John Possumato's Fleeting Thoughts Blog

1. Fleet-ing Thoughts: September 2006 Page 1 of 5
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Fleet-ing Thoughts
Adventures in the World of Automotive Fleet & Vehicle Remarketing
FRIDAY, SEPTEMBER 15, 2006
Vol. 2 No. 30
E.N.G’s 3rd Annual Executive Summit “Next
Generation Automotive CRM”: Identifying,
Attracting and Retaining Customers through
Search Strategies, Online Marketing and
Targeted Campaigns
Recently I was fortunate enough to attend the European Networking Group’s 3 rd Annual
Executive Summit “Next Generation Automotive CRM,” August 15th & 16, at the Marriott
Manhattan Beach, Manhattan Beach, California. The program focused on Internet-related
customer relationship management in the automotive sector, with seminars that included
expertise and “best practices” from both the manufacturer, media/consulting and retail
dealer perspective. Not long ago customer relationship management itself was a new topic
for automotive retailers, so to have a conference on Internet-enabled CRM shows you how
far dealers have come. Five years ago the manufacturers looked at the Internet as strange
new world, and dealers were outright hostile to those “twenty something” led companies
who were going to replace the franchise dealer. And for good reason – remember the lunacy
of “CarsDirect”, with a business model to buy vehicles from franchise dealers, replace the
new car dealer in the consumer service model and sell direct to the public and somehow
make money, hence the name “CarsDirect”…I couldn’t listen to it with a straight face back
then even after it raised $195M on the concept, one of the largest amounts raised for a the
start-up company back in 1999 if I’m not mistaken. That business model crashed and burned
before the Penske folks quietly brought it back to reality as a dealer lead generation tool.
This “Next Generation Automotive CRM” conference certainly updated me on the
tremendous evolution and advancement in using online and emerging media tools to refine
and enhance customer relationship management. In what seemed a very short time, we as
an industry have gone from skepticism of the Web to the “state of the art” in using online
leverage to build relationships, solicit new business and cost effectively manage growth and
build brand identity.
An Interesting Keynote (from an Interesting Company) and then
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2. Fleet-ing Thoughts: September 2006 Page 2 of 5
An Interesting Keynote (from an Interesting Company) and then dealer-based, small fleet
Vehicle Manufacturers’ Developments sales pilot programs for Ford,
GM, and Jaguar. I veered off
the track only once and did a
The jury is still out on Malcolm Bricklin’s latest venture, Visionary Vehicles, which plans to telecom start-up during the
import a US version of the Chinese Chery cars. Bricklin was a founder of Subaru, and has tech bubble years ‘99/00,
since had a string of less successful automotive ventures, including the ill-fated Yugo. But but soon found my way back
the keynote address by Paul Lambert, President of the new company and a veteran to the car business, creating
marketing executive, was very interesting. Driveitaway, the first Web-
based “upstream”
Most of the rest of the day focused on how automotive manufacturers are using new media remarketing product, selling
as a method to communicate to, and build, customer and prospect interest and loyalty, and cars before they come off
the ability to measure the results of their new media programs. Christine MacKenzie, lease, saving process costs to
Executive Director, Multi Brand Marketing & Agency Relations, Daimler Chrysler, gave a reach a sale. I’m on the road
presentation entitled “Emerging Media…The Leading Edge” with examples of what Daimler a lot, visiting fleet clients
Chrysler is doing in that regard (I like those bobble head Jeep commercials she ran, that and vendors, attending at
now seem to be everywhere on television). Patrick McFarland, Head of Customer Knowledge least 30 trade shows and
Services from Ford Motor Company, had an informative presentation on “Customer Lifetime vendor meetings a year. I’ve
Value – Predicting and Applications to Automotive Marketing ”…this, although not mentioned seen good auto-related blogs
directly, has aggressively filtered down to the dealer level, with even the major dealer out there, but none that
computer vendors building in an easy way for service writers in the dealer service shop to focus on the areas of fleet or
calculate, with a keystroke, the gross revenue each customer has generated for the remarketing, so I thought I’d
dealership over a multi-year period. This last point I picked up not from a presenter, but take a shot. After all, I’m a
from some dealer people I had lunch with that afternoon; seems a simple obvious thing to car guy …
want to do, but it was impossible back when I was a dealer.
