by MAURA KELLER
Effective marketing techniques and streamlined sales processes can “make or break” an automotive recycler’s future.
Just ask Jason Lancaster, president of Spork Marketing, an online marketing agency that helps automotive companies sell parts and accessories.
For years, automotive recyclers have relied upon word of mouth, online and offline local advertising, local searches, various interchanges, and buying leads from used part lead generators. However, with the growth of parts e-commerce, many recyclers have embraced selling parts on eBay and — to a lesser degree – Amazon.
“E-commerce has grown substantially in the last year due to COVID-19, emphasizing the importance of listing and selling used parts online as a core component of any auto recycling business,” Lancaster said. “Additionally, as e-commerce has grown, used part lead generation has increasingly lost steam.”
Parker Mitchell, founder and chief executive officer of Texan Rewards said automotive recyclers have had to keep up with the changes in technology and make sure they are continually getting their message out in the most effective way.
“Technology has made the auto recycling industry less geographically restricted and now many parts can be bought and shipped from further away,” Mitchell said.
“Historically speaking, auto recyclers used more traditional methods of advertising such as billboards, radio, flyers, television commercials and the Yellow Pages. Many of these methods are still effective to this day, but new technologically advanced methods have emerged which auto recyclers have needed to adapt to.”
And as consumers’ methods for researching and purchasing recycled auto parts have evolved, so too has pressure for auto recyclers’ to adopt new marketing strategies.
“If you’re in any business at all – it could be recycling or it could be landscaping – you either change or you watch your business die. Almost no one in business has the luxury of doing things the same old way year in and year out – that’s not a reasonable expectation,” Lancaster said.
“If we’re talking about jumping into selling used parts online – and that is definitely a good idea – the key is to change mindsets.”
As Lancaster explained, for decades, the conventional wisdom has been to obtain inventory as cheaply as possible, keep costs down, and hope that consumers find something they need in an auto recycler’s yard.
“But the Internet has changed the way consumers behave and the way they search for things,” Lancaster said. “Most consumers aren’t willing to just go to their local salvage yard and wander around for a while hoping they find what they need. Rather, most consumers want to search on their phone, find the part, and drive over to the yard to pick it up right now. While that goal isn’t always realistic, that’s what most consumers want.”
That’s why automotive recyclers need to do a great job of listing their inventory to survive. Auto recyclers who embrace pulling parts, cleaning and photographing them, listing them online, and then shipping them to consumers will thrive.
“The key is to know what consumers are looking for, so when a vehicle arrives you know what to pull and list right away. Fortunately, sites like eBay make that data readily available,” Lancaster said.
Strategies That Work
These days, the key marketing strategies that appear to be working the best within the automotive recycling industry include online sales, text messaging, email, social media and new inventory notifications. Auto recyclers should consider integrating each of these strategies into their methodology.
What’s more, Mitchell said that online sales on sites such as eBay are highly effective, especially with proper training on how to employ this strategy. Text messaging is a great way to reach your customers because everyone has a cell phone. And if you send out a text message to all of your customers, then it is likely that mostly everyone will read the message. Email is another method of communicating with your customers.
“Usually, email is not as effective as text messaging, but it is another method you can employ,” Mitchell said. “Social media on sites such as Facebook are good for posting your sales and pictures of new inventory.”
In Mitchell’s opinion, the best strategy to have for a hybrid salvage yard is a text marketing system, as well as a Facebook page that is updated each week, and online sales through eBay. You can post pictures of any new self-service inventory on your Facebook page and self-service weekend sales as well.
In addition, your text marketing program will be building a list of self-service customers and you can send sale messages out to these customers as well. “If you do a lot of deliveries or want to utilize a network of yards in your area to increase sales, then I also recommend taking a look at EZ Suite,” Mitchell said. EZ Suite was built by auto recyclers specifically for auto part delivery and quality control.
Experts agree that auto recyclers should consider these new strategies because they are opportunities to increase sales and reach more people. As Mitchell explained, if auto recyclers do not utilize these new methods of advertising, then rest assured, other auto recyclers already are and the growth of your business will need “a lot of luck” to reach its full potential.
“Another reason to consider these new strategies is because of the analytics they provide,” Mitchell said. “You can directly link these strategies to how many additional customers come in and how many additional people you can help with your product. With more traditional methods, it is not as easy to track how much additional business the advertising resulted in.”
Lancaster pointed out that most successful recyclers “by far” have specialized in either a specific type of part or a specific type of vehicle. There are lots of recyclers who only deal with Corvettes or BMW 3-series or Mustangs, and they do great business nationwide.
“There are lots of recyclers who only deal with side mirrors or wheels who do a great business,” Lancaster said. “Because of their specialty, they can focus on sourcing parts that consumers want, and they can afford to spend money on good inventory as a result.”
A Focused Vision
The COVID pandemic has altered the way many people live their lives, and in turn, how many companies run their businesses. And that’s true for the automotive recycling industry. According to Lancaster, the more that consumers become accustomed to ordering things online and having them delivered or handed to them, the more that they’re going to be unwilling to walk around an auto recycling yard looking for parts.
“The pandemic had an impact on everything,” Mitchell said. “Luckily, transportation is necessary no matter what is going on, so salvage yards were not affected as bad as other types of businesses. The biggest hurdle for salvage yards during the past year has been finding inventory. Since there has been less readily available inventory, then some yards decreased the amount of advertising they were doing and more sales were done online during the pandemic. However, we are coming out of the pandemic now and businesses are opening back up 100 percent in many states.”
Looking ahead, Mitchell does not think the way customers do business with salvage yards will change all that much in the immediate future. Rather, he believes self-service customers enjoy going to the yard with their tools and picking parts off of vehicles.
“The marketing strategies that self-service yard operators have been employing are working and we just need to get them easier access to inventory once again,” Mitchell said. “I can see more self-service yards reaching out to their customer base and asking if they have any vehicles to sell.”
For more expensive full service parts on late model vehicles, Mitchell sees online sales continuing to increase and the technology improving in this area. Being able to text individual customers and send pictures of inventory to them as well as accepting payment through text is a big step towards improving full-service sales.
And while there will always be people who are willing to search and get dirty, Lancaster said the majority of consumers are going to expect parts to be pulled and shipped or delivered to them.
“Consumers are also getting accustomed to seeing all the nitty gritty details of the products they buy or order online,” Lancaster said. “From a marketing standpoint, recyclers who focus on presenting exactly what they have as accurately as possible and making it easy for consumers to buy wherever they are, will meet the needs of these consumers.”
Published in the April 2021 Edition
