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It’s Tax Season

Here’s a short primer to help you take advantage of what could be the best time of year for special finance: tax season.

December 2010, F&I and Showroom - Feature

by Rob Hagen and Justina Ly

Except for those individuals who filed for bankruptcy and now have trustees holding their money to pay off debts, the vast majority of special-finance customers will receive tax refunds. To get you revved up for what could be a joyous time of the year, here are eight tips to get you ready to move the metal.

1. Recognize Your Customer’s Situation

Did you know that more than a quarter of all U.S. consumers have a FICO score of 599 or less? Well, that’s what Fair Isaac Corp. reported back in July. That’s why it’s important to take the time to understand your customer’s situation and take on more of a counselor’s role when working with your credit-challenged prospect.

And when you’re creating a marketing plan for tax season, make sure your ads don’t send the wrong message. The last thing you want is for your potential customers to think you’re out to seize their refund check. You’re simply offering a service to help them get into a vehicle with as little of their refund as possible.

2. Be Targeted With Your Direct-Mail Campaign

Remember: It’s quality, not quantity. Rather than running a 20,000-piece mailer, consider reaching out to 10,000 of your customers twice. This will emphasize that your dealership is there to help them find transportation. Taking this tact also may go a long way toward building trust with your potential customer.

3. Mine Your Database

You’ve heard dealership experts say it before, but when it comes to special finance and tax season, mining your database is an essential step. Get in there, dig up your e-mail addresses and create a targeted e-mail campaign. Best of all, these types of campaigns are relatively inexpensive to produce and allow your dealership to reach a large number of customers.

If you don’t have the time or the manpower, consider a third-party marketing company. These companies can contact customers multiple times, if needed, to ensure a good response. Just make sure the company you choose is familiar with your state’s advertising laws and be sure you approve anything sent out on your behalf.

4. Call the Tax Man

Your greatest marketing tool might very well be the local tax service company. So, get on over there and see if they’ll help be part of your marketing efforts. You may even want to sweeten the pot by offering incentives, such as agreeing to pay tax preparers commissions whenever they send one of their customers to the dealership. Once you have them onboard, load them up with dealership fliers and brochures they can hand out on your behalf.

Another effective strategy is to partner with an online tax preparation company and offer your customers an in-dealership refund service. These companies usually make money from the refunds they prepare, which minimizes the cost to you.

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