Article

Spotlight on the Sheehy Auto Stores: The Marketing Strategy

September 2006, Auto Dealer Today - WebXclusive

by John Zieglar - Also by this author

2005 was another big year for the talented team at the Sheehy Auto Stores. When we profiled this store in August of 2005, they were boasting 279 extra sales from 900 additional Internet leads. Not many dealers are able to increase their leads by more than 200 percent in just two months and even fewer are able to translate that increase into additional sales. Those that can increase sales often find it tough to maintain such an increase. So the real question for the team at Sheehy was: Could they sustain those results and continue to produce incremental sales? The answer: Yes. Not only have they been able to maintain a steady climb, they have been able to do it while decreasing advertising costs.
With 18 franchises and 1,000 employees, the Sheehy Auto Stores sell about 26,000 cars per year across 13 dealerships. The group’s first attempt at establishing an online presence led to disappointment when the leadership team realized they were selling just 124 vehicles across all 13 stores. It was unacceptable that an organization their size would only receive about 1,000 Internet leads per month and sell barely more than 100 cars from those efforts. The good news is that’s all changed today. Their Web site, www.Sheehy.com, and a new marketing strategy have helped reduce their cost per sale while generating an average of 3,449 leads per month, which is up from their average in August of 2,647 leads per month. In addition they’ve exceeded their goal of 300 sales per month and are now averaging 324 sales per month with an all-time high of 414 sales from their Internet department. So what changes were made in their marketing strategy to accomplish so much?
Sheehy Auto Stores realized early on that if the customers were relying less and less on traditional forms of advertising, they too would need to change the way they thought about advertising and the way they allocated their budget. With customers tuning out the radio and television and becoming less responsive to direct mail and newspaper, Sheehy saw the need to adjust. They limited their exposure in the Washington Post and turned their focus toward the web as an alternative way to drive traffic. Unlike traditional sources of media, the customers can and do access the Internet just about any time from anywhere.
 
Like most dealers, Sheehy’s advertising goal is to spend their dollars in a fashion that it is likely to reach their customer. For this reason they shifted some of their budget away from the so-called “tried and true” methods of advertising to digital marketing. When they made this shift, the leadership team at Sheehy discovered an added bonus in that unlike traditional advertising, digital marketing is easy to measure. Through measuring, they saw their average cost per sale drop from more that $500 per sale to about $197.
 
With the success of their shift in marketing, the dealership stepped up the rest of their strategy and process. Roy Reutter says, “Vince Sheehy recognized years ago that the Internet was putting us in touch with customers one, two, three and four months earlier in the buying process. If seven out of 10 customers were going to the web during the buying process and making contact with us much further upstream than they used to, we needed to get in the game. Like a lot of dealerships, we were involved in the Internet but we weren’t dedicated.”
 
Becoming dedicated meant establishing a dominant presence on the web and handling the leads in a way that resulted in an appointment and ultimately a sale. This prompted them to get serious about building an Internet sales model that reflected the shift in customer behavior and customer expectations. As a result, they immediately started to generate more leads and increase their appointment ratio, show ratio and closing ratios.
 
Of the marketing components their technology and training partner provides, Sheehy has seen the most value in Search Engine Marketing, E-mail Marketing, their Virtual Dealership and Virtual BDC Manager.
 
Search Engine Marketing
 
Sheehy knows that without traffic it’s tough to generate sales. They also know that customers today are using Internet search engines like Google during their buying process. Roy Reutter explains, “Our vendor uses Search Engine Optimization to ensure we appear at the top of the most popular search results. There’s organic optimization, which is free, and pay per click. We appear up top for free when a customer googles a popular search like ‘Washington DC Ford’, whereas our competitors have to buy sponsored links. As a result, we have seen an increase in the traffic to our phones, our Web site and ultimately to our stores.”
 
E-mail Marketing
 
In addition to using search engine marketing, e-mail marketing is another valuable tool for Sheehy. Their technology and training vendor works to help them master the art of using e-mail marketing to attract more quality traffic at a lower cost. Reutter explains, “We love how fast we can reach the customers, how easy it is, how cheap it is to contact hundreds and even thousands of clients and best of all, we love that it is 100 percent measurable.” When a manufacturer comes out with a new incentive, Buzzmail or a virtual test drive is sent to every one who has recently been in on that vehicle. Compared with conventional advertising like print, radio, television and direct mail, e-mail marketing allows communication with hundreds or thousands of customers with just a few clicks and virtually no cost. It’s faster, easier and more effective to target your marketing.
 
Sheehy’s Virtual Dealership
 
The Sheehy Auto Stores feel that they have more than a Web site; they have a virtual dealership that serves as their very own regional buying service. This has enabled them to reduce their reliance on third party lead providers, increase leads and sales and lower costs.
 
Roy Reutter says, “At first, we were using a Web site and CRM tool from our DMS provider, but the results were average to poor because those items were not their specialty. After hiring a company that specializes in digital marketing and CRM our numbers skyrocketed. After we switched from our old provider we increased our leads from 400 to 1,350 in the first two months which is more than 200 percent. Since then we have continued to grow to over 3,500 leads a month from our Web site. Our provider not only built an effective site for us, they handle all the online marketing.” Sheehy has found there are a few keys to any great automotive Web site:
  • Simple and easy to use
  • State of the art technology that’s engaging
  • Fast to load, even on a low speed connection
  • Automatic updating
  • Designed to be a marketing center that drives results, rather than merely provides information
Virtual BDC Manager
 
In the past year, Sheehy has pushed to do a better job of capturing, recording and following up with prospects to sell them a car and keep them loyal to the dealership. They appreciate the fact that their CRM tool makes it easy to manage and measure all the customer activity. The Virtual BDC automatically executes thousands of daily marketing activities and does the work that most sales people resist. According to Roy Reutter, “Our Virtual BDC tool automatically follows up with our customers and even automates sending out all our reports to our team every day. If we wanted to do all of this manually we would need to hire a team of 10 to 20 people and that would be cost prohibitive.”
 
The key to Sheehy’s ability to achieve and maintain their success is commitment from the top and training throughout the group. They have established a strategy, process and system that include the tools and training needed to get results. By starting with the right strategy, marketing, processes, people, pay plans and pricing, and ensuring that none of these components gets overlooked, they expect to continue their steady growth.
 
Vol 3, Issue

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