It’s time to change how you think about marketing. Shifting to a Demand Capture model is the best way to stretch your dollar and position yourself for the eventual recovery. We go over what that means and how you can start today.

Though it’s far from the worst potential outcome of COVID-19, the virus has raised some difficult questions when it comes to your dealership. As businesses shutter for the foreseeable future, profits are down, and you’re looking for places to cut that budget.

Since marketing costs tend to be somewhere between 10-30% of revenue, and marketing when no customers are visiting your showroom might seem silly, it’s probably the first place you’re looking to trim . Some cuts are necessary, but cutting too deep is more likely to cause lasting harm. Ideally, you want to position yourself to weather the storm, and when the markets start coming back, be ready to come back with them.

Source (don’t cut): https://effworks.co.uk/wp-content/uploads/2017/10/MEDIA_IN_FOCUS_FINAL_PDF_909.pdf

Right now is not the time for look to new business, but to defend what market share you already have. In other words, find ways to maximize what you do spend. A huge part of that is concentrating on a demand capture marketing model, while cutting your demand generation budget.

Demand Capture vs. Demand Generation

One of the divisions in marketing though is the distinction between demand capture and demand generation. The short version of this is that demand generation aims to create demand via marketing, while demand capture capitalizes on the demand that already exists. So, it’s more or less what it sounds like.

Demand generation informs as many people as possible that you exist and these are the kinds of cars you sell. You’re going to be reaching those potential customers who want exactly what you’re selling as much as you are people who have no interest and no amount of advertising is going to get them through your doors. Demand generation isn’t aimed, and because of that, it’s exactly what you should cut back on in times of economic hardship.

Demand capture means you’re targeting t hose people who are in the market for the kinds of vehicles you sell. It’s less about generalized brand awareness and more about ensuring that people finding you online are heeding your calls to action.

In other words, since your site exists primarily to generate leads, “demand capture” marketing for you means you’re still generating those leads. And one of the best way s to ensure that is the paid search model.

Paid search is the most effective form of demand capture out there. At its most basic, you’re paying to be featured at the top of search results where the ones clearly marked “Ad” are sitting. Normally, you pay every time your ad is clicked (hence the name Pay-Per-Click, or PPC), though sometimes when the ad is displayed (in a CPM or cost-per-thousand format).

The purpose here is to put your site in front of the eyes of those who have the demand for what you have, whether it’s your inventory of vehicles or your service department. In better economic conditions, you can afford to cast a wide net, and trust at least partly the mere-exposure effect to bring in business. In leaner times, it pays to narrow your focus.

Source (mere-exposure): https://socialpsychonline.com/2016/03/the-mere-exposure-effect/

So, while your search results will clearly list you as an “ad,” they will be at the top of the page, and you’re only paying for that if the searcher then clicks on your site. It’s not free, but it confines your marking spending specifically to those customers who have already taken one call to action.

Now isn’t the time to hunt for new business simply because there isn’t much new business to be had. Now is the time to shore up your current customer base and defend your market share. Paid search will keep you in the right minds. And when we’re all able to poke our heads out again, you’ll be ready for your marketing to cast a wider net.

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Author Justin Robinson-Prickett

Justin Robinsion-Prickett is a content writer from Los Angeles with over a decade of experience in the auto industry under his belt. When not working, he enjoys fencing, re-editing dialogue in old movies to remove articles, and playing with his two dogs James Westphal and Dr. Kenneth Noisewater.

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