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Digital Dealer Magazine - June 2009
 

Digital Dealer Magazine - June 2009

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Digital Dealer Magazine - June 2009 and be sure to visit and join the #1 Automotive Digital Marketing online exchange for the best strategies, tactics and resources at ...

Digital Dealer Magazine - June 2009 and be sure to visit and join the #1 Automotive Digital Marketing online exchange for the best strategies, tactics and resources at http://www.AutomotiveDigitalMarketing.com/

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    Digital Dealer Magazine - June 2009 Digital Dealer Magazine - June 2009 Document Transcript

    • Welcome to the digital edition of Digital Dealer magazine! Just as you are trying to keep your store(s) on the cutting edge, we are doing the very same thing as we venture into a new frontier in the publishing biz. We can get this digital version in your hands 2-3 weeks faster than the print version, giving you the freshest information possible. You can click on links at the end of each article to email the author of such. And you can click on the ads to link to that advertiser’s website (and you’d REALLY be helping us out by doing just that). It’s quite intuitive…I don’t think that someone who uses the Internet to make a living will have any trouble easily figuring it out. Please let me know what you think about it… mroscoe@Dealer-Communications.com Michael Roscoe Editor-in-Chief
    • June 2009 The Technology Magazine for Dealers & Managers Internet Sales: Highlights from a Round Table Discussion at the 6th Digital Dealer Conference page 12 Internet Sales in a Struggling Market page 15 KARLA Technology Trends How Many People do you Need in your IT Department? page 19 BDC/CRM: Rules for the New GULESERIANInternet Director Market Players Apple Automotive Group page 25 page 22 page 22 CIAL FF I O e e ottiiv o v tom alls om a s Autess on ff Auffessiio n no on o Pro org rg o iattiioales P rnlie.e.o a es nlin n oc i so c Sa l N Assernett S.AAISPo Ast erne wA AISPo n t ww . IO IIn w ww PU B L I C AT
    • T ABLE OF CONTENTS CIAL FF I O vee oti v mo ti ls uto m na ls uto io na off A fess io o A ss on Profe .o tion Pro .org rg ciatiSales o line e ociatt Sale sPonnlin N Ass orne .AAISP s Astern e w AIS In te ww .A IO In w w w PU B L I C AT The Technology Magazine for Dealers & Managers JUNE 2009 FEATURE MANAGING EDITOR LINDA DI PIETRO Digital Dealer Cover Story ldipietro@Dealer-magazine.com 22 Karla Guleserian PUBLISHER Internet Director GREG NOONAN Apple Automotive Group 607-264-3359 gnoonan@Dealer-magazine.com ART DIRECTOR JOE BIRCH COLUMNS jbirch@Dealer-magazine.com AAISP Notes PRODUCTION MANAGER 10 Mike Roscoe ELIZABETH BIRCH PRINT PRODUCTION Internet Sales DAVID MANTHEY 12 Highlights from a Round Table Karla Guleserian DESIGN CONSULTING Discussion at the 6th Digital Dealer Apple Automotive PUBLICATION DESIGN, INC. Conference Group COVER DESIGN Phil Sura JOE BIRCH jbirch@Dealer-magazine.com 14 Get your Dealership Into the Minds of Car Shoppers COVER PHOTOGRAPHY Paige Presley CONTE PHOTOGRAPHY CIRCULATION SUBSCRIPTION 15 Internet Sales in a Struggling Market RICH JARRETT Daryl Sanders 314-432-7511 rjarrett@Dealer-magazine.com 16 The New Four Square NATIONAL ADVERTISING SALES David J. Nelson adsales@Dealer-magazine.com 607-264-3359 18 Winning Online Dealer magazine makes every attempt to ensure the accuracy of all published works. Tom Mohr However it cannot be held responsible for opinions expressed or facts supplied herein. Nothing june be reproduced in whole or in part Technology Trends without written permission from the publisher. 19 How Many People do you Need in your All rights reserved. The publisher encourages you to submit suggestions. Submitted materials IT Department? become the property of Horizon Communications, Inc. and will not be returned. Send material for Sandi Jerome publication to 330 Franklin Rd., Suite 135A, PMB 386, Brentwood, TN 37027. The editor reserves the right to edit material; submission 20 Have You Upgraded your Operating System of material constitutes permission to edit and publish that material. This publication is to Dealer 2.0? designed to provide accurate and authoritative David Greene information in regard to the subject matter covered. It is presented with the understanding that the publisher is not engaged in rendering legal, accounting or other professional service. BDC/CRM If legal advice or other expert assistance is 25 Rules for the New Market Players required, the services of a competent profes- sional person should be sought. From a Chuck Barker Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers. Pre-owned Vehicles 28 Your Dealership’s Biggest ‘Black Hole’ Dale Pollak A PUBLICATION OF DEPARTMENTS 6 Digital Dealer E-mail 8 News DD 4 June 2009 DigitalDealer-magazine.com
    • D IGITAL Dealer E-MAIL Digital Dealer welcomes your letters and after verification will run them signed or Mr. Mooneyham, unsigned. Letters june be edited for space identify opportunities. In both cases with and clarity. Send letters to the two cars being sold, Richard noticed Thanks for writing and requesting the DDmail@DigitalDealer-magazine.com. comments about frustration over the car checklist I mentioned in my article. buying process. He then contacted those I hope it works and is applicable for Phil Sura, friends and took care of their concerns. your business. I use this when I go into a I am the Internet manager at Keene When someone states with an update, “I store to perform what I call a CRM Needs Chrysler Jeep Dodge in Keene, NH. hate car salespeople”, it sends a clear signal Assessment and based on the findings I I’m spearheading the development of to their entire social network that they submit corrective solution recommenda- the Internet department and one of my have a problem that needs to be solved. tions or fixes. Often I am then invited Internet marketing ideas included Richard now has 30 to 40 employees who into the dealership to host a CRM utilizing Facebook – then I read your he is mentoring on these concepts. Multiply Initiative Workshop with all sales profes- article in April’s Digital Dealer maga- his successes by 40. Think of Facebook as sionals and managers to enhance the zine, “Why Do I Need to be on an opportunity to give people a chance to store’s efforts to enhance business and the Facebook?” and thought you might be be noticed. It is one-to-one marketing. teamwork required to build the business able to discuss any basic dos and don'ts The key is being willing to adopt new under a true CRM initiative. This work- that you’ve found for using Facebook concepts like Facebook to adapt to the new shop has a heavy emphasis on behavior and other social networking sites. virtual sales space that exists today. identification of prospects/customers and I look forward to hearing from you! Congratulations on being bold and 21st century telephone skills coupled with Chris Frentzen working outside of the traditional box. high level professional communications Internet Manager Phil Sura techniques. These represent the trifecta for Keene Chrysler Jeep Dodge accomplished CRM initiatives and must Keene, NH Mr. Barker, be in place to manifest growth and frankly CFrentzen@KCPDodge.com I have read your article in the March survive in this marketplace. 2009 Digital Dealer magazine concern- As you go through this checklist keep in Hi Chris, ing objections, “Dealing with Objections mind a dutiful perspective toward objec- Great questions. Congratulations on Properly,” and I think this is a great tivity and honesty in assessing each area. being ahead of the curve by leveraging the article to learn from. I saw where you said Then, when you have completed it you social sites to drive sales and awareness for you have a total store CRM checklist, may consider e-mailing me for some direc- your operation. Many believe that the and I would like to receive one. Here in tion and suggestions to repair the social sites and YouTube helped Obama our BDC I always try to emphasize to lackluster areas you encounter. tremendously. If he is leveraging YouTube our BDRs how important it is to find out Keep in mind the trifecta items and and Facebook, shouldn’t a dealer? exactly what the customer's objection is. their importance. The key is testing concepts with the I really believe once we have the objec- Chuck Barker customers to see what drives results. Here tion we can work on the solution. are some basic steps to get started with Rosie Soto Hello Mr. Skeans, Facebook: Moritz of North Arlington I was looking back at your July 2008 1. As part of your monthly e-mail rosie_soto@moritzmail.com article in Digital Dealer magazine, campaigns, invite your customers to “Profit is Opinion – Cash is Fact” and become raving fans of your dealership by Mr. Barker, was wondering if I could receive some becoming Facebook fans. I was reviewing the March issue of instructions for creating a DOC on my 2. Teach your salespeople to create Digital Dealer and came across your ADP system? Thank you in advance. Facebook pages by keeping the informa- article, “Dealing with Objections Sincerely, tion professional and then ask them to Properly.” We are in the process of Jeff Lister become fans. developing our Internet department, GM 3. The friends of the customers and the BDC, and CRM programs and would Knippelmier Chevrolet employees can then easily join. very much like a copy of the CRM Blanchard, OK Once you get it started, Facebook will checklist you mentioned. soonermagic44@yahoo.com manage itself. Thank you in advance and for all Within 30 days of creating Facebook you folks do over at Digital Dealer! It Hi Jeff, pages, Richard Herod, e-commerce direc- really is a fantastic source of informa- For an example of the “frozen asset” tor of Saturn of St. Paul, personally sold tion for those of us that are somewhat reporting referred to in the article, please two cars and has another prospect, all for new to the business, and I am sure for take look at the spreadsheet available for zero costs. Keep in mind that Facebook the veterans alike. download on the free tools page on my will not sell an additional 20 cars a day Thank you, web site www.jimskeans.com. within a month, but it is an opportunity Chancey Mooneyham Thanks for reading Digital Dealer to expand the reach of your operation and Internet Sales Manager magazine and if you need anything else sell some additional units. Because Linwood Motors just let me know. Facebook allows people to state what is on Paducah, KY and Metropolis, IL Regards, their minds each day, it makes it easy to chanceym@linwoodmotors.com Jim Skeans DD 6 June 2009 DigitalDealer-magazine.com
    • D IGITAL Dealer “OVE.com can help independent auctions maintain their identities, strengthen existing customer relation- ships and garner new business. It’s the only online marketplace where sellers can choose their preferred auction location from which to both buy and sell.” Importing online www.manheim.com Declined services vehicle inventories feature added to easier for O AutoSoft Traffic OVE.com’s partners FirstLook COP CRM OVE.com provides independent Every day, in every dealership, despite auctions with an automated inventory expands consumer service advisors’ best attempts, vehicle import solution that simplifies the process of adding new vehicle listings optimization concept owners decline one or more recom- FirstLook has announced a concept in mended services. Capturing even a few of and reduces time and costs spent making marketing and sales centered on “the these seemingly lost opportunities can inventories available online. power of selling value.” bolster service sales dramatically. Many independent auctions use the FirstLook’s Consumer Optimization Often, however, declined services inventory import feature because it inte- System provides automotive dealers with opportunities simply get lost in the grates seamlessly with in-house the ability to maximize online “page shuffle and not followed up, a costly loss inventory management systems they are views,” drive in-store traffic and convert for any dealership, especially today. already using, including ASI’s auction traffic into sales without giving away poten- New technology, fortunately, makes it management software. Auctions can tial gross profit. This new set of easy for service departments to capture easily import images and display condi- consumer-facing marketing and selling tech- declined services opportunities from tion reports on OVE.com. Those niques focuses on optimizing pricing and repair order information residing in the capabilities make it easy for auctions to advertising and in-store sales. dealer management system (DMS) and add listings frequently and saturate the Consumer optimization, a revolutionary then integrate that data through a marketplace with their vehicles. concept that focuses “the power of selling customer relationship management OVE.com is tightly integrated with value,” is the key to successful pricing, adver- (CRM) system that enforces declined AutoTrader.com too, so dealer tising and selling of pre-owned inventory. services re-contact. customers can move their vehicles over Consumer optimization is broken down into Traffic COP, the new CRM from to OVE.com with a few mouse clicks. three areas: AutoSoft International, now incorpo- “We’ve been using OVE.com and • Consumer optimized pricing helps rates a new Declined Service tool to help have seen great results,” said John Rea, dealers manage the fine line between the service department track and pursue past president of the National Auto over-pricing vehicles and under-pricing, this lost business. Traffic COP pulls Auction