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Why Dealers Should Continue Marketing During Inventory Shortages

Chip shortages caused a decrease in new vehicle inventories. Utilize these sales tips to navigate the supply shortage.

This article was published by automotiveMastermind, a company that helps dealerships generate success in loyalty, service and conquest portfolios through a combination of turnkey predictive analytics, proactive marketing and dedicated consultative services. 

It’s no secret: chip shortages have led to historically low new vehicle inventories. As a result, dealers around the country are facing vastly different challenges and outcomes based somewhat on their brand – but significantly more so on their approach.  

According to NADA’s recent March Market Beat, the SAAR for March 2021 was 17.75 million units, which translates to the second-best March in the history of the industry.

The proactive dealers who have taken a data-driven approach toward truly maximizing their available inventory have been setting the sales world ablaze with their strategy of circumventing supply shortages by marketing what they have available to the right customers at the right time. 

Regardless of their stock or overall sales projections, dealers should not stop marketing during inventory shortages. Rather, dealerships should focus on smart and strategic marketing, even during challenging times. 

Finding An Edge

Early in 2020, demand for light vehicles began to stall along with the rest of the economy, but this trend quickly changed. As noted previously, demand in March 2021 reached the second-highest levels ever, despite a lack of inventory. 

This kind of situation means dealerships are in a unique position to seek higher margins if they can reach and engage prospects before the competition. For dealers facing new vehicle shortages or unable to stock in-demand models, this requires a strategic approach to marketing.  

Pre-Owned Vehicles

If your dealership is really struggling for new inventory, pre-owned may be the way to go. Much like new inventory margins, the average retail selling price of pre-owned vehicles by new car dealerships has increased by 11% compared to 2020, according to NADA’s March Dealership Financial Profile. 

For new car dealers unable to stock new inventory, pre-owned sales represent an incredibly valuable opportunity to promote dealership profitability on your marketing channels. This is especially true with low new vehicle inventories pushing more new vehicle buyers to consider pre-owned replacement options, like certified pre-owned vehicles. 

Incentives and Competitive Pricing

Try marketing your less popular models with incentives on trade-in values for high-demand vehicles. Dealers who are more competitive with their pricing can achieve even greater profitability by flipping customer trades as future pre-owned sales. 

Predictive Marketing

Additionally, leverage insights from your DMS, CRM and sales platform to map and market pre-owned options to new car customers who are most likely to be interested in them. The old “quantity-over-quality” approach meant your team was tasked with dialing every phone number in the system, regardless of specific needs. That marketing model is not only ineffective, but also a waste of your team’s time. 

Leveraging predictive marketing allows you to do more with less to fit your needs, which is exactly what the situation requires. Predictive analytics automatically search through DMS and CRM datasets for inbound and outbound lead generation.

The success of a proactive marketing strategy utilizing predictive analytics hinges almost entirely on high-quality data from customer lists both from sales and service internally, and externally from sources like IHS Markit, CARFAX, TransUnion and OEMs. 


Overall, dealerships employing proactive, data-driven and strategic marketing during inventory shortages have been discovering new levels of success, despite the challenging market.  

For more information on how automotiveMastermind and its flagship Market EyeQ platform helps dealers close more deals by predicting future buyers and consistently marketing to them, reach out to learn more and request a demo.