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What’s Old Is New Again

Xcel Media GroupBlog What’s Old Is New Again
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What’s Old Is New Again

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Used Car Dealers Struggle To Keep Up With Demand

Used car dealers are no longer the red-headed step-child to the new auto lot. In fact, with the low new auto supply expected to persist after the horrendous crises in Japan and with the still sluggish economy forcing consumers to consider older cars instead of taking on larger loans for new ones – it’s not all that surprising that demand for used cars in expected to persist well into 2012 and beyond.

The other exciting bit of news for the used car dealer is that with the heightened demand comes the ability to charge higher prices for used inventory. Inventories of used cars are actually rather low – partly because of the drop in new auto sales. In fact, new car sales have dropped from over 16 million just four years ago to less than 10 million today. An even further depletion of the used car inventory is caused by rental companies keeping their fleets for up to a year longer than the previous average of just six months. Cash-strapped shoppers are also holding onto their own used cars for longer.

This situation can leave a used auto dealer in a precarious position. Sure, when they have a full stock of quality pre-owned vehicles it’s no challenge to sell them. However, with such low inventory and with so few opportunities to build an inventory – how can a used car dealer manage to pull in more used cars?

Automotive Direct Mail is the Solution

Enter automotive direct mail. When executed properly, a dealership marketing campaign can compel a prospective customer to trade in their used car for what they perceive to be a fantastic deal on either a new car or a newer used car that’s less in demand. Considering the true need some dealers have for used inventories, auto direct mail campaigns could snag multiple car households looking to turn their lightly used autos into cash. The key is to get the word out and educate these potential customers to the fact that they are in possession of something you want – and to convince them that your dealership is ready and willing to make a deal. At Xcel Media Group we know the best way to get the word out is with our auto direct mail programs.

There’s no doubt that the used car market is red hot – it accounted for nearly triple of last year’s new car sales. Although this bubble is unlikely to last forever, success in selling used cars has always relied on a strong knowledge of values for the dealer’s specific market and the ability to make decisions on each car individually and not on aggregate prices. It’s a volatile business that’s not for the faint of heart – but with a solid consumer knowledge and dealership marketing strategy behind you, used car sales could be the only thing keeping your lot in the black for the foreseeable future.

Jessica Mitchell

Jessica has been working in the automotive marketing industry since 2005. She has helped dealerships all over the country develop effective marketing strategies to retain their current customers and generate new ones.