Association (NAAA). “This enabling them to get all of their online flagged Declined Services opportunities inventory import solution will only make vehicles “in the game” without giving from the AutoSoft DMS. By printing a transacting business on OVE.com easier. away gross profit. Declined Services report from Traffic It is helping us expand our business, and • Consumer optimized advertising COP, the service manager has a list of it’s a critical part of our remarketing strat- moves dealers beyond generic online ads declined services opportunities at his or egy. I think that’s true for many auctions created with VIN explosions to high her fingertips. Customers then can be re- across the industry.” impact ads that highlight the unique contacted by phone or email with a OVE.com’s inventory import solution benefits and attributes that set a vehicle simple yet carefully crafted message or makes it even easier for independent apart from the competition. FirstLook’s incentive offer to entice their return to auctions to leverage the power and bene- 360º Internet Advertising Accelerator is the dealership to have that declined fits of OVE.com. Auctions can: the first fully integrated solution service completed. • Avoid listing or membership fees. designed to create online ads that are AutoSoft Traffic COP gives service • Set their own fees. consumer optimized. managers complete and deep trans- • “Expand beyond the gates” to facil- • Consumer optimized selling shifts parency into every service opportunity – itate transactions they might not the sales focus from haggling over price customer by customer, service need by normally touch. (Many dealers turn to and payment to focusing on a technique service need, follow up by follow up, independent auctions to list vehicles at called “Value Closing” – a more transpar- day by day – so advisors are held their dealerships.) ent approach to selling that allows dealers accountable for pursing declined serv- • Sell more vehicles for their to harness the power of the Internet to ices opportunities and converting lost customers and expand their reach sell the value of their vehicle and price. business into profits. nationally and even internationally. www.DriveYourNumbers.com www.autosoft-asi.com Glenn O’Leary, director of independ- ent auction relations for OVE.com says, O O DD 8 June 2009 DigitalDealer-magazine.com
    • D IGITAL Dealer AAISP NOTES Mike Roscoe I ’ve got good news and I’ve got great Besides being home to the Digital news. I know where the next Dealer Conferences (and me), did you Digital Dealer Conference & know that Nashville is within 600 miles Exposition is going to be held. This of 70 percent of the population of the fall, November 1-3, the 7th Digital United States? That’s one of the reasons Dealer Conference & Exposition will we're holding the event in Nashville. be held in...Nashville! Also, Nashville has always been well- received and well-thought of by That’s right y’all, The Digital Dealer attendees and prospective attendees. Conference & Exposition is coming Plus we had to get out of the Orlando- back home to its roots, Nashville, fall/Las Vegas-spring rotation, because Tennessee. Don’t know if you recall, Florida can be just a little risky during but the first two events were held in hurricane season. Nashville in the spring of 2006 and spring of 2007. I remember it And honestly, another big reason for well...the cozy Nashville Airport Nashville is that I’m following my own Marriott being too small to put all the connected to our hotel, the Marriott advice re: the economy and the retail exhibitors into one hall; squeezing too Renaissance Downtown, and it's right automobile market: hope for the best, many people into the session rooms; across the street from Legend's Corner, prepare for the worst. We were able to the smelly cab rides downtown to hit Tootsie’s, The Stage and all the rest of get a very flexible agreement with the the honky-tonks. the honky-tonks. hotel and convention center here. I really stuck my neck out in Las Vegas The Digital Dealer Conferences have We’ve got more than enough hotel last April. The hotel room nights guar- grown considerably since then, so this rooms, more than enough room for our antee and the food and beverage time in Nashville we won’t have any of sessions and workshops, and easily minimum had me risking over half a those problems. We are holding the enough room for exhibitors with one- mil. Maybe it was dumb luck, but the sessions and exhibit hall at the third of the entire exhibit hall at the 400-plus registered dealership atten- Nashville Convention Center, which is Nashville Convention Center. dees surprised even me (I know it surprised some past exhibitors who didn’t exhibit). The deal we made here in Nashville cuts the risk considerably 7TH but still will allow us to hold as big of an event as we’ve ever had. It’s just good business. So, now you know when and now you know where. So what are you going to do about it...right now? How about this...go to www.DigitalDealerConference.com and take a look. And don't forget...it's never too early to register for the early- CONFERENCE & EXPOSITION bird discount. November 1-3, 2009 • Nashville, TN Marriott Renaissance Downtown www.DigitalDealerConference.com Michael Roscoe Editor-in-Chief DD 10 June 2009 DigitalDealer-magazine.com
    • D IGITAL Dealer INTERNET SALES Phil Sura Highlights from a Round Table Discussion at the 6th Digital Dealer Conference The transition from showroom selling to virtual selling is not going to stop because veterans are not comfortable with the changes T he latest Digital Dealer confer- next level. Salespeople at this dealership is entering a new phase, which will ence was great for a number of appreciate the Internet and the sales require the support of every employee. reasons. I reconnected with team. The Internet deals are worked by 2. Explain that dealerships of the past friends, the weather was 90 degrees, the sales team and closed by the finance tracked customers coming into four the conference was at a top notch managers. The goal is 200-plus units areas within the dealership (new car hotel, and there was a definite increase sold from the Internet department. sales, used car sales, service and parts). in the number of dealer principals Solution: Create an independent These customers were visible and there attending the conference with key sales team focused on the Internet. This was physical interaction. The dealership managers from their dealerships. The includes a director, dedicated Internet will now simply have another depart- conference kicked off with the oppor- salespeople and dedicated finance ment, which is not immediately visible tunity to network with others in round managers. This operation is well ahead – the virtual customer. table discussions. My table comprised of the curve with 90 Internet sales 3. To stay competitive, dealer of two dealers, seven Internet directors monthly. To jump to 200, the dealer- management must understand that and several sales managers from cities ship will need to embrace a different used cars, like new cars, are a commod- across the country. We focused on a sales process. Other dealerships were ity transaction. The Internet is the concern or problem from each dealer- mentioned that have increased Internet primary reason for this. Ninety-five ship. Each member of the table would sales to the 200 to 300 sales level. In all percent of the Internet market buyers articulate the problem and the group cases, a dedicated sales team was part of are using Google to start the process. would share ideas on how to resolve the equation. It is identical to separating 4. Provide continuing education by that issue. Here are some of the issues the new car department from used. sending the sales managers to the next and ideas that our team came up with: Problem: Sales management is not Digital Dealer conference and require Problem: Salespeople are not supporting the Internet team. They the managers to review articles from supporting the Internet department. believe that the Internet is hurting gross the magazine. Some are negative and they complain averages and they don’t buy into the 5. If all else fails, set an example by about the Internet team. The depart- idea of allowing the Internet director to replacing the worst offender. ment is responsible for appointment have the ability to work their own deals. Problem: Not certain of how to handle setting and then turning the deals over The Internet team keeps detailed price questions on the Internet? This was to the entire sales team. reports to track key metrics while the a concern with a couple of participants. Solution: The problem with this sales management team only tracks the Solution: Value must exceed the cost operation is that every salesperson is basics on the paper logs. The sales of the cars. It is still up to the Internet qualified to work the Internet leads, managers are paid off of the gross salesperson to sell himself/herself, the including the grumblers. The sugges- generated in the Internet office. dealership and the car. If you dwell on tion was to limit the Internet leads to a Solution: The dealer needs to get the price only, you will lose. small number of salespeople who earn involved with this. It became apparent 1. Several operations at the table did a the right to work the Internet deals. that the traditional sales managers were nice job of providing information on Allow the old school guys and the threatened by the success of the Internet three units, including price every time grumblers to work their own deals and team. This is a sad commentary that to the customer making an inquiry. feed the salespeople who are supportive happens in many dealerships. The old Example: a customer is requesting of the Internet activities. Earning the guard philosophy clashes with the information on a base Explorer. The right to qualify to work the Internet changes taking place. The transition response would include the information deals could be base on a combination of from showroom selling to virtual selling and price on the Explorer, a pre-owned individual CSI scores, closing ratios and is not going to stop because veterans are Explorer and an Explorer with a differ- a miscellaneous factor such as not comfortable with the changes. ent package. If you can create choices, support/attitude. Dealers must evolve or die and you will be in a stronger position. Problem: The dealership is doing managers must adapt or leave the indus- 2. It was also suggested that a video of well, selling 80 to 90 units a month try. The dealer needs to take the the units should always be pushed out from the Internet. The director believes following steps: to create a “pattern interrupt.” The though, that they are missing opportu- 1. Lay down the law with sales manage- customer will evaluate the response of nities and should be able to jump to the ment to make it clear that the dealership the three or four dealerships where a DD 12 June 2009 DigitalDealer-magazine.com
    • lead is being sent. The customer expects Solution: This is similar to the first Each salesperson can only effectively to get a text response, possibly with a problem listed. Some of the best tradi- work 80 deals each month. The picture of the unit in question. A video tional salespeople will never adapt to the Internet salespeople love to have a of the car would take the experience to virtual sale. Some of the frustration is a higher ratio but the store’s closing ratio the next level. A video walk-around is a reality that the game has changed and will suffer. The dealerships that had more emotionally engaging experience some of the veterans are threatened. In poor closing ratios and averages greater and it breaks the expected pattern set some cases they don’t like the young kids than 85:1 agreed to hire additional with other dealerships. being hired to set up Internet initiatives salespeople. 3. The consensus was that the because this represents change. The As I travel around the country, I see Internet team should get the customer steps discussed include the following. identical issues and problems. Get on the phone whenever possible to We will call the salesperson Joe. connected with a group of other dealer- discuss the options. If you rely on e- 1. The dealer should talk to Joe. Take ships to talk through the problems that mails, you will not be as effective. The Joe to lunch. Explain that the world has you are facing. One Chevrolet 20 group goal is to get the customer into the deal- changed. Thank Joe for the 10 years of that I visited is inviting their Internet ership. It is also important to note that service. Tell Joe that he is family; he will managers to the next meeting for this some people only feel comfortable with always have a home with the dealership very purpose. a sales process through e-mails. Some but you need and expect Joe’s support. people don’t feel comfortable with the Explain that his behavior is in direct Phil Sura is a VP of the Automotive phone sales process. Respect the wishes conflict with the direction that the deal- Division of UnityWorks Media. of the customers since they are the ones ership is going. Ask Joe, “Can I count who have the ultimate choice –the deal- on you to help me with this?” ership from which they buy. 2. Isolate Joe from the Internet team. If you wish to discuss this article with Problem: The top salesperson of the 3. Let Joe work his customer base. other dealers, or with the author, store is not a believer in the Internet and Problem: Poor closing ratios. The deal- please go to the “Discussion Forums” he works hard at discrediting the ership is getting 330 Internet leads with at www.DigitalDealer-magazine.com Internet department. He has been with three salespeople. The salespeople are and enter the “Internet Sales” forum or the operation for a number of years and responsible for working the entire deal. e-mail him at psura@DigitalDealer- he has a strong customer base. Solution: The ratios are out of line. magazine.com. DigitalDealer-magazine.com June 2009 DD 13
