Parts Department Marketing Mistakes
As marketing has evolved in all segments of the dealership world, so too has it in the parts department. While parts is still primarily a people business, Chuck Hartle says, it’s time to evolve—and that begins with stepping up when it comes to marketing.
Hartle, president of parts consulting firm PartsEdge, has consulted dealerships for years, in addition to running some of the largest parts dealerships in the country. He details the top problems when it comes to marketing parts and how to overcome those challenges.
Mistake: Not understanding your differentiators.
Solution: Before you can properly market your department, you first need to understand your competition. You need to thoroughly understand your competition's weaknesses and the ways in which you can differentiate yourself. Consider whether you’re in a rural area with less competition, which could allow you to mark parts up higher, or a metro area where prices might have to be more competitive.
You also need to consider your size and the accompanying message. If you’re a 15,000-square-foot store trying to compete with a store with $2.5 million in inventory, Hartle says you can’t tout parts availability or speed. Consider your differentiators and base your marketing message off that, rather than merely trying to match your competitors. For smaller stores, differentiators like having excellent counter people can be a way to stand out from a larger competing parts department, he says.
Mistake: Relying too heavily on Internet marketing.
Solution: While Internet sales and marketing are gaining traction and can be an effective tool for gaining business, Hartle says there are a few major mistakes that frequently stop departments from taking advantage of Internet marketing. First, he says, you can’t give the product away. If the gross profits aren’t there, there’s little point in doing anything, he says, which is why you need to vigilantly track those sales to ensure it’s not a waste of resources.
Second, you still need to build the relationships with the customer. Email or social media can be an effective marketing tool to stay in touch with clients, but Hartle says you still need to form solid relationships with your customers, particularly on the wholesale side.
“In car dealerships, especially from a wholesale perspective, body shops and mechanical shops are inundated,” he says. “How do you differentiate yourself? You still need to build the relationship.”
Mistake: Discounting heavily.
Solution: When Hartle was a parts manager he had a saying: Ten percent of something is better than 20 percent of nothing. Years later though, he says this is flawed thinking. The reason comes back to profit: If you can’t make a profit doing it, you shouldn’t do it. And one marketing tactic a parts department should not take is discounting heavily to gain business.
“Because of established relationships, a dealership will offer an unrealistic discount. They’ll offer the shop 35 [percent] off just to get their foot in the door,” he says. “I had many dealers who tried that with me when we were large and I just lived by the premise that a horse that poops fast won’t poop long. Inevitably I would lose a customer for 60 or 90 days as they tried this person out but they always ended up coming back.”
Mistake: Having an ineffective outside salesperson.
Solution: One of the most successful marketing tactics a parts department can take on the wholesale side is employing an outside salesperson to canvas body shops and mechanical shops—if that person is deployed correctly.
Hartle says what he frequently sees is the typically inexperienced part-time salesperson creates line sheets that represent one of each make and doesn’t have a clear marketing message. Instead, Hartle recommends hiring a fulltime outside sales person who is focused on the best interest of your dealership. In addition, the salesperson should understand exactly the type of message that needs to be conveyed, have some experience in the industry and receive clear direction on building relationships and acquiring business.
Mistake: Ignoring the aftermarket.
Solution: Within wholesale marketing, Hartle says one of the most overlooked competitors when it comes to marketing is aftermarket parts companies.
“I really didn’t treat other dealerships as my competition,” he says. “When I started getting into shops, I discovered it was NAPA and Carquest that I was competing with.”
Hartle recommends creating campaigns to compete with those companies by pushing quality over price, and if possible, availability. While you won’t be able to deliver to shops 10 times per day like those companies might be able to, he recommends creating and marketing as much convenience as you can. For example, creating short “hot shot” routes where drivers can get out and make deliveries multiple times per day is one way to do that. If done well, Hartle says tackling that area of the competition can lead to huge gains in mechanical business.