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The past two weeks have been very busy. I attended two events that relate to the two main focuses of Powersports Marketing (digital and print) and was able to see what other companies are doing, and where things seem to be headed. 

The first was more of a mastermind group related to the printing industry. Rod and I attended, and it was the first time either of us had been to this particular event. 

We had the opportunity to visit two of the largest and oldest print houses in the southeast during one of the outings. One has been in business for over 125 years, and the other close to 90.

They have huge facilities, and are in the third and fourth generation of family owners. 

What wasn’t impressive was that overall, it appears that much of the industry is using technology and thinking that is 50-60 years old, and doing things “the way we always have.”

As you should know, that kind of thinking is deadly in business – and it was really highlighted for me in the visits we made. Both companies had better than 150,000 square foot facilities, but much of that space was filled with empty work spaces and old workstations that were no longer being used. It was a gross waste of space. 

The problem, as I see it, is that they have failed to adapt to new technologies (like variable digital printing), and now they simply deal in commodities that are about as exciting as trying to sell post-it notes or #2 pencils. 

What was pretty surprising to me was that both companies actually had digital variable printers – which are the latest and greatest in technology, allowing for ridiculously fast turn times, and a “sky is the limit” ability when it comes to custom tailoring a specific mail piece to an individual for maximum response. The problem is that they, and the other folks attending the event, have very little in the creativity bucket, and their sales team have nothing in the tank when it comes to understanding the technology or even basic sales ability. 

It was tragic, but that’s what happens when you get in a rut. There’s a saying that a rut is just a grave with the ends kicked out. After that event, I get it. 

After having our souls sucked out at the first event, I attended a very different event here in Atlanta – the Digital Summit.

Chad (our Senior Digital Marketing Specialist) and I attended this one, and it reignited my hope for humanity. This event was attended by marketing agencies (large and small), and hosted by some real thought leaders in marketing best practices and “next big things.” 

We spent two days getting the latest info on everything from creating ideal digital experiences for clients, to website and user experience best practices, data management, digital variable print, email, the future of Google and SEO… you name it, we got it.

It was an amazing time, the excitement and optimism were palpable, and it was impossible to leave without a boatload of great info and takeaways that we’ll be implementing as quickly as we can. 

So why am I telling you about all of this? A couple of reasons. 

One is to be transparent with you. It’s important to us that dealers understand that our Company Core Value #5 “Dedication to continual improvement in business and life” isn’t just a phrase hanging on our walls here. We live it. It would be easy to just come to the office every day and “do what we’ve always done,” but then we’d be like the folks at the first event we attended. That future isn’t so bright.

The second reason I’m sharing is because when you are choosing a company to partner with to market your dealership, you want a partner that is committed to providing cutting edge services that keep you ahead of your competition. That takes work. That takes study. That takes coming to work every morning with the “productive paranoia” that pushes you to do things just a little better today.  Is it a shameless plug? Yeah, but we’re that kind of partner.

The last reason is that I want to push YOU a little bit. I’d like to encourage you to adopt our Company Core Value #5 for yourself. It’s something that will make an enormous difference in the quality of your dealership and your life. We spend more time than most companies in training and education, and the payoff has been better than I could have imagined. I’d like to encourage you to get out of your comfort zone and make a commitment to attend our Fall Marketing Boot Camp. I promise it will be worth your time, and it’s a great way to make a significant impact on your dealership’s profitability.  

See you at our Boot Camp,

Brad

There are four pillars that we focus on here at Powersports Marketing. If you’ve read any number of the monthly Ultra Marketing Machine Newsletters, you’ve heard about our 4 Pillars of Marketing.  They are a filter/test that tells us whether or not the marketing/advertising that’s being done is going to be successful or not. 

The 4 pillars are: 

1. Right Audience

2. Right Media

3. Right Message

4. Right Time

The filter is this; you have to put a checkmark beside each of these pillars for ANY & ALL marketing that you ever do. Period. If you miss even one of the ‘pillars’ your marketing will fail. Therefore,

it’s crucial you understand each one, so I’ll give a high level summary of each below. I’ll also hone in on the original question of why events are so important.

