J. Theodore Linhart now knows the importance of a name.
Before 1996, Linhart operated several dealerships in the Richmond, Va., area under a variety of names. Advertising campaigns were different. In fact, owner Linhart was the only common bond among his various operations.
But when he was getting ready to move three dealerships into a $4 million-plus center in 1996, Linhart decided to find out if a name change was in order. He hired a research firm to conduct a corporate identity and strategic directions study.
The verdict: Use the name that had been on the Chevrolet dealership that his family has owned since 1955 in Richmond's West End. It had tremendous brand equity.
Linhart's great uncle, multi-dealership owner Charles Johnson, purchased a Chevrolet dealership in 1955 and renamed it Dominion Chevrolet because 'Old Dominion' is a Virginia nickname.
Linhart learned Dominion stood for more than just the state. The research showed that in the auto business in central Virginia, it meant honesty and fairness. 'And in our industry, that is a huge strategic advantage,' he says.
The dealerships Linhart moved in 1996 didn't have the Dominion name. So he set out to develop a Dominion Auto Group corporate logo and gave all of his dealerships the Dominion tag.
The Dominion name is the primary identification used at his two present dealerships.
The Dominion Auto Group has outlets in different parts of the Richmond area. Dominion Southpark is in Colonial Heights, and handles Chevrolet, Buick, Cadillac, Nissan and Kia.
Dominion Carousel Lane is in the West End of Richmond; it handles Chevrolet and the Buick, Pontiac and GMC franchises that Linhart acquired this year. The dealership soon will move - probably by March - to a site farther west and will be renamed Dominion Short Pump, to reflect the name of the area where Linhart is building the $10 million complex.
'When you have that same name with the same logo at all your locations, it constantly reinforces the same message,' says Linhart, president of Linhart Co., which owns the Dominion Auto Group.
Banding the dealerships together under the Dominion name goes to the core of relationship marketing, Linhart says.
'My view is that it is the manufacturer's job to explain to the public the benefits of Chevrolet or whatever make it is,' he says.
'There are 10 Chevrolet dealerships in central Virginia. My job is to explain why Dominion Chevrolet adds value and sets me apart from my competitors.'
The single name, the multiple locations and the community support are some of the ways the dealership adds value.
'A vehicle that you already think is a good buy becomes an even better buy when it is purchased from a branded dealership in which you have confidence, based on location, longevity, image, or whatever,' he says.
That is why, for the first time, he divided the advertising budget among sales and image and promotion for the corporation. About 20 percent of Dominion Auto Group's $1.5 million advertising budget is related strictly to the corporate image. More will be spent this year because of the opening of the new dealership complex in Short Pump.
Some of the group's newspaper or TV ads don't even mention the car brands the dealerships carry. They simply talk about the integrity of the Dominion Auto Group.
It is more than just an advertising program; it is an image makeover for Dominion, Linhart says. Money that had been spent on newspaper and TV advertising in the past has been allocated to community activities, such as helping sponsor a youth soccer league or a New Year's Eve gala to benefit a charity.
His strategy makes sense, says George Hoffer, an economics professor at Virginia Commonwealth University, who specializes in the auto business.
Linhart is trying to differentiate himself in the consumer's mind so he can command a slightly higher premium for essentially the same product, Hoffer says.
'A Chevrolet bought from him is a slightly different product than other Chevrolets,' Hoffer says. 'If you can brand yourself successfully, you can get a premium price for your product.'
QUEST FOR LOYALTY
That type of branding is dangerous for the automaker, Hoffer says, because customers are more loyal to the dealer and less loyal to the manufacturer or model. Consumers think of Dominion as the brand, not Chevrolet, he says.
'As those branded dealers handle multiple makes from multiple manufacturers, they create more dealer loyalty, rather than creating make and manufacturer loyalty,' Hoffer says.
Linhart says it has created more consumer awareness of his operations. If Dominion Southpark is having a sale, for instance, there also is increased traffic at the West End location, even though there is no sale there.
'When we brand Dominion, we don't say that all Dominion locations are going to give you a low price, nor are we saying that all Dominion locations will be clean, though I hope that is true,' Linhart says.
'But the name says who we are: That we are going to deliver a shopping experience for a car that is fair and honest.'