How Your Dealership Can Turn Tax Refunds Into Down Payments
Tax season can just as easily become “down payment season” if your dealership employs the correct digital strategy. As consumers start receiving their tax refunds, show your financing and subprime-geared offers to the right audiences to increase dealership sales this tax season.
Think With Google noticed a trend in dealership foot traffic, increasing substantially from the slow months after the holiday season into summer. The big spike in the chart below peaks right around—yep, you guessed it—tax season.
Some sources claim dealers see up to 50% of annual business during tax season and sell more cars during this time of year than any other. While those numbers are bound to differ from dealer to dealer, we do know that tax refunds have more than doubled in the last decade. And this makes for a huge opportunity for industries that benefit from large initial investments.
Though Most Save Tax Refunds, Some Consumers Still Plan On Investing Their Cash In A Big Purchase
According to the National Retail Federation, more and more Americans are receiving tax refunds each year. As of 2016, two-thirds of Americans expected a tax refund.
And while most consumers plan to save instead of spend their extra cash, an average 10.5% of adults plan to spend their return on major purchases, like a new car or furniture:
As refunds are drawing closer, does your dealership have a strategy to increase dealership sales this tax season?
Tip #1: Target Car Shoppers By Credit Score, Income, and Age
According to the NRF survey data, those who are looking to “spend their tax refund on a major purchase” (like a car) belong to income ranges <$50K and are between the ages of 18-34 YO.
What if you could advertise your finance-related “Why-Buys” to ONLY those demographic segments?
Through solutions like Facebook, you can.
With the platform’s comprehensive user data, you can target In-Market vehicle shoppers near your dealership:
- by Credit score
- by Income range
- by Age
Then deliver the perfect ad that guarantees these shoppers that:
- …you have many financing options available
- …credit scores and histories aren’t a problem
- …they will reap a big reward for investing their down payment with your store
In other words, you can run smarter ads.
In addition to your proactive Facebook ads, ensure all of your reactive paid advertising on Google includes messaging around tax season to create an integrated, cohesive campaign.
Remember, while Facebook ads are great for lead generation, Google ads are best for immediate sales. Once a shopper receives their tax refund and types in “Ford Mustang financing options,” your dealership better show up!
Tip #2: Position Your Inventory Ads To Grow Dealership Subprime Business
Subprime audiences are also a major target during tax season.
Galpin Motors Inc., #32 on Automotive News’ list of the top 150 dealer groups and #2 in the top 10 average new retail units, has a used-vehicle department that aims solely to sell to subprime customers. Their goal is for subprime to account for 15-20 percent of the dealership’s used-vehicle finance business.
Galpin claims that subprime credit provides a good profit margin, and more importantly, “feeds the larger organization with other business such as service work and possible future referrals.”
If you’re listing your pre-owned inventory on Craigslist, you can easily appeal to these shoppers by making your finance options clear in your posts.
Include unique subprime messaging on your ads in the title, throughout your vehicle description, and at the bottom of the listing.
Next, remember that most Craigslist and subprime car shoppers are going to think in terms of monthly payments (NOT full vehicle price) when considering the affordability of a new car.
It’s important to see if your Craigslist provider will break down monthly prices to appeal to these consumers. (Spoiler alert, most won’t! See how our solution breaks down monthly price instantly!)
In A Nutshell: Smarter Ads Will Help You Increase Dealership Sales This Tax Season
As we approach the peak of the Tax Season, ramp up your digital marketing campaigns with messaging around financing options to target subprime car shoppers.
We’ve seen success with:
- Facebook targeting by credit score, age, and income brackets
- Altering AdWords and PPC campaigns to include Tax Season promos
- Including unique messaging in Craigslist ads to appeal to Subprime customers and increase Subprime sales
What has worked / is currently working to maximize tax season for your dealership? Share a few ideas for what’s working in your specific market below!
Enjoy this article? Subscribe to our blog to receive our latest articles, tips for your dealership, and more.