Right Audience - The right audience is actually different for every industry. For the Powersports industry, it’s pretty straight-forward… you have to target people who ride. I know you want new customers, but targeting non-riders with your marketing is not the way to do it. 

Non-riders don’t respond to marketing, and they never will in any number. The number 1 reason someone starts riding is because a friend or family member influenced them to. It’s never marketing. On the events note, encourage your customers to ‘influence’ their friends and family by inviting them to your events.

Right Media – Which media will best reach the Right Audience? It’s not mass media like radio, TV, newspaper and billboards. These medias target everyone, but only 3% to 6% of the population in your state are riders. Plus, people are utilizing DVRs, satellite radio, changing the station when commercials come on, driving past your billboard and not noticing it, etc.  The number one person most likely to notice a dealership’s mass media is someone who works at the dealership. 

Instead of 1-to-many, you should utilize 1-to-1 media like direct mail, email, phone calls, online ads, and more. Any media that can specifically target a person who rides, and that helps build a relationship is where you should focus your marketing efforts. For a more complete list call me at 1-877-242-4472.

Right Message – The message is all about your design and ad copy (what you say). Do NOT try to build your brand or get your name out there. The opposite of branding-style advertising is Direct Response advertising. Direct Response advertising always has a call-to-action, which means it tells the person receiving the media exactly how you want them to respond. It’s also quantifiable so you can measure response. 

Be sure your message isn’t focused solely on trying to generate unit sales. Studies have shown that only 1% of your list is in ‘purchase mode’.  Therefore, when your message is focused mainly on why your audience should buy a new or pre-owned unit you are alienating 99% of your list. So, if your audience for a campaign is 4,000 people, you’re training 3,960 to ignore your marketing.

When your message is an invitation to an event, it relates to everyone. Who doesn’t like to be invited to a party? 

Event marketing not only gets the attention of the 1% who are in ‘purchase mode’ (and gives them a bigger reason to respond), it also gives the 99% a reason to come by the dealership. The more enthusiasts you have in the dealership, the more leads you generate, and the more sales you’ll have in all departments. Sales is a game of numbers. The more at-bats you get, the more hits you get and the more runs you’ll score. 

Why try to get a few sales leads when you can increase sales in P&A, Service, Apparel AND New & Pre-Owned Units?

Right Time – When you drip out multiple media over the timing of a 10-day period, and it’s all integrated into a single campaign, it really increases response rates. This is what our Sharp Shooter program does.

Timing also pertains to consistency. Once you identify the Right Audience, you have to market to and stay in front of them consistently. We recommend at least 52 to 104 touches per year (with different media). Event marketing gives you a great reason to reach out every month (or more), and even if a customer can’t come to the event, it still builds loyalty, so your touches weren’t a waste. 

You can’t market to your audience once or twice a year and maintain any level of customer loyalty. Consistency, however, puts a fence around your audience and immunizes them from competitors’ offers. When customers buy from you and rarely hear from you again they become apathetic or indifferent. 

Powersports Marketing has dozens of event themes and designs to choose from, or we can create a custom design for you. Our goal is to make your life a little easier and your dealership more profitable. For more information, visit 

www.PowersportsMarketing.com or call 

877-242-4472.   

- Tory

Believe it or not, there are dealers who experience growth year after year, despite elections, the weather, the stock

market, etc. While there are other operators who misdiagnose having an up year because of a growing market. There is a BIG difference. Some dealers are market driven, and their results vary based on the ebbs and flows of the economy, while other dealers are marketing driven and they control their own destiny. 

A market driven dealer is oblivious to its number one asset. A market driven dealer doesn’t invest in and train its staff. A market driven dealer makes reactive advertising decisions and sloppily pays for one-and-done random billboard, radio, TV, and newspaper campaigns coming and going because he knows he should be advertising. A market driven dealer doesn’t understand what his buying base is, much less have a clue about how to dominate it. A market driven dealer is vulnerable. I should know, I used to be one. I learned the hard way, the expensive way. If you’re reading this, you don’t have to. 

