Text message marketing, also known as SMS marketing, has become increasingly popular for businesses in the automotive industry.

The solution came about as a way to reach customers wherever they are, at all times of the day, and with 97% of Americans owning a cell phone, it seemed the perfect way to target customers.

It's been a rising trend across all industries, with over 50% of businesses using it to engage their customers. Given the nature of the auto industry, dealerships have been using texting to communicate with car buyers due to the need to share urgent messages and time-sensitive information.

It's one of the first asynchronous solutions that freed up time for both customers and dealerships - enabling both parties to communicate at their convenience - and like any marketing channel, it has its pros.

For one, it's easy to set up and doesn't require any technical mastery. If used properly, it's reasonably cost-effective. The cost per message with basic functionality is minimal, making it ideal for businesses on a tight budget.

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However, as new tools become available and buyers demand personalized experiences, car dealerships encounter new challenges related to compliance, capabilities, and customer experiences.

Similar to live chat, it's become a ticking time bomb and, if not addressed, can put dealerships in a vulnerable position in an already competitive auto market.

Legal restrictions putting dealership text messaging at risk

A major challenge auto dealers, like many other enterprises, face in text message marketing is legal compliance.

As outreach methods and technologies evolve, so do the laws and regulations that govern them. As a result, they've become increasingly complex and stringent, none more so than the Telephone Consumer Protection Act (TCPA).

What is Car Dealership TCPA?

The act was established in 1991 to protect consumers from unwanted telemarketing calls and text messages and gives the right to those who are infringed upon to take legal action against the sender.

It's no small fine either - starting at $500 and going up to $1,500 for each text message sent - a number that can snowball into millions of dollars if not properly managed.

It complicates the day-to-day oversight and procedures of a dealership's text messaging program. When contacting customers without breaking the law, dealerships must ensure they have a customer's explicit consent before sending them text messages and must be able to prove such permission in case of a claim.

Car dealerships must utilize the proper texting tools and techniques to offer customers a clear path to opt-in and opt-out capabilities and transparent user policies regarding their data and engagement.

For any dealership not complying with the law, there is a high risk of costly penalties that could significantly dent their business's bottom line and reputation - a business-altering consequence.

Limitations of auto dealership messaging

When it comes to auto dealer texting tools, there are considerable limitations that cause frustration for car buyers and sellers alike. With today's technology, customer experience is everything. But car dealerships often cannot create the type of experience that customers expect today.

Restrictions on the type of content in text messages

While dealerships can use it to get in front of the customer at all times, it restricts the type of content that can be sent. Dealerships are limited to text, images, links, and nothing else.

The inability to add other elements, like video, documents, or audio, to text messages can damper their ability to provide a rich customer experience. The lack of personalization and media capabilities can make dealership messages sound robotic, impersonal, and lacking in engagement.

Content Availability

As customer communication occurs, the conversation details are only available on the customer's cell phone. Unfortunately, this means the customer can't access the information on another device, such as a desktop or laptop, making it difficult to track communication at every step of the customer journey.

Also, similar to email, text messages can disappear from the customer's inbox over time. As each text joins the general inbox clutter, it can quickly get lost or forgotten, making it hard for the customer to find it when needed.

Additional channels lead to additional complexity

Then, there’s added complexity to the various communication channels. Adding text to the mix, salespeople will now have to govern yet another form of outreach -  making it hard to keep track of customer interactions. 

Dealers will have to manage multiple tools like phone calls and texts through separate platforms like personal devices, text message platforms, CRM, and email. Such dispersed communication leads to scattered customer information and data silos, making it hard to create a full picture of the entire relationship with the shopper.

Character limitations can ruin the user experience

Another pitfall of text messages is that they're limited to 160 characters. That's less than a tweet!

Therefore, this short-form outreach limits the amount of information a car dealership salesperson can share, or they'll have to pay for the additional messages it takes to deliver.

While this may be a minor issue for one-off messages, it is challenging if you're trying to build an ongoing relationship with customers.

Lastly, customers often view links sent over text as suspicious. They may not know who the sender is and are more likely to ignore the messages instead of clicking on them so that they can remain safe online.