    • D IGITAL Dealer INTERNET SALES Paige Presley Get your Dealership Into the Minds of Car Shoppers How an optimized web site can boost your business W hen it comes to the success of useful to your shoppers, but will also be to have a successful business blog, includ- your dealership in this day accessible to search engines looking for ing having a corporate voice instead of a and age, it’s critical to have a relevant sites. personal one, reaching out to your audi- sound yet adaptive online presence. Also, place keywords in your page title ence versus selling to them and creating While clean design, updated specials and header, and be sure to always have easy-to-read content that isn’t too lengthy. and multiple inventory listings are information-rich content within each Don’t: Let more than one or two weeks certainly vital parts of an effective web site; page of your web site. Search engines will go by without updating your blog. To be it is crucial to pay close attention to how come across the information, index the effective and useful to consumers, a blog shoppers get to your site in the first place. pages and boost your site’s rank. should be updated on a semi-weekly basis Including your URL on every ad, Don’t: Insert so many keywords that with posts about current events and infor- marketing piece and promotional item is, your site looks more like spam than a cred- mation, not promotions or newsletters. of course, the simplest way to promote ible resource for vehicle information. This Do: Get as many links back to your site your site and encourage visitors. But, practice of “keyword stuffing” leads to a from other web sites by submitting your according to the most recent Automotive lower ranking for your site and dilutes the URL to relevant and niche directories. Internet Shopper Study by J.D. Power strength of your SEO campaign. You can also get involved with social and Associates, 86 percent of auto shop- Rand Fishkin, the CEO at networking communities like Facebook pers are going online to search for their SEOmoz.org, a popular site that educates or LinkedIn that link your profile to your next vehicle. With so many people people on the ins and outs of SEO, dealership site. looking to dealer web sites for informa- debunks the myth that the denser the Don’t: Get involved with link farms and tion, you need to consider how and where keywords, the more popular your site will other spam-like ways of link building. your web site appears in lists of relevant be. Fishkin notes that having multiple Search engines will see that your web site search results. appearances of certain keywords is not was linked from a low quality site, and If you’re following online basic best nearly as valuable as having just one good they will lower the value of your page rank. practices, then you already have the infor- link from a credible source. As the online community becomes mation that car shoppers want in your Do: Provide a sitemap that search more competitive with each passing day, vehicle research tools such as the ability to engines can easily index. It should contain it’s imperative that you optimize your site configure a vehicle, compare several vehi- essential information for search engines to ensure it appears in relevant search cles, view relevant rebates and incentives, such as when a page was last updated and results. A good web site provider should and access trade valuation information. what pages you believe are most impor- know all of these best practices, and Having your dealer web site appear as tant to shoppers. more, as they stay on top of industry one of the top links in Google or Yahoo! Don’t: Organize your site in such a way trends and incorporate them into the will help shoppers find this valuable infor- that it takes more than three clicks to get structure of your web site. mation on your site versus someone else’s, to any one page. If a page is too many all while building shoppers’ confidence in clicks into a web site, search engines will Paige Presley is the marketing your ability to provide them with the best ignore it. analyst/writer for Dealerskins in Nashville, car buying experience possible. Also, according to the J.D. Power Study TN. She enjoys mixing her passions for all Search engine optimization (SEO) is previously referenced, you lose nearly a things technology and for following con- understandably a hot topic in the web quarter of your online shoppers per click. sumer trends by staying involved in market community right now, and everyone is By keeping each page accessible from the research for the auto industry. trying to find the magic answer when it home page, you’ll retain customers while comes to getting their site at the top of enhancing your page rankings. the search engine lists. Do: Start a blog about trends in the If you wish to discuss this article with SEO is really not as complicated as auto industry, the most popular vehicles other dealers, or with the author, people make it out to be. Here’s a list of on the market and/or how your dealer- please go to the “Discussion Forums” things that you should and shouldn’t be ship is serving the community. By having at www.DigitalDealer-magazine.com doing now that will improve your results. this content on your site you will be and enter the “Internet Sales” forum or Do: Focus on your site’s content to adding more relevant keywords, which e-mail her at ppresley@DigitalDealer- improve traffic by including keyword- will enhance your site’s search ranking. magazine.com. rich information that will not only be SEOmoz.org offers excellent tips on how DD 14 June 2009 DigitalDealer-magazine.com
    • D IGITAL Dealer INTERNET SALES Daryl Sanders Internet Sales in a Struggling Market W ith the slowdown in store traffic, talked to! In most store processes, these attitude in the very face of a negative and it’s time for auto dealerships across potential buyers are sitting in the CRM tool. fearful environment. the nation to think and act differ- Do I need to say anything else? It is time to All voice mails should end on a positive ently than ever before. As a result of decreased rectify the process to make an all out effort note. Be sure to say, “This is a great time to sales, many stores have nearly shut off their ad to reach every lead in some way or other. buy a car!” All conversations need to be budgets, other than short-term event efforts. Perhaps the floor staff could come in (as uplifting, helpful, encouraging, and bring Why? During these days of uncertainty, opposed to sitting there with nothing to do) promise to work out everything during the potential customers aren’t responding even to and join an all out effort to make sure we are upcoming in store appointment. We exist to the best advertising efforts. making every effort to work every lead and help consumers find solutions to their car- However, in spite of this economic cultivate them toward a sale. buying needs. slump, there are opportunities that are In addition, for the leads we have already My new-car Internet staff is selling coming into our store that we are not maxi- talked to, more than half of them are still more used cars than ever. My philosophy mizing efforts to convert. After all my years sitting in the CRM tool because the neces- is to make it happen no matter what it in the car business I propose that most stores sary follow-up process has not yet ended in takes. Be prepared to offer alternatives. My are missing prospective customers every day. an appointment. And I mean sitting there Internet staff is trained to serve and go the So, as a seller, how do you find the hidden for months with no further follow-up extra mile by making additional calls to buyers and what do you do with them? action. Therefore, I’ve altered my manage- make it happen. First let us consider the Internet lead. ment process to ensure that my Internet staff Therefore, I advise all dealers and Every prospect has made a special effort to reconnects with every contact they have managers to take a constructive look at their get to us. They’ve researched online to find talked to, weekly. New behaviors require Internet departments. They should realize a suitable automobile web site. They’ve process modification and certainly now is that there is more opportunity than one can taken the time to narrow down their quest the time to modify. imagine. Let’s inspire existing staff to work for the right vehicle. These people have So what about used-car phone ups from those leads. Talk to everybody. Keep calling probably scanned through several choices the likes of Autotrader and Cars.com? My until you get them in the store. This is not before making a final selection. Before training method has closed 10 to 15 percent the time to cut third-party leads. In fact, I’d receiving the necessary information, on the of these leads. But every time I scan the advise every dealership to buy more leads vehicle of their choice, they have supplied phone lists I still see another 15 to 20 rather than spend money on other unpro- you with their name, e-mail, phone, percent that, for whatever reason, weren’t ductive advertising. address, and a make and model for consid- talked to. My suggestion is to forward the The Internet delivers opportunities, eration. My past auto business experience after-hours calls to someone’s after-hours cell which sooner or later equals revenue. What tells me to value this prospect. We have to phone, or at the least, the first thing in the more can a dealer ask for in this market? do whatever it takes to connect with them morning, have someone else call back these to work toward the sale. phone numbers to see what can be done. Daryl Sanders is the owner of Internet Dealer The challenge is that the behavior pattern What do we do about the hesitant people Solutions, Ltd. He has installed his evolving of Internet prospects has slowed down, and we talk to from these used car lead sales system in over 100 dealerships. He has a now it is maybe five to six months versus the providers? The challenge is to get their e- business degree in marketing from Ohio State 60-day buy cycle we have been experiencing mail address for future follow up. Most University. As an offensive tackle at OSU, he over the last five years. So how do we better likely these calls get shuffled as a bad lead was an NFL number one draft pick in 1963 manage these leads? This is where Internet rather than take the time to gather more for the Detroit Lions. sales expertise pays off. Right now everyone information from them and dig out a possi- needs to alter his or her Internet sales ble sale. process. This is why I advocate database No doubt the Internet has revealed the management of all leads. We need to be pent up demand in the marketplace. But If you wish to discuss this article with going back six months and rework all leads depending on your specific market, other dealers, or with the author, that are unsold. people are struggling with the question, please go to the “Discussion Forums” In all my experience in dealership sales “When is the right time to buy?” If their at www.DigitalDealer-magazine.com consultant work, I know that every Internet job status is shaky, obviously that is a and enter the “Internet Sales” forum or sales department has untapped leads dating serious issue. However, consider that if 10 e-mail him at dsanders@Digital back six months. In fact, nearly one third to percent plus is unemployed that means 90 Dealer-magazine.com. at least one half of all leads have never been percent are employed. Maintain a positive DigitalDealer-magazine.com June 2009 DD 15
