December 23, 2020
In the final DataBytes video of 2020 is now available, Suds™ President Jason Baumgartner and Vice President of Consumer Strategy Chris Moriarity look at week 50 and how the industry performed in the back half of the year. They also provide strategies for getting last-minute gift card sales and share some of their favorite holiday campaigns.
Jason Baumgartner: Hi and welcome to DataBytes December. I’m Jason Baumgartner, co-founder and president of Suds Creative. And with me as usual, our VP of strategy, Chris Moriarty. Chris, how are you?
Chris Moriarity: Doing well. Holiday’s rapidly approaching. I’m ready.
Jason: Are you?
Chris: No That’s par for the course. This is where hopefully my wife will be wearing the Santa hat and hopefully, she’s gotten some things for our children. If not, I’m sure I’ll hear about it.
Jason: Perfect. All right, well let’s take a look at the agenda. First, we’ll do, as we usually do, a national look and look at some trends, then we’ll go into some states discussion, and then we’re going to have Chris spend a little bit time on how you can increase your gift card sales leading up to the holidays and make that final push towards Christmas using something called attribute priming. And then Chris and I will break down our favorite holiday campaigns and see what we can extrapolate from those to help car wash operators. And as always feel free to send us your questions to Jason@sudscreative.com, or Chris@suchcreative.com, and make sure you use the subject line DataBytes. All right, let’s jump into it. First looking at the national trends. This is a again, a week over week look, average car counts with there’s close to a thousand different locations across the United States. So, it is a nice cross-section. Orange is 2019, and the blue is 2020. Chris, what jumps out at you when you look at this?
Chris: Well, when it comes to data, we love patterns. And obviously, what we’ve been seeing more and more of towards the tail end of the year is these lines really syncing up. So, even though we’re, we’re kind of winding up a little bit south of where we were, keep in mind that this graph then starts again on the left side. So, it is a very, very positive thing to see that tight correlation because it indicates that we should see a nice climb through the spring as we have every other year.
Jason: Absolutely. And you can see the trend, you know, is a little bit steeper decline. We’re going to actually break down what happened in Q4. So, you can see we started out really nice and then the back half of Q4, we just haven’t had those types of weather events that we did last year. And so, that’s the reason for part decline. I’ll move this over here. So, you can see this, the first part of Q4 we’re actually trending better than 2019. And we started dipping after about week 44, week 45. How much of that’s related to weather? Is there anything else? COVID?
Chris: It’s just been a myriad. I mean, if you look at it, we tested this back in the spring if you guys remember, that we wanted to see if there was any correlation between wash volumes and the stock market, the S&P. Where something else that tends to show up on the S&P is significant disruption right around election cycles. So, where we saw certain things kind of tweak or skew would be in line with what other industries see in terms of increased volatility, which is usually driven by our, our good old friend uncertainty. And I think what’s winding up happening now is that now that we’ve gotten on the other side of that, now that people have a clearer expectation in terms of what’s going to be happening with a new presidency, with the vaccine, with people returning to schools, it should be a return to consistency. I’m not going to say normalcy, because I don’t know that we’re ever going back to the way it was fully, but we should see less volatility.
Jason: You know, that’s a great point as we go back to this graph, this obviously is, there was so much uncertainty here between weeks 10 and really 20, how long is this thing gonna last? What’s going to be the lasting impact? Et cetera, et cetera. But as the resurgence has happened with COVID cases and deaths and, you know, across the United States, we haven’t seen that type of volatility which is really, makes you feel pretty good, right?
Chris: Well, and that’s just it, I mean everyone has the same question. What’s this mean to me? What’s this mean to my family, my job, and so on? And once people got a clearer and clearer picture of what it’s like to live in these current conditions, people find a rhythm and they find a pattern and it’s going to take a much more significant sort of disruption, akin to the first one, for us to really see anything that’s directly COVID related in terms of a fall off again.
Jason: Sure. All right, let’s take a look at the States.
Chris: Thanks, you’re up.
Jason: Let’s take a look at some states here. These are some states that are really performing strong compared to 2019. Most of these are, three of the four, in the Southeast. Kentucky, Alabama, Georgia. You’ve got Arizona in there and these are relatively flat. Oops, let me go back. These are relatively flat compared to some states that see really dramatic seasonality patterns, but you look at Kentucky really since week 22, 23 has outperformed 2019. Looking at Arizona. The back half of the year has really performed really strong. We did see a little bit of a dip when Arizona got into the COVID period where they had their little resurgence. Looking at Alabama, it dipped, but look at this Alabama and Georgia, you know close to each other, geographically, sharing some really nice weather over the back half of the year. Anything else that jumps out at you on these Chris?