A marketing driven dealer understands that his customer list is his number one asset (what I often refer to as “The Number One Asset Your Accountant Forgot to Tell You About”). A marketing driven dealer trains his staff on how and why capturing accurate data on his customers is of the utmost importance. A marketing driven dealer has a pro-active, integrated, direct marketing plan designed to touch his buying base 52 to 104 times per year and is quantifiable. Barring natural disaster, a marketing driven dealer experiences predictable growth. A marketing driven dealer understands this simple formula. 

Annual increase in list size + annual increase in customer value (or the same) = Annual Growth. 

While a multitude of factors are involved in a dealer’s ability to grow their list, it’s important to understand the two most fundamental contributors. 

1. Generating new leads. (Growing new market share)

2. Increasing the frequency of visits from existing customers and reactivating lost customers. (Increasing Retention)

Basically, there are two groups of riders that you should be marketing to in order to grow new market share: Your existing customers to increase retention, and conquest customers, those who live in your backyard, ride what you sell, but haven’t done business with you before. These two groups make up what we call your buying base. And, when you focus on touching these two groups 52 to 104 times per year, with relationship driven messages (as opposed to salesy, hypey, messages) something magical happens. 

If your focus each and every day, month, and year is just reacting to walk-in floor traffic, handling phone-ups and internet leads with no attention to capturing that customer data and marketing to them in the future, then you can’t grow every single year.  

Why? 

First - You will be confined to the conditions of the market and economy, as this is the primary driver of walk-in floor traffic.  

Second - Those who’ve given you money in the past will always be most likely to give you money again in the future, because they already know you. BUT, if you’re not reaching out to them with compelling reasons to visit your store they can easily be lured away by your competitors or lose interest all together.

When you develop and execute a solid marketing plan to build and retain your existing customers, and conquest your competitors’ and orphan customers in your market area YOU begin to control the floor ups, phone ups, and internet sales leads NOT the market. 

Ultimately, continual growth is achieved by touching your ENTIRE customer buying base 52 to 104 times per year. 

So if you’re ready to stop the up and down roller coaster ride of being a market driven dealership and you’re ready to generate predictable growth by becoming a Marketing driven dealership, pick up the phone and give us a call at 877-242-4472. 

FATHER'S DAY IS JUNE 18TH

This is the one holiday of the year that dads everywhere have permission to do whatever they want.  So, invite the dads in your market down to celebrate their special day with a Father's Day Party with a few hundred of their closest friends.

Click the image to request a FREE Quote for your 'Father's Day' celebration...

The Ad Industry’s Dirty Little Secret

"Customers move away, some are stolen by competitors, and some die. These are just a few of the reasons for lost customers. Most dealers just accept these losses as inevitable and beyond their control. Heck some even blame those damn disloyal customers. The nerve of those ungrateful SOB’s. Few lost customers actually leave kicking and screaming, most gradually depart due to a lack of interest or affinity. They silently wander off with a feeling of apathy; we call these quiet migrators. ."

Click the image to find out what the dirty little secret...

Don’t Trust Me.

"I used to think that TV and radio were pretty disingenuous, and to be fair, I still think to a large extent that they are. They adopt a “spray and pray” mentality. You broadcast your message out into the world and hope for the best. And, while I believe that both media methods are EXTREMELY inefficient and ineffective for our niche, you can at least say they are up front about what they are doing."

Say what?! Click the image to read more....

ASK TORY: What Are Your Thoughts on Branding Advertising?

"Many years ago, I heard a quote by Dan Kennedy, who is the direct marketing guru I often mention, and it’s really stuck to my ribs. He said, “Branding is for cattle.”

Click the image to read Tory's story...

Is Your Search Engine Marketing Pointing To A Lousy Web Site?

Rod's talked about the importance of having a good search engine marketing plan in place to drive customers to your website. But, have you stopped by your website lately to see if it's up to par? After all, it won't do you any good to have the best search engine marketing campaign in the world if it drives customers to a website that hasn't been updated since it was created.

This month, Rod is going to give some pointers about how to make sure your customers stick around on your web site instead of just breezing through and never coming back.

Click the video to watch...

ARMED FORCES DAY IS MAY 21ST

Show you patriotism and gratitude for the men and women who protect our great country by celebrating in their honor at your dealership next month.

Click the image to request a FREE Quote for your 'Armed Forces Day' party...

