Strategies to Increase Grosses in an Inventory-Constrained Market
The current inventory shortage is a defining challenge of the year, but it should not be viewed as a problem to be waited out. As C-4 Analytics’ Rob Stoesser and Sam Duncan argue, this is an unprecedented opportunity to focus your marketing resources on finding the highest-grossing customers and maximizing profits from every sale.
With fewer vehicles to sell, your goal shifts from simply getting more leads to getting better leads—the ones most likely to buy your premium models and pay top dollar.
The Mindset Shift: Seller's Market Tactics
The low inventory environment has created a seller's market. You no longer need to rely on high volume and cutthroat pricing to move vehicles.
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Focus on Quality, Not Quantity: Stop marketing to the same broad audience. Use digital channels to target high-value buyers who are less price-sensitive and more likely to purchase your higher-margin vehicles (e.g., M6s, Mach-E Mustangs, or high-trim SUVs).
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The Best Customer Mindset: Define your best customer segments (by location, income, or purchase history) and use advanced targeting to put your limited inventory in front of people who will pay the most.
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Fix Your Foundation: If your dealership’s Google Score and online reputation are lower than your rivals, these advanced strategies won't work. The house must be in order to attract a premium shopper who is already selective.
5 Strategies to Maximize Profit
1. Leverage OEM Reports to Out-Target Rivals
Use your Pump-in/Pump-out Reports to identify rivals who are struggling with inventory. If a competitor has more customers coming in than cars to sell, those customers are low-hanging fruit. Market your available inventory directly to those areas, exploiting your competitor's supply gap.
2. Become a Used Vehicle Acquisition Center
Aggressively market the idea that you buy cars outright. Use high-funnel display ads to plant the seed with shoppers that they can sell you their car, decoupling the trade-in from the purchase. This is a primary way to fuel your used vehicle inventory and profit centers.
3. Run Targeted Lease Pull-Aheads
Target customers (both your own and off-make rivals) whose leases are ending soon. Focus specifically on high-value models that will bring the most profit when you acquire and resell them. You are offering a service (getting them out of their lease early) to gain a high-demand vehicle for your lot.
4. Execute Vehicle Move-Up Campaigns
Target shoppers who are searching for your lower-margin vehicles (e.g., a Honda CR-V) and serve them ads for your higher-margin models (e.g., a Honda Pilot). Since price differences are minimized in a constrained market, it's easier to plant the idea that they should "move up" to a more premium vehicle.
5. Integrate Off-Brand Conquest
Blend conquest (brand vs. brand) into your pull-ahead and vehicle acquisition strategies. If you’re a Lexus dealer, use your rivals’ inventory shortages to convince their shoppers (e.g., Mercedes customers) to switch brands. This is an up-funnel play that targets the customer before their brand decision is final.
This inventory constraint is a huge opportunity for dealers to move away from low-margin, high-volume tactics and build a customer base that drives sustainable, high-gross sales.
Watch the Full Webinar
For a deeper dive into these topics and to hear directly from Rob Stoesser, VP of OEM, and Sam Duncan, Associate Director of Paid Search, watch the full webinar below.