Marion Toyota has promoted Market Based Pricing (MBP) for several years now, but I still often get asked the question: "What does that really mean?" So I thought it would be a good idea to try and answer that question.
If a retailer (of any product or service) is using a Market Based Pricing philosophy then it simply means their pricing comes from a competition -based strategy. On a continuous basis they go out and evaluate the market to see what similar products, that they offer, are selling for at other retail locations. In the automotive business this means comparing the exact make, model, and trim level along with the miles and equipment on the used vehicle. This would have been very difficult to do (if not impossible) in the past but with modern technology all of that has changed.
Marion Toyota uses a very sophisticated software system that goes out to scan the market for each vehicle they have in inventory and then compares the pricing, taking into consideration miles and equipment. We then try to always price our vehicles at, or below, the average asking price for comparable vehicles. Think of it as Marion Toyota shopping the price for the consumer, so they don't have to. This allows our Product Specialist to spend more time with the customer picking out the perfect vehicle and not having to spend valuable time going back and forth on the price.
Most dealerships still price their vehicles without using this data. This means that the cars more than likely have an inflated price. After negotiations the dealer and customer arrive at a fair price but this sometimes takes hours and hours and can be very stressful. We spent a lot of time talking with our customers and they unanimously all wanted to know the best price right up front and that is why Marion Toyota adopted a Market Based Pricing strategy. It makes for a much easier car buying experience. MBP is not a new concept …..but it is quite new to the automotive retail business. Find out more by clicking HERE.
