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Auto Sales will Slow, What should Dealers Do?
Adam Armbruster -- Television Advertising Expert Adam Armbruster -- Television Advertising Expert
Sarasota, FL
Monday, March 28, 2016


Recession-Proof Your Television Campaign 

Are we in a Recession? Who knows? Even the experts don?t agree. 

In fact, I seem to recall that during the last two recessions the experts did not agree even then.

It was only when we emerged from these down cycles that the economists finally identified each recession as it was swiftly fading away in the economic rear view mirror. 

Fact is we just don?t have a clear way to identify a recession. So for discussion purposes let?s assume that we are in one now. 

In a recession, customers don?t stop buying, they just stop ?over-buying?. In other words, they start second guessing that four dollar Starbucks latte and start talking about how great ninety-nine cent Dunkin Donuts coffee really is after all. Spending more conservatively on small items helps the American consumer rationalize larger purchases like cars, vacations, and clothes. 

So what to do when your local market economics wither? You need to make sure that your television ad campaign generates an even higher Return on Investment to compensate for a smaller market opportunity. 

How do you do it? Simple. You ?Recession-Proof? your television campaign. 

Here are a few tips on how to do it: 

Present a Superior Value: The consumer wants to see a commercial from you that can help her stretch her dollar. Auto dealers are moving toward advertising and selling more preowned cars instead of new cars. These used cars are a great value and the dealer makes money on these used car sales at a rate of five to one versus new. Department stores start gift with purchase events. Furniture stores are offering full room discount deals. Grocery stores start accepting competitor?s coupons. You get the picture. Think about what value statement you can create that makes your product or service a more attractive value than those of your competition. 

Create a Renewed Sense of Urgency: In a slower economic cycle consumers shop longer and buy slower. However, we find that there is always a sector of ?Now? buyers that will respond to short term sales promotions. Home builder clients of ours are proving this to be true in all kinds of regional economies. With so much negative press, even attractive home purchase opportunities are second guessed by shoppers. What can you do to create excitement and a short term sales promotion and communicate this excitement in your commercial? Examine the offers in your commercials. Are they motivating? Would you buy from you? 

Offer Deferred Payment: Americans are not broke. It?s just that their cash is tied up in their homes. They overbought during the home sales run up and now since home sales have stalled they have to spend ?real? after-tax money instead of home equity money. This has crimped the free cash in the market. On the upper end of American consumers these buyers have cash but don?t want to take their cash out of their investments especially in a down stock market. 

So what to do? Offer deferred payment. Most retailers can assign a small portion (3-4%) of their product cost to be able to offer a full year of free financing. Even if you never offered this before?now is the time. The consumer will be to rationalize buying from you since they will see the expense of buying as ?free? financing. In other words, they would rather use ?your? money to buy than ?theirs?. 

Create new Service Standards : Live web chat is being used by busy female home shoppers. They like the fact that they can hold a conversation with you while they are ?at work?. (In reality, she is shopping while working.) As a result home builders are encouraged to include this function in their web site and to promote this capacity in their television commercials. Click to Call (www.clicktocall.com)is being used by auto web marketers to create an instant connection with a car buyer. Now you can load in your phone number and have the car dealer do all of the dialing. Consumers are using this function more everyday. It makes for quick contact and never underestimate the power of a passionate salesperson in a down economy. 

Eliminate Wasted Ad Dollars: If you normally buy multiple television stations on your buy, perhaps it?s time to choose a few friends from the group of stations. Approach your television station partners and ask for creative support. Ask how these stations can stretch your dollar. If you approach in the right spirit, most station managers will join your cause and help. In a battle, chose your foxhole friends carefully. This is not the time to demand added value?this is the time to request creative support and new ideas. 

Buy Smarter: Negotiate an annual plan instead a quarterly buy. Television stations can help you on cost if you help them by planning. Next, analyze your current cost per thousand. Has it slowly increased as you?ve added dayparts to your buys? You may find better results in reducing your daypart count and instead double spotting lower cost per thousand areas such as local news and syndicated programming. Moving prime dollars to access can increase your frequency in your buy and create better response. Adding more AM news to your buys can increase reach and add frequency as morning news programs in some markets rival local evening news reach numbers. 

Look the Part: Market share can be bought ?on the cheap? when your competition stops being aggressive and leaves the marketplace. If you see that a major player goes quiet, then get loud. Pick up their customers and try to keep them. Several of our clients had terrific years in 2007 because while their competition pulled their TV ads in favor of more ?measurable? direct mail. 

With our clients we created a new pricing strategy which enhanced their TV presence and in some cases doubled their market share! The smartest thing to do in a recession is to present your business as aggressive and in search of value shoppers. Some clients even open up discount themed departments to represent this concept visually in their stores. 

These are just a few ways to stretch your television advertising dollar in a slow market. Hey, nobody asks for a down economic cycle. So let?s stay smart and give the customer what she wants and show her the message she wants to see. Use your resources creatively. Recession proof your campaign right now and, while your competition struggles, you may not even miss a step. 

-Adam Armbruster is a partner in the retail and broadcasting consulting firm Eckstein, Summers, Armbruster & Company located in Red Bank, New Jersey. Adam can be reached at adam@esacompany.com or at 941-928-7192.

Adam Armbruster : Television advertising expert and commentator on TV/Digital/Mobile advertising media trends and how these affect consumers and businesses.

Contact: 941-928-7192 
Email: adam@sendadam.com

See video clips at: http://adamarmbrusterarchives.com/


News Media Interview Contact
Name: Adam Armbruster
Title: ESA&Company
Dateline: Sarasota, FL United States
Direct Phone: 941 928 7192
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