“It’s not the right time.”
“Our busy season is just picking up – we don’t really make decisions like this now.”
“Get back to me in six months.”
This is the plight of every salesperson since the dawn of time; customers often delay before they decide. The phenomenon sharpens among businesses, as managers have full plates, and regardless of how aspects of their company might be improved, at least they’re working.
While decision inertia is certainly natural, a prudent manager should nonetheless consider the downstream effects of not deciding – even if the answer is, in the end, “no.” For dealerships, this could apply to a purchasing decision on supplies or a hiring decision ahead of a seasonal rush; delays might lead to losing out on a good quote, or finding yourself understaffed at crunch time.
Deciding how to manage your customer information is no different. Let’s discuss some resultant costs of putting off customer data management improvements, including longer setup times, missed opportunistic sales and being less equipped to develop sales and marketing strategies down the road.
Technical Costs: Setup & Implementation Time
Customer data management (CDM) is the process of dynamically collecting and maintaining customer information – such as contact info, purchase histories and touchpoints – in one centralized location across an organization to better engage with (and sell to) your customer base. Implementation involves many moving parts, and depending on your organization’s size, technical capabilities, and available data sources, the process may take a while. So, assessing the setup timeline matters a great deal.
For example, let’s say you’re sold on CDM, but your busy quarter is just picking up. It may seem easy to wait to start pushing the boulder up the hill – until you realize, three months later, that the boulder is bigger than you expected, and between configurations, integrations, and communications, the setup process itself may take another three months. Now half a year has gone by, and rather than training your team during downtime, they’re busy again, spelling uncertainty around adoption when you need it most.
The moral? Get the ball rolling, as soon as you can. A few exploratory emails and calls won’t put you totally underwater and will ensure a smoother and timelier rollout.
Opportunistic Costs: Up-Sell & Cross-Sell
As noted, the point of CDM is to better engage with customers. To return to our scenario, a busy period is the perfect occasion to kick the CDM process off, as you can capitalize on this influx through CDM-enabled opportunistic sales.
A key example is the cross-sell. By automatically updating customer purchase histories via CDM, you can quickly find products that a given customer hasn’t bought (yet). Maybe Joe Smith comes in for a new tire, and upon looking up his email at the register, you notice he’s never bought a helmet from you. At best, you mention helmets, and he picks one up. At worst, he notes that unfortunately you don’t sell his favorite brand – in which case you’ve collected valuable data to inform merchandizing.
The cousin of cross-selling is the up-sell: Rather than a new product type, you sell an updated version of something a customer already bought. Perhaps Joe brings his bike into the shop, and from his CDM-enabled parts history, your tech notices his muffler is three years old. Or, maybe Joe did buy a helmet from you – but 2.5 years ago. Joe’s clearly been slacking, and your team is here to help.
Without robust CDM, Joe might walk out the door with just a tire. Given all the Joe’s of the world, waiting to secure your CDM presents a hefty opportunity cost.
Strategic Costs: Setting Sales & Marketing Up for Success
Cross- and up-selling is great, but what about getting customers to the dealership in the first place? This is the realm of sales and marketing strategy, which requires well-informed insights on who buys what, when and where. Vigorous CDM is crucial here to determine the customers and products to target.
As with opportunistic sales, a busy season is the perfect time to start strategizing through CDM due to the short-term benefits of real-time analysis. Compare sales performance by area, gender, age, profession and other breakdowns relative to the same time last year. Perhaps accessory sales are down 20% YTD for females in the county over, which presents a case for footwear and goggle ads in local women’s magazines, and a small promotion to boot (pun intended).
Long-term strategy, on the other hand, requires time for interpretation. You may need a season or two of purchase data to draw meaningful conclusions (e.g., on changes in profit / day by customer group over time), at which point you’ll have to decide which findings matter enough to act upon. Maybe you shift merchandizing towards profit-driving demographics or focus on email marketing for a high ROI.
Regardless, whether looking near or far, the sooner you get your CDM squared away, the better.
Kicking the Tires
In all, the road to enhanced sales performance leads through customer data management, but if you keep kicking the tires rather than kicking off the process, you won’t get anywhere. It’s never too early to start researching your options, compiling wish lists, and collecting data. Future you, with net-new opportunistic sales, a well-informed marketing strategy and smooth CDM roll-out and adoption, will thank you.
Michael Paladino is a customer success manager at Black Ink Technologies, a provider of SaaS customer analytics solutions. He and Black Ink are based in Boston, MA.