The Obsolescence of Sales Events

Introduction (download the PDF below for the full article)

For used vehicles, sales events are largely a function of a bygone era, when shoppers had little transparency into vehicle prices or values without entering the store. The purpose was to use a sampling of low-price/high-value demonstrations to generate urgency in shoppers who are thinking about buying a vehicle and store preference for those who are definitely in-market for a vehicle. Today, shoppers have access to market pricing on millions of vehicles and enough information about many of them to formulate initial value estimates.

New-vehicle sales at the dealer level are quickly losing their impact, and coming changes will further erode their effectiveness. Information transparency regarding vehicles, prices, and interest rates is leading to the obsolescence of dealer specific sales events. This is not unique to the automobile industry. Other durable goods industries are already responding to the changes in consumer behavior brought on by readily available market information. Auto dealers must do the same.

More and more dealers are turning their used-vehicle inventory in less than 45 day, and many in less than 30. Keeping new-vehicle inventories to less than 60-days supply has become a priority for many manufacturers as well. When every shopper has 24/7 access to information in a competitive market place, the job of blowing out inventory is constant, and the blowout sales event becomes obsolete.

Related files: 

The Obsolescense of Sales Events~.pdf