Who Are Your Competitors?
Rivalries are a fact of life. Whether between a sibling, sports team, or the competition of a free market economy, we are all participants in some form.
As a car dealership, ask yourself a simple question: Who are my competitors… Is it the similar make dealership across town? Is it the competitive make dealership across the street? Or is it both of them AND a many others?
The answer of course is the latter. For each and every new model you sell, you may have a different competitor in your same make. Consider your inventory now. Each model has a list of competing models, and many are not what you expect. Evaluate features and pricing, not just model classification. You’ll find that some mid-sized cars make nice alternatives to small cars and often vice versa.
Throw in used cars and the picture becomes far more complex. Used-car megastores have a large share in many markets and private party sales are on the rise. Competition can be on vehicle make and model/vehicle type or solely on price. As a former retail car salesperson, I have personally seen a customer convert from a full-sized SUV to a small car when it came to decision time. Credit scores, gas mileage, and many other outside factors can influence the decision-making process.
While we are talking about retail consumers and competition, be mindful that there also are two types of buyers: customers (those who have already purchased) and prospects (those you’ll need to conquest). The second is a larger pool, but more costly. Convincing someone to do business with you starts with effective advertising, reputation management, an efficient sales process… and yes, you’ll need inventory, too. Long story short, don’t forget to focus on the first type of buyers. When evaluating your competition, the customer who has already done business with you is your best friend because they have already eliminated many of the variables. If you aren’t recapturing your own customers (or don’t know if you are), ask yourself why? Be sure that you have not become one of your own competitors.
So who are your competitors? It’s a long list. Make sure you are prepared for all of them.