Chris: Well, actually, it almost poses more questions. There are certain places where we know people are, they’re moving there. We know that the economy is, it’s kind of booming. Places like Boise, Nashville, you know, Denver historically. And so when you look at a lot of these sites, there’s nothing that you would say from a macro level, that kind of really explains why they’re really performing as well as they are. I would almost be curious to look at the operators themselves. I mean, these are a lot of states with some longstanding institutions in them. And I wonder how much of this can be traced back to people just getting better at what they do. because that’s something that doesn’t always present really clearly, but we should be seeing that, in terms of increased capacities, through better technologies. Things like ceramic bringing more people to the table than before. We should almost underlay, you know, features at some point, because features become more and more prominent. How does that affect the overall performance of not just the site, but you know, the region?
Jason: Interesting. What type of effect do you think from a state to state level will the vaccine have? If any.
Chris: I think it’s going to follow the populations. You know, where, as we look at more dense populations it’ll be interesting to see what large employers do now that they’ve gotten used to not having to carry significant overhead as it relates to office space. How many are going to say, “Hey you know what?” “The reality is we work better when we’re together.” “Start coming back in.” That actually would be a very, very good sign for this industry. As we know, some of what I call P1, or the most profitable members, tend to wash to and from work. Whether it’s a traditional commute, or somebody just scooting across town, that’s a big part of this business. So the more people do return to that pattern, while we might not like to be stuck in that same traffic, we benefit from it largely.
Jason: Sure. Well, we saw a few states that were relatively flat in terms of seasonality, Arizona, states in the Southeast. Let’s take it, this is one of the more dramatic ones. Look at those dips and then those peaks, and then those dips. Obviously, we’re in the back half of the year right now. And it’s a slower part, a slower part of the year in the Northwest, West Coast. But just really interesting when you look at this shape compared to, you know, in Alabama that is relatively flat and less volatility.
Chris: It’s true in California, much like Texas it’s hard to even put it under one umbrella. I mean, Northern and Southern California might as well be two different planets, let alone the same state. So, when something happens in one, you know it’s going to affect these numbers, but it really and we’ve done this before where we’ve kind of split the state, and you still see way bigger swings than one would anticipate, as it relates to a kind of a kind or a fair weather state.
Jason: Absolutely. You know, here’s another one that just continues to frustrate me. You know, Colorado took a dip at a time where it usually would have a peak, in that spring and really has struggled to recover. One of the more strict states relative to some of the actions that are taken against COVID and lockdowns and limiting gatherings and things like that. But certainly a time of the year compared to 2019 when you expect some weather events to kind of help level things off a little bit, and it just hasn’t happened in Colorado yet.
Chris: Yeah. And again, I would be really nervous to wave the politics flag, but there’s a, there’s a term called hegemony, which basically explores how we all sort of participate in our own oppression. And that sounds a little bit heavy-handed, but where you see a lot of these self-imposed and heavily enforced and potentially unnecessary regulations, the states that really leaned into them, I mean, I hope they’re helping people, but we know that it’s hard on businesses, versus other states that said, “Hey maybe there’s a middle ground.” Or, “Hey just be safe and do whatever.” You hate to think on behalf of business owners, that they’re being unnecessarily affected. Want to keep everyone safe, but at the same time, like, man, there’s a lot of people’s lives you know, wrapped up in these businesses.
Jason: Sure. All right. Well, let’s talk about, you know, we’ve got a handful of days before Christmas, so what can operators do today? Something that they can train their staff on today to make a final push to sell as possible gift cards? Talk to us a little bit about attribute priming.