There was a presentation on maximizing the profitability of customer interaction – “A
Strategic Framework for Driving and Leveraging a Profitable and Effective Customer
Experience” by Michael Fitzpatrick, Chief Marketing Officer of Harte-Hanks. This was
followed by the first panel discussion of the day, moderated by my old friend Cliff Banks,
Director, Editorial Development, Ward’s Dealer Business (a dealer trade magazine I’ve been
reading now for at least 16 or so years), entitled, “Moving Your Business Online – is Search
Engine Marketing the Answer to Declining Sales.” This presentation was the first to directly
apply the applications of search engines and new media to automotive retailers, and, as
such was of the most interest to me. The panel included representatives of some of the
“best and the brightest” marketing, communications and customer retention dealer group
managers, with Richard Fisler, Corporate Marketing Director for the C.A.R. (Conant Auto
Retail) Group, Erin Touponse, Director Development & Communications, Harte Auto Group,
and Cassie Broemmer, Director of Customer Retention and Marketing, Van Tuyl/Automotive
Investment Group.
One of the things that is clear to me, at least, from listening to his panel, is the fact that
the most advanced and effective dealers using the Web are creating their own leads
through things such as search engine marketing, and the role of the “third party” customer
lead generators (the Autobytels and the like) is being greatly reduced, if not marginalized
completely. The handwriting is certainly on the wall when the general metrics are revealed,
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3. Fleet-ing Thoughts: September 2006 Page 3 of 5
2006 –Technology Chang...
completely. The handwriting is certainly on the wall when the general metrics are revealed,
that, indeed, when closing ratios are considered, the least expensive Web based leads for a A Not-to-Be-Missed Podcast
dealer are those that are self-generated (through things such key word purchases), the next with John Manchin, Rema...
least expensive are those generated from the various manufacturers (such as through
FordDirect), and, by far, the most expensive leads are those generated by the many “third Vol. 2 No. 23 iRem@rketing
party” vendors – who in many cases generate their dealer leads through the same key word 2006: The Technology C...
purchase/search engine technologies that are available to dealers directly (that is, those ARCHIVES
that know how to use them correctly), and their only addition is a cost mark-up.
December 2005
January 2006
That Afternoon, I Couldn’t Resist Listening to How Ferrari Targets February 2006
their Prospects…(my Road Rally invitations must have been lost in March 2006
the mail) April 2006
May 2006
The afternoon had a couple of break out sessions and I had a choice on which to attend.
One choice was listening to David Kain of Kain Automotive, who I heard gave an excellent June 2006
presentation on utilizing search engine marketing (and I know this to be true, having heard July 2006
David speak before at a JD Power Roundtable as well as some other venues – David is one of August 2006
the best known speakers on this topic). The second, and I have to admit, the one I
succumbed to my temptation to hear, was given by Paul Montopoli, Director CRM & September 2006
Marketing Planning from Ferrari North America. Just to hear how the Ferrari folks treat and October 2006
nurture past and potential owners was a trip…when you sell a few hundred cars a year at
ultra high prices, to people, who, I learned, more likely than not have a whole fleet of
super luxury expensive vehicles (and private jets and yachts as well) you have to be very
generous for your “lifestyle” exclusive cocktail events and “road rallies”…but unfortunately
for guys like me they are also very selective…
The first day closed out with a presentation by Dan Keller, General Director, Marketing
GM/CRM, General Motors, on how he uses technology to coordinate and leverage all of the
various company contact points for a typical GM/GMAC customer – with a company as large
as General Motors (all the vehicle brands, GMAC, GMAC Mortgage, GMAC Insurance, OnStar,
etc.), the coordination alone is an serious task.
Being a Former Car Dealer who Leveraged “Old World Off-Line”
Customer Leads, Ralph Paglia ’s Case Study on Day II was Far and
Away my Favorite Part of the Whole Conference…
Day two started out with a
presentation by Aaron Smith,
Interactive/CRM Marketing
Manager for Hummer, on
“Empowering the Customer”
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4. Fleet-ing Thoughts: September 2006 Page 4 of 5
dealer counsel
“Empowering the Customer”
and matching dealer inventory PODCASTS
customer demands. Then my old friend Ralph Paglia, CRM/eBusiness Director, Courtesy
Chevrolet shared with the group the strategy and technique that produced his phenomenal John Possumato interviews
success at Courtesy Chevrolet in Phoenix, AZ, and made Courtesy the leading Internet John Manchin, Remarketing
retailer of new and certified used Chevrolet vehicles in America, in a presentation entitled Manager, Subaru Auto
“Integrating the Internet Department into our Retail Strategy.” Leasing, Ltd., June 19, 2006
John Possumato interviews
Frankly, Ralph’s presentation, and the whole CRM/eBusiness organization and their results Theresa Ragozine,
to date are so impressive that I immediately looked to do a podcast for the blog with Ralph, Worldwide Director, Travel
to give a more direct experience for those blog readers interested. Even with something and Fleet, Johnson &
like 38 people in his department, organized into three fully staffed business development Johnson, June 8, 2006
centers, an eBusiness finance team, and four distinct Internet sales teams operating out of
