Two of my family members currently work in the auto business and have almost all of their lives – so I spend a lot of time noticing the ins and outs of how car dealerships operate.  Particularly, I pay a lot of attention to how they market, to whom they market to, and what messages they use to market.  So I’ll admit to flipping through channels and stopping on those half hour infomercials on late at night.  One thing is clear, car dealerships spend a ton of money on advertising through television, radio and even print ads.  They undoubtedly understand the value of marketing, but are they spending any money on determining how to optimize their advertising?

It brings up the aforementioned situation on the blog that we’ve discussed.  Case A details Stan’s Auto Shop, which spends $100,000 on advertising and it results in a $250,000 growth in sales.  Obviously, Stan’s Auto Shop is extremely happy with this ROI and continues to repeat this advertising quarterly.  However, Case B details Mick’s Auto Shop, which spends $50,000 on advertising and another $25,000 in market research, which results in a $400,000 growth in sales.  Although Case B spent $25,000 on market research, the research helped them reduce their advertising budget to channels that were the most optimal, and it resulted in nearly double the sales growth.

So, it just seems to me that car dealerships and market research are a perfect match.  If you spend that much money in advertising, you should spend a little extra to make it more effective.  Here are a few of my thoughts about different types of market research projects that would provide good ROI for a car dealership (which I dream up while watching infomercials):

  • Market Surveys for Car Dealerships – this type of market research will have a direct impact on ROI.  Let’s first chat about an image and awareness study.  With this study, RMS can work with your management team to create a telephone survey script that will cover awareness of different dealerships, how they heard about or saw you, what their impressions are of the dealers, which they would choose when purchasing, why they would choose them, and importance of different aspects of the sales process, which most impact the sale.  Other survey options include failure-to-close sales studies where RMS would contact prospects who contacted/visited your dealership but did not buy and follow-up surveys where RMS would contact customers who recently purchased a car at your dealership.
  • Mystery Shopping for Car Dealerships – as a car dealership owner or manager, have you ever wondered how your salespeople are performing while on the lot?  Do you know why some salespeople continually close deals while others do not?  Do you want to take the effective habits of one salesperson and train the rest of your sales team on those?  These are all questions for which market research can provide solutions for.  A mystery shopping project is fairly easy to set up.  RMS can work with your dealership(s) to devise specific buying scenarios to assess how your salespeople respond. The RMS team will contact your sales team by email, by phone and even conduct in-person mystery shops.   From the market research, the Analytics team will summarize each case, aggregate the results and provide your staff with recommendations and action items.  This project will allow you to see what the auto sales process is like through the eyes of your customers.
Market research for car dealerships
  • Site Selection Studies for Car Dealerships – if you are thinking about expanding or relocating one or some of your dealerships, you should think about doing a feasibility study first.  This research will help you find the most favorable location to place your dealership based on research aspects such as demographics/market makeup, competition, strongest usage potential and strongest purchasing potential.  Through a combination of different steps, RMS will provide you with a site that will produce the best results for your dealership.
Are you a car dealership who is interested in finding out more about how market research can help?  We spoke about a few of the more relevant projects above but there is a lot more which could be done.  Contact our Business Development Director, Sandy Baker at or call her at 1-866-567-5422.  We look forward to partnering with your car dealership to provide you answers.