The ABC’s of Automotive Email Marketing Strategy
Is email marketing for car dealerships effective?
The short answer is yes, but just like any other tool it all depends on how you go about it. First, let’s take a look at email’s place you the overall toolkit of digital marketing strategies for car dealerships. From there, we’ll talk about why slicing and dicing your email list into different customized segments is a smart strategy, remind you that you need to be mobile compatible, hit on how email helps you connect at key touchpoints, and talk a little bit about how to think about metrics.
Where does email fit into your digital marketing strategy?
90% of all computer users use email. This beats out conducting web searches, consuming video and audio content, and hanging out on social media. It’s safe to say that unless a consumer has opted to sit out the Information Age, he or she has an email account.
What’s more, 72% of consumers would rather get promotional offers via email than over other platforms. Not only is this a consumer preference, but many offer types – like a targeted trade-in offer or a maintenance reminder – would be difficult to put out on another digital platform.
This doesn’t mean that every email a dealership sends will be relevant to every recipient at all times – especially since most consumers won’t cycle through cars all that quickly – but it does suggest that email marketing for car dealerships is a smart way to go.
Segmentation is a smart move.
Segmented email campaigns average a 14.4% better response rate than non-segmented ones. But how do you come up with an email segmentation strategy?
Elsewhere we talk about five basic ways to segment a local market: demographic, geographic, psychographic, behavioral, and technographic. These can be applied to email marketing for car dealerships as well.
With demographic segmentation, we’re talking about factors like age, gender, income, ethnicity, and so on. A useful application of this would be to send out the same email in different languages if you serve a multicultural market. You can also try campaigning to women and men in different ways, sending special offers to high- or low-income car buyers in your market, you get the picture. We can also parlay this information to apply purchase intent for certain makes across your email lists. For instance, many young drivers will eventually transition into family vehicles, and you can email these consumers with information on your minivans and SUVs.
Geographic segmentation has to do with factors like state lines, where people live, and the distance from point A to point B. Let’s say your dealership lies near the outskirts of a major city and draws customers from the exurbs, as well as folks who live closer to the city center. Odds are good that commuting to and from work is a big part of the exurbanites’ lives, and the emails you send to customers who live in these zip codes could be more focused on “commuter problems” like more frequent vehicle maintenance, safety features, how comfortable the driving experience is or isn’t, etc. The assumption would be that the closer to downtown you get, the less compelling this kind of messaging would be.
Psychographic segmentation refers to psychological characteristics, conscious and unconscious beliefs, motivations, and so on. This can become murky terrain in a hurry, but you might be able to do something like break down your customers as, say, “more environmentally conscious” or “less environmentally conscious” based on their last car purchase and send emails accordingly. A risky form of psychometric segmentation – and one we recommend that car dealerships avoid – is splitting up your messaging around sensitive cultural, social, and political issues.
Behavioral segmentation looks at factors like consumption habits, basic behaviors, and so on. Behavioral segmentation may well be the smartest way for dealerships to segment an audience. The customer who buys a new car every couple of years should be getting different emails than the one who buys a new car every ten. This strategy gives you the opportunity to connect with the individual customer where it counts, especially when the customer has had enough interactions with your dealership to establish a pattern. If you don’t have this, you might be able to use other types of segmentation – demographic, psychometric, etc. – to fill in the gaps.
Technographic segmentation refers to the ways the market segment uses technology. Here you could try splitting up your email list based on user open rate, click-through rate, click-through rate with different types of buttons, and similar metrics. Similarly, the lists used for email prospects have psychometric/lifestyle selects – such as retired, high-income, rural – than can be considered a form of psychometric segmentation.
Mobile design is a must.
Checking email is the most common activity performed on mobile apps, beating out web browsing, using social media, and other smartphone activities. Therefore, your emails need to open and run successfully on mobile devices. A good marketing partner can help you out on the design side.
Use email to stay in touch at key points.
The individual car buyer’s journey doesn’t come to a full stop once he or she drives their new vehicle off the lot. Warranties expire, maintenance checkpoints are hit, and every mile driven brings the customer closer to their next car purchase. In this respect, dealerships have an advantage over products like “groceries” – which a consumer may buy every week but can more or less get anywhere.
That’s why email marketing for car dealerships is a uniquely useful strategy. The average car owner should find warranty and maintenance reminders helpful, but he or she likely wouldn’t want the dealer posting these reminders on the car owner’s Instagram page. Similarly, targeted special offers would be difficult to distribute via social media. The medium is a relatively inobtrusive part of everyday life where “official business” is often handled, which makes email a good match for the business of car buying and ownership.
The name of the game, of course, is to convert the car purchase into a lasting relationship. This can be done by periodically coaxing the purchaser back onto the lot with discounted oil changes, pinpointing car owners with older vehicles and emailing them trade-in offers, and so on. In this respect, email marketing for car dealerships is a series of iterations driven by a single goal.
A word on email marketing metrics.
Metrics are used a lot in email marketing. Here are some of the most commonly used ones.
Open rate is the rate that a certain email was opened by recipients. If you sent it to 1,000 people and 200 opened it, your open rate is 20%.
Click-through rate is the rate that people clicked through the email to whatever outside site you have linked. If you sent an email to 1,000 people and 150 people clicked through to your website, you have a click-through rate of 15%.
Conversion rate is the percentage of recipients who completed a desired action, like made a purchase or filled out a form.
Read rate is the amount of time that a recipient looked at a message.
Hard bounce rate is the percentage of emails that could not be delivered because the email address doesn’t exist, the email server blocked the message, and related reasons.
Soft bounce rate is the percentage of emails that could not be delivered due to a temporary delivery problem, like the mail box is full or the message is too big.
Unsubscribe rate is, you guessed it, the percentage of people who opted out of future messages.
Every metric tells a story, but it’s important to look at these numbers critically. For example, an email with low open and click-through rates but a high rate of conversions may have been a very effective email; it just happened to speak to a smaller portion of your target audience.
You’ll also want to be careful about drawing conclusions on car dealership email marketing based on too general advice. The entertainment industry can rack up pretty good open rates because they’re offering “entertaining” content. An accounting firm might not be able to match the open rate, even if the joke in the subject line was the funniest accounting joke ever told. Plus, a great open rate (or even a great conversion rate) doesn’t always tell you if the email resulted in a sale, a better relationship with the business, etc. Email marketing for car dealerships has its own nuances. On that note, LOCALiQ AUTOMOTIVE offers email marketing campaign matchback, which evaluates your target audience against vehicle sales and CRM leads over a 30-day timeframe. It’s a great way to know if your campaigns are hitting the mark.
What these metrics may be most useful for is measuring your own progress. If Marketing Email A gets better metrics than Marketing Email B, it makes a lot of sense to think about what made Marketing Email A so special. If you’re seeing a lot of hard bounces, you probably need to clean up your mailing list. If you’re seeing a lot of soft bounces, you may be sending too big of emails.
Your next great email marketing campaign begins now.
Now when you ask yourself “What is a digital marketing strategy I really need to focus on,” email marketing will be one of the first things that pops into your head. If you need additional help, LOCALiQ AUTOMOTIVE has a lot of experience working with local dealerships like yours. Give us a ring, or send us an email for that matter.
Contact us to request a free Dealer Scorecard analysis for your dealership or Auto Group.