Value of potential new customer to a main dealer?
Discussion
I am pondering a new marketing opportunity that could drive the perfect customer demographic into premium main dealer showrooms (think BMW, Merc, JLR, Audi)
But not working within the trade I have no idea where to pitch the value of such a lead to the dealer..would a franchised Merc dealer pay me £50 for me to send a targeted, qualified person in to the showroom or is it £1000, £100 or £1????
Any help with this would be tremendously helpful.
But not working within the trade I have no idea where to pitch the value of such a lead to the dealer..would a franchised Merc dealer pay me £50 for me to send a targeted, qualified person in to the showroom or is it £1000, £100 or £1????
Any help with this would be tremendously helpful.
pontypool said:
I am pondering a new marketing opportunity that could drive the perfect customer demographic into premium main dealer showrooms (think BMW, Merc, JLR, Audi)
But not working within the trade I have no idea where to pitch the value of such a lead to the dealer..would a franchised Merc dealer pay me £50 for me to send a targeted, qualified person in to the showroom or is it £1000, £100 or £1????
Any help with this would be tremendously helpful.
Very tricky to say but I would suggest if you are pretty certain you are bringing high quality leads on a regular basis, I would approach a selection of dealers and offer them a sample of the leads free of charge. So for no cost they can see for themselves if they are any good. But not working within the trade I have no idea where to pitch the value of such a lead to the dealer..would a franchised Merc dealer pay me £50 for me to send a targeted, qualified person in to the showroom or is it £1000, £100 or £1????
Any help with this would be tremendously helpful.
After a period of time you can also follow up to see if anyone actually orders. From there you can look to gradually increase the price you charge for the leads until you find the right market level.
I would say predicting this in advance when it it unclear how qualified the lead actually is won't be possible.
Fair point about quality of leads. I can't say too much as it would give the game away but suffice to say I would be able to deliver this theoretical customer:
- type of person who lived somewhere very affluent like Ascot/Esher/Macclesfield/Sandbanks/etc..
- high levels of disposable income
- i know their validated contact info including email and telephone
- had expressed a preference for that dealer/marque already.
- can prove visit to dealer was result of my marketing activity
I think in practice you are right that I might have to give them away to get the ball rolling, but would still be useful to have a vague idea of where the ballpark sits for someone like this to walk through the door.
- type of person who lived somewhere very affluent like Ascot/Esher/Macclesfield/Sandbanks/etc..
- high levels of disposable income
- i know their validated contact info including email and telephone
- had expressed a preference for that dealer/marque already.
- can prove visit to dealer was result of my marketing activity
I think in practice you are right that I might have to give them away to get the ball rolling, but would still be useful to have a vague idea of where the ballpark sits for someone like this to walk through the door.
pontypool said:
Fair point about quality of leads. I can't say too much as it would give the game away but suffice to say I would be able to deliver this theoretical customer:
- type of person who lived somewhere very affluent like Ascot/Esher/Macclesfield/Sandbanks/etc..
- high levels of disposable income
- i know their validated contact info including email and telephone
- had expressed a preference for that dealer/marque already.
- can prove visit to dealer was result of my marketing activity
I think in practice you are right that I might have to give them away to get the ball rolling, but would still be useful to have a vague idea of where the ballpark sits for someone like this to walk through the door.
Ok, so Joe Bloggs has decided that they'd like an Audi and they live in Ascot. They're obviously going to go to the local dealer whether you're in the loop or not. Why would the dealer pay you £50?- type of person who lived somewhere very affluent like Ascot/Esher/Macclesfield/Sandbanks/etc..
- high levels of disposable income
- i know their validated contact info including email and telephone
- had expressed a preference for that dealer/marque already.
- can prove visit to dealer was result of my marketing activity
I think in practice you are right that I might have to give them away to get the ball rolling, but would still be useful to have a vague idea of where the ballpark sits for someone like this to walk through the door.
Why would Joe Bloggs contact you and not the dealer?
MagicalTrevor said:
Ok, so Joe Bloggs has decided that they'd like an Audi and they live in Ascot. They're obviously going to go to the local dealer whether you're in the loop or not. Why would the dealer pay you £50?
Why would Joe Bloggs contact you and not the dealer?
