MANY FACTORS contribute to a dealership’s ability to achieve continual growth year after year, but one of the biggest and most influential components is the size of your herd — your customer list.
In fact, your herd is your most valuable asset, yet it doesn’t appear on any of your financial statements and is rarely talked about in 20 group conversations or meetings with your CPA.
Once you understand the importance of consistently measuring the size and value of your herd, you’re well on your way to creating a blueprint for continual growth rather than depending on the market, weather or economy to control the outcome of your year.
|Your customer list is your most valuable asset, yet it doesn't appear on any of your financial statements and is rarely talked about in your 20 group conversations.|
Building and retaining your customer base — or if we’re continuing with the herd metaphor, putting a fence around them — is easier said than done. The initial roundup is no easy task. Some members of your herd are masters at escaping, unpredictable elements are constantly testing the integrity of your fence, and the bad guys are always trying to steal your cattle.
But what gets measured gets done, and without consistent focus on initial capture, walking the fence looking for openings and firing off rounds at the villains, you’re destined for intermittent success that depends on factors out of your control.
Just as you measure sales, cost of sales, fixed and variable expenses, you must also continually measure the size and value of your customer list. In aggressive marketing-driven organizations, customer data collected is considered “gold.”
Consider this: A colleague at my office tells about his days fresh out of school working for Radio Shack. If he didn’t achieve a 97 percent customer data collection ratio, he didn’t have a job. This is one of the reasons Radio Shack, a multibillion-dollar company founded in 1919, has survived more recessions than Betty White and re-invented itself more times than Jennifer Lopez. Its recent Super Bowl commercial was a great illustration of the retailer’s commitment to marketing and repositioning its brand as new and hip. To have survived this long and grown from one store to more than 4,600 clearly indicates a marketing-driven company, as opposed to a market-driven company.
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