Let’s do a thought experiment. 

Car dealerships are the quintessential local business, but what if yours was magically transplanted to another zip code in the U.S.? How would you change the way you do business if a genie appeared, snapped his finger, and you were selling cars in…. 

94301 (Palo Alto, California): Abracadabra, you’re in tech millionaire country now. Most of your customers are 25 and up, of Asian and Caucasian descent, and earn some of the highest incomes in the U.S. Housing prices are insane; local rents are high and home ownership is probably out of the question if you aren’t commanding a fat salary or have startup equity to lean on. What do you do here that you don’t do back home? 

65686 (Kimberling City, Missouri): Hope you like bass fishing and classic country hits, because now you’re setting up shop in a lakefront community about thirty minutes west of Branson. Seniors, most of them retirees from other parts of the Midwest and Upper South, make up 40% of the population. There’s also a mix of middle-aged families that love to fish, boat, and hunt in and around Table Rock Lake. The nearest city of more than 100,000 people, Springfield, is an hour’s drive away. What’s your strategy here? 

02125 (Boston, Massachusetts): Got a strong opinion about Deflategate? If so, keep it to yourself because you’re in Boston now. You’re also in one of the most diverse zip codes in the U.S. Bohemians, well-to-do metro families, recent arrivals to the U.S., and longtime Bostonians all hang their hats here; there are a lot of young people and the racial and ethnic mix is very balanced. Your dealership is on I-93, giving you strategic access to East Boston. One more thing, your market is on the Atlantic coast and is part of the Salt Belt, which means vehicle corrosion is a factor for your business. What changes now? 

Every time your dealership sends a targeted email, sponsors a local soccer league, or puts the owner on televisions in a cowboy hat you are engaging in consumer insight-based audience targeting.  

The insights that inform you audience targeting tactics typically come from the following five places: 

Common sense: Who wouldn’t want 20% off on their next service appointment? (Actually, there are a few market segments who won’t respond to coupons or offers. Common sense targeting has a way of skipping over unfamiliar possibilities.)  

Intuitive understanding: People in your market have always seemed to like and trust dealership owners who wear cowboy hats. You wear a cowboy hat because you know it is smart business … and because it feels so right. 

Observation: Young people seem to hang out on Instagram; therefore, you take pictures of your inventory and post them on Instagram. You’re more of a Facebook guy, but if that’s what the kids like… 

Synthetic/theoretical/inspirational: Maybe an unrelated movie or moment during your last vacation gave you an insight into your customers. Maybe the theory of something or other helped you resolve a practical problem. Maybe you had a sudden intuition, a prophetic dream, or heard a mystical voice. That’s what this means.  

Data-driven: You’re using customer data insights to select specific audience targeting tactics. 

All five types of insights are important, but the purpose of this article is to demonstrate how customer data insights can help you find what works in your local market. Using Claritas’s zip code lookup tool as a reference, we’ll work through a few scenarios that a hypothetical dealer in a given market might face. The point isn’t to “solve the problem,” but to think about how consumer data can help you find the right audience targeting tactics for your dealership.

 

Scenario 1: What are they looking for? 

Let’s pretend you just opened a dealership in Kimberling City, Missouri. Your goal is to corner the local retiree market and to siphon business away from Springfield and Branson, which is where most of the locals go to shop for cars. 

A reasonable first step might be to identify a target customer type. When we plug “65686” in Claritas it gives us a handful of consumer lifestyle groups found in the zip code.  

One of these lifestyle groups, which they call Traditional Times, appears to be just what the doctor ordered: 

Traditional Times is the kind of lifestyle where small-town couples nearing or entering retirement are beginning to enjoy their first empty-nest years. Typically age 65 and older, these upper midscale Americans pursue an active lifestyle. They belong to country clubs and civic clubs and spend their vacation time traveling. 

If you decide that Traditional Times is your target audience, you can explore how other dealerships are connecting with it. Maybe you’ll take a look at popular car models and successful dealers in Barnstable County, Massachusetts, where this lifestyle group is very present; or focus on a market that has a similar Traditional Times index score to your own, like Hall County, Georgia. If you can figure out what works with this group and apply it here in Kimberling City, you have a reasonable chance of winning their business. 

 

Scenario 2: How are they engaging? 

This time you’re trying to figure out a customer engagement strategy for your Palo Alto dealership. Do you hit leads up on social media, run a YouTube ad, or put an ad in the local paper? 

Here Claritas identifies five consumer lifestyle groups (in reality your dealership would have access to a few more but let’s keep it simple). Out of the five lifestyle groups in the heart of Silicon Valley, four score above average to high on household technology use. Shocking, huh? You’d have to drill down further to know what specific technologies/platforms they’re using, but odds are you’ll do better with audience targeting tactics that zero in on the devices in their pockets.  

 

Scenario 3: How do I plan for the future? 

You have a dealership in East Boston. You have a great team, a solid inventory, and a stellar local reputation, but lately you’ve been thinking about the factors you cannot control. What if sky-high rents, Boston’s mass transit system, and rideshare apps conspire to make deep cuts into your bottom line? What if you wake up one morning and discover that your brand has fallen out of favor with urban car buyers?  

Consumer data is a tool that helps you think through the future. In the 02125 zip code you have a lot of young, lower-income people. Many car dealerships won’t see this as a very productive group; but what if the city, the economics of car ownership, or automotive technology itself changes and these people become car buyers? Would you look back and wish you saw the opportunity coming? Are there any cost-effective audience targeting tactics you can use today to connect with tomorrow’s car buyer? 

When you ask yourself questions like “What is that state of my market right now?” and “What is happening that will make my market change?” the future might not seem so ominous. You might even welcome it. 

 

Are you ready to dig deep into your local market? 

Hopefully you’re excited about this. If you want to get started, you can visit websites like Claritas or census.gov, or you can give us a call. Data exploration is our bread and butter and we’ll be happy to help. Plus, we have some even more supercharged insights that dive into market share, competitive analysis and opportunity analysis.

 

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