many dominant dealerships from those that are struggling to stay relevant. It is no longer sufficient to have a good product and to expect consumers to find you organically. More than ever, you need to know your consumer and be able to engage with them at the precise moment that they want to service their vehicle or buy a new one. The competition is actively working to engage with your consumers to win them away from you and your brand and possibly is no more than a few clicks away from doing just that. The bottom line for dealers big and small is that a strategy is required to gather customer data and put that data into action.
The Opportunity
An Interesting study performed by SAP and The University of Texas School of Business, highlights the monetary value of strategically gathering and utilizing customer data (link). The researchers found that an increase of 10% in usability of customer data increases sales per employee by 14.4% at an average fortune 1000 business. Further, their data shows that the automotive industry reflects a higher than average rate of return. A 19% exists in automotive compared to 14.4% on average). Even more intriguing, the opportunity for a small business, like an average single point franchise dealership, is likely much larger because they are not starting with the same level of data quality as those fortune 1000 businesses. When adding these factors together, an incredible opportunity to improve sales per employee by 40% (or more) with only moderate improvement in customer data emerges quickly. These are the types of numbers that no entrepreneurial dealership can afford to ignore.
The Strategy
First, making a 10% improvement on your data quality can make a significant impact on your top line revenue. What does a 10% improvement mean though? We all should be committing to doing the following (3) tasks to continually improve our data sets:
Correcting invalid data in the existing data often represents a large opportunity in the dealership data that we work with at NetLook. Fixing bad data on your contacts is critical to make sure you are staying in touch with your existing customer set.
Finding new customers and adding more contacts to your data set is also an important activity. I would venture to say that no dealership we have encountered believes they have identified every possible customer to target for sales.
Identifying relevant data that can be tracked on your existing customers is an overlooked strategy for improving a data set. The point is to add more data about each of your customers that you can act on. For many dealerships, there is an opportunity to start tracking the expected lifecycle of vehicle maintenance, lease end, and the ideal times to re-engage with inactive customers. There are many other creative pieces of information that can be tracked to target customers effectively.
When combining those above actions, I virtually guarantee that there is an opportunity to improve any dealership’s data set by 10% with relative ease. However, having good data is only half of the strategy. Once data is available, there must be action being taken on that data to drive the business returns that we are seeking.
The following are a small set of examples of the types of actions a dealership must take to start winning the war that is going on in the digital consumer space:
Conquest new customers
Re-engage with previous customers who have not been served recently
Control the data and customer contacts
Manage VEHICLE life cycle (know when customer(s) are ready to see the following engagement items about their vehicle):
Regular Service Events (oil change, filters, fluids, tires, brakes, etc.)
Declined Service Re-engagement (provide tiered discounts on recommended services that customers have chosen to opt out of during their service visits.
Recall repair availability
Lease Turn-In
Engage with CUSTOMER life stages and act when your loyal customers are:
Graduating
Starting a new job
Getting Married
Having a family
Retiring
And every life changing moment in between
At NetLook, we have been designing the products that are necessary to simplify the process of winning the digital consumer over:
Our Inventory Platform is the most feature rich, quality driven, affordable, and user-friendly tool available to create the media content that is core to targeting consumers in the digital world. To learn more visit: https://www.netlook.com/our-platform
Product consultation is available to drive the digital consumer data to a high quality, action ready state. Schedule a Consultation
RABIT (visit on page at: https://www.netlook.com/rabit) is our proprietary solution designed to take the actions mentioned above on your consumer data set. RABIT implements intelligent algorithms to drive any of the actions mentioned and many more depending upon the needs of each dealership. Schedule a RABIT Demo
We are excited about the opportunities that are opening up as the digital consumer marketplaces mature. There is a continual stream of new and powerful ways for dealers to engage with their customers in this landscape. It is time to actively engage with a team that is dedicated to helping you thrive. Give NetLook a look. We are partners in solving problems you may not even know you have!