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Patrick
Tessier
MANAGING DIRECTOR
SALEFEST ADVERTISING
& MARKETING
Welcome to the
October edition
of E-Talk.
Where has this year gone? I, like all of you I’m sure, watched with fascination and a degree of patriotic pride at how we honoured two Australians who lived full and fast lives in many ways we probably envied. Of course I talk about Steve Irwin and Peter Brock.
Each of these men have made an enormous contribution of which they and their families can be justly proud. I don’t necessarily agree with the way the Nine Network scored ratings out of it, but I watched the Terri Irwin interview and was in awe of the woman she is, and the strength that she gave all and sundry who have been touched with a terrible tragedy of similar scale.
It amazes me that in this great country we love to cut those tall poppies down. Over the course of the last week or so I have heard a truckload of innuendo, comment and theories about both of these blokes and their families, very little factual or flattering, none of it from a person who had even met them or knew them, none of it with any regard to their families.
Ah, what a great land we live in, wankers and all.
On another tack, I have been watching the 2006 AADA National Dealer Convention post event surveys with interest. They always tell me a lot about where we should go and changes we should make in future conventions.
One survey in particular caught my eye, mainly because I thought the respondent and I must have been at two very different conventions. The comment that the workshops were empty and dealers were obviously looking elsewhere for this style of activity raised my eyebrow.
The only workshops poorly attended were those at 4pm on Saturday, and yes it was those workshops the survey alluded to. Every other session was full and in most cases some delegates could not get in. Most of the complaints I have received were that the workshop rooms were too small.
The 2006 AADA National Dealer Convention had 752 delegates, 494 of those from one of the 231 auto dealerships participating. In any language that’s a very good level of participation. In fact compared with NADA, pro rata dealer participation at AADA 2006 would have exceeded NADA in February.
Therefore it’s pretty clear to everyone that the dealers are turning to AADA for this style of activity. I do appreciate his survey comment because whilst it reflected only on Saturday afternoon it is incumbent on us to ensure the activity scheduled is well supported.
There are plenty of interesting articles in this edition of E-Talk, particularly our lead article discussing the respective marketing responsibilities of the factory and the dealer.
I hope you enjoy this edition of E-Talk and please feel free to contribute at any time.
Feedback
patrick@salefest.com |
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Marketing:
Who’s responsible for what? |
The relationship between the manufacturer and the dealer is more than just selling cars. Each has an obligation to market the product, but where does the manufacturer’s responsibility end and the dealer’s begin?
We asked a dealer and a manufacturing representative for their views. Both agreed it was a joint responsibility, with some areas shared and some discrete.
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Max Kirwan, dealer principal Max Kirwan Motorland (Mazda and Renault).
“It is a joint responsibility. They (manufacturers) market the brand and the product in a variety of different ways. It’s different for each manufacturer and is driven by the number of retail sales they are achieving and the number they hope to achieve. Mazda spent $12 million on M-Day alone.
“The spend is relative to the size of the brand in the marketplace and what you hope to achieve. We’ve got our business plan of where we want to be at the end of the year and so does Mazda.
“Our job is to raise the profile of the brand in our prime marketing area and sales figures in addition to what Mazda is doing at a national level. We sponsor sporting clubs and provide community support, advertise in the local press. We also gave two cars to the local CFA recently.
“Our formula’s driven by a ratio of $300 spent per unit retail. It’s similar with Renault and used cars.
“We have a raft of Key Performance Indicators that come in to how we spend and where, and we’re driven by those.
“What dealers are supposed to do at a local level is promote their own business in their PMA, not just the make but also to differentiate themselves from opposition dealers in the PMA and other Mazda dealers.
“A percentage of every Mazda sold goes into the Mazda co-op advertising fund to support the state. Other than that, if you’re achieving results you can do what you like.
“You might go to them if you’re going to spend an inordinate amount of money in your PMA, like a large direct mailout or a facility launch, like we’ll be having in January. Then there is a cohesive support arrangement.
“Retained/referred customers cost one-third of winning new customers so it is a good idea to keep your existing customers happy.
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Ian Juster, general manager, Hyundai.
“Generally speaking manufacturers are responsible for promoting the brand and supporting the brand in the marketplace. Also a primary responsibility of the manufacturer is to launch new product in the marketplace.
“Dealers, really, their marketing should be about branding and locating them in their PMA, telling new and existing customers where they are and what their services are and any specials or retail offers they might have in new cars, used cars, parts or service.
