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How to Overcome Common Dealership Challenges

Every day, car dealers face a wide array of challenges that can range from simple annoyances to significant strategic threats to their dealership’s bottom line. Dealership leaders often spend a large part of their day dealing with those challenges, taking time and focus away from proactive growth and innovation.

It doesn’t have to be this way. American founding father John Adams once wrote, “Every problem is an opportunity in disguise,” and dealers today have more tools at their disposal than ever before to turn some of the traditional challenging problems of the auto dealer business into opportunities to grow vehicle and service drive sales, improve their bottom lines and position their dealerships for long-term, sustainable success. 

In this blog, Mastermind shares examples of how to turn some common dealership challenges into dealership opportunities by:

  • Embracing the modern Internet-first car buyer  by committing to making those online interactions the first touchpoint in a data and analytics-driven customer experience that sets the tone for the entire customer relationship
  • Rewriting the rules of sales lead quality and quantity by deploying predictive marketing to identify, engage with, and nurture the best prospects in your market
  • Taking on the challenge of growing fixed-ops revenues by integrating them into a comprehensive customer experience program that provides your customers with what they want and need, often before they even realize it

Capturing the Internet-First Car Buyer 

Today’s Internet-powered consumers are more informed than ever before and make many of their car buying decisions before ever arriving at the dealership. 

Savvy dealers have come to recognize the value in investing in their dealership’s Business Development Center (BDC), embracing the Internet-first nature of many consumers and ensuring that they have the systems, processes and culture in place to make the transition from Internet to showroom as seamless – and managed – as possible. When BDC staff are armed with data-driven customer insights and integrated into a dealership’s customer experience processes, they can start customers off on the right foot long before they walk through the showroom door.

When more customers than ever before are beginning their relationship with dealerships online, being better at that first online interaction than your competitors turns that challenge into an opportunity to gain a competitive edge.

For more details, see our blog post on how to increase your dealership’s BDC effectiveness.

Improving Sales Lead Quality and Quantity

Traditionally, the challenge for car dealers has been balancing the quality and quantity of sales leads. The common wisdom – proved out through decades of experience – has generally been that the more leads you have, the more likely your team will be to waste time on poor prospects.

That may well have been true in the traditional dealership environment, when car sales leads were being generated largely through legacy broadcast and direct marketing campaigns, but it’s no longer necessary for dealerships to have to strike that balance between having lots of leads and having high-quality leads. With the right solutions in place, the challenges of automotive sales leads have been replaced by the opportunities generated by a Behavior Prediction Score® that identifies the best leads in your market at any given time.

There’s a reason that “know your customer” is a basic rule for sales success – the more you know about them, the better you’re able to identify which customers are the best prospects and put together the right offer to close the deal. In today’s data-driven environment, the challenge of knowing your customer becomes an opportunity when it begins with automated analysis of the right data.

For dealers who utilize Mastermind’s Market EyeQ sales platform, this means a steady flow of high-quality sales leads powered by household data from IHS Markit and their own DMS systems, as well as data partnerships with TransUnion and Carfax.

Additionally, predictive marketing means that dealers have more tools than ever before to take leads that are potentially high quality but still early in the sales cycle and engage with those prospects to nurture them through that cycle. 

For more information, see our blog on improving dealership lead quality, or learn more about our predictive marketing solutions.

Growing Fixed Ops Revenues

Growing fixed ops revenues – especially service drive revenues – is a constant challenge for dealers. One way to turn that challenge into an opportunity is to ensure that your service drive is doing everything it can to serve as a source of qualified sales leads, in addition to maximizing parts and service revenues.

And while cars and trucks have gotten less maintenance-dependent, they’ve also gotten older. The average age of a vehicle on the road in the U.S. reached 11.8 years in 2019, up from 9.6 years in 2002. Even the best-designed and built older vehicles need more maintenance and repairs, which creates opportunities for service drive revenues. 

Across the new car dealer industry, parts and service revenues are growing, from slightly more than $80 billion in 2002 to more than $116 billion last year. (This doesn’t include body shop revenues, which have remained largely flat.)

Part of this growth is because many dealers have found that customers who are hoping to drive their current vehicle for 11 years or more can be lured away from lower-cost independents or specialty tire or lube shops by messaging that’s focused on the value of OEM-trained technicians and factory-quality parts in ensuring their vehicle’s long-term durability. (For more detailed suggestions on improving parts and service profitability, see our blog on the topic.)

Beyond parts and service revenues, the dealership service drive and body shop also offer massive opportunities to drive sales. Mastermind’s Market EyeQ includes specific tools targeted at improving sales conquest leads and outcomes, integrating soft credit pulls from TransUnion and vehicle history info from Carfax to identify the right prospects – and skip customers whose credit challenges are significant enough to justify giving them a pass.

The end result is  your service drive becoming a source of extremely high-quality leads, headlined by a desirable cohort of conquest customers who are likely to be in the market for a new vehicle in the near future and who have high-quality credit that allows dealers to close a quick and clean deal. When integrated with predictive marketing campaigns, Market EyeQ’s service conquest solutions have empowered some dealers to activate more than two-thirds of their fixed-ops customers into their sales flow.


That’s turning the challenge of growing fixed ops revenues into powerful sales opportunities, and that’s the benefit of bringing data and analytics to bear on dealerships’ traditional challenges. 

Interested in learning more about how Mastermind’s solutions can help turn your dealership’s challenges into opportunities? Contact us today for a free consultation.