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DECEMBER 2012

AUTO DEALER NEWS C A R O L I N A S

I N D E P E N D E N T

A U T O M O B I L E

D E A L E R S

A S S O C I A T I O N

Page 6

Negative SEO?

Your website may be under attack by your competitors.

inside

t CALIFORNIA’S BHPH ISSUE: A BLUEPRINT FOR LEGISLATIVE SUCCESS t QR CODE ADVERTISING: THE NEXT BIG THING t COMPLIANCE OVERDRIVE

DALLAS, TEXAS Permit No. 2079

PAID PRSRT Standard U.S. Postage

V isit us at w w w.t heciada.com

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MAGAZINE CONTENTS 04 06 08 12 18 24 30

Executive Director’s Message Negative SEO? Blueprint for Legislative Success Government Report QR Code Advertising Money Matters Compliance Overdrive

WHAT’S NEW AUTOMOTIVE INDUSTRY NEWS & SPECIAL MONTHLY PROGRAMS

WEAR WHAT YOU WANT. WE CAN’T SEE YOU. SALES • OPERATIONS • F&I • REMARKETING • COMPLIANCE • LEGAL/REGULATORY • SPECIAL FEATURES • INDUSTRY EVENTS

www.niada.tv

ADVERTISERS INDEX ADESA................................................................ 17 Ally.....................................................................13 Auto Search Technologies...................................14 AutoTrader.com............................Inside Back Cover Auto Use.............................................................25 Carolina Auto Auction.................. Inside Front Cover Charleston Auto Auction........................Back Cover Dealer Center.....................................................11 Dealer Services Corp..........................................15 Dodah.com.........................................................19 GoldStar GPS........................................................ 7 Manheim.com.....................................................21 NIADA Certified...................................................26 Protective...........................................................23 STARS GPS.........................................................24 Sterling Credit....................................................... 5 United Acceptance..............................................27 UsedCars.com by Dealix....................................... 9 Voisys.................................................................30

CIADA OFFICE P.O. BOX 1088 • HARRISBURG, NC 28075 PHONE: 704-455-2117 OR 1-800-432-4232 FAX: 704-455-6810 • WWW.THECIADA.COM CIADA is a non-profit 501(c)6

NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV NIADA HEADQUARTERS: 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838 FOR ADVERTISING INFORMATION CONTACT: TROY GRAFF (800) 682-3837 OR TROY@NIADA.COM.

The Carolinas Independent Automobile Dealers Association is published bi-monthly by the National Independent Automobile Dealers Association Services Corporation, 2521 Brown Blvd., Arlington, TX 760065203; phone (817) 640-3838. Periodicals postage paid at Dallas, TX and at additional offices. POSTMASTER: Send address changes to NIADA State Publications, 2521 Brown Blvd., Arlington, TX 76006-5203. The statements and opinions expressed herein are those of the individual authors and do not necessarily represent the views of CIADA or the National Independent Automobile Dealers Association. Likewise, the appearance of advertisers, or their identification as members of NIADA, does not constitute an endorsement of the products or services featured. Copyright © 2012 by NIADA Services, Inc. All rights reserved. STATE MAGAZINE MGR./SALES Troy Graff • troy@niada.com EDITOR Andy Friedlander • andy@niada.com ART DIRECTOR Christy Haynes • christy@niada.com PRINTING Nieman Printing

From the Staff and Executive Committee of CIADA

The Carolinas Independent Automobile Dealers Association was organized in 1955 to assist members in enhancing their reputation in the marketplace, gain political influence and provide opportunities to interact with and meet other dealersAutomobile for the purpose of sharing business and marketing The Carolinas Independent Dealers Association was organized in ideas. 1955 to assist members in enhancing their reputation in the marketplace, gain political influence and opportunities to interact with and we meet As provide a mature and long-standing Association, areother proud to maintain the idedealers for the sharing business marketing ideas. als of and principles set and by the founders. But today, offer more…far more. Thepurpose Carolinas Independent Automobile Dealers Association waswe organized in With a fulltime inprofessional staff,reputation modern in technology and world 1955 to assist members enhancing their the marketplace, gain class educaAs a maturepolitical and long-standing Association, we become are proud maintain idetional programs, we have a to strong, effective and organizainfluence and provide opportunities to interact withthe and meetinfluential other The Carolinas Independent Automobile Dealers als and principles by the founders. today, weand offer more…far more.the independent, dealersset for thethat purpose of sharing marketing ideas. tion exists for But onebusiness reason only: To represent nonAssociation was organized With a fulltime professional staff, modern technology and world class educafranchised automobile dealer! The Carolinas Independent Automobile Dealers Association was organized in in 1955 to assist tional programs, we haveand become a strong, effective and influential As amembers mature long-standing proud organizatoDIRECTOR maintain ide- in enhancing PRESIDENT EXECUTIVE 1955 to assist in enhancing theirAssociation, reputation inwe theare marketplace, gain themembers als and principles set by the founders. But today, we offer more…far more. tion that exists for one reason only: To represent the independent, nontheir reputation in the MALCOLM SHEALOR JOHN BROWN political influence and provide opportunities to interact with and meet other ASHLEY PREFERRED AUTO staff, modern technology EXT 105 marketplace, gain political With a fulltime franchised dealer! dealers forautomobile the purpose of professional sharing business and marketing ideas. and world class educa-

