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With few automobiles, how are dealership ad dollars being spent?

Market share is a crucial consideration for how a lot to finances for advertising, mentioned Lauren Donalson, senior director of nationwide accounts for dealership advertising supplier PureCars.

“If we can pivot dollars to work for you more effectively, perfect. … If that means that your overall ad spend reduces, and you’re still crushing your objectives and not losing market share, great,” she mentioned. “That means that your ad cost per unit sold has effectively gone down, and more [profits are] in the dealers’ pockets.”

Bobby Sight, vice chairman of Rob Sight Ford in Kansas City, Mo., mentioned his retailer’s advertising finances has stayed largely constant since final year. His aim is to maintain the shop’s order banks full in order that automobiles flip shortly, giving the dealership the flexibility to extend its allocation from Ford Motor Co.

During the pandemic, Sight mentioned he turned his consideration to the service division, an space he hadn’t spent a lot to advertise prior to now past direct mailers. He mentioned he has continued digital advertising for service partly as a result of some prospects would possibly wish to hold older automobiles operating longer moderately than purchase whereas retail costs are excessive.

“Just because you don’t have inventory on the ground doesn’t mean there aren’t other areas in the dealership that you need to market towards,” Sight mentioned. “Those other areas, I think, also keep you relevant from the sales perspective because you always want to keep your dealership name in front. You never want to go dark.”

Staying in entrance of consumers all through the car-buying course of is essential, even whereas stock is low, as a result of it may take awhile to restart the promoting pipeline when car provide returns, mentioned Nick Brunotte, digital options director at DHG Dealerships.

Some advertising distributors say gross sales presents and incentives will all the time have a spot, particularly as stock ranges normalize. But a few of the modifications adopted in the course of the pandemic and chip scarcity could stick, similar to pitches to purchase prospects’ used automobiles.

“It’s oriented towards filling their inventory at a lower cost of what they would do at auction,” Donalson mentioned. “Now that dealers’ eyes have been opened to the increased profits that they see by deploying this type of messaging, they’ll continue to pursue it.”

Melissa Burden contributed to this report.

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