“Where we come together is that most dealers are part of a dealer advertising committee that raises money for each model, which is matched dollar for dollar by the manufacturer. We work hand-in-hand to retail the product at different times of the year.
“At Hyundai we have a couple of times a year when we work with the dealers on offers like free fuel or free auto upgrades. The money’s there not to support the cost of the retail offer, the money’s for advertising and promotional.
“With the A-League, particularly in Melbourne, our dealers have been very supportive of the Hyundai A-League, and have agreed to support the Melbourne Victory with the provision of cars for the players and with around the ground signs at Telstra Dome. In turn they get access to the membership database that Melbourne Victory has. It’s early days but there’s definitely some interest from some Melbourne Victory members. Our research shows that members of A-League clubs have been supportive of Hyundai from the word go.
“From a dealer advertising point of view, like with all advertising, everyone wishes they had a silver bullet for what does and what doesn’t work. From our perspective we encourage dealers to work on their existing owner base with below the line efforts rather than broadcast offers. Things like direct mail to their existing owners, with loyalty offers.
“Last month we had a loyalty offer for Excel owners, offering them a $1000 loyalty payment if they traded in their Excel for a new Getz. We did about 50 deals in two weeks – you wouldn’t get that kind of result from advertising in the papers. And that was a 50/50 contribution between dealers and Hyundai for the cost of the mailout. The $1000 payment came from Hyundai.”
So there you have it. It would seem that these two, at least, are in agreement as to who is responsible for what when it comes to marketing.
What do you think? Did they get it wrong? Are there any areas in which you feel manufacturers should contribute more? Or are you happy with your marketing arrangements? Let us know. |
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David Martin and Tom Stuker top AADA
ratings |
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He’s scored the hat trick: for the third time in three visits to the AADA National Dealer Convention, David Martin has been rated the top speaker by delegates. However this year David had to share the honour with another of our international guests, Tom Stuker.
David was rated number one by Day Program delegates, while Tom was the top choice for those who attended the main program.
More than 98 per cent of those who saw his Day Seminar gave David their highest rating, less than one per cent ahead of Joe Verde. In fact, most speakers achieved extremely high ratings, backing our boast to have put together the best AADA Convention program ever.
To have had the best attendance in at least a decade was another great achievement and judging by the feedback we’ve been getting, that record will be under threat when we return to Queensland next year.
Certainly to hear from the likes of Tom Stuker, a legend in the US automotive industry and a highly in-demand workshop facilitator, that the 2006 AADA National Dealer Convention was the best of its kind he had ever attended, was a real feather in our cap.
“Unbelievable,” was his one-word summation.
Thanks Tom. We’ll take that.
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Friends raise funds for cancer centre |
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As you all know, the Monash Medical Centre Children’s Cancer Centre is close to our heart. Which is why we were delighted that an old friend of Patrick’s, Colin Brown, organised a kids’ ‘Fun Run With Thomas’ on the weekend of October 8.
Running with Puffing Billy, the kids had enormous fun, including Tyler Fyshlock, the brave little boy who lost both his eyes to cancer.
A great day was had by all, and even better, over $50,000 was raised for the Children’s Cancer Centre. It was a marvellous effort and a credit to all involved.
It’s also a great kick-off into our own ‘Bailey’s Day’ charity golf day, luncheon and auction. Each of the past two years we have raised $100,000 for Monash Medical Centre and we want to at least match that this year. Visit the site or download a registration form. Hope to see you there!
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Gaylene ties the knot |
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With all the fuss and sheer busyness concentrated around holding the AADA National Dealer Convention last month, we neglected to mention a very special occasion.
Salefest business and pleasure became inextricably linked on August 26, when one of our favourite daughters, Salefest Queensland account manager Gaylene Gillard, married Doug Barton Motors dealer principal Mark Beitz.
Gaylene and Mark tied the knot in a ceremony at St. John’s Cathedral in Brisbane, followed by a reception at the Polo Club, attended by 133 guests.
The happy couple then took off for a honeymoon on Bintan Island, which Gaylene reports was most relaxing.
Okay, now that you’re refreshed girl … back to work! |
Regarding Richard |
This month we welcome back our creative director Charles Bayer from a four-week European sojourn but it’s thanks to this bloke that most of you probably didn’t even notice the difference.
‘This bloke’ is our new creative assistant, Richard Butcher. We brought him in to cover for Charles and liked him so much we asked him to stay. He accepted and so the growth of our happy family continues.
Richard comes to us with an impressive CV. Beginning in his home town of Adelaide, he worked in industrial design, furniture design and was a partner in a design consultancy.