CIADA STAFF

EXECUTIVE COMMITTEE

Meet Our Professional Staff

INC. influence and provide tionalGROUP programs, we MT. PLEASANT, SChave become a strong, effective and influential organizaopportunities to interact tion that exists for one reason only: To represent the independent, non-and meet other with As a mature andPRESIDENT long-standing Association, we are proud to maintain the ideELECT dealer! ANGEL LONG franchised automobile dealers for the purpose als and principles set by the founders. But today, we offer more…far more. DRIS ASSISTANT Meet Our Professional Staff

MICHAEL DARROW

of sharing business and marketing ideas.

Meet Our Professional Staff WILL DAVIS

As a mature and longstanding Association, we are proud to maintain the ideals and principles set by the founders. But today, we offer more… far more. With a fulltime professional staff, modern technology and world class educational programs, we have become a strong, effective and influential organization that exists for one reason only: To represent the independent, non-franchised automobile dealer!

THE AUTO EXT 109 With a fulltime professional staff, modern technology and world class educaINC. tional programs,FINDERS we have become a strong, effective and influential organizaDURHAM, NC tion that exists for one reason only: To represent the independent, nonNC VICE PRESIDENT franchised automobile dealer! CATHERINE NEELY G & B AUTO SALES OF LOUISBURG INC.

ADMINISTRATIVE

DIRECTOR John Brown Executive EXT Director 102 Ext 105

Carl Mischinski Ext 109

Catherine Neely Ext 102

Meet Our Professional Staff SC VICE PRESIDENT LISA KLUTTZ LUKE GODWIN Carl Mischinski Ext 109

John Brown Executive Director Ext 105

GODWIN MOTORS INC. COLUMBIA, SCCarl Mischinski

John Brown Executive Director Ext 105

Ext 109

TREASURER DARLA BOOHER DEAL DEPOT, INC. GREER, SC Carl Mischinski

Krista Simmons Ext 109 Ext 103

Catherine Neely Ext 102

Krista Simmons Ext 103

John Brown Jayne Harris Lisa Kluttz Executive Director Ext 111 Ext 107 Ext 105

SECRETARY Krista Simmons KIM BRADSHAW Ext 103 1ST NATIONS AUTO SALES BURLINGTON, N.C.

Lisa Kluttz Ext 107

Lisa Kluttz Ext 107 Catherine Neely Leslie Waslo Ext Ext102 110 Jayne Harris Ext 111

CUSTOMER SERVICE EXT 103

Catherine Neely Ext 102

Jayne Harris

Leslie Waslo

Ext 111 JAYNE HARRIS Ext 110 CUSTOMER SERVICE EXT 110

Leslie Waslo

Ext 110WASLO LESLIE DRIS ACCOUNTS MANAGER EXT 108

CHAIRMAN OF Jayne Harris Leslie Waslo Krista Simmons THE BOARD Lisa Kluttz Ext 111 Ext 110P.O. Box 1088 Ext 103 Ext 107 JULIA ROGERS TRACY MYERS Harrisburg, NC 28075 FRANK MYERS AUTO MAXX INC. Phone: 704-455-2117ACCOUNTING or 1-800-432-4232 EXT 101 WINSTON SALEM, NC P.O. Box 1088 Fax: 704-455-6810

CIADA is the only not for profit association that represents the independent automobile dealer in the Carolinas with a National affiliation.

Harrisburg, NC 28075 www.theciada.com Phone: 704-455-2117 or 1-800-432-4232 1088 Fax: 704-455-6810P.O. Box CIADA is a non-profit 501(c)6 Harrisburg, NC 28075 www.theciada.com Phone: 704-455-2117 or 1-800-432-4232 704-455-6810 CIADA is a non-profitFax: 501(c)6 www.theciada.com CIADA P.O. Box 1088 is a non-profit 501(c)6 Harrisburg, NC 28075 Phone: 704-455-2117 or 1-800-432-4232 Fax: 704-455-6810 www.theciada.com CIADA is a non-profit 501(c)6

In addition to on-site classes, CIADA offers CETV on DVD and CE On-Line. Call 1-800-432-4232 for additional information or visit us at www.theciada.com. 3

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EXECUTIVE DIRECTOR’S MESSAGE

Time to (Re)Focus on Business The elections are over. Regardless of the

Simple idea No. 1: Let’s agree that

it is time to focus our efforts on improving

economic future.

a particular focus on small business.

