why data analytics for car dealers are important

Data Analytics for Car Dealers

What Is Data Analytics For Car Dealers?

The automotive industry, like many other sectors, is facing new challenges every day. Data analytics for car dealers present solutions and aim to be the change-maker in these trying times.

Data analytics present the perfect opportunity for car dealerships that are ambitious and ready to take advantage of technology, in order to stand out from their competition.

You’ve probably read more than a few times how using data analytics can help you gain a significant advantage over your business competitors. In this blog post, we’ll provide you with information on how data analytics are proving invaluable in the world of automotive sales.

what is the help of data analytics for car dealers

Behavioural Analytics For Customers

Auto dealerships everywhere now have a variety of different communication channels. In addition to dealer websites, we now rely on social media networks for communication, marketing, research, and innovative new sales processes to help improve the overall car purchasing experience.

You can make use of quantitative techniques by deploying the insights that can be obtained from data analytics. This process involves the aggregation of information from both internal and external sources, including dealer management systems (DMS), sales and marketing databases, demographics databases, and so on.

With these results, you’ll find yourself in a better position to understand the potential value of your client segments in the coming months. With the help of these figures, you can work on improving your customers’ overall experience, boosting retention numbers, and targetting new customers while keeping existing clients loyal to your brand.

Marketing Expenditures Management

Once your auto dealership has found its ideal target audience, you can begin to optimise the marketing mix.

The optimisation process will start with data analytics tools, which will collate and analyse your customers’ behaviour and marketing information, to gain more important insights.

These analytics help you evaluate marketing tactics, sales, and macro trends to quantify their value. Eventually, they can be used for scenario-based planning for marketing, performance forecasting, budget allocation, and media optimisation.

Supply Chain Management

Data analytics for dealer management is also useful in the effective management of supply chains, minimising risks and driving growth at the same time.

To ensure a smooth-running supply chain, you need to take into account factors like regulatory environments and variance in production output figures from OEMs (original equipment manufacturers), among others.

If things don’t go as planned, you may find yourself in challenging situations such as dealing with parts shortages and stagnant inventories. Fortunately, with data analytics tools, you will have tons of data at your disposal to help you overcome these problems.

These data will help you adapt to the changes in the market by letting you identify emerging trends early on, like customer preferences for different vehicle models, gearbox types, engine types, and more. Armed with this information, you can stock both your new and used inventories with the right mix of vehicle types to maximise your profits.

how to use data analytics for car dealers

Predictive Analytics

Many people are familiar with what predictive analytics can offer a business. This technology has become sophisticated enough to assist manufacturers in identifying possible vehicle defects, which could very well lead to costly product recalls.

Predictive analytics also let you figure out suitable countermeasures well in advance, thanks to early signal detection.

Another area where predictive analytics shine is in improving your dealership’s relationship with customers. It can predict how they will behave in line with emerging market trends, and do so with high levels of precision.

With today’s open and wide-reaching communication channels, like social media, news about how your auto dealership handles your customers’ concerns can spread like wildfire.

With the power of predictive analytics and diagnostics, you can position this attention in your favour with proper implementation.


Like other systems and processes, data analytics also present hurdles that you need to overcome, such as the unavailability of sales transaction information, your lack of understanding of the strategies used by competitors, and so on.

However, once you’re able to thoroughly understand every aspect of data visualisation for automotive dealerships, the information you can obtain from data analysis will start to work wonders for you.

Let our team of experts at Automated Metrics show you how our products can help you overcome any obstacle that comes your way.

How Auto Dealers Utilise Data Analytics

When a prospective buyer goes shopping for cars, they’ll generally undertake a lot of comparative research among various vehicle brands, models, and, of course, prices. As an auto dealer, you’ll understand that if you perform well in these comparisons, you’ll get more clients, and therefore a better share of the market.

This entails detailed data analytics for automotive dealerships, whether it’s from the Internet or showrooms, to better understand what customers want.

Ultimately, you want to make it a point to maximise every opportunity to be seen as being better than your competitors. It starts with understanding the data you collect and coming up with ways of working with it effectively.

Dealing With Online Data

The first step is data collection. There are a variety of software tools that are now available to help by collecting information from your customer database and website, along with search engines and social media platforms. You can also compare your own customer database with local demographics.

As a car dealer in your community, it’s a good idea to collect as much data about your existing customers as possible. You can also use tools for data visualisation for car dealers to target “lookalikes” and understand certain discrepancies.

At Automated Metrics, we enable you to access live data in a simple, easy to use format. Our sophisticated reporting tools will help you make proactive decisions that will improve daily productivity and efficiency.

Why Are Data Analytics Important?

As a car dealership, data analytics will help you to:

  • Identify the best prospects at the right time
  • Create a community of loyal clients
  • Increase your ROI
  • Promote efficiency
  • Gain an edge in online marketing

If you’re looking to improve your daily sales performance and exceed the monthly targets you set, we’ll be more than happy to help. At Automated Metrics, you can try out our product for 30 days without any contracts or credit cards required. For more information and to see our demo, log on to our website now!

If you have any questions, feel free to contact us on 02890 538252 or via info@www.automatedmetrics.io.


What do most companies use to track KPIs?

In the beginning, businesses usually start tracking KPIs and other metrics using spreadsheet software such as Google Sheets or Excel. But as time goes by, it becomes apparent that gaining live vehicle sales data access from other sources, creating KPIs, and then entering the data makes it far too time-consuming and tedious to do it this way.

That means many people are turning to specialised KPI software such as data visualisation for CDK Autoline as a better alternative.

What are the five key performance indicators?