The Strength of the Foundation Determines How High the Skyscraper Can Rise

"I wasted more money on lame advertising that didn’t work than I care to admit. And often times, I was throwing away tens of thousands of dollars, and then sweating when the floor checker showed up asking for a hefty check. Those are the experiences that make you truly disgusted with any wasted cash outflow, and left searching for answers."

Click the image to find out what Rod means...

ASK TORY: What's So Bad About Focusing Our Marketing On Creating New Riders?

"To put it bluntly, the biggest challenge with focusing your marketing on creating new riders is that you’ll get little to no response, and therefore little to no R.O.I.  Ultimately, you’ll simply be wasting your money instead of investing it. There is a way to create new riders, but it’s not directly through marketing, believe it or not. To prove a point, let me share a related story."

Click the image to read Tory's story...

Asking how much something costs is a natural question that's usually derived out of simple curiosity.  In fact, when most of us go shopping for something, don't we want to know how much it costs?  Of course we do!  So, when our customers ask about price it doesn't mean they are looking for our best deal; they're just curious, and there's no reason to invite unnecessary negotiations!

This month's Quick Takes video focuses on how to improve margins by staying off price on the showroom floor.

Click the video to watch...

Garner’s Motorsports is a family owned and operated powersports dealership in Hobbs, NM.  They pride themselves on maintaining that small shop feel while making big sales. And they really are just like a family there.  In fact, General Manager, Tanner Griffin, has been hanging around the shop since he was 13 years old. He’s been riding and racing since then, too.  So, to say he knows the business is an understatement.  But, that’s why he knows the importance of a having quality leads for a sales team to help generate those big sales for this ‘small’ shop.

 Tanner signed up for the Local Web Dominator program to take advantage of the lead generating components within the program: Google AdWords to drive traffic to his website and the Lead Magnet to capture leads while they were there. 

He was currently using the lead generating feature that is added on to some website providers, but wanted to see if the Lead Magnet would have better success.

In less than 2 months, the AdWords + Lead Magnet combo generated EIGHT unit sales and has more than doubled the website traffic for the dealership.  That kind of success makes the investment in the Local Web Dominator program a non-negotiable for Garner’s Motorsport’s marketing plan. Tanner is thrilled and is looking forward to the success the program will continue to bring the business all year long. 

Want to have your marketing budget generate that kind of ROI?  Give us a call for a FREE demonstration or to get a FREE quote on the Local Web Dominator program: 877-242-4472 or visit us online at www.PowersportsMarketing.com

Two different dealers, located in polar opposite marketing areas of the country, just finished their first Sharp Shooter Program the past couple weekends. 

Shenandoah, located in Virginia, is used to having perfect riding weather this time of year getting them ready for spring. Vandervest H-D®, located in Green Bay, Wisconsin, never knows what the weather will bring in late March. Unfortunately, for both dealerships, they both got a snowstorm!

Get a better result out of their marketing dollars

 The Sharp Shooter program, at least on some level, is weatherproof. We only market to proven riders in your backyard (past customers and competitor’s customers). So even if Mother Nature drops a foot of snow on top of your dealership three days before your event, the Governor declares a, ‘State of Emergency’, and not a single customer walks through the door, you can still sleep well at night knowing that every penny spent on a Sharp Shooter Program hit a proven rider. That is a HUGE victory over any and all other types of mass media advertising. In order to grow your business, you need to ‘touch’ your

buying base 52-104 times per year. The Sharp Shooter program helps our clients achieve this critical number much faster, by utilizing up to 12 touches per campaign including direct mail, emails, call blast, social media updates, event signage, fliers, web banner, lead magnet, survey site and even more. 

Having said that, there’s something even more powerful that helps make our clients events weather proof: The Survey Site. 

Every piece of communication is driving customers to a survey site, to capture First Name, Last Name, Email Address and Phone Number for future marketing. The more contact information you have on each individual customer or prospect, means the faster you’re going to be able to convert them into a sale. That means that the results on the day of the event are actually just a happy by product.