Simple idea No. 2: Let’s agree that

has been the little engine that could. The success of our nation and the Carolinas is directly attributable to the success of small business.

Simple idea No. 3: Let’s agree that outcome. Simple idea No. 4: Let’s agree that

Simple action No. 1: Call a timeout addressing any barriers to accomplishing the simple ideas. Simple action No. 2: Eliminate any barriers found that impede the success of the simple ideas. Simple action No. 3: Agree to a

policymakers to help further educate them automobile dealer. Being a membership-

Simple idea No. 5: Let’s agree that employing more people in our dealerships

can make the difference in our success or failure.

deter from the success of the goals of the simple ideas. By focusing on these simple ideas and

Simple idea No. 6: Let’s agree that if have more disposable income. Simple idea No. 7: Let’s agree that if all Let’s begin by giving the Carolinas the best small business climate in America by than by not implementing those ideas.

Keeping you informed

JOHN BROWN EXECUTIVE DIRECTOR

AWA R D W I N N E R S

N.C. Dealers Earn PWI Community Values Award they sell. Although both are very busy donating time and resources to both the Scottish Rite Hospital for Children. manage to run a very successful business.”

identify and promote the company’s “core values.”

dealerships. Southpoint Automotive of San Antonio took the top prize – the Five Values

the right thing and relentless pursuit of has demonstrated that he is honest and

Scout troops and churches. Josh Schneer said. dealership’s name to Cub Scout the Children’s Hospital of Santa Rosa.

sales consultant Raymond Hes said. “For

custom motorcycle dealer Strokers Dallas

earlier and bought the vehicle back from him before any problems occurred.”

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COVER STORY

Negative campaigning isn’t limited to politics – your competitors could be sabotaging your website

Negative SEO? When you first hear the words “Negative SEO” you probably think it sounds like an oxymoron. You know, like living dead, original copy, dark light or accidentally on purpose. But two items that don’t seem to mesh are finally doing so. During this election year, we have all seen the dirty tricks politicians have played on each other – negative smear campaigns and truth spinning. But don’t think those tactics are isolated to politics. In the automotive industry, there are growing numbers of companies that like to play dirty as well, and if you are not aware of it yet, you need to continue reading. With the constant uphill battle of your competition “flagging” your ads on Craigslist or leaving negative reviews on listing services such as Dealerrater .com, Google Places or even Merchant Circle, the war has just become a bit more complicated. “Negative SEO” can mean any type of malicious harm intentionally caused to hurt the placement of a website’s search engine rankings. The thought process is, if you can’t become No. 1, then sabotage all of those ahead of you until you are No. 1. Forcing one website to appear lower in the SERP (search engine rank placement) means other websites will climb higher in the SERP. That’s why negative SEO is considered a viable model by unethical website providers and online marketing companies. The most common form of negative SEO is accomplished by linking a website to low-quality, unrelated businesses. Those are called “black-hat” links – they’re the bad guys. Links are among the most important items when it comes to SEO (search engine optimization), but you want to make sure related industry businesses are linking into your website. Links can pass value to your website when done the right way. Links can harm your website when done the wrong way.

There are two types of linking that can be done with any website: internal linking and external linking. Internal linking is linking to resources inside your website/ domain, while external linking links to web pages or other resources outside your website/domain. A link on another website that points to your site can either have value to it and help your site or it can have a negative effect on your website and hurt you. External links that point to your site are a common way negative SEO is applied, and it is very hard to see because it all happens away from your site and is nearly invisible. Related incoming business links: You might have heard the term “link swapping.” That’s when a business asks you to place a link to it on your website in exchange for a link from its website. That can be beneficial if the business is in the same industry as you are. For example, if a used car dealership swaps links with an auto repair/service facility, a towing company or a tire sales business. There is a reason for you to swap links because you are helping your customers navigate to a product or service that you might not offer that could be considered helpful. Value can be associated to both websites in that process. Each of the links from the other website that points to your website counts as an “incoming/inbound link” to your site. Other related links that can qualify are from third-party paid listing services, social media outlets, online video channels and business directory listings. If you are link swapping with other businesses, you always want to make sure the links you are pointing to are valid websites that are still in business. If you are linking to an off-line website, or “dead link,” as it is called, it can easily wipe out the value of hundreds of positive links. Disassociated business links and unnatural links: Disassociated