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Then he made the shift to the big smoke, working for six years in the art and design department of the Sunday Herald Sun. That was followed by a four-year stint in the USA, where he painted murals for three years while awaiting a work visa. Once he got the visa he spent a year working in automotive advertising agency – good training for here as it turned out!
Richard moved back to Melbourne in 2005, working out of a shared studio in the city, making roto-castings for artist installations, as well as some 3-D modelling.
Then, at the end of August, he joined us. And he’s loving the opportunity to do more writing and strategic planning.
“As with the Herald Sun, the fast turnaround is a chance to evolve. Ideas move quickly. I see it as still a product development exercise,” he says.
“The production crew and design people have been very helpful and made the transition pretty easy. It’s been good because retail experience is an area I needed to develop. I’m happy to say there’s a long way to go still, but I’m really developing a good sense of the business.”
Welcome aboard Richard. We promise you a fun ride, right gang? |
Hyundai gets its teeth into Salefest Queensland creative |
Salefest Queensland has landed a big fish, winning the right to create a campaign for Queensland Hyundai dealers to position the Tucson alongside market leaders X-Trail, CRV and Vitara.
Appearing in Brisbane and most likely in regional areas as well, the campaign asks buyers to compare “apples with apples” and see that, with Tucson, “she’s apples”.
Across press and point of sale advertising, with the potential for radio and, direct marketing , this is a huge campaign for us and a real coup for David Stanes and his team.
According to David, the brains behind the concept, the idea was to create a campaign edge that was distinctive and stood out from the pack.
"She's apples" is one of Australia's best-known colloquialisms. It attracts the consumer’s eye and puts into perspective a comparison of the Tucson and its rival vehicles.
Plus the apple represents a fresh approach to advertising that consumers can ‘get their teeth into’! |
It has connotations of environmental friendliness and lends itself to distinctive point of sale and marketing opportunities beyond the day to day retail.
As David says, "Position is everything and when consumers are looking to buy in a competitive marketplace, the apple concept gives them something to identify with."
Talk to David for a similarly fresh approach to your campaigns. |
The service department is ripe for rewards programs |
Is your wallet full of rewards cards for your favourite stores? It’s becoming an Australian obsession: Don’t leave home without your supermarket rewards card or you’ll find yourself paying twice as much for your milk and eggs, not to mention missing out on a chance to earn points toward your next discounted purchase.
Rewards are all the rage, but do they have staying power and is there a method to the rewards madness that automotive dealerships can learn from? The most compelling thing about rewards programs is the customer loyalty they build almost as a by-product.
Customers may not think they are hooked on a particular store, but they are. Why would you go to Store B when you can get a discount and points for future perks at Store A?
It’s a logical thought and action based on pure emotion. People want to feel like savvy shoppers, and, with a good rewards program, they leave the store with the satisfaction of knowing they got a good deal and there is more to come down the road.
How could a rewards program work for your service department? What would it look like? It could be something as simple as an oil-change punch card where customers get every fourth oil change for free. Or perhaps you could reward customers with points for every dollar spent at the dealership on service or parts. Point levels could then translate to different perks – a free oil change, parts discount, free detail job, and, at the highest level, a discount for a new car.
The time is ripe for rewards programs in the service department. If you can do a few things to convince people to return for the value of manufacturer parts and services rather than aftermarket, then it's a good thing for your department, your dealership and auto manufacturers.
In today’s service department, there aren't a lot of things to tie into a specific dealership that keep consumers coming back. |
Are knowing service department personnel, getting good customer service and seeing discount service reminders in the mail enough to keep customers engaged?
For many customers the answer is yes. What if your customer moves and your dealership is now 20 minutes out of the way? Will they keep coming back? And what about an unfortunate incident of bad service, which isn’t 100 per cent preventable in even the best service departments? Will that customer take his or her business elsewhere?
Rewards programs can help you build and maintain loyalty by cementing customer relationships. At a very basic level, these programs are successful because they create incentives and reward the customer for being loyal. |
How the car park has changed |
Well, we won’t sell as many cars this year as we thought. According to the Federal Chamber of Automotive Industries we’ve sold 722,376 vehicles so far this year. That’s 29,660 – or 3.6 per cent - less than the same time last year.
Some manufacturers have been hit harder than others. Holden has seen its sales fall 18 per cent for the year so far. At the end of September last year it had sold 133,641 vehicles for the year. That figure is 109,365 this year, and Holden’s market share has fallen from 17.8 per cent to 15.1 per cent.