four separate buildings, Ralph is still rapidly growing his Internet operation, through a state John Possumato interviews
of the art interactive marketing strategy (creative key word purchases, site creation etc.) Scott Mayo, Fleet Director
strategically coordinated with traditional off -line media marketing. for Wendy's, May 31, 2006
John Possumato interviews
Of course, part of Ralph’s advantage is that he has always been in the forefront of Sherb Brown, vice president
automotive retail Internet and interactive marketing, as a consultant or practitioner, since group publisher of Bobit
the science (or art depending on how you look at it) began, now probably close to ten years Business Media, April 19,
now. And clearly, part of his success has to be his unique insight and energy. But I have to 2006
tell you, seeing Ralph’s phenomenally successful results on leveraging new technology (not John Possumato interviews
to mention the fun he has with it on leading the pack in the online dealership environment Rod Smith, president of
with a single point store), more than anything else out there, makes me wish I was back in Arelco, Inc. April 10, 2006
the retail car dealership environment. Way back when, before there was an Internet, I had
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some decent results in leveraging “old world” direct marketing (direct mail, telemarketing,
Charlie Vogelheim, Master of
etc.) - as the Internet geometrically expands this reach, as no better an example than Ralph Ceremonies CAR April 7,
has proven, it makes me wonder how I would fared in the online environment today as a car
2006
retailer. The Internet truly is a great “equalizer” in a lot of ways for car dealers, and, I
think, in many respects one is limited only by one’s imagination, creativity and drive in John Possumato interviews
leveraging its use for results, rather than in the old world limitation parameters of physical Tom Kontos, Vice President,
location, number of franchises and locations, etc. Adesa Analytical Services,
March 29, 2006
SYNDICATION
A Research Analyst, a Few More Manufacturers, and Close Out with
a Car Dealer
Later in the day, Ron Rogowski from Forrester Research, made a presentation entitled
“Building Your Automotive Brand Online” mostly aimed towards manufacturers, while
Valerie Fuller from FordDirect (the manufacturer/dealer cooperative site from Ford created
to drive Internet traffic to Ford dealers) addressed the group with “Supporting Dealer
Operations Through Customer Intelligence. ” Also, Mike Musich from Toyota Motor Sales USA
Search this blog:
had a presentation on “Working Together for the Ultimate Customer Experience – How
Toyota and the Dealer Organization Can Drive Higher Customer Satisfaction Toward Search
Improved Customer/Owner Loyalty.
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5. Fleet-ing Thoughts: September 2006 Page 5 of 5
Improved Customer/Owner Loyalty.
The last presentation of the day, however, was of greater interest to me than the » Blogs that link here
manufacturer centered presentations, as it was conducted by a car dealer principal » View my profile
addressing a issue that, although focused on Internet-based sales, certainly addressed a
problem that pre-dates the Internet inside car dealerships, namely, how to recruit, train
and retain good sales representatives. The case study presented by Mike Johnson, the
owner of Antelope Valley Ford/Shuttle Lincoln Mercury entitled, “Training Staff for
Professional Online Service” began with the fundamentals of how to hire and train “green Powered by Blogger
peas” (car lingo for people hired with no experience in car sales) – in this he had an and Blogger Templates
advantage, as an ex-schoolteacher he developed a training/tracking program from the
start. He also outlined the “bad habits” all dealers went through before terms like “CRM”
were important, such as relying on “ups” (again car lingo for someone who walks through
the showroom door inquiring about a car), and promoting the practice of doing everything
possible (advertising & promotion, manipulating phone inquiries, etc.), to drive the
prospect physically into the facility before any serious interaction took place.
Johnson then outlined how Internet sales, and indeed, the development of CRM in general,
required a very different culture for success – one of his presentation bullet points,
“determine when, not if a separate sales staff for Internet customers is needed,” kind of
says it all. In an era where the average dealer spent $565 per retailed vehicle in advertising
(NADA data for 2004), Mike Johnson’s emphasis on hiring, training and accurately measuring
the performance of sales personnel, particularly in the emerging Interactive media area,
not only makes sense, but probably will dictate which dealers survive and prosper in the
years to come.
Although this was the third in the series, I had never been to one of these
manufacturer/dealer E.N.G. Next Generation Automotive CRM conferences before, and was
very impressed with the information presented and the quality of the presenters and
audience. At the end of the day (literally), I’m more convinced than ever that the
automotive retailer world is rapidly dividing up into those that “get it” and those that don’t
(or refuse to…sometimes clinging to old past practices as doggedly as the venture capital
folks a few years ago were blindly convinced that Internet-based “bubble era” companies
were going to replace the automotive retailer). It’s clear to me, at least, that with new
technologies, automotive retailing is evolving and changing more rapidly today in prospect
lead generation and customer relationship management than at any time in its 100+ year
history – the message is “keep up with the latest developments, or lose the race to the
competition…”
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