links are considered an attempt to try to boost the ranking of your site for the sole purpose of increasing your position. Some businesses think all links are good links. Right? Wrong! Make sure links pointing to your website are within your general industry – stay away from disassociated links, such as linking a used car dealership with, say, a flower shop, a hardware store or a movie theater. In addition to disassociated links, there are companies referred to as “link farms” that advertise they’ll sell you hundreds or thousands of incoming/inbound links, which are referred to as “backlinks.” The companies will point those links to your website for a monthly fee. Most of the time, the companies will claim the links they provide will be within the same industry as your business, but there is no real way to guarantee that. Google recently released an update called the Penguin that in part identifies websites in the link farm business that offer unnatural links. If you are found on the receiving end of those links, you could have some serious issues with your online placement. Because there is nothing to keep a competitor from signing up your website’s URL with those kinds of companies, and the links do not appear on your website, that style of attack can easily go unnoticed. Be aware of who is linking to you. Periodically looking into what links are being directed to your website can help detect negative SEO campaigns that have been launched against your business, as well as identify any links that are unrelated to your industry. There are many free websites you can use to check for backlinks. A good free site to check is www.ranksignals.com, which allows you to identify the total number of backlinks as well as get a page rank of the links that are pointing to your website.

BY MICHAEL D. JACKSON CEO OF AUTO SEARCH TECHNOLOGIES, INC. HE CAN BE REACHED AT (949) 608-0809 OR CEO@AUTOSEARCHTECH.COM.

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YOUR VOICE HEARD: A BLUEPRINT FOR SUCCESS BY STEVE JORDAN

NIADA CHIEF OPERATING OFFICER

H O W C A L I F O R N I A’ S B U Y H E R E - PAY H E R E L E G I S L AT I O N G A LVA N I Z E D T H E I N D U S T R Y

augmented by additional public relations As the committee assignments in the

Automobile Dealers Association of

and some consumer advocate groups. It’s been a year since the Los Angeles Times published a three-part series

for its approach to the legislative engage in state legislative activities – that is normally directed by our state associations – but given the far-reaching and restrictive nature of the California participate heavily.

industry stakeholders to determine

interested in the same outcome.

a recently formed group of concerned

in the state. it became more apparent the fate of industry had taken a real interest in

a microscope and the legislative die

deaf ears. Much of the committee testimony

stronger collectively than individually.

of consumers telling customer service by the bill’s provisions. One car buyer overly sensational L.A. Times stories. The

lead position. took the vehicle back to the dealer and ultimately got her money back for the car.

name of consumer protection.

capping interest rates and limiting asset

the only business concerns in the state opposed to the bills.

and other industry stakeholders pulled recourse to solve her problem. A problem continued to march the halls of the The bills raced through the Democratic-controlled Senate and

DMV and Department of Corporations. C O N T I N U E D O N PA G E 1 0

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passage or veto. Our focus then shifted legislative counsel and the state agencies oversight to the industry on passage.

DETAILS OF THE CALIFORNIA BILLS

Here’s a look at the requirements of Senate Bill 956, Assembly Bill 1447 and Assembly Bill 1534: SB 956 Would have required BHPH dealers to:

C O N T I N U E D F R O M PA G E 8

YOUR VOICE HEARD: A BLUEPRINT FOR SUCCESS

yet convinced the evidence merits the regulatory oversight of this bill.”

sigh of relief. As for the media and consumer Commerce and concerned consumers

L.A. Times reporter

AB 1447 Requires BHPH dealers to:

began to ask legislators to look more lobbying effort that had little impact on Based on our internal industry data

governor’s ear.”

AB 1534 Requires BHPH dealers to:

determined that losses in revenue for credence by California’s legislators dollars annually.

and local governments that rely heavily on state funding for basic constituent

small business.

Definition of BHPH Dealer

(a)

consumer advocates received additional

clauses of the constitutions of California segment of the auto industry to play by operational guidelines that do not

(b)

ironically led to less access to affordable transportation for the very consumers to protect.

inherently overreaching restrictions on

fray to protect our members again.

(d)

the combined efforts of the industry’s

(a)

resources and making our collective voice heard on behalf of our dealers and their customers. legislature by the end of August and

(c)

(b) (1) (2)

BY STEVE JORDAN

NIADA CHIEF OPERATING OFFICER

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L AT E S T G O V E R N M E N TA L I S S U E S

NIADA Legislative Team Update latest governmental issues and activity affecting the used car industry from Sante Esposito of Federal Advocates

Thrifty to sign a pledge promising not to rent or sell cars under safety recall until

Congress tightening the deductibility

support legislation to ensure rental Auction Sales

sponsors and obvious bipartisan recalls in a timely manner and insist any legislation should also cover other through the legislative process. That has not happened for several reasons – the

the impact of the current auction

S.1449, MAP-21 fact that no revenue bills are moving

enforcement.

the issue is not a priority for House

the senator and other interested

Congress is likely to be in legislative session for less than half that time and is of higher priority issues.

of time remaining in the Congress to consider legislation. S. 3468, the Independent Agency Regulatory Analysis Act of 2012

auctioned cars.” Agency Regulatory Analysis Act of Trust Fund should be funded through user fees.” problem legislators are trying to solve.

