Data privacy and its impact on automotive marketing. It was positioned to be a headlining story of 2022 as dealers evaluated the impact on their advertising strategies. But, between the ongoing vehicle inventory shortages and Google’s announcement that they will delay deprecating 3rd party cookies until 2023, the story has largely faded from view. If your dealership has put data privacy and its impact on automotive on the back burner, it’s time to turn up the heat. Why? The next update from Apple – iOS 15 – will impact your email marketing.

Before we go any further, no need to panic. Email marketing remains one of the most effective ways to influence car shoppers. The evidence suggests Apple’s iOS 15 update will likely impact how you and your vendor partners measure effectiveness. And the first hint of that impact will come quickly.

So, what is it and what should you be thinking about?

iOS 15 will go public for iPhones, iPads, and desktops using OS Monterrey this month. The update includes two features that will impact email marketing and measurement, Mail Privacy Protection and Hide My Email. At a high level, Mail Privacy Protection gives the consumer the opportunity to protect their email and prevent the tracking that tells people like you and me if, when, and where the email was opened. There’s no need to get into the technical weeds, but this update means when a customer or prospect receives an email on their Apple device, and they have opted into Mail Privacy Protection, that email will automatically register as “opened” regardless of the person’s actual activity.

Now you might be asking, is this the reality for everyone using an Apple device, and will it be effective immediately? The short answer to the first question is no. However, when Apple Mail user downloads the new operating system to their device, they will be asked if they want to protect their email. What we learned when Apple introduced App Tracking Transparency with iOS 14 this spring, 96% of Apple users said “Yes! Don’t track me.” So, it is prudent to expect a majority of Apple users to do the same with Mail Privacy Protection.

The second answer is yes, but not fully. We know from experience that the adoption of new operating systems comes in waves. Some cutting-edge techies update as soon as new features are available and others follow suit in waves. Suffice it to say, expect at least 75% of users to be up and opted in on the new updates by the end of 2021.

Which leads us to why this matters. Google Chrome’s plans with 3rd party cookie tracking is front and center because they are the dominating web browser – accounting for 65% of internet activity. Similarly, Apple is the dominant player in email. For dealers using email marketing (which is practically everyone), this update has the potential to impact up to half of the customers and prospects you engage via email.

Again, no need to panic. This update does not render email marketing ineffective. But it should cause you to pause, evaluate and adjust a few things.

Let’s look at a few high-level actions you can take.

1. Look back at Opens: Establish a measurement standard

Because Mail Privacy Protection automatically triggers the “open” pixel, you can expect your open rates to grow. To track how much, take a look at your history. Open rates vary from send to send, but normalize within a given range over time. Start by taking a look back at the first six months of 2021 to set a measurement standard. This gives you a benchmark to see how open rates change month to month. When you see the normalized open rate start to increase, you will have a general idea of how many of your customers are Apple Mail users and inflating your measurement.

2. Look beyond Opens: Expand your portfolio of email metrics

Open rates are a key metric in marketing reports. Yet by itself, the open rate has long been a flimsy performance measurement. Open rates can be an indicator of awareness, but engagement is better measured by clicks and conversions. Open rates are typically higher and look better on a report, and iOS 15 will likely only inflate those numbers. Resist the urge to take credit for the higher open rates that everyone will see as more users download the new operating system.

Instead, pay MORE attention to click thru rates and conversion metrics. In order to understand email campaign effectiveness at a greater level, utilizing UTM tags and Google Analytics are another incredibly effective way to monitor email performance and conversion. At Client Command, we also measure effectiveness through match back reporting and give dealers visibility into the impressions, frequency and clicks that influence a sale. Your vendors are likely already measuring the effectiveness of email marketing with an equal or greater focus on clicks and conversions. It’s important that you make sure you extend this to internal email engagement efforts, such as email cadences from your CRM.

3. Assess your Automation “Triggers”: Disable cadences based on “Opens”

Marketing automation is built on trigger events. If X action happens, Y cadence is deployed. There is a high likelihood that at least one email cadence set up in your CRM are built around whether someone opens or does not open an email. Opens is far from the only trigger, but is common, especially within dealership operations.

Instead, tie triggers to a more reliable action; such as ownership milestones, service activities or important events. To go deeper, build trigger events inside those cadences, based on clicks — to the enclosed offer, digital retailing tool or form. At Client Command, our marketing automation is triggered by online shopping activity and clicks to lead forms.

4. Resist the urge to react: Entertain some level of the “wait and see” approach

Yes, we know enough to take some proactive action like the steps previously mentioned. But even the Email Service Providers (ESPs) who think only about email delivery all day every day, are taking some level of the “wait and see” approach versus an all-encompassing game plan. They are making necessary adjustments now (including but not limited to the ones mentioned prior), preparing to measure the full impact over a period of time and make optimizations and recommendations accordingly. We experienced this earlier this year when Apple released iOS 14 – partners positioned themselves for the change and continue to optimize as we learn more about the nuances of the impact. Adjustments from ESPs could further impact OR improve email marketing measurements. So, if the ESPs are waiting, there is wisdom in following their lead.

Net-net. Email marketing remains a highly effective way to stay in front of car shoppers and a critical component of your omni-channel marketing strategy. As iOS 15 rolls out and users begin to sign on, start adjusting what you can control – how you measure effectiveness and how you trigger your email cadences – and be ready to adjust to residual impacts. The key is working with partners you trust — committed to staying up to speed, working to keep you ahead of the curve and ready to navigate these and future changes with you.

Article originally published here https://clientcommand.com/ios-15-and-dealership-email-marketing/.

(Bloomberg) — AutoNation Inc., the biggest US chain of car dealerships, warned that used-vehicle prices are softening as rising interest rates curb demand from more price-sensitive buyers.