    • D IGITALJ. Dealer INTERNET SALES David Nelson The New Four Square Look beyond the numbers – sell value to retain more gross A seasoned car salesperson escorts a Book, Edmunds True Market Value and factors, which focus on personal customer into the sales office at others. As a result, the negotiation mission, can lead to a huge disconnect his dealership. Sitting across the advantage has been turned in favor of between how dealers sell and how desk from his customer, the salesperson the consumer. consumers buy. The haggling that says, "So how can I earn your business ensues can erode dealer profits and today?" The consumer contemplates – Consumers and dealers collide prevent deals from being closed. will I be treated fairly and given a good While most dealers sell based on the What dealers need is a new approach price? Will this salesperson try to take four money-related leverage points of to selling – one that takes advantage of advantage of me? The salesperson pro- the four square method, most the consumer’s knowledge and sells on ceeds with the negotiation, based on the consumers buy based on what they value, rather than selling solely on four-square leverage points: trade-in value, or what we like to refer to as the price. At the Digital Dealer Conference value, purchase price, down payment M.A.R.K factors: in Las Vegas (just days prior to writing and monthly payment. While the con- this article), I presented this “New Four sumer struggles to understand a good 1. Mission: Does the vehicle fit my mis- Square.” deal from a bad one, the dealer “works sion? the numbers” and ultimately gains the • e.g. Safe, fuel-efficient, family car that The new four square upper hand in order to settle on a deal seats five (including three car seats) and In order to meet the needs of the that works in his favor. has a cargo area instead of a trunk to fit empowered consumer, it’s time for While this is how a negotiation my dog dealers to adopt the new four square scenario may have played out in the method, which centers on the M.A.R.K. past, history has led many consumers 2. Affordable: Is this vehicle affordable factors, or the emotional and functional to feel jaded about the car buying given my financial means? needs of the consumer. The new four process, often feeling like the negotia- • Payment range is the primary factor. square shifts the process from a tion process is set up to confuse them confrontational negotiation based solely into buying a car at an unfair price. 3. Risk: How much risk on reliability on price to a more win-win negotiation Participating in a four square negotia- am I taking? based on consumer values. The key lies tion often resulted in the buyer feeling • One-owner, still under warranty, serv- in shifting the sales focus from haggling “worked” by the end of the process. ice history, low mileage, J.D. Power over price and payment to focusing on However, while the dealer has tradi- Quality Ratings, projected total cost of the principles of consumer optimized tionally had most of the leverage in the ownership selling, (see Pat Ryan’s May Digital negotiation, in today's Internet age, Dealer article “Stop Haggling…Start negotiation leverage has now shifted to 4. Key differentiators: What are the “Value Closing”), and a technique called the consumer — particularly in today’s key differentiators of this vehicle versus “Value Closing.” In this more transpar- down market. my alternatives? ent approach to selling, the dealer’s job Dealers are now contending with • Leads consumers to make purchasing is to highlight the value of each car and super-empowered consumers, who have decision based on price to value equa- leverage the information that consumers spent an average of 6.5 hours research- tion have been using in order to meet their ing online before ever setting foot in the needs and values: dealership. In fact, unlike the days of Let’s face it, in the Internet age, traveling from shop to shop down dealer dealers need to recognize that the four 1. Vehicle highlights: Focus on the row, today the average consumer only square method is no longer the high value equipment that most closely visits 1.5 dealerships before purchasing. primary consideration when negotiat- fulfills the customer’s mission. Super-empowered consumers are typi- ing a sale. Of course, price, payment, Differentiate your vehicle from similar cally armed with very specific trade-in and down payment are still vehicles on the market. information about the car they want to critical components to the deal – but purchase. They know the availability they should not be the starting point. 2. Quality and risk profile: and price of similar vehicles in your Starting with the dealer’s “four Highlight the vehicle attributes that market and have a sense of “fair price” squares,” which focus on money levers, based on guidebooks such as Kelley Blue rather than the consumer’s M.A.R.K continued next page DD 16 June 2009 DigitalDealer-magazine.com
    • LIMIT ED TIM P E COMB RICING ON INED Next y PACKAG ear th e ES! will be pr $395 e ice ach! have the potential to reduce risk and • Empower your sales team Super reinforce vehicle quality. In today’s Internet-empowered 3. Certified pre-owned: Highlight Controller II world, the “old four square” should no vehicle certifications, which provide a longer be the centerpiece of the negoti- general sense of quality (better ation. Rather, it should be used after inspected, reconditioned, etc.). It is crit- ically important to emphasize some of the powerful benefits of certified the four pillars of the “new four square” have been sold to the customer. In the end, dealers who adopt the new four Guide programs that currently have low consumer awareness such as “seven-year, square will earn the trust of Expenses 100,000 mile extended warranty” and consumers—and will be rewarded with not only the sale, but with buyers more and Employees “24-hour roadside assistance.” willing to pay a fair price for value. As a result they will create satisfied • Learn Sandi’s “Item Expense” 4. The value of your pricing: Sell the customers while also increasing poten- value of the price you are offering as it tial for strong gross profits. method of tackling expenses! compares to the trusted sources that • Job descriptions for every your customer has likely already David Nelson is senior vice president and position in the dealership! reviewed such as Kelley Blue Book, general manager for FirstLook’s Elite Edmunds TMV and JD Power • Receive all forms and Operations Division. FirstLook by Information Network, as well as the INCISENT Technologies is the leader in spreadsheets needed! vehicle’s own pricing history (i.e. origi- automotive retail performance solutions • Use your DMS system to detail nal sticker price, your original list price, and was ranked as the #4 Fastest Growing expenses! average selling price, etc.). Software Company in the United States in Inc Magazine’s 2008 Inc500, as well as • Learn to budget and create By aligning dealer’s goals with the #1 Fastest Growing Company in the pay plans! consumer’s goals, the new four square automotive sector. • And much more. puts dealers in a better position to persuade the consumer based on how they define value. The result: a win-win If you wish to discuss this article with negotiation process that allows you to: other dealers, or with the author, • Draw a parallel between what your please go to the “Discussion Forums” customer has learned and what they at www.DigitalDealer-magazine.com need and enter the “Internet Sales” forum or e-mail him at dnelson@DigitalDealer- Order online at • Determine what evidence you have to www.sandijerome.com support them magazine.com. DigitalDealer-magazine.com June 2009 DD 17
    • D IGITAL Dealer INTERNET SALES Tom Mohr Winning Online H ere is a stark but simple fact: the the customer doesn’t buy, will see at least for Internet Lead Marketing Study, May marketplace offers fewer active a two percentage point increase in close 2008, shows that offering upfront price buyers than are needed to sus- rate on average. Get these two critical correlates directly to significantly tain the current dealer community. A steps right and you’ve made the leap into increased customer loyalty. Darwinian fight for survival is under- the winner’s circle. Why? Because so few Some dealers realize that hiding the price way; an alarming percentage of dealers dealers can pull it off. According to J.D. is self-defeating. As one participant in the will go out of business in the next 12 Power’s October 2008 Internet Mystery April 2008 Polk Automotive Intelligence months. Those that emerge will do so Shop Results, the average response time Summit said, “…if I don’t give price infor- because they possess key traits that pro- on Internet leads is over 12 hours. Thirty- mation to the customer, I’m automatically vide a persistent competitive edge. two percent of leads don’t get answered at viewed as the highest price guy in town.” A How can a dealer leap into this evolu- all. And if there is a response, 55 percent relevant and transparent response is impor- tionary winner’s circle? of the time the customer receives just one tant in order to build customer confidence The answer to this life-and-death ques- single e-mail, even though 32 percent of and trust. That means the response should tion is hidden behind another: where do customers buy 90 days or more after include the price. dealers have the greatest opportunity to submitting a lead, according to the 2007 But how can a dealer do it? No matter impact a buyer’s choice of dealership? Cobalt/Polk eBusiness Study. the size of Internet department, the This is key. If you know the moment of Here’s the opportunity: customers want reality of car-selling at ground zero (the truth—the moment when the customer a quick, information-rich response. The dealership) is a steady hail storm of is most open to a dealer’s courting July 2008 Capgemini Cars Online Study distractions that take away salespeople rituals—you gain a distinct advantage showed that faster response times had a from the incoming lead. Whether it be a over competitors. By closely observing direct correlation to higher conversion test drive, a customer in the finance the steps a consumer goes through to buy rates. Citing one example, “Capgemini department, the weekly sales meeting, a car, the point of maximum influence found that when the automaker responded breaks, lunch or a day off, many conflict- becomes clear. to a customer web inquiry within 20 ing priorities pull salespeople from the Two incontrovertible facts guide us. minutes, conversion rates were doubled.” task of executing a quick response to the First, over 80 percent of car-buying A rapid, relevant response increases sales. customer. The result? A third of leads go customers use the Internet to gain an Speed is key, but it’s not the only impor- unanswered. The remainder receives a information advantage as they prepare to tant factor. Evolutionary advantage is also response more than a full business day interview dealers who seek their favor. tied to the content of the dealer’s message. after arrival of the customer’s request. Second, an increasing percentage of We’ve just reviewed the huge disconnect Then there’s the question of the response customers extend their remote engage- between reality and customer expectations itself. Is there a price? That’s what the ment further by sending their first for responsiveness. J.D. Power indicates customer wants. Even if the dealer is willing expression of interest (a lead) over the that consumers are even more critical of to provide a price, and the salesperson can get Internet, to multiple dealerships. the completeness of the response. the quote out, too often the quote is compro- The moment of truth, of course, is the Customers want the dealer’s price, and mised by human error—math, spelling point where the consumer has sent a lead dealers who hide it hurt their prospects for errors, etc., or it lacks punch: no new and to three to five competing dealerships. The a sale. According to Forrester Research’s used car alternatives shown, for instance. dealer who leaps in front of the pack and “Auto Site Dealers Must Rethink Price These errors and omissions, large and small, first initiates the courting ritual, then is Info” article in June 2006, “…consumers weaken the impact of the response. gently persistent with insightful words and who understand car prices are happier Under the Internet department struc- offers over time, leaves his competitors with their vehicles and their dealers. They ture, the problem with immediate clamoring in the dust. feel significantly better about their car- response is distractions that pull salespeo- Rapid response and effective follow-up buying experience and are more likely to ple away from their computers. Under a are the one-two punch that knocks out purchase from the same dealer again.” BDC structure, the problems are cost, the other guys. Experience shows that AlixPartners, 2007 Consumer Brands quality of personnel and management dealers who can deliver an immediate Index study found “…auto buyers are no oversight challenges. response with a price quote every time longer willing to settle for anything less Here’s the simple fact. To make the when a customer submits a lead, and than totally honest and consistent most of the moment of truth – to make personalized follow-up every time when pricing.” Polk’s Consumer Expectations continued on P-DD21 DD 18 June 2009 DigitalDealer-magazine.com