Senate Homeland Security Committee.

the rulemaking process of regulatory not include a vehicle miles-traveled

be introduced this year.

Commission the Consumer Financial

Rental Cars (S.1445, S.3502 and H.R. 6094) There have been reports that consumer advocates are nearing a deal of banning rentals of motor vehicles under safety recall until the defect or anything.”

to make agencies “more effective or less burdensome.”

H.R.860 and S.110, Promoting legislation. Vehicles Act of 2011 and Regulatory Affairs. A negative cosponsored by Sens. Dianne Feinstein for up to three months and force the

co-sponsored by Feinstein.

membership. The bill amends the Internal Revenue Code to make it easier to

impact various aspects of the regulatory

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C O N T I N U E D F R O M PA G E 1 2

NIADA LEGISLATIVE TEAM UPDATE Department of Labor Last year, the Department of Labor finalized a rule to eliminate the overtime exempt status for service writers and service advisors. But as part of the department’s 2012 appropriation legislation, Congress prohibited the department from using any funds to enforce that rule. That appropriation legislation expires in March, and the prohibition will also expire unless it is extended by new legislation. Internal Revenue Service The Financial Crimes Enforcement Network (FinCEN) announced that a variety of businesses, including auto dealers, are now able to electronically file Form 8300, Reports of Cash Payments Over $10,000 Received in a Trade or Business, using the Bank Secrecy Act electronic filing system at http:// bsaefiling.fincen.treas.gov/main.html. E-Filing is a free system that allows businesses to submit their FinCEN reports through a secure network. Paper filings of Form 8300 will continue to be accepted for now, but businesses are encouraged to begin E-Filing.

Federal Trade Commission The FTC has published a guide called Marketing Your Mobile App: Get it Right from the Start, to help mobile app developers and users comply with truthin-lending and privacy laws. The guide highlights that all required disclosures must be made clearly and conspicuously and suggests apps only collect necessary information and providers be transparent about data collection and sharing practices. This information is important for dealers who advertise on mobile sites or who have their own smart phone app. The FTC released a statement on Sept. 13, reaffirming its focus on enforcing the Fair Credit Reporting Act. That suggests more enforcement action on illegal sharing of personal information and illegal use of credit scores. Dealers should have their counsel review all contracts that allow vendors access to their DMS, and any vendor that provides list of customers based on their credit profile.

ast

INDUSTRY NEWS

Auction Edge Integrates with ShipCarsNow, AFC Buyers, sellers and consigners across the independent auto auction industry can now seamlessly use ShipCarsNow from Auction Edge Inc.’s auction management platform, allowing customers to ship multiple vehicles to multiple destinations and take advantage of built-in volume pricing. ShipCarsNow is part of Union Pacific, which transports approximately one out of three new cars sold in the U.S. With more than 1,300 quality trucking companies under contract and strategic ties with major railroads, ShipCarsNow offers nationwide, door-to-door rail and direct truck service at competitive pricing. ShipCarsNow provides Auction Edge members with the capability to transport cars safely and securely, supported by 24/7 customer service. “We want to make it as easy and as cost-efficient as possible for our Auction Edge customers to manage shipping and delivery of their sales and purchases,” Auction Edge senior vice president Scott Finkle said. “Dealers and consigners with AuctionACCESS IDs will be able to set up a ShipCarsNow account with a couple of clicks and start shipping vehicles immediately.” For more information, visit www. shipcarsnow.com or call 866-207-3360. Auction Edge, a national remarketing platform that powers more than 130 independent auto auctions in North America, also introduced a new function that allows key auction employees to view credit lines and available credit for dealers with Automotive Finance Corporation (AFC) floorplans, enabling auction personnel to help the dealer complete purchases and quickly floorplan their vehicles through AFC. FO R MO R E I N FO R MAT I O N , V I S I T W W W. AU C T I O N ED G E. C O M .

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D O N ’ T B E T H E O N E O N T H E S I D E L I N E WAT C H I N G E V E R YO N E PA S S YO U B Y

SUBPRIME IS ON THE RISE many years.

Customers are discouraged about having to provide more information than they are used to.

BY DANI LUNSFORD

NATIONAL SALES AND MARKETING EXECUTIVE WITH SHOWCASE PUBLICATIONS, INC. SHE HAS BEEN IN THE RETAIL AUTOMOTIVE INDUSTRY FOR 14 YEARS, WORKING IN SALES, SERVICE, E-COMMERCE MANAGEMENT AND AS A CONSULTANT TO IT COMPANIES AND DEALER GROUPS. SHE CAN BE REACHED AT DANI@AUTOSHOPPER.COM.

AUTO SHOW

NORTHWOOD UNIVERSITY’S 2012 AUTO SHOW DRIVES THE DREAM

Faber said.

FO R M O R E I N FO R M AT I O N , CA LL ( 9 8 9 ) 8 37 - 4 8 2 3 O R EM A I L P RO M O T I O N S C H A I R @ N O R T H WO O D . ED U .

