By: Danielle Longenecker, Product Marketing Manager
If you are familiar with The Price Is Right, you’ll know that overbidding can knock a contestant out of the game. Whether they are on contestant row, playing the infamous Plinko, or competing for the Showcase Showdown, players are always looking to get the price right.
On the game show, contestants don’t have much to rely on when suggesting a price. They are blindly guessing based on experience and hoping for the best. On the contrary, automotive dealers, using market-based pricing tools, have a complete toolbox of information.
Market-based pricing tools help dealers visualize the competitive landscape in seconds across their inventory which gives them a strong competitive edge within their market.
So, let’s play a quick game. Consider yourself a contestant. You’re playing a game of Price Is Right to win the business of the car shopper.
“COME ON DOWN… You are the next contestant on Dealer Price Is Right!” You line up on contestant row with three other dealers. One of the lovely Price Is Right models brings out an eager car shopper who is looking to “WIN A NEW CAR” from one of these dealers. Drew Carey describes the year, make, model and trim. And each dealer/contestant ponders on a bid. Here we go! Each dealership makes an offer to the shopper: $48,000… $41,000… $39,500… and now it’s your turn.
Think about the market and take another look at your competitors’ pricing.
You know the average price is around $42,000 and you have two competitors/dealer contestants pretty close to that price range. Good news, one contestant is bidding too high, so they don’t stand a chance. You really want to win the car shopper so you think about making that infamous $1 bid. Not a good idea. Bidding too low can give off the impression that something is wrong with the vehicle. With the real-time, market-based insight you can make a competitive bid and still win the shopper. You finally decide on $42,100.
“The actual retail price this car shopper is looking for is… $42,320.” Congratulations, you win!
Although you didn’t have the lowest price, the shopper felt your offer was justifiable for this vehicle and your price remained below their budget (actual retail price).
…vehicles with a competitive price generate more than double the number of demos and contacts.
This metaphor may seem a bit silly, but the truth is that your potential customers are taking mere seconds to compare you with your competitors, and vehicles with a competitive price generate more than double the number of demos and contacts. If your inventory pricing isn’t in line with the market, you can lose the purchase.
The pricing game is a continuous cycle. The real-time Price Guidance feature available within Dominion Inventory Manager, allows you to gain a true understanding of how to price each vehicle based on the competitive landscape and make those changes quickly to remain in the car shopper’s game.
Price inventory competitively, engage shoppers and drive sales using Dominion’s Price Guidance Tool. Talk to a product specialist today- call 877.421.1040READ MORE >