    • D IGITAL Dealer TECHNOLOGY TRENDS Sandi Jerome How Many People do you Need in your IT department? I “Why not get more recently did a study and deter- reports to you regarding the security of mined that you need one IT your system. What virus and firewall person per every 72.5 users. I’ll value from your are they using and how up-to-date is it? What methods are they using to explain this ratio later in the article, but for many dealers, the thought of IT department comply with Red Flag and Safeguards? This should be provided at least cutting your IT department might scare you. Instead, why not get more rather than trying monthly as a “state of the system” report for you. To get back to my ratio value from your IT department rather than trying to use my ratio to make to use my ratio of one IT person per 72.5 users, that was for one particular dealership group staff reductions? Every dealership IT department or system administration to make and as you know, no two are alike. Each dealership has different DMS systems should be doing three things and not doing three things to get the most staff reductions?” that provide different levels of support and each dealership has different tech- value for your technology dollars. The first item that your IT depart- —Sandi Jerome nology that might include support or ment or system administrator should not. Sometimes I analyze a dealership not be doing is to support the DMS that has all their PCs under third-party system. Your DMS system comes with can work more efficiently if your support and others have it supported by monthly support for each of the appli- employees use e-mail or electronic the IT department. The key to getting cations and much of the hardware. If support software. It is vital that you the most value from your IT depart- your employees prefer to use your have either this software or some kind ment is to analyze their electronic friendly IT person instead of the of support log because without it you support log (or get them to start cumbersome DMS support depart- can’t determine what your IT staff or keeping one) and determine if they are ment, then you need to stop paying person does all day. doing the right type of support that support to the DMS company. Since What about the three things your IT makes money and protects your dealer- that can’t happen (you signed a contract department should be doing? First, they ship. Send me an e-mail if you’d like a the requires you to pay support), you should find ways to use your database free job description for an IT director need to have your employees use the to sell or service more vehicles. This or information on analyzing your IT DMS support as long as the issue is not includes keeping the database clean and department costs. keeping a customer waiting. Next, your updated and constantly creating IT department should not repair print- marketing reports for your key Sandi Jerome is a former controller, ers or PCs down to the component managers. They should also be keeping CFO, system administrator, F&I, assis- level. This hardware has gotten so the DMS database synchronized with tant GM, and fixed operations manager cheap that you can save money by your web site inventory, CRM with over 20 years experience in the auto- keeping backups of equipment instead customer database and service motive industry. She is the owner of Sandi of having your IT department tear merchandising and scheduling tools. Jerome Computer Consulting. apart computers and printers, trying to How can you effectively use these tools find out what is wrong. When you if nobody is making sure all the data is replace a perfectly good PC with a correct? Next they should be providing newer model, wipe it and reinstall regular training on all your technology Windows. Now you have a nice free for the users. Each month, new If you wish to discuss this article with and fast backup PC to give to another employees start work and the most other dealers, or with the author, employee. The third thing your IT staff common contribution to that person’s please go to the “Discussion Forums” should not do is to answer the phones. success by the IT department is giving at www.DigitalDealer-magazine.com When they are busy working on one them a password. Instead they should and enter the “Technology” forum or problem, the interruption of the next go over all the technology you own and e-mail her at sjerome@DigitalDealer- phone call slows them down. Your IT make sure the person knows how to use magazine.com. department or system administrator it. Last, they need to provide regular DigitalDealer-magazine.com June 2009 DD 19
    • D IGITALGreene TECHNOLOGY TRENDS David Dealer Have You Upgraded your Operating System to Dealer 2.0? I f your dealership is marketing and Unfortunately, this often leads us back With an upgrade to Dealer 2.0 we selling to a Web 2.0 world but still to price, framed within the ancient ques- wisely realize that prospects might using a Dealer 1.0 operating system – tion, “If I could... (insert whatever visit our web site and several others it might be time to consider an upgrade. prospect has just asked about or requested before leaving and coming back to An operating system is the program that here) ...would you (insert anything to the send us an e-mail request for more once installed on your computer, man- effect of buy a car today here)?” information. Although our goal is still ages every other program on the In Dealer 2.0 we have developed a to sell a car today, building a selling computer. If you think about it, your customer communication strategy that system around that objective in a dealership has an operating system as growing market of research intensive, well. You might not have noticed if you choice conscious and Internet were working with an outdated system empowered super shoppers is not real in the past, but the challenges of the cur- effective. Why? Because the prospect rent market have made it clear which “The best news is that is trying to make a decision that is dealers have made the upgrade to Dealer best for them. 2.0 and which haven’t. it doesn’t cost much If our communication with them is Based on our work with dealerships really telling them that we are trying to that are fighting to maintain and grow to upgrade your get them to make a decision that is best market share in a brutally competitive for us and not them – we usually lose retail environment, there has been a operating system – the sale whether it is today, tomorrow shift in focus from simple cost cutting or next month. to significantly improving the efficiency only the ability to In an upgraded selling system we and effectiveness of the retail operating have learned to expertly facilitate the system. They can literally do more with embrace change, see prospect’s shopping experience and sell less. The upgrade formula is pretty them on the fact that we are easy to do simple. Fewer resources (opportunities new opportunities,…” business with, we genuinely want to to do business) x increased efficiencies help them make a good decision and —David Greene we can make it faster, better and easier (improved selling system) equals competitive advantage and greater to get the vehicle they want. market share. The best news is that it doesn’t cost enables our sales and service team to • Dealer 1.0 has very limited much to upgrade your operating deliver a unique selling proposition at memory. We assume this is directly system – only the ability to embrace every customer touch point in the deal- related to the programming change, see new opportunities, and be ership. The manufacturer of your vehicle mentioned earlier, which holds that if the driving force that combines sales franchise markets the benefits of owning there is no opportunity to do business enabling technologies with people your vehicle brand – the dealership today it follows that there is no oppor- and potential. markets the benefits of doing business tunity to do business tomorrow, much with the dealership. In the information less two months from now. As a result, Here are five key application age we don’t so much sell the prospect after an unsold up leaves the dealer- upgrades you’ll see in a Dealer the vehicle as we sell the prospect the ship or our e-mails are not responded 2.0 operating system: experience of making a good decision to, the prospect gets mentally deleted • In Dealer 1.0 we relied heavily on about where to get the vehicle. and we look for the next up or expensive display advertising, the inbound e-mail lead. primary strategy behind which was to • In Dealer 1.0 “be-backs don’t come have a lower price in a larger type font back” and the sole purpose of our exis- Luckily in Dealer 2.0 we have devel- than our competition. That way, when tence as salespeople is to convince a oped a long memory and the concept our prospective customers responded to walk-in prospect – better known as an of prospect relationship management. the ad we could do everything possible up – that today is the day, this is the car, We know that only a relatively small to avoid talking about price and really and we are the place from which to sell the value of taking action today! purchase it. continued next page DD 20 June 2009 DigitalDealer-magazine.com
    • Technology Trends, Greene (continued from P-DD20) Internet Sales, Mohr (continued from P-DD18) percentage of prospects – whether in managers are able to retain their roles as the leap up the evolutionary ladder – the form of e-mail leads or walk-in “desk men” while sitting in a “tower” manual solutions are inadequate. A tool, prospects – will be sale ready on the day overlooking the showroom floor. an intelligent interactive system that oper- that we see them. We need a follow-up ates continuously as the dealer’s digital plan that doesn’t make dumb contacts – With Dealer 2.0 we have gotten over assistant, is needed to ensure a quote is sending out an e-mail or making a call our phobia of price and no longer sent to customers immediately, showing to a prospect that essentially asks, “Are equate it with a license to shop – multiple vehicles, both new and used, that you ready yet?” is a dumb contact mostly because we have figured out surround the customer’s specific request, because it adds no value. Instead we that our Web 2.0 prospect is all about to every lead every time. If the customer continue to market to prospects over a research and shopping, it’s what they doesn’t buy right away, a clean, profes- prolonged period of time with value will do. When they ask us about price sional follow-up campaign must ensue, adding messages that keep us first in they are usually really asking us, “Are one that intelligently customizes the mind when they are in an active deci- you easy to do business with?” The message based on the customer’s behavior, sion making mode. answer to this is an important part of and interactively enables the customer to who they eventually choose to do busi- gain more information and reveal when • In Dealer 1.0 a sales process is ness with. Knowing this we have she is back in the market to buy. typically a list of sales concepts listed formulated a pricing philosophy that In summary, whether it’s an expanding from 1 to 10 and posted on a wall in a enables us to answer pricing questions market or a shrinking market, the high- place that is alternatively referred to as in a way that builds customer trust performing dealer consistently wins at his “the training room” or “the break while retaining average gross profits competitors’ expense. It’s about survival, room.” In theory this list identifies “the equal to or better than we did in and the stakes can’t be higher. He prevails steps of the sale,” it usually begins with Dealer 1.0 by catching the customer’s attention at the meet and greet and concludes with In making the upgrade to Dealer the point she is most open to being won the close. This list is seldom if ever 2.0 you’ll find that most of your deal- over: when she has presented three to five representative of what sales people ership’s sales enabling technologies – dealers with an opportunity to prove actually do, but it makes everyone feel the applications you purchased themselves. Thirty two percent won’t like there is a sales process in place, hoping they would provide you with answer at all. The rest may get around to which everyone knows is something a competitive advantage and it in over 12 hours. Almost two-thirds of you’re supposed to have – plus it lets increased productivity – will run dealers won’t send the customer a price sales management get back to being faster and be much more effective. quote unless she’s willing to talk on the “desk men” instead of process coaches You’ll also find that while you may phone, or come to the dealership. A faster which requires skills they haven’t have fewer sales opportunities than in response—with the pricing information upgraded to yet. past years with your upgrade, you’ll the customer wants—right away every be ready to convert a much higher time—with follow-up that is both Dealer 2.0 is all about being efficient percentage of current opportunity friendly (i.e., relevant, personalized, not and effective and neither can be into sales today. “spam”) and persistent enough to catch achieved without a well designed sales the customer when they’re back in the process. We define a “sales process” as a David Greene is president of e-Pro market—achieves the goal. Dealers can’t communications strategy combined Automotive Group and is one of the do it manually: it’s too costly, too hard to with a series of sales activities that automotive industry's most progressive manage and too prone to failure. The occur in a pre-determined sequence, and effective performance and training only viable solution is a powerful, intelli- with each activity adding greater value professionals. Greene has been in the gent tool that can act as your ongoing to the next and resulting in the highest automotive industry since 1980 and assistant, communicating on your behalf percentage of sales results possible. It’s has worked in all aspects of retail sales the right way, right away, every time. measurable, manageable and we use it management. Prior to founding e-Pro with every opportunity to do business. Automotive Group, he was EVP of Tom Mohr is co-founder, president, and CEO In Dealer 2.0 a sales manager is not a Sales & Service for Reply!, an online of ResponseLogix. Mohr was president of “desk man,” but an individual whose marketing services firm. He also served Knight Ridder Digital, responsible for the digi- responsibilities include helping the as vice president of Dealer Network tal assets of the second largest newspaper sales team to follow the sales process Operations for Autoweb.com, one of company in the US. He was also a board mem- and coaching them on how to achieve the first publicly traded online auto ber of the parent company of Cars.com and peak performance. buying services. Apartments.com, as well as CareerBuilder. • In Dealer 1.0 we only want to talk about price in all of our traditional advertising to prospective vehicle If you wish to discuss this article with If you wish to discuss this article with buyers. When we actually get to talk to other dealers, or with the author, other dealers, or with the author, a prospective vehicle buyer, we rigidly please go to the “Discussion Forums” please go to the “Discussion Forums” avoid discussing price until they’re at www.DigitalDealer-magazine.com at www.DigitalDealer-magazine.com landed on a specific vehicle and ready and enter the “Technology” forum or and enter the “Internet Sales” forum or to buy today. This helps to maintain a e-mail him at dgreene@DigitalDealer- e-mail him at tmohr@DigitalDealer- high level of mutual distrust between magazine.com. magazine.com. seller and buyer and ensures that sales DigitalDealer-magazine.com June 2009 DD 21
