As someone who is very happy with my simple base-trim pickup, I still get truck envy.
“Chrome rims would be nice...”
“4-wheel drive would be so useful...”
When I'm on the road, I can't help but notice the trucks sitting out in front of dealership after dealership. It got me thinking, "How does a dealership decide which vehicles to put on display?" They can't show their whole inventory, so there has to be a strategy.
Here's what I know:
The car dealership business model is focused on volume. Cars have a relatively low profit margin, so the dealer relies on turning over as many vehicles as possible to keep the sales coming in. Interestingly, things like service calls and oil changes are the reliable source of income for dealers.
Dealers know that there's a good chance that a car buyer will bring the vehicle in for regular service, and even if the dealership only ekes out a thin margin on a new-car sale, there's the possibility of continued cash flow from a service relationship.
Edmunds - Where Does the Car Dealer Make Money?
The End Zone
It seems that most dealerships don’t put nearly their best, most feature-packed vehicles out by the road.
In fact, by-and-large they seem to choose the trims and tiers of car that are closer to the middle. Why? If I had to guess, I'd say the selected cars are those that I can vividly see myself owning tomorrow. The range of features and trims chosen for visibility are the ones that put me in “Why not right now?” mode.
I've decided to call this the “End Zone”. The End Zone is the product appeal sweet spot for your target demographic. If you throw past it, you'll miss the sale entirely.
Let's say I pass by your dealership and see my dream car. I might get pleasant thoughts of winding through an ethereal mountain pass or racing on the Autoban, but I'm not going to pull over and pull out my wallet. In fact, making the actual purchase will probably never cross my mind.
That's throwing past the End Zone.
As a dealer, you want to avoid putting people's brains in "maybe someday" mode. I'll be mixing sports metaphors here, but for product-based and productized service businesses, a couple of home runs can't be the only scoring plays. The game is won when points are accumulated steadily through consistent base-hits.
Maybe this just made you want to buy a new car. I'm going to be avoiding dealerships for a while, just in case somebody lands vehicle in my End Zone.