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C R E AT I N G Q R C O D E S F O R TA R G E T C O N S U M E R S L E T S YO U CONNECT AUTO SHOPPERS W I T H YO U R D E A L E R S H I P A N D W I T H T H E M U LT I M E D I A C O N T E N T O F YO U R C H O I C E .

QR CODE ADVERTISING: The Next Big Thing The era of the used car dealer is is replacing some of the older methods of getting customers in the store to buy a car.

average user returned for an additional

because they enable targeted customers codes get higher response rates than

have salesmen standing at points on

their interest. Roger Matus said. mobile device in hand has the potential

customer’s cell phone to give him more The codes are being adopted by even could have.

chat sessions and codes that link you and your customer together. Many cutting-edge dealers use QR

you have supplied. The results of the report suggest car dealerships should consider adding QR codes or other mobile action codes

e-commerce site. “mobile action codes can turn a print advertising campaign into a direct

are very similar to barcodes used by retailers – the key difference is the amount of data they can hold or share.

average response rate.” That could start driving the customer to

car dealerships.

They understand they can gather information and store it to use at a later

immediately redirected to the vehicle’s creating the appropriate QR code for the

encourage the recipient to scan the code

codes are spurring consumers to take other direct marketing tactics.

for all vehicle details.” help you build your “virtual dealership”

other mobile action codes at an average

the information they need to make an purchase.

per visit to the code reader app over

information as you can to shoppers puts you heads above your competition.

BY DANI LUNSFORD

DANI LUNSFORD IS A NATIONAL SALES AND MARKETING EXECUTIVE WITH SHOWCASE PUBLICATIONS, INC. SHE HAS BEEN IN THE RETAIL AUTOMOTIVE INDUSTRY FOR 14 YEARS, WORKING IN SALES, SERVICE, E-COMMERCE MANAGEMENT AND AS A CONSULTANT TO IT COMPANIES AND DEALER GROUPS. SHE CAN BE REACHED AT DANI@AUTOSHOPPER.COM.

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INTERACTIVE MARKETING

PLATINUM NATIONAL CORPORATE PARTNER

DSC Joins as Platinum Partner

DealerTrack Acquires ClickMotive marketing solutions for the automotive retailing

inventory and create more sales opportunities. DSC’s additional

and increase sales for automotive groups and individual franchised dealers.

operations.

customers need it. FO R M O R E I N FO R M AT I O N , V I S I T W W W. D I S C OV ER D S C . C O M , CA LL 1 - 8 8 8 - 9 6 9 - 37 21 O R EM A I L C U S T O M ER S ERVI CE@ D I SCOVER D SC. COM.

FO R M O R E I N FO R M AT I O N O N D EA LER T R AC K , V I S I T W W W. D EA LE R T R AC K . C O M .

NHTSA Warns of Counterfeit Airbags WA R N I N G

Chinese-made counterfeit airbags have been used as replacement

The airbags are being sold to independent repair shops as original

Cars that have had their airbags replaced by independent shops or

established by their car’s manufacturer to have the vehicle inspected and the airbag replaced if necessary. The list of call centers and other

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ADVERTORIAL

INDUSTRY NEWS

Sandy Not as Hard on Vehicles as Expected for fraud regarding vehicles affected by reported the dire predictions of hundreds

According to insurance claim data

Early estimates predicted the storm to result in more damaged cars than the

because of the storm.

insurance company group that monitors fraud and other trends. He said insurers

“It doesn’t translate to there’s going to because this is such a huge geographic

INDEPENDENT DEALERS NEED NEW ‘F&I MANAGER’ Having had the pleasure of serving automobile dealers for more than 50 years, we at of our dealer customers. Like many readers of this magazine, we place great importance on industry studies to ensure we are on top of the latest market trends – and in particular, your needs. However, we recognize selling cars is more than numbers and charts. It’s a people business. We spend countless hours working to support dealers of all sizes and types. We’re in the car business and a lot of what we do still takes place with a meeting, a handshake, leadership and good in-store training. In our goal to share proven dealer solutions, we turned to the largest audience – the growing group of independent auto dealers. We wanted to better understand what you We asked many of you from across the county questions about your operations, current selling processes and the importance of F&I to your businesses. Your feedback was informative and insightful, and aligned with many of the current successful approaches we use today. Here is a snapshot of what we learned: When we inquired about the types of vehicles and service contracts being sold today, we learned the average vehicle sold is 3-7 years old with 50,000-100,000 miles on it. We discovered more than 65 percent of you sell vehicle service contracts in your dealership. When we inquired how Protective could better support you, we learned that ease of doing business is very important, followed by working with a company you can trust. On the technology front, 55 percent of you use or plan to use an electronic device such as an iPad® or a tablet device to educate your current and future consumers about F&I products. We found that in general, consumers still rely on good, quality education from you to learn about the value of a service contract and most consumers don’t have preconceived ideas about what that value really offers them. The study reinforces what Protective Asset Protection already does well: helping dealers make money selling F&I products. So what is the best way to help you be more productive, drive more revenue and increase customer retention within the F&I process? We think the answer is obvious – hire an F&I manager. No one said it was a simple customers with the best options and the true value of making an F&I purchase decision. Obviously, adding to your headcount is no small task, and we asked ourselves what Okay, we didn’t hire an F&I manager for each independent dealer. Instead, we You might have guessed your new F&I manager is not actually a person but instead is an electronic sales presentation using an iPad, or a desktop/laptop-based solution. and sales ability, it does provide you a tool to increase service contract sales. With our new F&I solution, you have the ability to offer a vehicle service contract customized

