Car Count Daily
Hey shop owners, welcome to this edition of Car Count Daily. My name’s Ron Ipach, but you can call me Captain Car Count, because that’s all I’ve done over the past 20 years, is help thousands of auto repair shop owners, just like you, to get and then keep all the top-quality customers that their shops can handle.
The other day I was on the phone with a client. Now in case you don’t know I do take on clients, and I talk a lot about marketing because I’m Captain Car Count. I’ve been doing this for a very long time, and I eat, sleep, and breathe marketing. And this particular client was ecstatic over a new marketing campaign that he just did, that brought in 25 new customers to his shop. Well of course my ears peaked up. I love hearing about successful marketing pieces.
So I asked a little be more about it. Turns out, what he did was what I call shotgun marketing. Shotgun marketing is like if you had a shotgun, and you pulled the trigger, pointed it up in the air and pulled the trigger, all the fallout everywhere, somebody’s bound to get hit. Now the opposite of that is laser-focused marketing, or targeted marketing, where you know exactly who you’re marketing to, to a very specific person, like your own clients. If you’re marketing to your own clients you know exactly who they are. You’re not blanketing the area you’re marketing to just that one person.
I have no problem with shotgun marketing when it works because look, we all need new customers in the shop. So this client of mine was thrilled that he spent, on this particular case, I think it was about $2,500, to mail out these 5,000 postcards, I might be off a few pennies here or there or a few dollars here or there. And it brought in 25 people, so I thought, well that’s amazing, 2,500 bucks for 25 people.
It cost a hundred bucks to get a brand new client in the door. But then I asked him a question. Now by the way, the average cost to get a new client in the door, what we found over all these years of doing this, is about $85. So $15 more to make it a hundred dollars to get a new customer in the door, I’m perfectly fine with that. He spent $2,500, he got 25 people in the door. But then I asked him the question; were all 25 of these brand new customers or were they, some of them, your own customers? After looking at it, he found out that 20 of them were his current clientele, and only five of them were brand new customers. And then I thought, oh boy, here we go, just took the wind out of the sails. I thought we found something awesome that I could tell everybody about to get a whole bunch of new customers in the door. Come to find out that this is an extremely expensive marketing to get new people in the door.
See, when I talked about the laser-focused marketing, so if we did a marketing campaign and marketed to your own clientele, let’s say you have a thousand people in your database, and you mail that same postcard that he did, to them. And let’s say they cost 50 cents a piece, okay. So he’d spend $500 marketing to your own people, and it brought it 25 people. Well your costs are actually, if it brought in 20, in this particular case that’s what it did, it brought in 20 of his own clientele. So 20 divided by the 500, it’s scary doing the math on there, but let’s say 20, 25 bucks is what it costs to get the customer in the door if you’re marketing to your own clientele. Because that’s what your marketing is designed to do in that particular case.
With the shotgun marketing he’s trying to attract new people to his shop, so he spent $2,500 mailing 5000 postcards out there, and only got five people to come in the door, of the brand new variety. So in other words, those people cost him $500 a piece to get them in the door. See overall, it was successful, you spent the money and it brought in a lot of people. Okay, I get that. And you can argue with me all day long with that and look, the bottom line is, if he made money, he made money on it. However, he spent entirely too much to get the new people in the door.
Five hundred dollars a piece is extremely expensive to get a new person in the door, when he could have gotten 20 of them. In other words, that’s what the majority of the people in the door, eighty percent of them or so, again doing math live on camera is a bad idea so if I’m wrong, I’m wrong, but about 80% of the people that that marketing brought in could have been attracted in a much cheaper mailing. Using the same mailing marketed to their own people will bring in those same 20 people, because those same 20 people got the same postcard. And if you spent $500 to bring in those 20, now it costs you only a few dollars a piece to get them in the door. New people, $500 a piece. So you’ve got to do the math.
You have to understand, if you’re mailing or marketing, or whatever campaign you’re doing, if it’s designed to attract new customers in the door, that’s how you divide up the number. Whatever you spend by how many new customers come in the door. That’s how you run the math on there. If you’re marketing to your own clientele, bring in how many people and how much money they spend, that’s how you figure out how much it costs to bring them back in the door, okay.
Now I know you want to argue with me, and that’s perfectly fine. I love alternative viewpoints on this. So if you wouldn’t mind, go down below this video post and let me know what you think.
I do get it. I understand that it did bring 25 overall people in the door, but there’s expense to that. There’s a lot of cost to it. Spending $2500 to bring 25 people in the door may not seem like it’s horrible, and of course it all depends on how much money they spent, and that’s the most important thing. But here we’re looking at customer acquisition cost. Customer acquisition cost with this postcard mailer, which is what he was trying to do, was way too expensive. It was five times, over five times as expensive as it needed to be.
So just pay attention to the marketing you’re doing, as to the effectiveness of it.