Implement the 2% Rule in Your Dealership to Win More Sales

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No matter where your dealership operates, two of its most important and obvious goals will be to gain more sales and rake in more money.

While there are numerous ways to go about doing this, in this article, we’ll be telling you about one of the most effective ways. And the fact that it’s also hugely profitable is an added benefit.

What we’re talking about is the 2% rule.

Understanding Your Traffic

The 2% rule is mostly about converting traffic that’s already on your auto dealer website. The visitors on your website, referred to as traffic, can be broken down broadly into organic and paid traffic. Organic traffic consists of those who ventured to your auto dealer website by themselves, and paid traffic consists of those who were directed to your dealership website by re-targeting campaigns, PPC campaigns, social media ads, and so on.

Applying the 2% Rule

The 2% rule says that any additional 2% in conversion of engaged visitors results in more cars being sold than a 20% increase in quality website traffic. For instance, if your auto dealer website has 10,000 visitors monthly, 200 of them (2% of 10,000) become leads for you. If you get 2,000 more unique visitors monthly, making a total of 12,000, you will have only 240 new leads.

However, if the 2% conversion rate rises to 4% for the same 10,000 unique monthly visitors, the number of leads your auto dealer website generates changes from 200 to 400. This difference is massive and your sales team gets the opportunity to close far more deals than they would if the rate was just 2%.

Cost-Effectiveness

We all know that it takes money to drive more visitors to your website, and a good amount of it as well. In order to get an additional 2,000 visitors to your website, it would cost your auto dealership about $6,000, assuming $3 cost-per-click.

On the other hand, increasing the conversion ratio by 2% should only cost around $1,000.

Highly Engaged Visitors

Paid visitors convert at a much lower rate than organic traffic does. There is also the concept of highly engaged visitors, who usually become paying customers and buy their new vehicle within 30 days.

Auto dealerships these days need to use a combination of technology and tactics in order to identify who these people are, and then interact with them to push through deals that have a high likelihood of success.