Running a dealership involves the usual fire drills and day-to-day requirements, but handling the “tyranny of the urgent” often comes at a price, limiting one’s time to focus on big-picture tasks. Essential tactics that get ignored include tracking your competitors.
But this necessary mission doesn’t have to be all-consuming. Read on as we explore how to pursue your rivals and beat them to the customer. It’s a combination of B-school basics and creative research.
1. Define the competition
You can’t track the competition without knowing who they are. Chances are there are several contenders in mind, but use this opportunity to reassess the list. Challengers come from beyond same-brand dealers.
For instance, J.D. Power reports that Toyota enjoys 62.2% brand loyalty among its customers. And while that’s an impressive number, the flip side of the coin says that almost 38% of Toyota buyers aren’t so dedicated.
In addition, online car buying also means your competitors may not be local.
2. Perform a SWOT analysis
There are numerous competitor analysis models to use, but the strengths/weaknesses/opportunities/threats (SWOT) method doesn’t involve rocket science. This review can involve an exhaustive breakdown, but a one-page grid is an excellent starting point. Importantly, collect multiple people’s thoughts to minimize bias.
| STRENGTHS
List what makes your dealership stand out above others, especially against competitors where your customers shop. Examples include:
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WEAKNESSES
Nobody is flawless, including your dealership. Take an honest look at where your business falls short. These imperfections could involve:
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| OPPORTUNITIES
Here’s the chance to expand on those ideas you’ve been contemplating or exploit competitor shortcomings. This could center on:
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THREATS
Competition is a never-ending game of whack-a-mole. So, recognizing these challenges will keep your operations sharp. Be ready for:
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While having an overall SWOT analysis is helpful, competitor-specific critiques are most valuable. Having individual challengers in mind is more actionable.
Importantly, a SWOT analysis is a living, breathing document. Your business regularly improves and worsens, and so does the competition. Therefore, review each SWOT analysis monthly or quarterly. Keeping a running log of information you come across and incorporating these updates into these regular reviews can be useful, too.
3. Taking action
With a complete and accurate SWOT analysis in hand, you can bob and weave like a prizefighter. These responses should directly address competitive threats and your dealership’s shortcomings. At the same time, these plans should exploit where your business excels. Ultimately, you’ll close more deals as a result.
4. Sourcing competitor information
You may gather details about the competition through industry scuttlebutt, anecdotal conversations, and more official sources. Yet, there are also creative ways to watch your rivals. Consider these inventive hacks.
Ask former customers
Train sales staff to ask one question (“Where did you buy your car?) when they get the bad news that they’ve lost a sale to another dealer. Track this information to look for a pattern. If the same competitors’ names keep popping up, you know where to focus your efforts.
Research public records
Long before a shovel gets turned or cement gets poured, zoning applications and building permits get filed. A review of this information (which is often available online) can provide insight into a competitor’s plans well ahead of construction.
Review personnel announcements
Check local media and LinkedIn to see if key personnel at competing dealers have changed. A new hire is likely to want to expand their employer’s business at your expense.
Be a digital sleuth
Checking out the competition online is more than a web traffic analysis. One no-brainer resource involves Google Alerts. Just enter the dealership name, key personnel, or anything else you can think of. Also, review their websites regularly, especially blogs or news articles. Lastly, sign up anonymously for your competitors’ promotional emails. It’s the easiest way to learn what messages are going out to consumers.
