How technology can help to maximise used car profitability

As economic uncertainty continues to disrupt new car sales across the UK, used car sale operations have become even more important to dealers.

I speak to dealers every day, helping them make the most of their technology investments; crucial to our talks is discussing how they can use technology to maximise used car profitability, and I have identified three areas on which to focus.

Consumer confidence is low, which means finding new customers is challenging. Focus should be on the expected change cycle of your current database.

Understanding where customers are in their vehicle ownership lifecycle is key, meaning an up to date customer database is vital.

It will enable you to understand your customer buying behaviour and flag when their current vehicle reaching the end of its ownership life.

Also, look to integrate data from the service department into the customer database; monitoring vehicle maintenance will highlight when MOT costs are increasing and therefore when owners are going to be most open to discussing newer models.

The used car market moves rapidly, unless you keep an eye on developments you could lose out to competitors.

To keep competitive ensure you are preparing, pricing and tracking stock correctly. The right technology should provide the market intelligence to enable you to go to market with the right product at the right price.

This clear viewpoint on the market also facilitates agile pricing, enabling you to keep up with changes as they happen.

Most car buyers start their journey online, making the evolving landscape challenging.

Dealers must respond to changing consumer shopping behaviours across their stock portfolio.

The best dealers are the ones who are open for customer enquiries 24/7and act on them fast to convert interest into a lead.

There are many ways in which your CRM system can respond to this ’always-on’ behaviour so that you can automate regular communications, flag new opportunities quickly, and personalise communications.

Alistair Jeff is head of partner programme at CDK Global