While the recession is still the major feature of the business landscape, many companies, including car washes, see sales stabilizing or even getting better. The skies may not be sunny yet, but many are ready to leave the basement and start cleaning up the mess. That means spending some money on marketing to get those customers with new jobs or new cars or new hope to spend some money at their car wash.
However, even for those unscathed by the storm there is a sense that consumers have changed. The marketing world (always hungry for a new buzzword) has been calling this the “new normal”. It describes a consumer movement towards permanent frugality due to a deep recession followed by a slow recovery. Basically it means things have changed for the foreseeable future, if not for good, and marketing decisions must reflect that.
That sense of change and uncertainty has caused many to spend most of their time and resources on the newer trends in marketing. Some of this is worthy and some of it is hype. So this article is meant to provide a year-end status of some of those trends including “green”, social media, coupons and the Internet. We’ll also look at some trends to watch for 2011.
“GREEN”
“Green” is the clear winner of the “latest trends we love talking about” contest. If we keep score by magazine covers, blogs, trade show seminars and pandering advertisements, then “green’s” score is astronomically high. Of course this is not an issue limited to our industry. The rise of the green movement was everywhere and it became a top priority message from marketers everywhere. However there are signs that consumers are no longer seeing the same intrinsic value in “green” products.
According to a November 8, 2010 article in Advertising Age entitled, “Has Green Stopped Giving”, research is showing a slowdown in green buying. For example, bottled water, which was a favorite target of environmentalists had seen a 52-week decline in sales until last quarter when it was up 4%. Also, water filtration devices, which saw years of growth, showed a decline in the third quarter.
This certainly doesn’t mean that no one cares about green anymore. However, after years of being inundated with “green” messaging, it seems the consumer is starting to become immune. However, in cases where a company has a deep and transparent commitment to sustainability, the consumers are still motivated to buy. Seventh Generation, a truly “green” manufacturer of cleaning products saw double-digit growth in 2010 after a flat 2009.
The auto industry is another place where “green” messaging has thrived. In 2009, hybrid sales were up 3% in a market down 21%, according to HybridCars.com. But in 2010 hybrid sales are down 10% in a market up 10%.
The Take Away: Most consumers are no longer automatically moved by “green” products and services. The companies that continue to succeed are the ones that make their sustainability efforts crystal clear and a major part of their positioning. For a car wash that means you will have to do more than put up a poster about being green. If you really want to position yourself as a green company, than you will need to invest time and money in educating your customers, supporting local sustainability and making your “green” efforts transparent and easily understood.
SOCIAL MEDIA
Another hot topic for conversation (and blogs and seminars and articles…) is social media. Again, this is coming from the broader retail industry where companies everywhere are trying to leverage this new platform. The power of social media cannot be denied however, for about 90% of car washes it is more hype than useful tool. This is because companies that successfully utilize social media have successfully done about a dozen other things first.
For starters, it is essential that a company first be “social” before leveraging social media. For example, social media mavens like Starbucks and Dell had built consumer idea websites to solicit customer feedback long before they were using social media. In other words, they were already engaging their customers in a social way.
Mountain Dew, another great example of social media, had already been uniting their most loyal customers long before using Facebook and Twitter to do the same thing. So when they did start using the tools they had a built-in audience that was already engaged.
The other problem with the way car washes are currently using social media is that the content is almost exclusively promotional. Retailers that are successfully using social media are sharing relevant, engaging, entertaining and useful content. The promotional stuff is always an afterthought. This makes sense because the power of social media comes from its ability to influence a large number of people in a viral way. Coupons simply don’t get people excited and the research shows the people that are redeeming those coupons are already your customers. So unless they are for upgrades like a detail or for a wash package that the customer usually doesn’t buy, than you are giving incentives to customers that didn’t need them.
The Take Away: Unless you are already social or are deeply committed to engaging your audience in a non-promotional way, your focus and money are better spent elsewhere. If you are the rare car wash that is already being social and identifying and communicating with your most loyal customers than congratulations- you are ready for the seductive power of social media.
COUPONS
The bottom-line is that customers are still clipping coupons. In fact, due to the recession, coupon clipping is up 23%, which represents a 30% increase in value. This is the first increase in 17 years according to data from Valassis Communications, which also owns NCH, one of the largest coupon clearinghouses.
Part of this increase is because marketers have been willing to offer bigger discounts to grab attention in the past 12-months. However, the numbers seem to be cooling off as marketers start to dial back the offers by lowering the incentives and increasing the stipulations for redemption.
Online coupons still only represent about 1% of customers, but redemptions are up to 10% showing that it is a fast growing coupon platform. The question of course is are you providing an incentive to a new customer or improving the frequency, or are you simply rewarding a customer that was coming in anyway.
The Take Away: The key is to use coupons for a purpose. Keep in mind also that retailers that use these deep discounts have higher margins and/or much higher average tickets than a car wash. Coupons have their place, but they shouldn’t be the backbone of your marketing.
YOUR WEBSITE
The fact that so many carwashes have old, under-maintained, or no website at all indicates that the Internet is still a lower priority when it comes to marketing. However, a simple statistic indicates that plenty of consumers are looking for your website.
According to Google, an average of about 700,000 people in the U.S. search the term “car wash” every single month. Another 100,000 search for automotive “detailing”. About another 100,000 search related terms like “hand car washing”, “express car washing”, “auto wash”, etc. That means close to a million people are searching for car wash websites every single month and that is just people using Google. I can’t say how many of those people are in your market, but chances are there are plenty.
Another reason to focus on a website is that people that spend time on a local businesses website are much more likely to actually visit that business and spend more per visit. Your website is a spokesperson for your car wash and is one of the best ways to communicate value outside of the customer actually being onsite.
Your website also becomes the catchall for other marketing tools. All your listings online, including social media, maps and review sites will feature a link to your website. Research shows that even direct mail becomes more effective when it is tied into your website (such as when a direct mail piece requires the user to visit the website for validation or redemption).
The Take Away: A good website is vital to good marketing. It should communicate your personality and style and is worthy of some marketing money.
TRENDS TO WATCH
2011 will certainly have its trends and they will most likely be evolutions of the ones we have talked about.
One big one will be online tools that focus on local business marketing. For example, Groupon.com, is a group buying site that offers subscribers deep discounts if enough people buy the offer. Already dozens of copycats are out there and it seems Groupon will have a hard time holding on to it’s market share as big retailers like Walmart are now coming out with their own versions. However, you can still see value in these “group buying” tools and it is a trend that will definitely be evolving. It is currently fairly expensive, but if it gets new customers in the door it might be worth it.
Another interesting development is geographic based tools like Foresquare and others that let users find discounts where they are. Perhaps the biggest and latest development here is Facebook Deals, which was released in November 2010. Facebook users can “check in” with their location and Facebook serves up promotions for local businesses that have placed ads with Facebook. This is pretty similar to Foursquare and others, but leverages Facebook’s enormous subscriber base. This is really a result of the penetration of smart phones and you can expect to see a lot more tools available in the coming years.
DON’T FORGET THE BASICS
Of course, the basics never change and never go out of style. Regardless of the latest marketing tools you still have to do a good job of cleaning the car, you still need good people and you still need to clearly differentiate yourself from the competition. For most car washers, it is far more important to focus on these three areas than it is to worry about using every new tool out there. You have to be a good marketer to grow, but that will be impossible without first addressing the basics.
