Boosting Car Sales with Data-Driven Inventory Decisions

A white sedan moving quickly up a hill. It is blurred.

Knowing your customer is critical if you're going to meet their needs and retain their loyalty. For car dealerships operating in an increasingly competitive market, it's more important than ever to learn what consumers really want. Data-driven inventory decisions are one way to deliver on their demands. Discover what kind of inventory management data automotive dealerships can capitalize from below.

How Inventory Management Data Can Benefit Your Dealership

There are many different types of data you can gather at your car dealership, and with modern tools, gathering, organizing, and analyzing that information is easier than ever.

Some key types of metrics you want to pay attention to include¹:

Sales and pricing metrics: Examples include average transaction price, total sales volume, and gross profit per unit. These data points help you identify trends in your pricing strategy and give you a way of assessing how your sales team is performing, down to an individual level.
Customer relationships metrics: Examples include customer retention rate, customer lifetime value, and customer satisfaction ratings, as indicated by things like Net Promoter Score (NPS) or online review platforms (like Google Reviews). These metrics can help you assess how happy your customers are and where you might be lagging in terms of reputation.
Service metrics (for dealerships with service departments): Examples include service revenue, number of service appointments, and average repair time. Taken together, these metrics tell you how efficient your service department is and allow you to identify bottlenecks impeding efficiency.

Different dealerships may have different needs, according to their business model. For example, if you don't have a service department, there's no need to collect service metrics. However, in general, the more information you can gather, the more comprehensive a picture you'll have of your automotive dealership's health. Plus, with this information, you can optimize your business operations in a few ways.

Tailor Your Inventory to Your Customers' Wants

Leverage auto dealership analytics to cater to customers' needs and wants—and boost your sales. For instance, you can use details about customer preferences and purchasing patterns to guide inventory acquisition and merchandising decisions². This can help reduce the risk of over- or understocking, improving cash flow and optimizing facilities use³.

Target Your Marketing

Inventory management data can also inform your marketing efforts, allowing you to create personalized campaigns that will resonate with your target audience. By combining customer data with automotive market trends and sales statistics, you can identify target segments among your audience and tailor your marketing, improving lead generation and conversion rates².

Forecast Future Demands

Finally, you can use inventory management data for predictive analytics purposes. By looking at historical data, you can forecast future trends—say, convertibles sell big in spring and summer (as a very rudimentary example). Predictive analytics can help you determine exactly when is the best time to launch that convertible promotion³.

Understand the Customer Journey

Ultimately, data analytics helps you understand the customer journey, providing insights that allow you to tailor your sales offering and approach to what the people want. This is especially critical as more consumers move to online car buying, meaning stiffer competition that spans geographies—and more informed consumers than ever before.

Data Inventory Optimization Tools

Collecting inventory management data has gotten a lot easier, thanks to modern technologies. Tools like ACV Max can help with everything from acquisition to appraisal and pricing. The inventory management software allows dealerships to quickly analyze sales records to see what's selling (and what isn't), making it easy to optimize stock.

ACV Max also has an embedded cost-to-market appraisal tool that uses artificial intelligence (AI) technology to identify damage on vehicles, simplifying appraisals and trade-in negotiations. The tool can further combine that data with real-world market data to accurately price vehicles.

Salespersons can access this information at their fingertips, ensuring your team is knowledgeable and able to communicate accurate information to customers. Knowledgeable sales teams are empowered and can negotiate with confidence, keeping up with customers who are increasingly market-savvy thanks to online tools.

Make Auto Dealership Analytics Work for You

While gathering inventory management data was once a tedious task, modern technologies like ACV Max simplify the process. Learn how our automotive inventory management software can help optimize your dealership operations.

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