Staffed Events & Promotions
"Using Staffed Events Responsibly to Enhance your Bottom Line "
By: Scott M. Hipsky
While talking with hundreds of car dealers and general managers on a monthly basis I noticed the conversations seem to revolve around the same theme, “What is wrong with staffed events these days?” They're too expensive, they had a bad experience with a team and to top it off staffed events can be a risky venture. These are just a few of the negative things that I hear. I can understand how these dealers feel. I truly do. However if done responsibly with a responsible, reputable staffed event company there is no better way to help the bottom line. Not to mention that the staffed event can be a huge asset to the long term well being of your car dealership.
Sure, I understand that a dealer can feel that writing a $20,000 to $30,000 check for advertising (direct mail) and then paying a percentage of their resulting profit is excessive. However let's examine the numbers in closer detail. Let's say that the average car dealer spends $20,000 to advertise a staffed event. For some car dealers this may be the same amount that they budget for an entire month. If an auto dealer spends $20,000 over the course of 30 days to advertise on the television, on the radio and in the newspaper to attract customers to their dealership is the money being used in the most advantageous way? Let's look at the numbers. A dealer that spends $20,000 and is efficient enough to sell 40 cars ($2,200 average per vehicle retail) as a result of that advertising will gross approximately $88,000. Subtract the initial $20,000 spent for advertising and you are left with $68,000 in adjusted gross income. However if the same $20,000 is spent on a focused direct mail marketing campaign and staffed event the dealership will become optimized to perform at it's peak level. Even if this optimization is only for a short period it is still financially beneficial for the dealer. Consider for a moment that an event company can produce 40 car sales in 5 days with a $20,000 advertising budget. A good team will increase if not double a dealerships per vehicle retail. These 40 cars sold at $4,400 per vehicle retail gross will result in an event producing $176,000 in gross profit. Subtract the initial $20,000 advertising investment, the 24% commission for the company facilitating the sale and the dealer is still left with $113,760 dollars in adjusted gross profit and three more weeks to sell cars. So is it really to expensive?
It can be, if you pay to little. Remember, you get what you pay for. And this is a performance based business. This brings me to the second biggest complaint that I hear from car dealers regarding their previous staffed event experiences. I will be the first to admit and I know that I am not alone when I say that there are some unscrupulous characters in the marketplace portraying themselves as reputable promotion companies. Their practices and unethical dealings are giving the rest of the staffed event industry a black eye. They aren't trained and don't have enough experience to properly facilitate a sale. They lack the work ethic to compensate for their inexperience and their integrity is quite often in question. Luckily these individuals still make up a small percentage of those of us who perform these sales and they are easy to identify because they will work for what they feel they are worth, next to nothing.
Ten years ago when I was recruited into the staffed event and tent sale business it was a new concept that attracted the best talent that the auto business had to offer. With big paydays and the opportunity to travel the country and help others succeed. Living in hotels, flying from one city to the next, living out of a suitcase, from one dealership to the next, working 14 hour days, being away from the family for weeks at a time counterbalanced only by the fact that the money was worth the sacrifice. However in an attempt to duplicate the results for less money some dealers began to sacrifice quality by hiring individuals or start up companies for a fraction of the price. Remember people will work for as little as they feel they are worth.
Without trying to sound cliché I can't emphasize enough, “You get what you pay for.” After all why would talented, ethical, hardworking automotive sales professionals want to pay to travel to your store and be away from their family, living in a hotel, working 12 to 14 hour days to get paid peanuts? The answer is, “They don't.” However the individuals who can't get or keep a management job at a dealership will grab at any opportunity they are offered. Not exactly what I would feel confident investing ten's of thousand of dollars in advertising money on. That's if the money that you give them makes it that far.
So back to my original point, “Using staffed events responsibly to enhance your bottom line”. To do so use the follow rules as a guide the next time you consider doing a staffed event.
- Hire a reputable company and pay them well.
“The bitter taste of a bad job will remain long after the sweetness of low cost is forgotten.”
- Make sure and get USPS mail receipts. (for direct mail marketing)
- Don't be afraid to check their references thoroughly,
- Check the better business bureau and the Attorney general of several of the states they have done business in.
- I have also found by doing a little research online (Google searches being a great resource) you might be surprised at what you turn up on a company.
- Use Staffed Events to enhance your bottom line no more than 4 - 6 times a year. If you do them two times a month as I have seen some dealer do they become business as usual around your dealership and community. In essence they become ineffective.
For more information regarding the implementation of staffed events in your car dealership feel free to contact me at Scott@Showroomtoday.com or by calling me at 321-951-1683 ext 11
I hope you will find this information informative as well as useful. I will be contributing articles on Training and Staffed Events on a monthly basis. Feel free to contact me with any questions that you may have.
Tell Me More....
Contact Scott M. Hipsky at Scott@Showroomtoday.com or call him at 321-951-1683 if you have questions about conducting a Staffed Event, Tent Sale or in regards to a From Zero to Hero Sales Training Program.
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