    • D IGITAL Dealer COVER STORY Karla Guleserian Internet Director Apple Automotive Group relying on interactivity with its customers. We recently spoke with her about how she has approached her job. How did you get started in the automo- tive business? It’s an interesting story. I’ve worked in business development and marketing in the IT space for about 20 years; since before there was a true definition of Internet marketing. For about 17 of those 20 years, I oversaw the development of web-based high tech enterprise scale appli- cations, bringing those solutions to market and formulating the business development and marketing plans. I was a consultant on a variety of projects ranging from hospital information management systems to global asset tracking solutions across many different industries. I developed and imple- mented full marketing strategies including online strategies and tactics encompassing everything from e-mail marketing, pay- per-click (PPC) SEO, online audio and video lead generation expert writing, all of that. Those were the years when the Internet was booming and venture capital Karla Guleserian, the 45-year-old Internet enterprise as a whole. Today the group relies was accessible and then of course the director for Apple Automotive Group in York, on proprietary web sites and a fully flexible tragedy of 9/11 hit and the IT space Pennsylvania, brought a polished resume and backend administrative panel. An estimated changed dramatically. Following that an extensive IT background to the table when 30 percent of the group’s overall sales now are period I became vice president of market- she took her first dealership job at a modest generated online. ing for an ad agency that built online sub-prime store in Baltimore in 2006. There Guleserian, who says she’s fascinated with third-party lead generation solutions. she says she worked to bring online sophistica- the radical technological change the Internet When the company, Fluent Creative tion to a business that hadn’t had much represents, still isn’t satisfied. She’s currently Technologies, relocated to Florida in 2006, Internet success. After transforming the store’s fine tuning everything and laying the I had the opportunity to go into a sub- web site and implementing a solid lead gener- groundwork for combining online depart- prime Ford dealership in the Baltimore ation strategy, in 2007 she joined Apple, with ments where it makes sense, so leads can be area and implemented and end-to-end eight franchises, the largest automotive group distributed from a central location. She also online business development solution. I in Central Pennsylvania, and again started says she wants to make sure the group gets the went into this 100-unit inventory store, from scratch; this time with an eye toward most from social networking and video search rebuilt their web site, implemented a new designing online departments suitable to each engine optimization, which she sees as a lead management tool, took the store store’s culture, while still making sense for the natural complement to Apple’s strategy of through a Reynolds CRM implementa- DD 22 June 2009 DigitalDealer-magazine.com
    • tion, generated my own leads, and handled marketing for Apple Automotive’s eight unique Internet department in every store. the phone appointments. Within the first franchises. They include Honda, BMW, Our plan is to experiment with a central- full 30 days, my department sold 53 units Acura, Subaru, Cadillac, Nissan, two ized Internet department that will handle with an average gross of $3,000 a copy. Chevrolet stores and a Ford store, plus a online inquiries and leads for several stores used car outlet, all in York and Red Lion, from one location. How did you structure that department? PA. I have an office at the corporate center We are now in the process of upgrading I started by building a new web site and in York but often move from store to store. our lead management tool. Effective May two lead generation sites, in order to gener- I’m very hands-on with my departments 1, 2009, we will be live with iMagicLab, ate direct, exclusive leads through PPC and managers. and it’s a very good thing because we actu- advertising. We were able to eliminate all Essentially I started from scratch on the ally outgrew our old lead management third-party lead providers, with the excep- Internet department. Most of the stores tool. We are also upgrading the communi- tion of Cars.com, which is a significant did not even have lead management tools. cations platform that I brought in consumer portal in the Baltimore region. They were getting leads in their Outlook December of 2007 and now are moving to When a lead came in, I was the sole phone boxes. The first thing I did was take a a more sophisticated and functional plat- person, so I handled the selling of the culture test, spending some time in every form, so we’re updating some tools and appointment. My show ration was more one of the stores doing a SWAT analysis, getting some other things in place for this than 80 percent. Working with one of the looked at the strengths and weaknesses and restructuring. strongest sales teams I’ve seen, they sold the opportunities and threats and various units while I focused on generating more cultures and personalities of the GMs What are your processes now? leads and getting more people in the door. across the stores. I knew I needed their The process is not going to change buy-in for my vision for Apple, and that much. We have a multi-pronged approach Did you consider that strategy a bit would be critical to my success. I presented and at the core is the focus on maximizing risky at the time? my initial assessment and my plans for lead conversion to our primary web site Well, I’m an entrepreneur so there’s structuring Internet departments for each and other conversion sites that we run. We always a level of risk with anything you do of the stores. I did that rather than opting are heavily focused on direct lead genera- in business, and I’m not afraid of it. I came for a centralized Internet department tion. In every store the direct leads have the out of an agency where I had been building because some of our stores are operated highest closing ratio and grosses. We do online lead-generation solutions across with some level of autonomy, so I knew utilize third-party leads and have a strong many different industries and had never that I needed in those cases individual referral program and e-mail marketing on seen one fail yet. From an academic Internet departments. our communication platform to drive perspective I have a bachelor’s degree with I brought in lead management tools, traffic to our web site and Internet depart- a double major in technology and manage- educated and trained my team so they ments. So we have a variety of strategies to ment communications studies and I have a could understand why we needed these build our lead volume. Some lead master’s degree in electronic commerce, all tools, set up their lead sources and docu- providers for one store may not work as from the University of Maryland, and mented and mapped out a process for well for another. So we’ve experimented graduated with highest honors in 2003. So effective lead management across the with that and because brand, location and I had the background and knew how stores, while at the same time focusing on culture affect the performance of a particu- successful the strategy could be. my people and trying to identify those lar lead provider, at least at our stores, we who were either taking leads or handling track and manage the return on our invest- How did you get from that Ford dealer- phone calls. So I started out slow with the ment for all of our lead providers and make ship to Apple Automotive? goal of getting some small wins and decisions based upon those outcomes. From there I had a short stay, about putting some structure and processes in We have a consistent lead process across three months, with the Koons organiza- place for the Internet department. all stores. We identify three primary tiers tion. They were very good to me, but I was within a 90-day lead management cycle. not satisfied with being the ‘Internet girl’; I Now that you have some experience The critical part we believe is the lead age had more I wanted to do. I knew I had to with that model will you stick with it? between days one and 30. We would call find an auto group that would bring me in, At this time each store has its own ISM. that Tier I. During Tier I, telephone one that had made very little progress in But we have undergone a lot of change and contact is maximized along with a series of the Internet space, so I sought out Apple. we’re now in the process of restructuring e-mails that will drive these prospects to After a few calls to Apple dealerships, I was some departments again with the goal to call the dealerships. We believe that our e- able to get in touch with the owner. We become an Internet automotive group. We mail communication has one primary had a meeting and I was able after a few are a ways away from that goal. We have a purpose and that is to drive the call to months to show them the value I could unique culture in our stores, Apple has a action of a phone call for the purpose of bring to the organization, and they very low turnover rate, some employees selling the appointment and getting the brought me on board in 2007. I’m hoping have been selling 20 to 25 years and I’m individual in our store in order to sell a car. to stay here another 20 years until the end working within that culture. In the last We are appointment-driven in the first 30- of my career. They’re very good to me. year and a half though, with some of the day tier. Days 31-90 is the second tier; changes I brought and with market condi- we’re still on the telephone but not every Tell me a little more about Apple and tions, the culture has evolved. So we may day, and prospects get a series of auto your Internet group. centralize at a couple different locations responders focused on selling our value I’m the director of Internet sales and but right now the existing model is a propositions. Obviously the point is a call DigitalDealer-magazine.com June 2009 DD 23
    • to action, such as telephoning the dealer Do you do search engine marketing? back-in administrative panel, so those are or just stopping in at one of the locations. We do. We have engaged in pay-per- our proprietary web sites. We built them to Tier II is our post 90-day lead age, when click advertising, primarily promotion be flexible and to accommodate audio and prospects are converted onto a multime- targeted such as when we have a three-day video on the fly and each of our Internet dia communications platform so we can event, and that is just because I try to managers are trained and handle their own maximize our communication beyond control costs very closely and I have found video online specials, so we have total flexi- the 90-day period. In Tier III we can that pay-per-click can be a bit expensive bility with regard to our web sites. In the IT focus on relevant value building commu- depending on the brand and where we’re space, I had a development team in the nications from Apple, direct mail, targeting so that is very promotion specific. Ukraine that I had worked with for over a telephone, text messaging, depending We use local search and we just completed decade, so they did the programming and upon available channels of communica- our first level round of SEO strategies we built it from scratch. We used Chrome’s tion for the prospect. It may be about a across all of our brands with specific web service and partnered with eVox and community event; we have customer landing pages on our web pages and built it all from the ground up. appreciation days, service-related coupons specific sites that are search engine opti- Last September we conducted an e-mail or other offers like driving them to one of mized for a defined list of keyword phrases, survey of our customers after our new sites our car washes or service centers for a and targeting local search. We also do were live for 30 days. We received more special value. online press releases that are search engine than 2,000 e-mail surveys from our optimized and with new tools we’re customers providing insight and feedback When do you retire a lead? moving into the area of optimized videos on our web sites. It’s been a fascinating We don’t. Once a lead is in our plat- online, social networking and blogging. opportunity and challenge. form, it’s retired when they come in and We’ve spent a year and a half laying the they buy from us or they say, “Don’t groundwork for this transition to online What metrics do you rely on to measure contact me anymore.” We monitor very marketing and believe we needed a good your efforts? closely the content and timing of our foundation to build on and to implement We are metrics driven. We use Google outreach. We only send communication certain technologies and processes and analytics on our web site and lead site we believe would be valuable and relevant we’ve been training and educating in house, to our prospects. we’ve rebuilt all of our web sites with a full continued on P-DD29 DEALERSHIP PARTNERS IN PROFIT: Dealership name: CRM program: Dealix Apple Automotive, Inc. UCS Black Book Online Web site URLs: Vehicle video vendors: Third-party sites where www.appleautomotive.com eVox inventory is posted: Chrome Systems Cars.com Web site provider/hosting: Internal video production AutoTrader JaguarPC and placement Vehix CarSoup Vehicle marketing: Vehicle valuation tools: AutoUSA Homenet Black Book CarsDirect CDM Data Dealer Specialties Online lead generators Vehicle history reports: iMagicLab not including the OEM CarFax sources: DMS provider: Cars.com ADP AutoTrader UCS Vehix CarSoup BDC software/vendor: AutoUSA UCS CarsDirect DD 24 June 2009 DigitalDealer-magazine.com
