Dealerships have long been able to use data to measure service indicators such as MFP volumes, end-user usage, uptime, parts usage, and inventories, as well as sales indicators such as activities, pipeline and sales results. However, the majority of these indicators are monitored for internal purposes only, such as managing your MIF (Machines in Field) and sales team activities. These are critical components to gain insight to more effectively manage the business and improve efficiencies, but there is other data available to every dealer that remains largely untapped.
In contrast to the significant amount of activity around capturing dealer data, including the use of automated reports and dashboards, there has been little to no activity or communication around data marketing — using data for marketing purposes. Data marketing uses databases of customers or potential customers to generate personalized communications in order to promote a product or service for marketing purposes.
Every dealer strives to build brand value through its website and the use of sales and marketing content. When we read the “About Us” or “Our History” tabs on dealer websites, we read about the value of the organization. We learn of its roots, evolution from earlier analog technologies to digital technologies and services, its loyal customer base and its commitment to the environment and its local community. In short, we read about the value most dealers bring to their customers. So how does a dealership truly differentiate its brand against its competitors? Does the competition have a similar story that may be equally as impressive in terms of years of service or its long-term customers, community activities, etc.? Meanwhile, as MFPs are becoming more and more commoditized and the numbers of bids increase, hardware and aftermarket price points continue to decline due to competitive pressure. So how to differentiate your brand in this very mature/flat market?
There are two primary ways to differentiate your brand. One is to market evolving or bleeding edge technologies (e.g., IoT or AI) to position your brand as a future market leader. The other is to market to application-specific or proven solutions to position your brand for real solutions that result in efficiencies and cost savings. As both marketing methods can differentiate your brand, which of the two marketing methods will create demand and generate sales calls and pipeline growth? I am going to vote for the latter, as we have worked with dealers to differentiate their brands based on the unique value-added offerings they currently sell to their customers.
So how does a dealer differentiate itself over its competitors? The simple answer is customer intimacy.
Customer intimacy is a marketing strategy where the supplier of a product or a service wants to get closer to the customer to understand their business challenges and needs. Customer intimacy helps firms in understanding and anticipating the customer’s needs and wants better than its competitors, which leads to new product/services generation with customer needs at heart.
As we have noted, all dealers bring value to their customers. The trick is to gain better customer insight to determine what unique value you are providing to which customer segments. In other words, what are the sweet spots or target markets where your dealership currently provides unique value and clearly differentiates against your competition? The answer sits within your data. Data marketing and customer insight will result in true customer intimacy, allowing you to create a marketing strategy to drive specific value-added offerings.
If you know what types of solutions and services were sold to which of your customer segments, you can begin the data marketing process. First, we must confirm the solutions and services feasible to market. There may be 20 or more software solutions in your price book; what are the solutions you sell on a consistent basis? What solutions can your dealership support on a pre-sale/post-sale basis? What solutions are you more comfortable offering? Remember, you want to market proven solutions that give you the ability to gain customer insight. Identifying specific software solutions and other well-defined services such as MPS and MNS is a critical step to determine which specific customers to identify. Successful dealers determine two to four software solutions to market and clearly define the services to market as well. This will not be a 30,000-foot, broad marketing pitch; it will be an application-specific value proposition to environments where you are proven to be successful. Your dealership will actually better understand these environments and market to them, thus clearly differentiating your brand in your marketplace.
Getting the most from ERP and CRM tools
Customer insight sounds simple, but it takes a structured approach before you get to the appropriate customer segments (vertical/horizontal markets). You start by identifying your current/active billing customers through your ERP.
Once the value-added offerings are confirmed, your ERP/CRM can identify which customers have purchased which solutions and services. This is the data marketing step. If you ask most dealers how many MFPs they have under contract, or how many MIF, you will receive a quick, accurate number, as their internal data is well managed in most cases. MIF leads to clicks, clicks lead to billings, and billings lead to revenue. This data is very well managed. But if you ask most dealers how many active/billing customers they have, you may receive a different response. Most dealers I have spoken to did not know the answer as quickly and as accurately as the MIF question. Why is this? It is due to the culture of how we manage our legacy business from the inside out. Your ERP has all of the data necessary to conduct the data marketing step, but this topic was never well communicated to the dealer channel.
The second source of customer data is your Customer Relationship Management (CRM) tool. A majority of dealerships do not use their CRM tools as a customer relationship management platform. In many cases, the sales rep still “owns” the account as the primary face to the customer. Five years ago, marketing did not participate within the CRM platform and few dealer marketing personnel had a CRM seat license. If customer intimacy is a marketing strategy, marketing must be very active inside your CRM tool, and in order to have true sales and marketing alignment, marketing and sales must intersect within the CRM tool.
The CRM tool is a significant topic today. Many dealers want to clean up years and years worth of bad data and are focused on the non-customer/net new records, as net new is an important strategy for most dealers. The existing customer records are being overlooked, primarily being managed by sales, with limited to no interface with marketing. Your customer records are your most important asset. This is the clearest path to brand differentiation and strategic revenue growth, focused on high value solutions and services. With brand differentiation in place, you will not need to wait for competitive MFP contract expirations to capture net new customers.
Use your assets
Your dealership owns your customer assets, not the sales rep. You have a platform to communicate specific value propositions to customer segments where your dealership is proven. Marketing is responsible for providing this message, by solution and by environment. Marketing must align with sales and solutions subject matter experts to identify customers already benefiting from the solutions to be marketed.
Example: You have sold your content management solution to three law firms. Have your content management subject matter expert interview the three firms to confirm the business challenges faced and how your solution solved the problem. You learn the law firm environment, applications, verbiage and document workflow. Can this apply to other legal customers or legal net new opportunities? Yes. Market to your strengths.
Every dealer has an ERP/CRM in place where your customer data resides. A data marketing process will identify market segments in order to gain customer insight on each of your strategic revenue growth initiatives. Most dealers have focused on the tactics before putting the strategy in place. A marketing strategy can better enable sales through a series of direct or indirect marketing tactics.
Marketing and sales are both responsible for sales enablement. Using your data platforms through a structured process will result in sales and marketing alignment to collectively drive revenue growth for your business. Sales must buy into marketing in order to achieve return on your marketing investment. Marketing must have insight to your customers to provide a compelling value proposition that gets sales leads.
Data marketing is proven. Get marketing to the table to get strategically aligned to your business.
Latest posts by Dominic Pontrelli (see all)
- Brand Differentiation Through Data and Customer Insight - February 1, 2020