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Here They Come Again...
The dealers that take 4
minutes and read this have all said the same thing.
"You opened my eyes, and the emperor had no
clothes."
We've
all been there. The nicely dressed ad rep walks in
our office and starts telling us about the huge
numbers and reach they have. Maybe it's TV, Radio,
Auto Magazines or Newspapers.
"You need to understand Mr. Dealer that our pricing
is high because we reach out 80 miles and millions
of homes."
Here's the problem that
most dealers miss. 85% of your business comes from a
commerce radius around your store. (Do the research
yourself. You will be shocked.) Depending on the
area that usually runs between 5 and 25 miles.
STOP: We are not talking about the 5 - 15% of
consumers that drive from outside that circle. That
is not the MAJORITY of your business. You need
to understand that your ad dollars need to be spent
EXACTLY in proportion to your commerce radius.
Example: (True story)
One dealer ran the numbers to test this theory. He
ran his sales through a spread sheet and found that
85% of his consumers came from a RADIUS of 11 miles.
However, when he looked at his ad budget, only 25%
of his budget was reaching this area. The rest of
his dollars were going outside this radius due to
large media buying.
What did he do to fix this.
He starting dropping direct mail EVERY week to only
those addresses within that 11 miles.
He quickly realized that EVERYONE got his message
because EVERYONE had a mail box.
He increased his advertising on the WEEKLY papers
that focused on those areas.
RESULTS...
His ad budget dropped 16% and his sales increased
21%.
It is a
habit we all have to break.
Hoping to bring customers in from outside our area,
while not focusing on the proven producer, will
drive you into the poor house.
You
will be amazed at how many consumers that live
within 15 miles of your store have NEVER seen one of
your ads. Focus on your commerce circle. Be the KING
of your local market.
In
the illustration below, 85% of your ad budget should
be invested in the YELLOW zone.
However, many dealers still target the whole BLUE.
The only way to concentrate your marketing is
through direct mail.
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