    • D IGITALBarker Chuck Dealer BDC/CRM Rules for the New Market Players Weathering this storm means being in it A s we watch more and more in our profession and heighten the Here are a few of the things the dealerships close their doors, professionalism and true customer abovementioned dealers who are the opportunities amass for service that built this industry. closing were doing wrong: those still in business – if you are will- The stores that are motivated to ing to adopt and adhere to certain implement new strategic and tactical • Treated the Internet manager as a principles with a vengeance. I have concept training ideas and take their second class citizen. Did not include witnessed in the last month several stores to new and expanded levels of them in manager’s meeting and did stores announce they are closing. achievement always impress me. Some not consider their input important. Upon hearing this news, I reflected on are reporting sales up by 12 to 17 the multiple times I had conversations percent this quarter. And then there • Did not stay up on Internet with these dealers about elevating their are the stores that make change a toxic improvement processes, SOP and approach to utilizing new processes, technology. CRM initiatives, training and their need for improved leadership. Each “Who has the time • Had no specific process or training conversation I had with these dealers in place for the handling of incoming yielded essentially the same response: and patience for telephone inquiries. Anybody could “We are doing just fine the way we are pick up the phone. and really don’t need any of that stuff.” planning? Anyone They were actually a bit arrogant and • Had no training in place for relation- exhibited an opinion giving one the who wants to be ship development communications feeling that they were solely responsi- and still wondered why gross profits ble for inventing the automobile and successful and stay were down. no one could teach them anything. Even as their reputations diminished in business – • Had very poor prospect follow-up along with their businesses, they process or training. Heavily relied remained hard-headed about making that’s who.” upon fresh up traffic to support the any changes because “This is the way —Chuck Barker sales activity. my father and his father did it.” OK, see you later Mr. Out of Business. • Had no owner base strategy or train- This story, sadly, is one major reason event. What is the difference? Some ing. Due to attrition, most owners had that stores are being driven (or should dealerships have a plan, strong leader- no one taking care of them and as a I say putting themselves) out of busi- ship, spend money on training in new consequence, no referrals. ness. They were cruising in a strong motivational business strategies, get market, either fearful, lazy or simply buy-in from the team, make these new • Did not encourage or ever give pats too hard-headed to adjust by imple- ideas contagious and truly mean what on the back to their staff. People need menting new business processes. they say. Then, there are the “ready, to be loved to perform for you. However, the poignant tale-tell sign of shoot, aim” approach stores. “How their weakness was exposed in a down many have we sold today, Bob”? These • Did not participate in community market. These stores also treated their incidentally continue to struggle year giving. Take, take, take and never give staffs poorly, cheated them out of after year and experience high levels of back to the town that supports you. money and earned a sour reputation in attrition and are now closing down. their marketplace for unscrupulous What they should have been saying is, • Kept everyone off base by intimida- methodologies. I say good riddance. “How many appointments have we tion and bragged about how rich he We do not need stores like that spread- made this week”? Some stores always was. ing cancerous paradigms to customers wait for the business to come to them. further infecting the good guys’ stores. Some have a well trained staff that • Poor hiring practices. People hire in What thoughts come to your mind goes and gets business and builds their like-mindedness thus they never when I say “car salesperson”? It is time customer relationships through the to take back ownership of confidence selling process. continued on P-DD26 DigitalDealer-magazine.com June 2009 DD 25
    • BDC/CRM, Barker (continued from P-DD25) elevated to a higher class of team play- customers and your company. Then things get interesting. We have two ers or just stayed the same with no you can prioritize these opportunities, basic choices—re-engineering to increase in performance. pick the best and put them into play. perform each process step as effi- Obviously, there’s a little more to it ciently as possible or re-engineering • Cut all investments in any type of than that, but that’s the gist of it. to maximize “throughput” from the CRM initiative training for entire It is very important to understand beginning of the marketing/sales team including managers and customer relationship planning and process to the end. We normally opt parts/service. No wonder their reputa- how it’s done is recognizing these for the former—which might work if tion became tarnished. significant departures from traditional marketing and selling were factory market planning: stuff with predictable work flows. So how do you stay alive and well? But they’re not. Instead, we have Simple, do the opposite of what these • You plan everything around cus- these unpredictable elements called failed dealerships were doing and you tomer wants, not company goals. “customers” that refuse to cooperate will come out of this much stronger and do things according to our and gobble up a greater market share. • You focus on listening to cus- schedules. These dealerships are losing prospects tomers, rather than forcing them to Without drowning in the science of that will be making a purchase some- listen to you. process management, suffice it to say where and it is your opportunity to that in conditions of uncertainty, take up the slack through fewer Redesigning functional activities is trying to maximize efficiency up and competitors. otherwise known as the step we forget down the process chain is usually an One big area that gets overlooked in about altogether. Why? Because we’d unmitigated disaster. In contrast, a down market is that our efforts must rather get ambushed by it, catch a maximizing throughput usually gives have the customer’s best interest in whole quiver of arrows in the chest, us a far superior return on our market- mind. We’re having so much trouble then die a dramatic death in the ing and sales investments. Developing defining CRM processes for one corner service bay. new processes will take you to the next simple reason: so many of us are deter- So you don’t forget, here’s what achievement level but you better get mined to define CRM as something happens. When you change to more some training installed in this area as less than it is. Why? Because it’s easier customer-focused business strategies, well or again you will be wondering to implement that way. Hey, if we can you have to work differently. where you are headed. I have put cut it down to a couple of simple steps, Otherwise, you’ll do the same stuff together a “must do” line item check- even one, we can slam it in much you’ve always done. But we have a list entitled CRM Initiative Training quicker. Unfortunately, the only thing nasty tendency to “keep on doing and if you would like a copy to that gets “slammed” using this abbre- things the way we know” while trying template your new initiatives, send me viated approach is the dealership. So to go somewhere else. Ergo, we leave an e-mail at cbarker@digitaldealer- let’s define CRM for all it is: a functional activities as they were. This magazine.com. complex, multiple processes with far- doesn’t work! Instead, we have to care- reaching effects on the very way we fully assess the roles of all departments Chuck Barker’s experience ranges from conduct business. interacting with customers to see if an executive with a Fortune 200 com- Start with developing customer- they’re adding value to customers, or puter corporation to the automobile focused business strategies—also adding cost instead. Then we have to business. He has held positions as busi- known as the step we most want to figure out how to reconfigure our ness development manager, sales avoid, because it’s all about planning. organization so that everything we do manager, acting GM, ADP executive Who has the time and patience for is designed to help customers and regional manager specializing in CRM planning? Anyone who wants to be nothing we do adds unnecessary costs and his own current company, Impact successful and stay in business, that’s (this does not mean not investing in Marketing & Consulting Group, LLC, who. The object of planning training your team to become better). located in Virginia. His firm delivers customer-focused business strategies is This does not mean cut, cut, cut, but CRM process strategies, 21st century to find win-win opportunities with instead be wise. CRM sales training, CRM e-business customers. Do more that benefits The function of process re-engi- deployment and CRM management them so they’ll do more that benefits neering our CRM (not just the leadership workshops. us—like buy more from us, give us technical side) is fairly obvious. In referrals and stay with us. The order to put the customer in the customer relationship planning center of our business circle, we have approach is relatively simple. Put your- to change departmental roles and If you wish to discuss this article with self in your customers’ shoes. See responsibilities. And when that other dealers, or with the author, through their eyes. Discover what they happens, we have to adopt new work please go to the “Discussion Forums” want and how they wish to be treated. processes. Otherwise, we’ll do the at www.DigitalDealer-magazine.com Even anticipate what they don’t want same work we’ve always done with and enter the “BDC/CRM” forum or yet, but will. And when you’ve done the same outcomes yet hoping for a e-mail him at cbarker@DigitalDealer- that, you’ll be ready to identify the best different result. But how should we magazine.com. mutual opportunities for your change work processes? Here’s where DD 26 June 2009 DigitalDealer-magazine.com
    • D IGITAL Dealer PRE-OWNED VEHICLES Dale Pollak Your Dealership’s Biggest ‘Black Hole’ F or as long as I can remember, deal- mortar operations of a dealership, it’s they understand how helpful these can ers have always tracked their largely absent in dealership’s virtual be at making a store’s online used showroom traffic. “How many ups showrooms—especially when it comes vehicle showroom more effective. After today?” is a familiar question. to used vehicles. all, isn’t a detailed page view—when a Some dealers use sophisticated I recently asked a group of 100 dealers customer chooses to click on one of customer relationship management and used vehicle managers at a confer- your vehicle listings—the equivalent of systems to track this data; others use a ence in Las Vegas to raise their hands if someone walking into your showroom more basic, paper-on-clipboard approach. they knew, off the top of their heads, the and saying, “I’d like to take a closer look Either way is OK. The money and average daily page views and detailed at that vehicle”? time spent collecting this customer page views for their online used vehicle I call this lack of knowledge the information is generally worthwhile. inventory. In essence, I was asking how “Internet Black Hole” and, rather than The data can often reveal important many customers visited their virtual chastise dealers and used vehicle benchmarks valuable to any store— showrooms. managers for being unaware, I’d rather traffic that results from the latest ad No one raised a hand. educate. The fact is, a deeper and more campaign or the close ratios among analytical understanding of basic salespeople on fresh and comeback A knowledge gap that needs metrics like page views and detailed customers. attention page views can make a huge difference Good dealers are intuitive about these To me, this is a critical problem. Most in getting more action from your online benchmarks. They know if they do a dealerships spend thousands every used vehicle listings and more sales. mailer to 5,000 customers, they’d expect month to list their used vehicles on Let’s take a closer look. to see 100 or more customers show up third-party sites like AutoTrader and Say there are two Ford stores in the at their store. And, of those customers, Cars.com. Yet, when it comes to assess- same town, roughly 10 miles apart. Both they’d have expectations for their staff ’s ing the effectiveness of these advertise similar used vehicle inventories close ratios. investments, dealers and used vehicle on AutoTrader. On the 15th of the For some reason, however, while this managers are behind the curve. month, the first store has 37,000 page kind of data collection and customer Many have not even heard of page views, the second, 1,500. The conver- tracking is ingrained in the brick and views and detailed page views, nor do sion rate on these views—the number of detailed page views divided by page views—runs 5 percent for the first store and 1.5 percent for the second store. Which of the two dealers is doing a better job? What factors might be behind the difference between the conversion rates? What might the second dealer do to adjust his online listings to improve conversions? The easy answer to these questions is that the first dealer’s virtual used vehicle showroom is in order: His vehicles all have photos, accurate descriptions and competitive prices—it’s a consistent, compelling presentation on par with the eye appeal of the iron sitting outside his store. Meanwhile, the second dealer’s virtual showroom is more cluttered, less consistent and less likely to catch the eye of online shoppers. continued next page DD 28 June 2009 DigitalDealer-magazine.com