If this was the case why does anyone ever do any advertising or marketing? Why would Joe Bloggs contact you and not the dealer?
but back on the topic...For my existing business I already spend money in plenty of channels to attract customers and I know pretty much exactly what I am willing to spend to speak to a potential customer - just wondering roughly what that figure is to a franchised dealer.
SpeckledJim said:
Rather than asking to be paid for a (probably dead-end, realistically) lead, you might be better charging a larger royalty if the dealer actually makes a sale to one of your introductions.
That's a fair point and potentially going to earn me much more money so is definitely a possibility. Not being in the trade currently I am trying to get some sort of insight before I start calling up dealerships and introducing the concept.
pontypool said:
SpeckledJim said:
Rather than asking to be paid for a (probably dead-end, realistically) lead, you might be better charging a larger royalty if the dealer actually makes a sale to one of your introductions.
That's a fair point and potentially going to earn me much more money so is definitely a possibility. Not being in the trade currently I am trying to get some sort of insight before I start calling up dealerships and introducing the concept.
If your money is made when you hand over the lead, rather than when the lead turns golden, then you don't have a direct stake in the lead being any good. So I'm not sure I would trust you that the leads were as good as you said they were. At least in the early days.
If your leads are as hot-to-trot as you say, why don't you insert yourself into the deal as a broker?
SpeckledJim said:
If you tried to sell me a lead, I'd be asking you what the refund policy is if they 'don't work'.
If your money is made when you hand over the lead, rather than when the lead turns golden, then you don't have a direct stake in the lead being any good. So I'm not sure I would trust you that the leads were as good as you said they were. At least in the early days.
If your leads are as hot-to-trot as you say, why don't you insert yourself into the deal as a broker?
Because I am not in the business of being a broker, but offering access to the right audience who are motivated to know about your marque. If your money is made when you hand over the lead, rather than when the lead turns golden, then you don't have a direct stake in the lead being any good. So I'm not sure I would trust you that the leads were as good as you said they were. At least in the early days.
If your leads are as hot-to-trot as you say, why don't you insert yourself into the deal as a broker?
No refunds, you might be a terrible salesman so its not my fault!
pontypool said:
MagicalTrevor said:
Ok, so Joe Bloggs has decided that they'd like an Audi and they live in Ascot. They're obviously going to go to the local dealer whether you're in the loop or not. Why would the dealer pay you £50?
Why would Joe Bloggs contact you and not the dealer?
If this was the case why does anyone ever do any advertising or marketing? Why would Joe Bloggs contact you and not the dealer?
but back on the topic...For my existing business I already spend money in plenty of channels to attract customers and I know pretty much exactly what I am willing to spend to speak to a potential customer - just wondering roughly what that figure is to a franchised dealer.
The advertising/marketing, by the dealer, is broadly 'we sell these cars, come and buy'. I can completely understand why they'd spend that money on advertising, I can also understand why a dealer might pay £50 (for example) if you were able to encourage a customer to not buy a BMW and buy an Audi from them instead or alternatively, buy an Audi from a specific dealership over another.
The question I asked was trying to establish the value of the lead. I was trying to work out what I'd missed as the customer is likely to go to the dealer without any intervention. Is that not a reasonable assumption?
pontypool said:
For my existing business I already spend money in plenty of channels to attract customers and I know pretty much exactly what I am willing to spend to speak to a potential customer - just wondering roughly what that figure is to a franchised dealer.
Wonder if a franchised dealer would ever have thought about this? You may have difficulty extracting fair value if the dealer had no clue what that number might be. Might well be easier to ask for a commission on sales made. MagicalTrevor said:
Strange response!
The advertising/marketing, by the dealer, is broadly 'we sell these cars, come and buy'. I can completely understand why they'd spend that money on advertising, I can also understand why a dealer might pay £50 (for example) if you were able to encourage a customer to not buy a BMW and buy an Audi from them instead or alternatively, buy an Audi from a specific dealership over another.
The question I asked was trying to establish the value of the lead. I was trying to work out what I'd missed as the customer is likely to go to the dealer without any intervention. Is that not a reasonable assumption?
ok, so think of my concept as another "we sell these cars, come and buy" channel if that's the way you are looking at it. The advertising/marketing, by the dealer, is broadly 'we sell these cars, come and buy'. I can completely understand why they'd spend that money on advertising, I can also understand why a dealer might pay £50 (for example) if you were able to encourage a customer to not buy a BMW and buy an Audi from them instead or alternatively, buy an Audi from a specific dealership over another.
