Let’s face it: taxes are rarely anyone’s favorite topic. Few people look to tax season with anticipation, with the exception of accountants… and dealerships?
That’s right. Dealerships who play their cards right could cash in big when taxes are due. IRS data from 2017 shows that the average taxpayer was refunded $2,895. While a good portion will use their check to pay off debts or bolster their savings, there is almost always a sizable population who will look to spend it on a large purchase. This means that soon there will be buyers in your area shopping for a car. The uptick in tax refund-driven sales often starts in February and can continue to June. In fact, Think With Google found there to be a clear spike in lot foot traffic around tax time.
To take advantage of this season, dealerships would do well to keep a few things in mind. First, consider targeting the demographics that are more likely to use their refund for a car or car-related purchase. According to a GOBankingRates survey, women this year are more likely to use their refunds on a big purchase than men, and those between the ages of 25 and 44 are more likely to do the same than any other age groups. Investing advertising towards these groups could pay off the most.
Second, consider pulling all the stops around when people receive their checks. Multiple surveys over the years show that the majority of consumers aren’t 100% sure what their refund money will go towards. You can entice the fence-sitters with well-placed ads and campaigns. Tax season sales, partnerships with accounting firms and other applicable events could quickly boost sales this time of year. You can even offer special “spa treatments” to help relax customers after the stress of filing their taxes.
Next, realize that not everyone has the desire to use their refund to splurge. In the last few years, more and more Americans have been looking to invest their refund wisely. Point to ways refunds can be used productively at your dealership. For example, offer customers counseling on how to refinance a current car loan or how to best pay off a current car loan. You can steer them towards necessary fixes and upgrades that can improve their vehicle’s performance and value. Show them how putting their refund towards a large down payment or other auto-related good or service can be a solid investment.
Finally, keep in mind the general rule that “people like easy.” Even with money to spend, most customers today don’t want to wade through tons of paperwork, especially after they’ve just gone through that with their taxes. Find ways to make it easier for them to use their refund at your dealership by removing or minimizing as much red tape as possible. Your message to buyers this season should be that death and taxes aren’t the only things they can always rely on: your dealership is there to be a much more pleasant constant in their lives.
