Like many businesses today, auto warranty sales is a competitive calling. You want to offer superior coverage, more coverage options, and better customer service than your competitors. But you also want to provide the best rates. That’s why it matters more than ever how you market your services.
Direct mail is perceived as a more trusted form of marketing, especially when consumers are asked to shell out money for their car. They’re more likely to do business with you based on a printed, direct mail piece than an email advertisement. Here’s how you can use direct mail marketing for your auto warranty sales business.
Auto Warranty Sales: Marketing Your Services
If you’re thinking about using direct mail marketing for auto warranty sales, chances are you already know a lot about auto warranties. You’re just trying to find new, more effective ways to sell your services.
Auto warranties come in many forms. For example, a typical manufacturer’s warranty upon buying a new vehicle is three years or 36,000 miles, whichever comes first. Some luxury car brands will extend that basic warranty to four years or 50,000 miles. This basic, bumper-to-bumper warranty covers just about everything in the car. You’re protected via repair, replacement, or refund as long as you agree to maintain the vehicle with regular oil changes and routine maintenance.
There’s also a powertrain warranty that typically runs for five years or 60,000 miles. This covers the engine, transmission, and drive components—unless, of course, you take up drag racing, set your car on fire, or purposefully drive it into the ocean. The moral of the story: take care of your car.
But what about a specific type of auto warranty that you may offer in your sales arsenal—like the extended auto warranty? Let’s take a look.
Extended Auto Warranties: Who’s Buying?
An extended auto warranty (sometimes known as a vehicle service contract) comes into play when the original manufacturer’s warranty expires. This is where your services become a serious option for consumers who wants to protect themselves against the potentially paralyzing costs associated with major auto repair work.
According to a survey by Pegasystems, Inc., 63% of drivers don’t have an extended warranty for their vehicle despite seeing the value in having one. It’s these drivers who are prime candidates for further convincing. If they see the value, why aren’t they making the purchase?
- 35% say cost is the reason they won’t buy an extended warranty.
- 32% simply don’t think they need one.
- 29% say it wasn’t an available option when they purchased their vehicle.
It’s also reasonably safe to say that most drivers don’t understand what an extended warranty provides. After all, about half of those surveyed only “kind of” understand their manufacturer’s warranty. About 7% have no idea what a basic warranty covers. If you can provide consumers with a simple yet convincing explanation about extended warranties (such as the peace of mind it offers) with a fair price tag attached, you’ll have more success selling them. How do you reach consumers with this information? Direct mail, of course.
How to Use Direct Mail Marketing for Auto Warranty Sales
Direct mail marketing is a proven winner no matter what industry you’re in. Response rates are up 96% (for house lists) and almost 70% (for prospect lists) since 2017. Those numbers are considerably higher than email, paid search, and social media marketing can boast. Plus the ROI is almost 30%, which positions it third behind email and social. With total mail volume decreasing (it’s down 30% since 2006 according to the USPS), this only makes your message stand out all the more.
When you include some eye-catching graphic design work, an effective headline, and a can’t-miss CTA, you’re practically ensuring a successful campaign each time.
Furthermore, direct mail is easy to track and it’s the best method for reaching all age groups—because everyone loves to get mail. Now let’s look at some of the ways direct mail marketing works for auto warranty sales. Use these methods to help achieve your best results.
Personalize Your Direct Mail Campaigns for the Best Results
People are more inclined to open a piece of mail if it’s personalized. Approximately 85% of those surveyed said so. This applies to auto warranty sales, too. When a consumer receives an extended warranty offer with any form of personalization, they’re more likely to not only pay attention to that offer, but also to act upon it. One effective way to multi-personalize your direct mail marketing campaigns is with variable data printing.
Variable Data Printing: Direct Mail Customization
Variable data printing (VDP) allows you to mass customize your direct mail marketing campaigns. So instead of sending the exact same direct mail piece to every contact on your mailing list, you can increase your chances for auto warranty sales success with a bit of personalization. Here are some examples.
- You’re going to write an eye-popping headline, right? Why not add the contact’s name to that headline? People love to see their name in print and it gives them the sense that you’re speaking directly to them.
- If you know what type of vehicle they’re driving (and you should), use a personalized image in your offer. For example, if they’re driving a Glacier Metallic 2015 Jeep Renegade Sport, use that very image to speak to them directly. When you include a graphic of the vehicle they own, you’ve immediately got their attention. Now they’re interested in what you have to say.
- QR codes and personalized URLs (PURLs) allow you to send consumers directly to an offer (landing) page that’s designed specifically for them. On this web page, you can include more personalization. Plus, this type of page allows you to easily track results. We’ll talk more about this later with omnichannel marketing.
