It was 2007, the recession was closing in and Mike Shaw could see that the special phone numbers in his newspaper ads were generating neither calls nor sales.
So he made a tough decision. He canceled the $1.5 million he spent each year on newspaper advertising for his six dealerships, doubled his annual Internet ad spending to $360,000, beefed up the Internet sales departments at all of his stores and made online sales the cornerstone of his marketing strategy.
Those moves, plus cutting staff and adding a used-vehicle inventory management tool, helped Shaw ride out the recession and create efficiencies that are still paying off.
In 2011, new-vehicle sales at the seven dealerships that now make up Mike Shaw Automotive in Denver jumped 45 percent from 2010 to 5,406. Meanwhile, sales of used vehicles climbed 59 percent from 2010 to 6,370.
The sales gains are continuing this year. Shaw says his new- and used-vehicle sales through March rose 30 percent from the first quarter of 2011. Profits for the quarter were up more than 30 percent.
"The reason our new and used sales went up is because we're good, not great" at using the Internet, says Shaw, 65. "We've got a couple of stores that are close to being great. They are delivering 50 percent of their volume on the Internet."
Shaw has been in the retail auto business since 1969. He owns seven dealerships that sell Buick, Chevrolet, GMC, Honda, Kia, Subaru and Toyota vehicles in Colorado, Louisiana and Texas. He sold Saabs until the automaker went out of business last year.
The dealership group ranks No. 121 on the Automotive News list of the top 125 dealership groups in the United States, based on new-vehicle retail unit sales in 2011.
In recognition of his dealership performance and community service, Shaw in February was named the 2012 Time Dealer of Year. The award is sponsored by Time magazine in association with Ally Financial and in cooperation with the National Automobile Dealers Association.