Chris: I’m excited about this little section, and those of you who work with Suds and have been through one of our sales trainings know that attribute priming is a tactic that we’ve preached for a long time. And it’s really simple, and the way I want you to think about attribute priming is like nudging. We’re planting little seeds in terms of what we want people to do. Attribute priming itself is a behavioral economics term, and there’s a bunch of studies on it. But the one that’s probably most referenced is one that Jason’s made famous in his talks. It was done at a computer store, where half the group of people coming into this store were stopped. And they said, “Real quick, one question survey, “are you coming in today to buy a computer based on memory?” “Yes or no.” Second group comes in. They said “Are you here today to buy a computer “based on speed?” “Yes or no.” What they found was the people they asked the speed question to bought faster computers. The people they asked the memory question to, bought computers with more memory. So again, just nudging, just nudging. And when you see attribute priming, generally it takes on the form of a question that doesn’t really depend on the answer. Example, as somebody pulls onto a site, we always recommend instead of saying, Hi, you know, welcome to Joe’s wash. Let tell you about the XYZ. Start every conversation with welcome back. We’ll do a whole video about that someday, for a whole lot of reasons. But welcome back. And the next thing, what comes out of my mouth is going to be whatever it is that I’m attribute priming. So, what might this look like? It could be, it could take on a lot of different faces but we’re going to use this specific example for gift cards right now. Because what do we know? That a lot of people are scrambling to check people off their list. Everyone’s living in fear of what? That they’d forgotten about somebody. So, how do we attribute prime for that? Number one, we’ve got to set the table. We’ve got to be ready. So grab a bunch of gift cards, get them preloaded. Don’t give people options, give them one option. People think they want more choice, but they don’t. They want nice and clear options. So, a bunch of $20 gift cards for you to go, would set you up for this. So now as people pull in and we say, “Hey welcome back.” “Bet you’re here to pick up a gift card.” “Seems like everybody today forgot somebody on their list.” “Seems like everybody today forgot somebody on their list.” “I bet you’re here to get a gift card.” And you just say that where all of a sudden all you’re doing, as the attendant, is just telling people something that you’re seeing. People keep coming in and getting gift cards. Apparently everybody forgot someone on their list today. What am I really saying? What seed am I really planting? Because what you’re trying to trigger is that person in the car going, “Wait a minute, did I forget somebody?” “I think I got everybody.” “I don’t actually know.” “I should probably grab something.” “This is good, yeah, this is good.” “This will work.” And you want to start putting them on that motion, rather than, “Hey can I get you a gift card today?” Which is a very transactional, non-relationship oriented act. So, we want to keep it very, very simple. Just, “Hey, welcome back.” “I bet you’re here to get a gift card today.” “It seems like everybody I’ve talked to “forgot about somebody on their list.” That’s it. It’s a nudge. Just sharing a story, where they can sell identify. Now, I was talking to Jason about this, and whereas we go through these sales trainings, anytime we’re disturbing somebody’s communication. And think about our industry. You are potentially having the exact same conversation hundreds of times a day. Change is hard. So, often we’ll use attribute priming as sort of a, to kind of let them, like a proof of concept, almost. Just try this and see if it moves the dial. And we’ll usually have the sites pick anything any a la carte menu, any item, whatever it is. We had a group of sites recently, they actually picked towels. The microfiber towels, the margins on them are great. They don’t sell a ton of them. So, they started attribute priming for towels. “Hey, welcome back.” “You’re probably in here to get a towel.” “Apparently everyone’s going to pick up towels today.” And that’s really it. And they tripled the sale of their microfiber towels within one week.
Chris: Not because it’s magic, because it’s easy. It’s easy to bring up. It doesn’t matter what they say. And it’s frequency. Towels, you’re here to get a towel, get a towel, get a towel. People are going to start picking up towels. So, the reason we want to do this is it’s easy to deploy, easy for the team to adopt. And it works. ‘Cause how many do you have to sell to make this worth it? One.
Jason: So, it could be one question. One question. So you have operators just call up your store manager and say, this is all I want. We’re selling gift cards. Don’t ask them if they want to buy a gift card, ask them if they’re coming in because they needed a gift card. Because it seems like everybody forgot somebody on their list. Really simple.
Chris: That’s it.
Jason: And then just track the changes. See if Chris is right.
Chris: Put it to the test. And this is the whole thing, don’t overcomplicate it. Nobody wants to have a sales conversation, just have a conversation. And just nudge. Easy to implement and successful.
Jason: My wife is really good at this. She says, “Is that what you’re wearing?” That’s that’s her version of attribute priming. So, I get it.
Chris: Oh yeah. It’s, you know. Also we need to listen to those, those ladies when they’re trying to help.
Jason: Absolutely. Yeah. I am anyway… All right, let’s talk about holiday campaigns. What are some of your favorite holiday campaigns? Maybe name a couple that just jumped out at you, over the years.
Chris: So, you know, it’s interesting because like you got your Super Bowl commercials, you got your holiday commercials. You have these things that, you know, as it relates to marketing that are really seasonal, there’s going to be a lot of dollars behind it. But I would easily say that the campaign that comes to mind is actually one that’s been around a long time. And it’s that Hershey’s Kiss commercial, where the Hershey’s Kisses, excuse me, are bells. And they play a little song. And the last one does, the green one or whatever, does the ring at the end. I remember reading about this at some point in time where what it cost them to produce that commercial was almost nothing, at least in their day. And I believe they’ve been running it well over a decade, certainly even longer. And what’s so beautiful about that commercial is its simplicity. It doesn’t require any explanation. It’s absolutely straightforward. It’s lighthearted, it’s memorable, but what’s admirable for a company like Hershey’s who certainly has the resources to try to continually outdo that. They don’t. So much of the holidays is about familiarity. That when things show up it becomes a sign, it’s officially the holidays when you start seeing that stuff, you know.
