The success of your dealership's bottom line over the next few months hinges on understanding a simple truth: WallStreetBets used the oldest trick in the book—they studied the data and found opportunity.
The current inventory shortage has created a massive market imbalance: supply is down, and demand is up. This has led to a new price equilibrium, presenting an opportunity for massive tendies (profits) for savvy dealers. But as history shows, you must be a diamond hand, not a paper hand, to win.
A C-4 Analytics case study revealed a clear dichotomy among dealers during market challenges:
Paper-Handed Dealers: Those who cut their marketing budgets by 50% or more saw a 37% decline in sales. They sold at the first sign of trouble.
Diamond-Handed Dealers: Those who cut their budget by 20% or less were able to stay flat or even increase sales. They used data to find opportunities while competitors slept.
The question is, which side are you on? Diamond hands don't panic; they pivot their strategy to exploit the market opportunity.
Diamond-handed dealers must focus their marketing efforts on two key areas: acquiring inventory and maximizing profit on new vehicles.
With high demand (up to 7 "butts" for every car), dealerships are acting like auctions. The more consumer demand you capture through marketing, the more you can control the sale price and profit margin.
Custom Orders & In-Transit Vehicles: Aggressively advertise the ability to custom order or purchase in-transit vehicles before they hit your lot. This captures demand now, allows you to sell at MSRP or above, and creates a waitlist of eager buyers.
Keep Your Funnel Healthy: Don't neglect mid- to high-funnel marketing. Cutting this spend now will create a demand gut in 60-90 days, making you vulnerable when supply increases.
The substitution effect—consumers looking for alternatives to new cars—has caused used car prices to go to the moon. To combat rising auction prices, you must acquire inventory organically.
Sell-Your-Car Campaigns: Launch a full-funnel strategy (paid search, social, display) promoting the direct sale of cars to your dealership—not just trades. Use the same successful targeting data used for in-market buyers to find people who own the vehicles you want.
Lease Return Conquest: Market to customers whose leases are expiring, even if they leased from a competitor. Educate them that they can return their lease to your dealership, securing the used vehicle for your inventory.
Fixed Ops as Acquisition Tool: Fully ramp up Fixed Ops marketing. Every vehicle that comes into your service bay is an opportunity to acquire a used car, especially if the owner doesn't want to pay for necessary repairs.
New inventory is currently sitting in empty lots and garages, waiting for chips. When those vehicles are delivered, they will come by the truckload. If you haven't been keeping your sales funnel warm and securing deposits now, you'll be inundated with supply and no immediate demand, forcing you to slash prices.
Like the WallStreetBets community, you must study the data, find the opportunity, and take action while others are complacent. The profits you make now will separate your dealership from the competition for years to come.
For a deeper dive into these topics and to hear directly from Justin Cook, Co-Founder, and Andrew Silva, Account Director, watch the full webinar below.