markets. dealers often try to conceal from potential buyers the fact that vehicles have been

overcome objections and help close the sale. We want you to have the closest thing we could provide to an actual F&I manager. Protective’s Protection Plus vehicle service contract and supporting web/iPad app will working with independent dealers to introduce them to their new F&I manager. You can learn more about the technology and our goal to bring you innovative new ideas and

individuals to check if a vehicle has ever

BY RICK KURTZ

SENIOR VICE PRESIDENT-DEALER SERVICES FOR PROTECTIVE ASSET PROTECTION HAS MORE THAN 23 YEARS OF INDUSTRY EXPERIENCE. PROTECTIVE ASSET PROTECTION PROVIDES F&I PRODUCTS FOCUSED ON ENHANCING PROFITABILITY AND CUSTOMER SATISFACTION. FOR MORE INFORMATION, CALL 800-950-6060, EXT. 5755, EMAIL RICK.KURTZ@PROTECTIVE.COM OR VISIT PROTECTIVEASSETPROTECTION.COM.

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MONEY MATTERS T H E F I R S T O F A T H R E E - PA R T S E R I E S O N T H E B A S I C S O F B A N K R U P T C Y P R O C E D U R E S A N D W H AT I T M E A N S T O D E A L E R S / L I E N H O L D E R S .

Understanding Your Customer’s Chapter 13 Bankruptcy Congress enacted the federal Bankruptcy the trustee gathers and sells the debtor’s several times since. The procedural aspects are governed by bankruptcy rules and the

also has a special provision that protects

Bankruptcy Code.

than can protect co-signers.

Chapter 13 – wage earner plan: distributes payments to creditors. process is administrative and conducted

including an opportunity to save their homes from foreclosure. can stop foreclosure proceedings and

the individual’s unsecured debts are less

by a trustee. What’s the Difference? The consumer bankruptcies that affect you

mortgage payments that come due during How Chapter 13 Works

Chapter 7 – liquidation: A chapter

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Making the Plan Work submitted for court approval and must

a schedule of current income and

the debtor must make the plan succeed by making regular payments to the trustee either directly or through payroll

then distributes the funds to creditors can offer creditors less than full payment on their claims.

to retain property as long as payments are

to evaluate the case and serve as a from the debtor and making distributions to creditors. The bankruptcy clerk gives notice of the bankruptcy case to all

plan must provide that the holder of the secured claim receive at least the value of the collateral. If the obligation underlying

provided by the debtor.

collateral – such as a car loan – and the

plan must provide for full payment of the

BY ROD HEASLEY hearing on the repayment plan. under the plan “as soon as is practicable.”

ROD HEASLEY IS EXECUTIVE VICE PRESIDENT OF PERITUS PORTFOLIO SERVICES , A SOUTHLAKE, TEXAS-BASED SPECIALTY FINANCE COMPANY THAT SPECIALIZES IN THE PURCHASING OF OPEN BANKRUPTCY ACCOUNTS.

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T H E S E C O N D O F A T H R E E - PA R T S E R I E S O N T H E B A S I C S O F B A N K R U P T C Y P R O C E D U R E S A N D W H AT I T M E A N S T O D E A L E R S / L I E N H O L D E R S .

The Ins and Outs of Chapter 7 trustee gathers and sells the debtor’s

some types of debts are not discharged. How Chapter 7 Works collection actions against the debtor or the

Bankruptcy Code.

stay is effective only for a short time. The

garnishments or even telephone calls demanding payments. debtor is solvent. The debtor has no liability for

and nature of their claims.

of creditors. The debtor must attend the

the debtor’s income. C O N T I N U E D O N N E X T PAG E

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Role of Trustee in Chapter 7 consult competent legal counsel before

initiate or continue any legal or other action against the debtor to collect a discharged debt.

case trustee to administer the case and

trustee later recovers assets for distribution

and ask the customer’s intention. That debt. That’s an agreement that the debtor

prior to discharge. Next: Your options when a customer

debtor’s unsecured creditors. The trustee accomplishes this by selling the debtor’s property if it is free and clear of liens. Chapter 7 Discharge A discharge releases individual debtors from personal liability for most debts from taking any collection actions against the

promises not to repossess the automobile or other property so long as the debtor continues to pay the debt.