Jason: Like Starbucks red cups.
Chris: Exactly. And so it’s almost, it’s not official, until the red cups are out. And now, you know, if they fill those red cups, with the other thing that you see ads for this time of year, which is booze. I mean, think about this. You don’t see ads for alcohol any other time of year, until now. And it’s, I mean, I know why, if you’ve met my family you’d know why too, just kidding. Because alcohol is one of the number one gifts that people give when they go over to, whether it’s a party or whatever it might be. And so this is the only time of the year where they really do much spending around it. And I can definitely see why.
Jason: Right. You know, a couple that come to mind for me, just some classics. The Lexus, December to Remember, you know with the big bows, you know you and I were talking about that, you said that they sold out, and couldn’t find the big bows anymore, because everybody was trying to get those.
Chris: Yeah. And it was, it was interesting to where, whatever ad agency, we should actually look up who did that, you know the big bow is so crisp and so elegant in the commercials, but to the point where they couldn’t, they didn’t know that people were going to actually want the bows. And so people were like holding off, they were upset. They didn’t have this bow when they’re trying to buy a Lexus, which is, I’m sure they’ve taken care of that now because when somebody’s there to drop you know, 60, 70 grand on a car, you know if the thing holding them up is the $150 bow, they need to get some bows. But it’s very interesting. I’m back. So, I’m kind of with that though, I think it’s actually a really, really good learning point where what Lexus did or that what that campaign did is it created a picture, created a picture in your mind of what this experience was supposed to look like. And it wasn’t about the car alone. It was about the car, plus the gift, plus the surprise. And it was all of that. So, when you took out any piece it no longer felt the same way. And this is something that we scrutinize all over, in terms of what story are you telling? And it’s not about being Lexus, you guys have heard me say this before. I don’t care if you’re Walmart, I don’t care if you’re Nordstrom’s, they both make billions with a B. But when you paint this picture with your marketing in terms of what this experience is supposed to be like, you gotta make sure it is. And make sure it’s in line with the story and the values that you’re kind of putting forth to that brand to begin with.
Jason: I like that. You know, it’s funny, one of the, one of the campaigns that sticks out to me, I, you know I love music, but that, that Garmin commercial do you remember the Garmin commercial where it’s like they rewrote that. ♪ Da da na na ♪ ♪ Da da na na ♪ ♪ Give-a, give-a, give a Garmin. ♪ Just a catchy little, you know, every time it came on and you’re listening to the words, I really enjoyed that. I don’t even know if Garmin, Garmin is around, right? Because that’s where we get some of our traffic data, but they’re not doing the same thing. They’re not making money the same way as they did before.
Chris: Yeah. They realized that what they had was the guts, the information, the technology, they still make a, I guess a pretty fancy, like $700 smartwatch, I guess that’s supposed to be pretty good. But those auditory triggers that they built into that are, obviously, it’s an entire industry of people who just try to make things sticky. And what’s interesting is I know we do a lot of opulent triggering, within this industry. Meaning that when you pick a certain level of wash you might get additional lights. You might get additional features that are going on in there. But I don’t hear a lot of audio triggers. Which I don’t know how that could potentially be explored, but you got to think, for something to be maximally effected we want to hit as many of the senses as we can. So, we’ve concentrated on the sense, we’ve concentrated on the sights. Like start thinking about the sounds. I mean, there’s no reason. You’re already there. Let’s think about what we can work in.
Chris: I want somebody on their top wash, when somebody selects it, I want a voice to come on with that big, that Ferris Bueller. “Oh yeah.” Just something like that that’s disturbing almost, at least when I do it, but like I would, I would laugh. I would love it. I would buy it just to hear that. “Oh yeah.” Or something along those lines.
Jason: You got car wash operators wheels spinning right now. All right. That’s it for DataBytes December. As always like we mentioned, send us your questions. Here’s our email addresses. Jason@sudscreative and Chris@sudscreative.com. Be sure to include DataBytes in the subject line. From all of us at Suds Creative to all of you, we hope you have happy holidays, and enjoy the rest of the year. And can’t wait for 2021.