Best Practices

Pricing – Strategy or “Just a Tactic”?

Pricing Strategy

Our good friend Ed Brooks started a thread over on the DealerRefresh forums asking…

Is your vehicle pricing a real Strategy or nothing more than a Tactic?

This questions has caused a flood of comments and engagement with different opinions. We have many readers of the blog that have yet become a member of the forums. Take this great opportunity and sign up for the DealerRefresh dealer forums today and get started in on the conversation!

Read what Ed posted here and take your comments over to the forum.

Recently I was involved in a discussion on Twitter. I was taken aback at the phrase “pricing is just a tactic”. Twitter is a tough place to have an in-depth discussion, so I wanted to ask the DealerRefresh community for your thoughts.

My belief is that pricing can and should be an integral part of a modern automotive marketing strategy, but it could also be just a tactic. The right price on the right car can certainly drive traffic. By right price I don’t mean the cheapest, but rather a well-researched, competitive price. It becomes much more than just a tactic when a dealer leverages the transparency of the Internet to justify and hold their asking price by showing customers how their car’s pricing fits into the market.

A more “Old School” approach would be to use price to Just get ‘em in. The next steps for an “Old School” dealer would be switching the customer to another car and working hard to drive up the gross. In this case price is just a tactic and one almost guaranteed to perpetuate all the well-worn car dealer stereotypes.

What do you folks think? Should pricing be an important part of your strategy or just a tactic?

Click here to comment on the fourm

Founder of DealerRefresh - 20+ Years of dealership Sales, Management, Training, Marketing and Leadership.
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  • July 20, 2011
I hate the phrase "just get 'em in here" with a fiery passion! In today's world where 90+% of shoppers doing their research online, if you try to switch them, they're out! I'm the Internet Marketing Director and one thing I've learned very quickly is that leads on a car that isn't here or leads on a "bait" vehicle are a waste of my time and the sales staff's time. We price our cars pretty aggressively (strategy) and rely on the value we have offered to sale cars. People are smarter shoppers today. My experience is that all a bait and switch (tactic) is good for is to piss the consumer off and waste your sales staff's time.