Leveraging Data Analytics to Gain Unique Insights
The concept of leveraging data analytics is nothing new. But how many dealerships are effectively using data to manage their business? Effectively is the operative word here. For years, many industries, including automotive, have collected data and ran analytics to uncover insights and trends that would be useful in future decision making. Today, new technologies are making it possible for businesses to collect and process data faster than ever before.
Imagine if you could predict how long a vehicle will sit on the lot, the day it will sell, and for how much. This scenario is not very farfetched. Predictive analytics are giving dealerships unique insights that support proactive decision making.
Dealerships must leverage data analytics if they want to remain competitive in today’s marketplace. Learning how to use data to manage your dealership will naturally lead to streamlined efficiencies that drive a healthy bottom line and exceed customer expectations. In this article, we explore how dealerships are using data analysis to gain unique insights, improve operations and increase profitability.
How are dealership using data analytics?
To better understand their customers.
Dealerships can use gathered data to better understand their customers’ purchase patterns, preferences, and priorities. Understanding customer habits and behaviors will allow dealerships to implement highly personalized marketing plans. Your customers will appreciate the tailored experience, and you may even uncover a new sales or service opportunity!
To better understand their own operations.
Leveraging data to gain new insights will help dealerships identify areas for improvement within their operations. Data analytic solutions can quickly process an enormous amount of data, identifying patterns that would likely have otherwise gone unknown. Understanding the data can help a dealership turn an isolated service visit into a repeat customer. Through predictive analytics, dealerships can anticipate when a customer will be ready to buy and therefore ensure they have stocked inventory. Predictive analytics will also help reduce common inventory struggles such as losses due to aging and obsolete parts.
What to look for when selecting a data analytic platform.
Keeping in mind that no two data analytic systems are alike, you want to find something that is customizable, user-friendly and dynamic. Also, it is essential that this system is designed to integrate with other applications you may be using. A virtual dashboard can provide key decision makers with an overview of the following key metrics:
- Sales trends by product category
- Financial metrics
- Inventory
- Parts/pricing
- Service and operations metrics
- Customer profiles (loyalty and retention indicators)
Before you begin leveraging data analytics, you will want to have a quality control process in place to ensure the data is reliable.
If you would like additional information on leveraging data analytics to improve your dealership’s bottom line, contact us today.
Councilor, Buchanan & Mitchell (CBM) is a professional services firm delivering tax, accounting and business advisory expertise throughout the Mid-Atlantic region from offices in Bethesda, MD and Washington, DC.