The Wednesday before the event is when we send over the Campaign Update, which includes a list of leads generated by the program so far. For both dealerships, Vandervest and Shenandoah, they had snow in the forecast. Erik Vandervest said, “The phones are ringing off the hook (because of the call blast), we’ve already set 5 sales appointments from the leads and everything’s working great…but we’re supposed to get a foot of snow tonight through 11 p.m. the following night (Thursday).” A foot of snow at the end of March is just plain bad luck. However, if Vandervest H-D had spent the money through any other type of marketing, they would have missed out on over 750 sales opportunities generated up to that point and over 150 new & used unit sales opportunities.

Below is the review they left for our team at www.PowersportsMarketingReviews.com:

Vandervest H-D: There were 987 surveys completed, which created a total of 803 sales opportunities in P&A, Service, and riding gear, PLUS 204 responses for a new or used bike.

The same was true for Shenandoah H-D. They too had snow in the forecast and it was supposed to be a balmy 30-something degrees on Saturday for their event.  Shenandoah ended up with 66 New & Used Bike Leads, 109 Parts & Accessories and 37 Service Leads and 92 MotorClothes Leads! On the day of the event, they rolled 3 units, $11,000 in P&A and $6,000 in MotorClothes with over an inch of snow on the ground. Since then, they’ve, rolled four more bikes! 

Erik said, “We had a really good turnout – got busy early and stayed busy all day. I think we sold 3 that day but did a lot of write-ups that day. Did $27,000 over the counter. It was a great day! Still working on following up on the leads.”

What’s next? May and June mean Summer Kickoff Parties. This is what you’ve been waiting for. If you don’t already have a Kickoff to Summer Open House on the books, plan one today. Check out the insert for an example of a proven winner for May or June.

For more information on how the Sharp Shooter Program can help kickoff your Summer Selling Season with a bang, give me a ring on my direct line at 

877-242-4472 ext: 112 or visit us at www.PowersportsMarketing.com and click ‘Sample Campaigns’. Happy selling.

Many years ago, I heard a quote by Dan Kennedy, who is the direct marketing guru I often mention, and it’s really stuck to my ribs. He said, “Branding is for cattle.”

I advise against a dealer spending their hard-earned dollars on marketing that’s purely designed to ‘build their brand’ or ‘get their name out there.’  I’m a dealer advocate at heart, and quite frankly, branding is a waste of money. 

Don’t mistake having a ‘brand’ with ‘branding advertising.’ Having and building a ‘brand’ isn’t a bad thing, I’m not against that at all. In fact, here at Powersports Marketing we’re building a brand with our company name, our Sharp Shooter program, and our Local Web Dominator program. You’ll never see us, however, spending a single penny on branding style of advertising. In other words, I want all dealers to know who Powersports Marketing is, and what our Sharp Shooter and Local Web Dominator programs are all about, but every dollar I spend will have a call-to-action with a reason to respond.

When you focus your advertising on brand building, you should know that it cannot be, and never will be accurately quantified, so you can’t hold it accountable. 

Branding advertising is usually associated with mass media like TV, radio, billboards and newspapers. Mass media sales reps have to build value somehow, so they focus on branding so you won’t know if it’s working or not, and subsequently you’ll keep on doing it. There are 2 big reasons dealers do mass media: 

Number 1 is Marketing Incest - Dealers copy other dealers assuming it’s working for their competitor, so it must be the right thing to do. This often leads to the advertising getting dumber and dumber as they copy each other, hence the ‘Incest’.  :) 

Number 2 is Pride & Ego - It feels good to hear your commercial on the radio, see your dealership on TV, drive past your billboard, etc.  Did you know that the people most likely to hear/see/notice you on mass media are you and your staff members?  You hear your radio spot, but you probably couldn’t tell me the commercial that aired before or after it. Radio commercials don’t typically sway what you personally buy. Yet, dealers keep doing it because it feels good. It’s a faux security blanket that dealers think is always on. It’s not, and when your commercial plays most folks miss it.  

Instead of wasting money by going after the masses (when only 3% to 6% of people ride/buy powersports), you CAN create a name-brand identity and recognition for your dealership as a happy byproduct of Direct Response marketing that actually generates leads & sales every time you do it. 

Focus your advertising where it counts. For instance, we build a carefully selected audience group that we call a dealership’s Buying Base. It’s made up two groups: 

1) past customers

2)conquest riders who live in a dealership’s backyard, but have never done business with them.  