    • Pre-owned Vehicles, Pollak (continued from P-DD28) Cover Story, Guleserian (continued from P-DD24) It’s also fair to assume the first dealer tent, competitive pricing; compelling activity and track them regularly as well as and his used vehicle manager have a vehicle descriptions; the “in-demand” through reporting within our lead manage- better handle on the metrics for their status of specific vehicles. ment tools. Nearly 30 percent of the online used vehicle inventories. They’ve Among my clients, some stores are group’s sales come from Internet leads now, likely tested the optimal number of also using these metrics to guide other and I think it was a couple of percent when photos, and the type of vehicle descrip- important decisions in their used I started, though nobody really was track- tions and pricing to generate the most vehicle operations. ing anything then. When the market online attention from used vehicle shop- For example, some track the detailed started turning, October and November pers. Chances are, they’ve also asked for page views on a per-vehicle basis as a were a very tough months as far as show- and adopted recommendations from proxy-like data point to help them room traffic for dealerships across the their third-party web site vendor rep determine what vehicles they should country, but it was actually the best month during the requisite monthly visits. stock and highlight through “Spotlight we’ve had since last July, so our web site My point is that dealers and used Ads” on the third-party sites. The traffic and lead volume have not seen the vehicle managers can and should take approach stands to reason as vehicles fluctuation in the market that other chan- more control of what they choose to with a larger volume of detailed page nels have. We look at the data and analyze share with customers about their used views are likely to be more “in demand” it and try to learn what consumers are vehicles online. The first step toward than those with lesser volumes. thinking, but whether it’s the price of gas, managing this increasingly important I’ve also heard from dealers and used the accessibility of the Internet or some merchandising and retailing channel is vehicle managers who use detailed page other reason, we’ve seen a steady increase in understanding the basic metrics that views and similar metrics to add our visitors, page views and stickiness. provide clues on how you can do better. urgency in negotiations to close Plus, probably about 60 percent of our web customers. In essence, these dealers are site visitors are new. Getting to know your metrics telling customers, “Look at the atten- Here’s a quick test I share with dealers tion this vehicle is getting. If you pass What’s happening to sales in this and used vehicle managers to attune up our offer on this vehicle, you’ll miss difficult market? them to page views and detailed page the opportunity to buy it.” We have absolutely seen a decline like views metrics for their online used As I noted above, metrics like page everyone else. Our Internet sales are repre- vehicle listings: views and detailed page views for your senting a greater number of all sales. The online used vehicle listings are essentially percentage is going up on the Internet but • How many page views has your deal- the same as the showroom traffic stats we’ve seen a decline in sales through our ership received today from your primary you measure and track every day. Few other channels. But we are forward-looking third-party web site? would argue that dealers who carefully and believe that when the market swings • How many detailed page views have track these showroom stats, and use around, we will be positioned to dominate occurred today? them to pinpoint successes and short- Internet sales in our targeted regions. • What’s your month-to-date ratio of comings in their sales processes, will do detailed page views to page views better overall than those who don’t. How specifically do you use e-mail to (detailed page views divided by page The same is true for your virtual used communicate with customers? views)? vehicle showroom—with one key We have an e-mail strategy throughout • What ratio of detailed page views should difference. You don’t have to pay extra all of our stores. We monitor e-mail collec- you expect? What’s the industry norm*? to obtain your online metrics. Your tions by the week for finance, sales and vendors already share them. Now, it’s up service, because we communicate with * A confession: This last question is to you to find, get familiar with and use every customer through an e-mail in a loaded. Our industry has yet to clearly these metrics to your advantage. variety of ways. We send service reminders, define benchmarks for the detailed page appointment reminders, monthly service view ratio. I do know, however, that Drawing from 13 years experience as a and sales campaigns so that we’re driving among vAuto clients the ratio typically dealer principal and eight years as a suc- sales through our service department using runs between 2 percent and 5 percent. cessful high technology executive serving e-mail marketing. We use highly targeted Stores with higher ratios, it should be the automotive retail industry, Dale campaigns that vary through all our stores noted, have managers who review these Pollak is an authority on maximizing and segment our data so that we only send and other metrics on a near-daily basis. dealership profits from pre-owned vehicle selective campaigns to targeted markets. For those of you who can’t answer operations. Pollak is the founder and Every month we send service coupons and these questions off-hand, do not worry. chairman of the board of vAuto, Inc. a post them on our web sites. We also just The data’s available through the dealer- pre-owned inventory management solu- started a quarterly e-newsletter across all of ship interfaces from third-party sites like tions company. our stores with a variety of content. For AutoTrader and Cars.com. If no one in example, in the first one we introduced our your store knows how to access the car wash in York, Apple Car Wash Express, If you wish to discuss this article with which we call a customer retention tool metrics, call your rep for help. other dealers, or with the author, As you begin to get comfortable with because it was built so we can wash all of please go to the “Discussion Forums” our customers’ cars after service. I just sent these metrics and use them to guide the at www.DigitalDealer-magazine.com way you showcase your used vehicle out a promotion this morning announcing and enter the “Technolgy” forum or a complimentary service clinic for my Ford inventory online, you’ll start to see and e-mail him at dpollak@DigitalDealer- understand the factors that make these magazine.com. numbers move up and down—consis- continued on P-DD30 DigitalDealer-magazine.com June 2009 DD 29
    • do business with you. A stat I recently read you can search, and we have Apple certified suggests that only 20 percent of online vehicles with our own warranty, and we customers are actually price-driven and have a car finder service so if it’s not in our that’s what we believe. They want to be inventory, when a similar vehicle comes treated like they are important, and I don’t into inventory you can be alerted via e- think they’re any different from a customer mail. You can also e-mail an entire walking into the store, so it’s not our policy inventory page to someone else. If, for Advertiser ......................pg # to just shoot prices out. We strive to tell example, you go to the Ford store and you Apple’s value proposition because it really is search Apple green cars and open up a very strong. specific car, at the bottom of that page we ActivEngage ........................9 pull vehicles from other stores in our group How do you distribute your Internet leads? that are similar based upon logic we’ve AutoListener......................27 An auto-response goes out and an defined for that car, so you may even see a Internet sales manager or phone coordina- Honda car on the Ford site. Auto Point ..........................3 tor calls the prospect immediately. We train our people to strive to get the appointment How are you leveraging the social and we have a best-deal guarantee, so we networking arena? AutoTrader.com ..................2 focus on selling the value of doing business We are now using video in all of our with Apple, and during the entire cycle if a specials and know the popularity of online AutoUSA............................32 voice message is left, calls are automatically video. We certainly need to leverage it to populating the work plan and we make engage our customers, and soon we’re going BZ Results/ADP ....................5 calls until we get the prospect on the to be doing some personalized e-mail so they phone. So it’s heavy phone calls and auto can meet our staff. We’re a community-based responders. Each store has an Internet organization and think we can get up close to cars.com ............................31 department. Depending upon the lead our customers using video. Our strategy volume, some stores have several ISMs; really is all about community and interactiv- DealerPeak (Widestorm) ..28 some may have one ISM with a phone ity online so yes, we want to connect with coordinator. Our Honda store for example our customers in the social networking space. Homenet..............................7 has a team of ISMs. If a client is working Some of our customers don’t pick up the with one member that lead is assigned to phone, they e-mail us. We want to respect that particular team member, but they that and deliver the same experience through IMN Loyalty Driver............11 perform and are rewarded as a team. that channel. When I first started here I thought the BMW store or Acura store NADA Used Car Guide......13 Who updates your web sites? customers would be the most likely to buy It’s a little different at each store. For cars online, but my customers in the Ford example, at my Acura store the service store in Red Lion are far more interactive via Sandi Jerome Consulting..17 manager updates his own service specials, e-mail. I learn something continuously here though I provide the creative. The sales and most importantly I’ve learned that it’s manager and Internet manager keep the not just 18-year-olds but we’re seeing senior Cover Story, Guleserian (continued from P-DD29) new car specials up-to-date, and the citizens booking their service appointments Internet manager maintains the used car online. I’ve learned not to stereotype. store in Red Lion on May 5, 2009, an specials. If we’re having a crazy end of the information session for our clients. And we month I will jump in and check all of the What do you think distinguishes your did a pre-opening campaign for Apple web sites to make sure all specials are active. group? Ford Quick Lane. We have a strong team approach. We have an Internet strategy for the deal- erships that is really a team effort. I don’t Have you cut back on Internet market- Is there any tool that you’ve found to be believe there’s an Internet director, or GM, ing spend? really effective? or CEO who can single-handedly imple- Actually we’re currently increasing that When you say tool I think of tactic. SEO ment an Internet strategy. I have the finest because we think we have proven a great and the design of our web site are critical. team of Internet personnel and top execu- level of success in our Internet departments We built in vehicle comparison tools for tives who are supportive and open to trying and we’re now bringing on more sophisti- comparing across brands, electronic new things they’ve never even heard of, and cated tools to help bring this to a new level. brochures and virtual test-drives, all the I have a team that were selling cars the old We believe in the Internet channel and it tools consumers need to take an action, so way now doing things they never imagined isn’t going to do anything but grow, and we I think of that as our best tool. We use they would be doing in the car business. want to be ready to leverage the opportu- Chrome’s web service so we have what we We would never have achieved the level of nity to the fullest. call a lifestyle search where they can find a success we have without those people. vehicle by, say, fuel type, transmission type, Everyone’s role is just as important as the Do you believe in advertising prices on price, mileage, body type, or all-wheel next person’s. We work together and think your web sites? drive. We have advanced search functional- together and succeed together. We give quotes when asked but what I ity at all of our sites. We have our green cars teach is that price is not the primary in a feed of their own, so if you’re looking kguleserian@DigitalDealer- driving factor for the Internet customer to for a vehicle that gets 30 miles per gallon magazine.com DD 30 June 2009 DigitalDealer-magazine.com