An individual receives a discharge for most of his or her debts in a chapter

BY ROD HEASLEY

ROD HEASLEY IS EXECUTIVE VICE PRESIDENT OF PERITUS PORTFOLIO SERVICES , A SOUTHLAKE, TEXAS-BASED SPECIALTY FINANCE COMPANY THAT SPECIALIZES IN THE PURCHASING OF OPEN BANKRUPTCY ACCOUNTS.

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COMPLIANCE OVERDRIVE

Out with the Old and In with the New? AG acknowledged issues with the proposed

compliance challenges, the story can sound similar from year to year. There are usually a handful of new regulations facing dealers and lenders that have made a big impact on the industry over the previous 12 months.

As a result, it pulled back the changes and

because 2012 arguably hasn’t been as much about new regulation as about the additional scrutiny of regulators enforcing laws that have been in place for some time. That has been particularly evident in the

(OFIR) said bad check charges are not allowed in motor vehicle retail contracts in spite of statutory authority that seems to allow it. This year, the OFIR published a letter saying bad check charges cannot be collected on retail motor vehicle sales contracts unless the contract contains a bad check charge provision, indirectly reversing its prior position. The OFIR now holds that bad check charges are allowed

and loan documentation. that state regulators are taking a closer look authority and transaction documentation: New Mexico: attorney general’s regulation has required creditors to provide a summary or a translation of English-language transaction documents in consumer sales negotiated in a language other than English. Its coverage is very broad and general proposed additional changes to the regulation. After receiving comments, the

further study. Michigan: Years ago, the Michigan Department of Licensing and Regulatory Affairs,

retail contract. Montana: The Montana late charge authority is a bit ambiguous and has been that way for many years. Because of the ambiguity, there were vastly different interpretations in the marketplace. In response to a request, the Montana Division of Banking and Financial Institutions recently published a letter clarifying its interpretation of the state statute. The apparently heightened state scrutiny might be just a coincidence. It could also be that states are demonstrating their diligence and control to the public and to the new federal Consumer Financial Protection Bureau (CFPB). The CFPB regulates dealers who don’t means the CFPB regulates Buy Here-Pay Here dealers. The Federal Trade Commission (FTC) continues to regulate the rest of the auto sales The net result is there are two federal

tested draft real estate disclosure documents with consumers in shopping malls. The Dodd Frank Act requires the CFPB to research and provide policy guidance on whether arbitration provisions should be allowed in consumer credit (non-real estate) transactions. To start that process, the CFPB published a request for suggestions, data sources and strategies to study the issue. It’s also clear the CFPB is not afraid to take a fresh approach to presenting transaction the CFPB published a proposed rule in July regarding integrated mortgage disclosures under RESPA and the Truth in Lending Act. Leading up to the proposed rule, it published a number of drafts trying various new disclosure formats and designs. rules from the CFPB, and the planning process industry and consumer feedback. As a result, more than 1,000 pages. The upside is the CFPB is trying practical, consumer-tested ways to present information so average consumers can understand key transaction terms. The downside is the volume of information in the proposal is overwhelming. It’s hard to know when the CFPB will complete its foundation-building and begin industry. It’s likely big changes will come to the market. It’s just unclear when. While we’re in this waiting period, dealers might feel there are a lot of variables out of their control, but the focus needs to be on the areas you can control. Since a number of states seem to be

possible states are more actively clarifying and in an effort to maintain a level of control over federal oversight. has been, it’s also time to think about what might lie ahead. What will the new regulatory environment look like in 2013? Many thought the CFPB would have done now, but that hasn’t been the case. One reason practices and disclosures. The CFPB also seems to be carefully studying the consumer – to lay a solid foundation for its regulatory oversight. The CFPB’s strategic plan for 2013-18 notes one of its strategies is to “develop and maintain

requirements, dealers should review and button down compliance documentation and processes to make sure they are satisfying those requirements. Additionally, reviewing and tightening transaction standards and communication within the dealership is key. Make sure your and add-on products and services in a correct and consistent manner. Educate your buyers and be direct and honest about each element of a transaction and the risks each party is assuming. Investing in those areas can go a long way toward maintaining compliance now and preparing for what lies ahead.

BY CHIP ZYVOLOSKI seen the CFPB asking good questions and

CHIP ZYVOLOSKI IS A SENIOR ATTORNEY FOR INDIRECT LENDING AT WOLTERS KLUWER FINANCIAL SERVICES. FOR MORE INFORMATION, VISIT WWW.WOLTERSKLUWERFS.COM/INDIRECT.

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CIADA Auto Dealer News Dec 2012