This group (Buying Base) is where the majority of a dealer’s sales will come from over the next 12 months. It also narrows the field down to a size  that you impact with the resources you have.  A giant market is only useful to someone with a giant wallet. Don’t try to make a difference by peeing into the ocean. 

A brand (or brand identity) is simply a recognized symbol that represents and reminds people of ‘what’ you and your dealership are all about. But, don’t overlook the fact that it should also resonate with ‘who’ your business is for. 

The ‘who’ is two-fold… you have to know who to market to, but you also need to let them know who you are. Personal branding is far superior to a corporate style of branding. People prefer dealing with people rather than nameless & faceless institutions. You have to put yourself out there!

Again, there’s nothing wrong with creating a name-brand identity and recognition for yourself and your business. Just be sure you’re doing it as a byproduct and bonus of solid, accountable, profitable Direct Response advertising.  Do NOT buy ‘branding’ outright with image enhancing advertising. 

For more information on Direct Response advertising, building your buying base, or all-things marketing call 1-877-242-4472 and ask for me. 

- Tory

I used to think that TV and radio were pretty disingenuous, and to be fair, I still think to a large extent that they are. They adopt a “spray and pray” mentality. You broadcast your message out into the world and hope for the best. And, while I believe that both media methods are EXTREMELY inefficient and ineffective for our niche, you can at least say they are up front about what they are doing.

What I DON’T like is what I see as a relatively common practice among companies providing pay-per-click services. Many of them are playing what amounts to a shell game with client’s money in one or more ways. 

What I am talking about is transparency. 

Transparency is a huge hot button for me. A lack of transparency in what you are doing tells me that you’re doing something that you think isn’t right or in my best interest. Doing business with someone who operates that way isn’t in anyone’s best interest.

Doing what we do with AdWords and reputation management, we are in constant competition with, and being compared to, companies who provide similar services to ours. We get to see what other companies are doing every day, and in many cases it’s pretty frustrating to see what sometimes happens.

The biggest foul I see on a regular basis is a failure to disclose what is adspend vs. management fees. This is usually presented as a “for ‘x’ dollars per month” lump sum type of service often focused on a monthly budget that is all-inclusive. 

While this is an easy model to understand on the face of it, what you aren’t seeing is how much of the money you give them goes to Google, and how much they pocket as management fees. Typically, the reporting from most companies using this model show impressions and clicks, without getting into the specifics of cost-per-click or discussing conversions. I’ll stop short of saying that this model is crooked, but it sure has the potential to be. It’s pretty easy to get a lot of impressions and clicks that don’t convert to anything inexpensively and pocket more than you’ve spent. If you’re not transparent on adspend, and not accountable for conversions, it’s not just easy, it can be tempting. At the very least it’s a great way to be hugely inefficient.

Let’s compare two companies just for the sake of argument. 

The first company bills you an agreed upon amount per month for pay-per-click services. At the end of each month, you are given reporting that shows impressions, clicks, and maybe where they came from in some nicely laid out charts and/or graphs. You ask how much your average cost per click was, and the answer is a little evasive. You ask how many conversions you got, and you get another bypass. Then you ask what your actual adspend was – not how much the bill was, the actual adspend. Frankly, some reading this article right now don’t have the answers to the questions I just posed. I suggest you ask them of your provider, and if the answers aren’t immediate and straightforward – fire them.

The second company in our comparison bills you an agreed upon amount each month. The invoice itemizes exactly what services are being provided, and documents how much adspend with Google will be. This invoice doesn’t add that amount, simply documents it as a comment. You receive a statement from Google that shows exactly how much was spent with them. At the end of each month, you receive reporting that shows how much you spent, how many impressions, clicks, and conversions you had, along with how much each click and conversion cost you. If your OEM offers co-op for Adwords, you find that this company did the submission for you. Maybe you call them up and want to see what your search ads look like, or what keywords are being used, or want to see the strategy employed for targeting. They show you. Maybe you want to see what percentage of impression share you are getting for your budget (how often your ads are being shown vs. how much they COULD be shown for relevant searches with a bigger budget). 

You may decide a bigger budget makes sense based on that information.

