Turning Challenges into Opportunities: Leveraging Kelley Blue Book Instant Cash Offer During Inventory Shortages

Dealerships are continually striving to boost overall margins. Now, with used car gross profit taking top spot in dealership earnings¹, strategies to enhance acquisition during inventory shortages are imperative.

Kelley Blue Book® Instant Cash Offer can serve as a cornerstone in your acquisition strategy. This blog delves into how dealerships can nurture long-term customer relationships, optimize inventory management through comprehensive acquisitions, and leverage Kelley Blue Book ICO features to bolster their inventory strategy.

Used Cars: An Essential Component of Dealership Inventory Strategy

Now that the fluctuation of new car inventory we saw over the last few years stabilizing, dealers are directing their attention towards gross profit and margin compression. The average gross profit of a used car has now surpassed that of a new car by an average of $378¹ in gross profit, so dealers must ensure that used vehicles are now the central focus of inventory strategies. Adopting an ‘acquire every car’ mentality can position dealerships for success.

46% of consumers typically wait over a month to finalize a used car sale,² emphasizing the need for digital tools that foster customer trust and yield higher profit margins. Kelley Blue Book Instant Cash Offer is a trusted resource, with 67% of consumers who sell their car to a dealership using Kelley Blue Book during their shopping process. ³

Cultivating Customer Loyalty

In the competitive automotive sales landscape, approaching trade-in acquisition as more than just a one-time transaction but as an opportunity to foster long-term customer relationships through trust and transparency is crucial for enhancing overall inventory strategy. Implementing Kelley Blue Book Instant Cash Offer across the dealership ensures a superior customer experience.

When staff, from used car managers to service personnel, embrace the following strategies supported by Kelley Blue Book ICO, they witness heightened customer trust and increased closed deals:

• Ongoing Training: KBB ICO Performance Managers are there provide dealers with continuous training on inventory strategies such as enhancing website traffic and improving customer engagement, fostering transparency and trust.
• Every Car Inventory Strategy: Encouraging your staff to use Kelley Blue Book ICO to acquire every car can be hard challenge to overcome.  Dealers like Jim Farkas, Used Car Director of Germain Dealer Group found that it is worth it, saying “Some cars they wanted and some cars they didn’t. The wholesale gain really comes from taking every car in. It’s the $400 car that you take to auction and get $1,000 for it.”⁴

• Service Lane Acquisition: One of the best opportunities for used car acquisition is in the Service Lane, where dealers are seeing more activity. Since you have already established a trusting relationship with that customer, they will be more open to an invitation to complete an Instant Cash Offer before and after their service appointment.

Maximizing Kelley Blue Book Instant Cash Offer for Long-Term Customer Growth

Ensuring the integration of Kelley Blue Book Instant Cash Offer into the dealership’s DNA is paramount to establishing the trust and transparency sought by shoppers and customers during vehicle sales.

One way to ensure KBB ICO is woven into the fabric of the dealership is to:

Leverage the Performance Manager

One factor of dealership churn is the lack of focus on ongoing training.  By regularly engaging with the Kelley Blue Book ICO Performance Manager, they can help identify opportunities for continued training of your staff and improve their overall engagement and satisfaction helping reduce churn.

Performance Managers are also there to inform you and your staff of the latest free ICO digital services available such as eBlast templates to increase website traffic and Service Lane Hang Tags which can be placed on the review mirror of every car leaving your service lane.  They can help your team leverage add-ons like contact center, which continues customer communications on your behalf, keeping them engaged in that crucial window between offer generation and their scheduled appointment.

Ensuring your entire staff is knowledgeable of the ICO process and the digital tools available to support your dealerships trade-in acquisition strategies through regular engagement with your Performance Manager serves to improve the customer experience, leading to more closed deals. 

Winning with KBB Instant Cash Offer

Embracing KBB Instant Cash Offers prioritizes trust and transparency, fostering long-term customer loyalty through a robust trade-in acquisition strategy. By supporting dealership wide ICO utilization, dealers can unlock its full potential, leading to increased sales and successful deal closures.

Discover how real dealers benefit from Kelley Blue Book Instant Cash Offer in our Dealer Resources.

Sources:

1. National Automotive Dealers Association, “2023 NADA Data: Midyear Report,” January 2024
2. Cox Automotive Instant Cash Offer Dealer Transactions (January 2023-December 2023)
3. 2023 Cox Automotive Car Buyer Journey Study, Cox Automotive
4. SUCCESS STORY: Buying Center at Germain Dealer Group

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