The lack of personalization and content diversity makes it hard for a car dealership to build strong customer relationships and leverage its text messaging programs to drive sales.

Lacking the capabilities of rich messaging

Beyond content type and length restrictions, car dealership text messaging lacks the capabilities of rich messaging, tracking, and analyzing.

Rich messaging, also known as multimedia messaging, allows users to send multimedia content, such as pictures, audio, videos, contacts, and other rich forms of media. As mentioned above, car dealerships are limited to sending text, images, and links, but that's just a fraction of the differences in the type of messaging solutions.

Absence of automation workflows to support the customer

Unlike other forms of marketing, it's difficult to automate the process of sending out messages and tracking responses in text message marketing. Instead, dealerships have to manually send out responses, parse customer responses, and track their interactions across the various tools they use for each segment of their business.

Today's buyers demand information quickly, and the lack of self-serve automated workflows can prevent a customer from getting their questions answered - further damaging the customer experience.

Dealership texting software offers minimal options for self-serve information for car dealerships, making it harder for them to create engaging customer relationships.

With dozens of customers reaching out at a time, this can be a time-consuming and tedious process for dealerships and their reps.

Live data tracking and analytics for decision-making

Asynchronous digital tools also allow the tracking of valuable customer data that text can’t provide. Such as who opened the message, when they opened it, what they clicked, and where they are located.

Data like this can be invaluable when personalizing messages and creating custom campaigns. For example, dealerships can use customer insights to segment customers, target them based on their needs, remind them of appointments or offers, upsell products, and more - all in the form of rich messaging content.

It reveals what customers resonate with, if they're engaged with the dealership's content or not, and in the end, if they can convert into buying customers.

Without this data, dealerships are left in the dark regarding customer relationships and cannot use text messaging to drive meaningful conversations or sales.

The challenge of using multiple text messaging tools

Dealerships tend to use multiple tools for messaging customers for different services.

For example, they may use unique tools for each respective type of engagement - customer service, new promotions, scheduling a dealership visit, customer surveys, etc.

Such a fragmented approach takes away from creating a cohesive customer experience. When using multiple tools, customers will receive messages from different numbers for different services, making it a headache to keep track of all conversations. Having texts dispersed across various numbers and struggling to identify who the sender is can lead to customers feeling overwhelmed or disoriented.

The changing landscape of customer acquisition is extremely focused on customer-centricity and providing an individualized experience, and the lack of continuity in the ongoing customer conversation disrupts that goal.

An added layer of complexity for dealership salespeople

This also becomes a burden for the dealership's salespeople. It requires them to manage, troubleshoot, and keep track of multiple messaging tools - all while trying to ensure compliance with the Telephone Consumer Protection Act (TCPA).

For car dealerships to tap into their text messaging programs, they have to manage multiple messages from a single platform easily. Otherwise, it can become a costly and time-consuming activity.

Why are today's alternative asynchronous tools the answer?

The issue with text messaging isn't the ability for reps and customers to communicate when they want - it's the lack of capabilities it offers car dealerships, delivering an incomplete user experience that can subsequently expose the dealership to unnecessary compliance risks

Today, an array of alternative asynchronous messaging tools offer a wide range of features and capabilities to meet the demands of automotive retail sales and customer management - specific to each niche requiring a personalized customer experience.

Modern asynchronous tools, like QoreAI, offer solutions to provide dealerships with the ability to customize their messages for customers at scale, track valuable insight about customer engagement, and communicate with customers in a unified manner to support better customer relationships.

Text message marketing - indeed a ticking timebomb

As the automotive retail industry evolves, so do customer expectations.

Text message marketing is undoubtedly a viable avenue to reach out to customers. Still, there are challenges and risks involved that can be easily avoided with the use of alternative tools:

• Risk of regulations and TCPA compliance

• Poor user experience from the lack of rich messaging capabilities

• Inability to track customer engagement for business decisions

• Lack of continuity with ongoing customer communications

Auto dealers must find alternative solutions to remain competitive and compliant in today's market, avoiding the risk of losing customers and facing legal action - and now the options are available.

Take your dealership into the modern world of sales and marketing and change the customer conversation today. Give your dealership salespeople and customers the experience they demand and deserve, and contact QoreAI today.