This is what I mean about transparency. A company that is totally transparent with clients has total freedom. They become a part of the team rather than an expense. I’m sure you can see how the first company wouldn’t be motivated to do their best work for you, and likely wouldn’t. Accountability results in performance. 

This is when the magic happens.

Yeah, Powersports Marketing is the second company, and I could put a dozen names in as the first. And while the plug here might be a little shameless, I welcome you to bullet-hole my logic. 

The bottom line is, when it comes to your digital marketing, dig in. Ask uncomfortable questions. Get answers. If you find that you can’t seem to get straight answers – or answers at all, go somewhere else because you have identified that your goals are not the same as your marketers.

Yes, I want your business, but don’t trust me.

Talk Soon,

Brad

Customers move away, some are stolen by competitors, and some die. These are just a few of the reasons for lost customers. Most dealers just accept these losses as inevitable and beyond their control. Heck some even blame those damn disloyal customers. The nerve of those ungrateful SOB’s. Few lost customers actually leave kicking and screaming, most gradually depart due to a lack of interest or affinity. They silently wander off with a feeling of apathy; we call these quiet migrators. 

The common reaction to solve the lost customer challenge is to invest in more new customers. This seems logical, and after all, is recommended by all the traditional advertising experts. But, let’s investigate a little further. First off, there is something you should know about 80+% of the advertising industry. They tell you the purpose of your advertising is to build your brand and create top of mind awareness so you can spend your entire budget in the vaguest and least measurable way possible; to try to attract new customers. Much of this B.S. is pushed out there by ad agencies who get paid a percentage of their customer’s ad spend. Talk about an inherit conflict of interest.

When I first got a whiff of how this game was played, I knew it didn’t smell right. I felt there had to be a better way.  And there is; although the ad industry tries to keep it hush hush. But before we chase that rabbit, let’s look at some quick math on the cost of losing these quiet migrators and replacing them with new blood.

Here are some real numbers pulled from an old 20 group composite book combined with research on their customer data file. This store had $9,892,781 in annual sales with 3,462 active customers who did business with them in a year. Backing into the math that reveals each customer was worth $2,857.53 in total sales annually. So, each time you lose a quiet migrator you’re losing thousands of dollars in sales PER LOST CUSTOMER, ANNUALLY. Now consider most customers have a potential customer life of greater than 10 years and you’re looking at a loss of over more than $20,000 over the lifetime of a lost customer. But, wait.  It gets worse.

What does it cost to replace that customer? Let’s say this roughly $10 million dealership spends 1.5% or $150,000 per year in advertising. Now add an allocated percentage of the remaining dealership overhead (rent, payroll, utilities, taxes, etc.) to that number - the same percentage that new customers contribute to total sales, then divide that number by the number of new customers generated per year. For the sake of time, let’s say conservatively that number comes out to $500 per new customer created. But, it really cost you $1,000 because you invested $500 to get him, then another $500 to replace him. 

Understanding this math is very important. Even if you feel these numbers aren’t consistent with your store, that’s fine, cut it in half, then cut it in half again, and it still makes the case.

Now, back to that dirty little secret that the ad guys and gals selling radio, TV, billboards, yellow pages, etc. don’t want you to know. The primary purpose of your advertising isn’t to build your brand, create top of mind awareness, and generate new customers. That’s the crazy expensive way that big dumb companies choose to do advertising. The first dollar you spend on marketing should be Direct Marketing to your existing customers. This is called Retention marketing and it’s how you develop and nurture quality relationships with your existing data base of customers. This prevents lost customers so you don’t have to spend hundreds of thousands of dollars going after new business while ignoring those quiet migrators. 

When you commit to “touching” your buying base 52 to 104 times per year, with one-to-one relationship style marketing you’ll begin to see that losing customers isn’t inevitable and nearly 100% of the non-deceased category can be eliminated.  

Our Sharp Shooter marketing system is purpose-built to accomplish this mission and is 100% measurable, unlike traditional mass media (BTW, it will also conquest new customers).

And, our Local Web Dominator program has a built-in alarm system for customers that are about to be lost so you can safely rescue them prior to their departure. 

For more information on how we can help you increase retention and carve off new market share without the waste, contact us at 877.242.4472 or visit www.powersportsmarketing.com.