Even with the global economy showing signs of stabilization and even prosperity – customers, businesses, and buyers are still closely monitoring their budgets. For dealerships, this means creatively displaying a price on vehicles and other big-ticket items like mechanical equipment that doesn’t send the prospective buyer heading for the hills.
Sticker shock stops buyers from pursuing their purchase based on a fear of being unable to afford the equipment they need to progress their operations. And who can blame them? Investigating the need for a new piece of tractor trailer equipment, a new fleet of vehicles, or construction equipment and being met with astronomical figures is a sure-fire way to inspire cold feet and thoughts about used equipment that can be secured for less.
Eliminating sticker shock is integral for developing engagement from buyers by making the visible price point easier to commit to. Vehicle and equipment dealerships who are considering private lenders to support their customer sales can benefit from this attractive partnership by helping customers to more easily recognize value.
National Average Transaction Price
The overall purchase price of some vehicles and pieces of heavy, big-ticket equipment is what scares buyers. It’s often too much. A good way for dealerships to combat this initial surprise is to simply display another number that represents the same cost in a more agreeable way.
The Ford Motor Company recently undertook a new marketing campaign design specifically to help eliminate sticker shock in vehicle showrooms. Instead of displaying the manufacturer’s suggested retail price, Ford is displaying the “national average transaction price” in hopes that a nice lower payment inspires positive thinking about achievable weekly prices, and eliminates “pain points” associated with purchasing an expensive vehicle or piece of equipment.
JD Powers & Associates analysts have concluded that the shift in sticker price could indeed “resonate with customers and boost sales.”
Provide Alternate Incentives
There are a number of special incentives that dealerships can provide to help boost sales of particular models or pieces of equipment:
Rebates deliver a pseudo refund of a fixed amount of money for purchasing a popular, or struggling model. Rebates are often used to pay off a considerable chunk of the vehicle’s outstanding balance – another incentive for buyers. Alternatively, this money can be used by the buyer or their company to offset other operational expenses. Rebates can be offered as ‘loyalty’ incentives for making another purchase within a certain brand, or ‘conquest’ incentives – designed to intrigue those considering switching brands.
Displaying low-interest financing with a low annual percentage rate is appealing to buyers concerned with what the purchase will mean for their company monthly. Qualified buyers with good credit scores can be approved for rates as low as 0-1.5% APR.
Simplification of Language
Changing the vocabulary of the dealer’s perceived motives also can help to reduce sticker shock. Rather than trying to sell vehicles and expensive equipment, advertisements, marketing campaigns, and responses to customer questions can be geared at trying to ‘help’ someone to make the right purchase.
Consider this a type of re-positioning. Instead of looking to profit from their purchase, make it known that providing openness and customer satisfaction is a hugely valuable goal of your dealership. Such changes can assist in inspiring trust and transparency through the customer/dealer relationship.