Speak Directly to the Consumer’s Individual Needs
You read about offering consumers peace of mind with your marketing messages. Your goal should be to reassure them, in plain language, so they can understand the benefits they’ll receive in purchasing an auto warranty. There are ways you can optimize your direct mail letter to produce these results. For starters, keep it simple. It’s important that your message is clear and concise. Auto warranties are confusing enough without complicating them with a lot of technical jargon and unnecessary information. Furthermore, most people don’t have the time to read a lot of text. Hit them with the details and offer them peace of mind. If they want to rest easy knowing their vehicle is covered as it ages, you’re well on your way to selling an extended warranty.
Warning: Consumers Might Be Skeptical
As you market your auto warranty sales to consumers, be aware that there are certain similar businesses that aren’t as scrupulous. In fact, car warranties are often looked at as scams. That means you’ll have to cross the abyss, so to speak, by ensuring potential customers that your services are legit. An A+ accreditation with the Better Business Bureau will help. So will your affiliation with the Vehicle Protection Association. Use these badges of honor (literally) in your marketing messages and apply any corresponding logos to the footer of your website. Also, be sure to use any positive reviews you have to help market your services.
Use Multichannel Marketing to Reach Every Consumer
We’ve talked about a variety of ways to use direct mail marketing for auto warranty sales. How about using all your available marketing channels—both online and offline—to reach consumers? It’s called multichannel marketing and it combines both digital and print channels, turning them into an effective marketing machine.
For starters, a multichannel approach increases awareness of your business. After all, the more channels you use, the more consumers will see your your message. If you started an extended warranty campaign for car owners via email, social media, digital ads, and direct mail, your message will reach as diverse an audience as possible. It also allows consumers to see your message on their preferred channel. Just remember to keep your brand message consistent throughout all your channels. An easy way to ensure this is to use a brand management software platform.
Just remember that it will take time to learn your prospects’ preferences, but you’ll eventually be able to answer some important questions, like:
- Which of your messages did they respond to the most and why?
- Which marketing channels did they prefer?
- What day of the week or time of day produced the best results?
As you discover your customers’ preferences, your direct mail marketing metrics, like response rates and ROI, will improve. We’ll read more about this in the next section on learning from your results. For the moment, we’ll stick with multichannel marketing, but let’s kick it up a notch.
Omnichannel Marketing: Take Multichannel Marketing to the Next Level
As long as you’re using a variety of marketing channels, why not develop a strategy so they all work together to achieve your marketing goals? Omnichannel marketing accomplishes this. Let’s look at a few examples as they pertain to auto warranty sales.
- Have you ever received a postcard in the mail telling you that your car warranty is about to expire? This is your heads up that you might want to consider an extended warranty while you still have an opportunity. Naturally, if the direct mail piece is convincing enough—and legit—you’ll take action. One method that makes it easy for consumers to respond is to direct them to a personalized URL, or pURL. This makes both your direct mail piece and website work together.
- If your goal is to get consumers to walk into your dealership, shake your hand, and sit down at your desk, you might invite them—via a direct mailer—to discuss their extended warranty options in person. The same would apply to a phone call. Both are examples of omnichannel marketing.
Learn from Your Direct Mail Marketing Results
Results are for more than examining how your direct mail marketing campaigns performed. That’s obviously very helpful, but results also help you determine how you’ll handle future campaigns—if you have access to the right information. When a strategy works once, you’re more inclined to repeat the process again. When you don’t achieve the results you were hoping for, you can analyze why it happened and determine how to fix it next time.
Direct Mail Panorama is the Future of Direct Mail Management
The most effective way of streamlining and managing your high-volume direct mail campaigns is with a software solution called Direct Mail Panorama. This revolutionary direct mail management program offers a “panoramic” view of all your direct mail metrics. You can track and analyze every step of the mailing process. This allows you to improve upon each campaign with shorter cycle times and higher engagement rates. As a result, you’ll reduce your management time and improve your speed to market.
Direct Mail Panorama is loaded with features. An automated proofing system notices any changes, analyzes the templates they belong to, and delivers only the relevant proofs to the authorized user for faster approval and simpler direct mail management. Direct Mail Lookup lets you view each piece of mail to see what was delivered and when. To learn more about how this game-changing software can help your auto warranty sales efforts, check out this detailed Direct Mail Panorama page and/or contact us to talk about it.
Partner with a Trusted, Proven Direct Mail Marketing Provider
When it comes to auto warranty sales, you’re likely dealing with two types of targeted groups:
- Car owners who didn’t buy a vehicle service contract when they bought their vehicle.
- Customers whose existing coverage is about to expire.
One of the best ways to speak directly (pun intended) to their needs is direct mail marketing. To ensure your success, a best practice is to partner with a proven provider. MSP has over 65 years of experience in direct mail marketing. Contact an MSP representative today to see how we can help you achieve your marketing goals.
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