Other manufacturers have also recorded sales falls, with Ford down from 98,366 at the end of September 2005 to 89,204 to the same time this year. Mitsubishi sales fell from 44,739 to 40,270, while sales also fell for Mazda, Nissan, Hyundai and Kia. |
In fact, of the top 10 manufacturers, only Honda (from 36,111 to 40,995), Subaru (from 27,482 to 28,246) and market leader Toyota (from 151,503 to 157,364) have increased sales this year.
It is an interesting change in fortunes coming off a record year last year. Last year we sold a record 988,269 vehicles. The FCAI says that number will be about 970,000 this year, 10,000 less than it originally predicted.
But we might not even get that far. It could be more like 952,000, ending a run of four record years in a row. But as FCAI CEO Peter Sturrock points out, just five years ago car sales averaged around 780,000 a year.
Even small cars sales have fallen, down 1.8 per cent last month compared with a year-to-date increase of 2.4 per cent. Light cars were up 1.8 per cent last month, compared to 20.1 per cent for the same time last year. Large car sales dropped 7.1 per cent.
It will be interesting to see how the market reacts to the release of the Toyota Aurion later this month, and we will continue to watch VE Commodore sales keenly.
So what’s behind the fall in sales? Is it just cyclical, or a reaction to rising fuel prices? We’d love to hear your experiences and views on the current state of the market. Click here to tell us your thoughts. |
Beware Martin Seeley |
We recently received a warning regarding a man by the name of Martin Seeley that we thought we should pass on.
According to Greg Wallace of Ripponlea Mitsubishi, this person is best described as “a serial psychotic defrauder”.
Last year Seeley was charged and jailed for over 100 offences relating to deception, fraud, bounced cheques and obtaining goods by false pretences.
Apparently he has been recently released from jail.
His deceptions covered many walks of life and have included the false acquisition of real estate, and more often motor vehicles.
He will present at your dealership and appear perfectly plausible and acceptable. |
He is 5ft8 (173cm), neat, tidy in appearance, Caucasian, of medium build, well spoken, and for all appearances someone who you would do business with.
His driver’s license will be in his name and it will record as his address a home in Black Rock. This is not his correct address, it is however the address of a couple who have had their identities corrupted and their lives made hell by Seeley. Greg Wallace says Seeley completely ruined his 2003 Christmas.
You should inform your sales staff of Seeley and do not allow any dealing to occur with him whatsoever. Repeat: nothing, nil, zilch, no test drive, get out and call the police.
Please feel free to pass this on to every one in the industry. |
Branding by design.
On a recent holiday to Europe, we were walking down the Champs-Elysee in Paris with thousands of other tourists when we stopped in front of number 136, a showroom that had an amazing window display titled Rustic Chic.
It featured rows of white ducks (not the wooden kind), watering cans and brightly coloured gumboots. It certainly grabbed our attention so we decided to go in and take a closer look…at this very prestigious Peugeot showroom.
The inside was an even bigger surprise! Not a balloon, windscreen banner or price ticket in sight. Instead, the decorators had suspended period chairs and tables from the ceiling. Turned terra cotta pots upside down for lampshades.
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And created a feature wall of Peugeot logos dating back to when the company began manufacturing cars mounted in transparent perspex portholes.
All this against a backdrop of stylish wall panels featuring leaves and beetles in silhouette.
Then there were the cars: the stunning 4007 Elixir, 4002 concept car, 1007 with dual sliding doors, stylish 407SW with boxes of fruit on the roof and a beautifully restored vintage wagon with wood trim and a bicycle mounted on the roof.
What did it all mean? In the end it didn’t matter because it was an unforgettable experience that really emblazoned the Peugeot brand in our minds, and the minds of everyone who was queuing to buy Peugeot-brand merchandise as a memento of their visit to this very French dealership. |
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AIM Newsletter Online begins a four-part series on ambush marketing with a report on major sports sponsors joining forces to stop GM HOLDEN’s blimp advertising; how a US dealership hit the headlines for planning a motor market ‘jihad’; how an independent ambush marketer goes about his business and what he offers; and some of the legal questions involved in ambush marketing.
Also in this issue:
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Vehicle imports continue to expand their share of the total Australian market while sales of locally made cars continue to fall. VFACTS year-to-date September results paint a disturbing picture of the trends. |
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COVENTRY GROUP is accelerating its push in Queensland following the recent sale of its loss-making New South Wales automotive operations. |
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Planning on handing over the reins of your business to a family member, say your eldest son? A study by global management consulting firm McKINSEY suggests you should think again. |
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