Driving Performance
AutoNation pairs analytics and digital printing to power response and retention
June 2006 By Amy Syracuse
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The number of unique combinations, not to mention the odds of marketing the ones that will resonate with individual consumers, are mind-boggling. But that didn’t stop AutoNation, America’s largest dealer of new and used vehicles, from leveraging analytics and digital print technologies to create a variable content direct marketing program that consistently delivers customized and relevant communications.
As a result of its innovations, AutoNation has doubled response rates and generated a return on investment that is “enormous,” says Scott Zientarski, director of database and direct marketing. And it’s not just the incremental sales the program has generated, he adds. “It’s the fact that we’re holding on to our customers.”
What AutoNation Traded In
After joining AutoNation in 2002, Zientarski realized the company’s direct marketing efforts needed a bit of a tune-up. The company had 17 different vendors working on service marketing for 272 dealerships in 17 states. Their output primarily consisted of service reminder letter packages with very little copy. No segmentations were being applied.
Upon tracking the number of customers who visited AutoNation dealerships for service after receiving these notices, Zientarski found a response rate of 10.43 percent. Meanwhile, in a holdout group of customers who were not being sent mailings, 9.17 percent brought their vehicles to AutoNation for service. This poor incremental performance prompted a fundamental change.
AutoNation decided to consolidate all of its direct marketing under a single agency: Daytona Beach, Fla.-based DME. The two companies then began working to make relevance the foundation of a new service marketing program, which ultimately would help AutoNation sell more vehicles. Zientarski stresses that the link between sales and service is essential to AutoNation’s business. “Keeping that customer in a service relationship … increases the likelihood fourfold that they’ll repurchase from the store,” he says.
The New Model
According to Zientarski, relevance isn’t the only thing that’s important to marketing in the automotive industry. There’s also the question of credibility. To address both of these issues, he worked with DME to create a variable content direct marketing program that would demonstrate knowledge and understanding of customers’ needs. The program was launched in May 2004.
It begins with the gathering of transactional data housed in AutoNation’s dealer management system (DMS), the software used by the individual dealerships to manage their businesses. This data is subjected to analytics that prioritize which customers to communicate to, what to communicate and how to communicate it. Using this information, unique impressions of marketing pieces tailored to customers are generated. These efforts are brought to life through cutting-edge technologies in digital print and on the Web.
Companies Mentioned:
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The Business of Database Marketing
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