Why "race to the bottom" to move inventory when you can use pricing proof points to hold value and increase profits? Using pricing proof points to reinforce the fair value prices of your inventory gives customers confidence that they're getting a fair deal on the vehicle they're buying.Racing to the bottom against the competition or different dealerships within the same group does not lead to success.
Why is fair value pricing effective?
80% of buyers are not looking for the cheapest vehicle. Instead, they’re looking for something that has a fair value with all the features and packages they’re looking for in their next car. Making sure that salespeople are highlighting vehicle packages (and that dealerships are publishing them) creates proof of why vehicles are priced the way they are and builds confidence and trust in the customer.
How does it work?
Fair value pricing takes into account the features, market value, and third-party pricing proof points for a given car. The vehicle a customer is looking at could be more expensive than the one down the street, but that’s because it has three packages, premium equipment, and low miles. If you show that to the customer, they will be more willing to pay list price because of the value that has been shown. If you make the most of your appraisal tools (adding features, packages, and other data), the car will have fair value pricing automatically. If you don't, the vehicle might not be priced accurately.
Time to build customer trust
Ensuring the customer is aware of all of the features will build value and trust, eliminating the need to discount the vehicle. If you want to increase your profitability and gross, building transparency with your customers is fundamental. They all want to know why the vehicle is priced the way it is and feel like they’re getting a fair market price.The MAXDigital platform provides all the information needed to prove that vehicle pricing is fair, leading to trust from customers and prevention from racing to the bottom. Schedule your demo now.