Use marketing to grow business, not just advertising to fill bays short term
St. Louis— “So what?”
That’s what Ron Haugen, former owner of Westside Auto Pros in Des Moines, Iowa, believes consumers are saying about the way a lot of shop owners showcase their business in advertising campaigns.
“‘We have ASE-certified techs’ — so what? ‘We have $14.95 oil changes’ — so what? These are all things that your potential customers are seeing from you and everyone else as well. It’s not about hooking them in with a gimmick,” Haugen said, “it should be about retaining the customers that you know will keep coming back. You have to keep track of what works and what doesn’t. You want to focus on marketing to grow your business, not just advertising to fill your bays for a week or two with customers who won’t return.”
Customer retention, advertising strategies, and, most importantly, tracking the results of marketing were the hot topics of interest at a recent MWACA (Midwest Auto Care Alliance) seminar held at Factory Motor Parts in St. Louis.
The seminar, which also counted as an Ami—certified course, was presented by Haugen who had been successful in marketing his own shop for many years through trial and error.
“Marketing works, but if you don’t have a plan you will never get there,” he said. “We had a spreadsheet that listed every marketing campaign that we would be doing and when they would be most effective. To be able to make it work, we sat down every fall and planned out the entire next year based on the previous year’s results. All of that starts though with an important first step. You have to first be willing to establish a marketing budget and fund it weekly, and not weakly.”
Set aside approximately 6-8 percent of sales dollars for marketing purposes to grow business, Haugen said. “If you seek to maintain where you are now, you would be looking at four to five percent of sales for marketing, but if you want to make that jump to the next level then aim higher. One thing to remember though is this only applies if you are hitting profit benchmarks already. Do not put yourself in the hole.”
What comes next is deciding how to distribute that budget. “Branding, retention, and new customer attraction are the main types of marketing that you want to research. Branding is how you want your business to be portrayed. What is your image? Retention is how to keep your existing customers coming in and trying to get them in at least one extra time a year. New customer attraction is the most expensive and the most difficult, but necessary because of attrition. You have to give them a reason to come in and see you. They will probably look at or listen to ads multiple times before deciding to come in,” he said.
Measuring the success of those campaigns is most important. “Measuring branding is difficult, but this is where the ‘So what?’ comes in to help you measure the effectiveness. Your customers have to know what’s in it for them that makes it worth their while. Branding also has to tell your shop’s story.”
A shop management system helps determine whether or not a shop is making a positive ROI by tracking retention and new customers, Haugen said.
“Tracking the number of responses and sales made from ad campaigns is where you can really start to see what works and what doesn’t. You want to be able to answer these three questions from tracking: Was this a good campaign? Was this a good response rate? And what do we need to do to be successful?”
MWACA St. Louis President and owner of Jammin J Automotive Doug Jacquot, who was in attendance, said, “This seminar gave us the target for what we should be doing as well a glimpse at how successful we can or could be. The biggest thing I realized is that he knows how much he makes off of each campaign. Not only did he spend a lot but he makes a lot more.
The event was sponsored by Factory Motor Parts, which also provided dinner. For more information on MWACA, contact Executive Director Sheri Hamilton at 816-413-9800 or email sheri@MWACA.org.