With data visualisation for car dealers, you can take advantage of these KPIs:

  1.    Revenue Growth – This is one of the most basic indicators of success for any business.
  2.    Income Sources – Analysing all your available revenue streams lets you determine which ones are most profitable and helps you make more informed decisions.
  3.    Revenue Concentration – You should make sure that most of your income doesn’t come from only a few clients.
  4.    Profitability Over Time – Tracking your expenses and income will help you see anything that may be needlessly draining your finances.
  5.    Working Capital – This will allow you to take advantage of big business opportunities that may come your way.

Because these factors are so crucial, many businesses are turning to data analytics for CDK Autoline to maximise their business growth.

How does an automobile company measure the performance of their cost and revenue division?

Companies calculate this KPI by dividing all aftersales profits by the costs they cover, including all fixed and semi-fixed expenses such as rents, salaries, and IT-related expenditures. Dealerships usually aim for above 80% aftersales absorption ratios to survive periods when sales figures are down.

What do car dealerships mean by Internet price?

The Internet departments of car dealerships focus on selling a higher volume of cars rather than focusing on getting maximum profit for each individual deal. Given this, you should expect that the initial price quote from an Internet sales representative will be close to the lowest selling price possible for any given vehicle.

What are the four general ways to increase sales?

There are four typical methods to consider if you’re looking to bring in more money for your business.

  • Increase the number of your customers;
  • Increase your average transaction size;
  • Increase the frequency of your transactions per customer; and
  • Increase the prices of your products.

How do you evaluate sales performance?

To evaluate your sales reps more fairly and effectively, you should use an automotive sales KPI tracker to get better insights into what they can bring to the table. Also, remember to evaluate the process and not just the final results, promote good prospectors, reward training, recognise the value teamwork, and think about the next deal ahead of time.

What is DMS for car dealers?

A dealership management system (DMS), a.k.a. an auto dealership management system, is a bundled management information system. It is specifically designed to be used for car dealerships or large equipment manufacturers, such as General Motors, Ford, Fiat Chrysler, and so on.

What does a dealer management system do?

DMS is a piece of software that equips automotive dealers with an entire suite of powerful tools. It allows you to get real-time insights for your vehicle after-sales KPI report, to automate tasks, and to turn data into profitable growth, all on a single platform made specifically for the auto dealership industry.

Do car dealerships have monthly quotas?

Yes, car dealerships also have monthly quotas that they are required to meet. If they manage to reach or exceed their targets, manufacturers will allocate more vehicles to their dealership. A more extensive inventory will provide their customers with more vehicle options to choose from, resulting in more sales.

Driving Dealer Profitability With Data Analytics

The margins auto dealers can expect to receive are under more pressure than ever before. That’s why the need for useful information to control business performance has never been higher. Standard daily automotive sales performance reports from the DMS fall short of dealers’ needs, which is why the pressure is also on DMS suppliers to help them improve their reporting.

Now, most dealers have already given up and resorted to generating their own DMS reports. Though some establishments may be content with this approach, many still end up falling short of their requirements due to the lack of third-party application data.

With the advent of Big Data tools, progressive dealers have discovered data analytics for automotive dealerships that are effective in maximising costs and helping them work out of the box to deliver improved results.

why data analytics for car dealers are important

Technology On Customer Data

There are times when you may question the quality of consumer data you find in your car retailer’s DMS. Fortunately, there is now an entire range of ways to guarantee their usefulness, thanks to technological advancements. With data visualisation for automotive dealerships, it’s now easier than ever to get a greater insight into what your clients want.

Connectivity and digitalisation are among the biggest driving factors of this change, presenting a host of opportunities and risks for original equipment manufacturers and retailers everywhere.

Five F&I Metrics That Should Matter To Dealers

For your dealership to thrive, you and your Finance and Insurance (F&I) department need to consciously shift towards more customer-focused KPIs and a service-led business that uses data analytics. At present, success is measured on operational efficiencies, how fairly you treat your customers, and whether or not you strive to get the best outcomes for them.

The five main metrics are:

  • Lender efficiency
  • Length of transactions
  • The number of F&I systems being used, which you’ll need to audit
  • The F&I product ratio wherein you consider the number of vehicle sales where no F&I products were bought
  • Lost sales

Benefits Of Integrated Business Planning (IBP) For Automotive Suppliers

Understanding the true cost of the different processes involving automotive components is vital for ensuring the efficiency of every strategy that you’ll apply. That’s difficult – not to say nearly impossible – to achieve without a centralised view of data visualisation for dealer management.

IBP presents the following benefits:

  • Detailed monitoring of quality control and production management.
  • Centralised view of the investment required in production, design, material, labour, and more.
  • Ability to come up with forecasted demand for spare parts, which can help ensure efficient use of resources and stock levels.

Ways Digitalisation Is Transforming Car Brands And Dealers

The following are ways in which digitalisation is transforming the car industry – from the manufacturers to their partners:

  • Fresh Business Models

Automation could well lead to significant reductions in the number of accidents, higher vehicle utilisation, and lower pollution levels.

  • Digital Customer Experience

In order to adapt and keep up with the needs of the customer 4.0 revolution, auto companies see the need to change their business model and move away from product-centric to customer-centric ones.

  • New Automotive Segments

Digital transformation also brings with it the rise of completely new application areas, the most well-known example of which is the autonomous or self-driving car.

  • From Automotive to Mobility

Relating further to the idea of connectivity, automotive firms now need to adjust their models in line with the provision of end-to-end mobility.

Automated Metrics can help you improve your new auto sales KPI performance reports and exceed your monthly targets. Contact us now!