The question I asked was trying to establish the value of the lead. I was trying to work out what I'd missed as the customer is likely to go to the dealer without any intervention. Is that not a reasonable assumption?
The potential customer may not automatically thought of Audi and so needs to be marketed to to make sure they don't go to BMW and I can let Audi have access to 5,000 of the target demographic, which has to have some value to them (even if it isn't much, but that's what I am trying to establish)
pontypool said:
ok, so think of my concept as another "we sell these cars, come and buy" channel if that's the way you are looking at it.
The potential customer may not automatically thought of Audi and so needs to be marketed to to make sure they don't go to BMW and I can let Audi have access to 5,000 of the target demographic, which has to have some value to them (even if it isn't much, but that's what I am trying to establish)
But in a previous post you said the lead you are selling had already expressed an interest in the marque?The potential customer may not automatically thought of Audi and so needs to be marketed to to make sure they don't go to BMW and I can let Audi have access to 5,000 of the target demographic, which has to have some value to them (even if it isn't much, but that's what I am trying to establish)
Who is going to say 'Yes, I'd quite like an Audi, send me to an Audi dealer' to you, but hasn't already said it to their Audi dealer?
With my dealership head on, I'm smelling a rat.
But might be tempted to say something like "ok, you want £30 a lead and the sale is my own. I'm offering nothing per lead and £150 a sale. Put your money where your mouth is."
What would you say to that?
Edited by SpeckledJim on Thursday 17th November 14:13
pontypool said:
ok, so think of my concept as another "we sell these cars, come and buy" channel if that's the way you are looking at it.
The potential customer may not automatically thought of Audi and so needs to be marketed to to make sure they don't go to BMW and I can let Audi have access to 5,000 of the target demographic, which has to have some value to them (even if it isn't much, but that's what I am trying to establish)
Ah, I see. It was your earlier comment that threw me "had expressed a preference for that dealer/marque already."The potential customer may not automatically thought of Audi and so needs to be marketed to to make sure they don't go to BMW and I can let Audi have access to 5,000 of the target demographic, which has to have some value to them (even if it isn't much, but that's what I am trying to establish)
SpeckledJim said:
The other thought is this:
The first time I realise I've paid you £30 to tell me about a guy I already play golf with, or who lives next door to me, or who was in the showroom on Saturday, I'll be so pissed-off that I'll jack the whole thing in.
How will you handle that?
The lead-gen businesses who sell leads for windows, solar panels etc deal with that very easily.The first time I realise I've paid you £30 to tell me about a guy I already play golf with, or who lives next door to me, or who was in the showroom on Saturday, I'll be so pissed-off that I'll jack the whole thing in.
How will you handle that?
Once you get the lead you can query it if you think it wasn't a proper lead. So for example, if the contact number on the lead wasn't correct etc.
Depending upon the relationship you have with lead gen company and how many leads you were buying, they would probably just give you a refund on the cost of the lead.
EddieSteadyGo said:
SpeckledJim said:
The other thought is this:
The first time I realise I've paid you £30 to tell me about a guy I already play golf with, or who lives next door to me, or who was in the showroom on Saturday, I'll be so pissed-off that I'll jack the whole thing in.
How will you handle that?
The lead-gen businesses who sell leads for windows, solar panels etc deal with that very easily.The first time I realise I've paid you £30 to tell me about a guy I already play golf with, or who lives next door to me, or who was in the showroom on Saturday, I'll be so pissed-off that I'll jack the whole thing in.
How will you handle that?
Once you get the lead you can query it if you think it wasn't a proper lead. So for example, if the contact number on the lead wasn't correct etc.
Depending upon the relationship you have with lead gen company and how many leads you were buying, they would probably just give you a refund on the cost of the lead.
For an established provincial prestige dealer, there won't be many people in his local potential market who are genuinely completely new to him.
He would have to sell me the 50 leads, and then refund the 25 I claimed I already knew. And he'd have to trust that I was telling the truth that I already knew them. Bit messy.
Much easier to say "Here's my list I've been tickling on your behalf - lets agree that if any of them buy a car from you in the next 6 months, it's £150 a time."
Edited by SpeckledJim on Thursday 17th November 15:47
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