The company said Thursday that third-quarter earnings rose to $6 a share excluding some items. That was below the $6.29 a share average of analysts’ estimates. Revenue increased 4% to $6.67 billion, roughly in line with the average of Wall Street projections.

Mike Manley, who took over as chief executive officer of AutoNation a year ago, said he’s been aggressively turning over his portfolio of used cars to make sure he doesn’t get stuck selling them for less than he paid.

“We’re beginning to see used-car prices mitigate with faster depreciation” among mainstream and budget cars, Manley said in an interview. “We benefit from the mix of our portfolio being premium luxury.”

Shares of the company, which also said its board approved a stock buyback of up to $1 billion, pared an early gain of as much as 6.7% to trade up 3.2% to $105.64 as of 9:57 a.m. in New York.

Separately, Hertz Global Holdings Inc. said Thursday that its depreciation costs jumped in the third quarter, reflecting the decline in prices its used cars fetch at auction. Still, the rental-car company narrowly beat Wall Street’s estimates for profit in the period.

Pent-Up Demand

AutoNation’s CEO said new-vehicle inventory is still tight, despite the chip shortage beginning to ease, and there is strong, pent-up demand for vehicles priced above $30,000.

“It’s easing rather than becoming a glut,” he said.

New-car inventory will remain below pre-pandemic levels next year as automakers try to preserve margins to pay for electrification, Manley said on an earnings call Thursday.

In the used-car market, it’s just a matter of time before weaker prices at car auctions filter through to the retail market, pressuring margins for dealers, he said.

Last month, used-car retailer CarMax Inc. said profit from wholesale vehicles dropped 30% in its second quarter as buyers encountered “affordability challenges” and its bank of used cars depreciated.

The article was originally posted by Bloomberg. https://www.msn.com/en-us/money/other/autonation-s-ceo-warns-of-used-car-price-drop-as-rising-rates-curb-demand/ar-AA13qSuj?cvid=d80090900b4a4c25cd9c52261cc24e40&ocid=winp2sv1plustaskbar

In the post-pandemic climate of inventory shortages and heightened consumer demand, industry analysts predicted automakers would sell as many vehicles as they could build. But now, just as supply chains and inventories are starting to flow again, there are new pressures on the horizon. Inflation, and the interest rate hikes meant to ease it, are leading to higher auto financing costs and cooling demand for new cars, according to Agent Entrepreneur. 

Last month, the average interest rate on a new vehicle purchase hit 5.7%, an increase from about 4% in 2021. “It seems likely that much of the pent-up demand from limited supply will dissipate quickly as high interest rates erode car buyers’ willingness and ability to buy,” said Cox Automotive Senior Economist Charlie Chesbrough. Adding to the equation, the average price for new vehicles reached $45,971 in Q3 2022, up 10% from a year earlier and the highest of any quarter on record, according to J.D. Power.

The irony for dealerships is that just when new vehicles are finally becoming more available, most car buyers can no longer afford them. AutoPayPlus offers dealerships a solution to this challenge. 

AutoPayPlus is an F&I service that uses automated biweekly payments to help car buyers better afford their loan payment, purchase additional products, shorten their trade cycle and return to the dealership with less negative equity. A 10-year analysis has shown that dealerships sell approximately 57% more F&I products on AutoPayPlus deals versus standard retail deals. In addition, results from our company’s top dealer groups reveal a 63% increase in per-vehicle financed income on AutoPayPlus customers.

How does it work? Standard auto loans require one payment every month. Biweekly loan payments divide the monthly amount in half and pay it every two weeks. Because there are 52 weeks in a year, the borrower makes 13 payments over the course of a year (instead of 12) with the extra payment applied to the principal. 

These smaller biweekly payments are scheduled to coincide with when the borrower gets paid to make it easier to plan for and ensure timely repayment. On a monthly basis though, the payment amount is the same. Simply put, this biweekly strategy gives dealerships a solution to present affordable payments in challenging times.

A lot has also been written in recent months about the wisdom of generating more revenue from the service department as a way to improve a dealership’s bottom line and, in turn, create customers who return to the dealership to buy their next vehicle. AutoPayPlus can help here, as well.

The company offers dealerships an industry-first fintech solution for increasing profits from customer-pay service and boosting customer retention. AutoPay+PERKS combines the company’s biweekly loan payment service with the added advantage of a Mastercard debit card at no additional cost to the customer or dealer. 

Once a customer’s AutoPayPlus account has been active for six months and it’s time for their first service, AutoPayPlus sends them a debit Mastercard co-branded with the dealership’s logo and preloaded with $100 that can only be used at the selling dealership’s service department. A dealer boost program allows dealers to load additional funds to the card, further incentivizing their customers’ return to the dealership. It’s a guaranteed way for dealerships to drive new customers to the service department that doesn’t interfere with any other existing retention program such as pre-paid maintenance and, best of all, it’s easy and can be cost-free for dealerships to implement.

As interest rates increase, car buyers are facing significantly higher auto loan payments. And, with no notable inventory improvements forecasted for the fourth quarter combined with waning new-vehicle demand, Cox Automotive is projecting sales in 2022 will be down more than 9% versus 2021 and at the lowest level in a decade. 

Yet, in the face of continued market volatility, supply chain and inventory concerns, and questionable consumer financial strength, opportunity still exists. “The key to a dealership’s success today is to maximize its two primary profit sources,” AutoPayPlus CEO Robert M. Steenbergh explains. “Our programs give agents something to offer their dealerships that no other biweekly program can deliver and a solution to continually build customer loyalty.” 

Originally published on Linkedin by John Stephens, CSO of AutoPayPlus. https://www.linkedin.com/pulse/solution-dealership-success-todays-depressed-economy-john-stephens/