CAR BIZ TODAY CBTNEWS.COM
SALES TRAINING & RECRUITMENT
ATTRACT GREAT PEOPLE AND KEEP THEM by Grant Cardone
YOU CAN’T MANAGE TIME
YOU CAN ONLY MANAGE
YOUR ACTIVITIES by Joe Verde
THE POSITIVE POWER OF PRESSURE by Dave Anderson
7 SIMPLE STEPS TO FEELING EMPOWERED by Paul Potratz
THE FACTS & MYTHS OF PRICE COMPARISON BOARDS by Jeff Cowan Epage
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WITH TODAY’S CONSUMER THROUGH TEXT AND CHAT Contact At Once! began with a realization that consumers were no longer shopping for cars the way they once did. Instead of traveling to showrooms their search began on the Internet, but rarely at the dealer’s own website. How could dealers connect with potential buyers who were doing their research online? For more than 13,000 dealers the answer is Contact At Once! This software is a service that enables dealers to connect with individuals through chat, text and video across multiple platforms and ECont. on Page 24
Management consultants in almost every industry all agree that most managers waste, on average, about 25 percent of their day at work. Because ‘time is money’, and wasted time equals lost sales and money, ‘time management’ has always been a buzzword in sales and sales management. We talk about this in our Team Leadership workshop, and everyone agrees that time management is one of their biggest problems. The real problem: You can’t manage time, you
can only manage the activities that use up your time. So I’ve listed some common ‘time wasters’ dealers and managers always talk about in our workshops, and we’ll discuss some solutions for you. Activity Management... First mistake – stop calling it ‘time management’. You can’t control time and I can’t either. It’s actually ‘Activity Management’ that buys you back the time you need to be more productive, because you can’t control time, but you ECont. on Page 20
DJoe Verde |
CBT NEWS 5955 Shiloh Rd. East Alpharetta, GA 30005
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Trainer, Speaker, Author
NADA RELEASES FAIR CREDIT COMPLIANCE PROGRAM FOR DEALERS CHAIRMAN’S MESSAGE by NADA Chairman Forrest McConnell III
Last year the Consumer Financial Protection Bureau issued fair credit “guidance” to indirect finance sources that seeks to change the way they compensate dealers for arranging financing. Since then NADA has led the charge in defending the dealer-assisted financing model, and is working to prevent the adverse consequences that governmentimposed flat fees would cause for consumers, dealers and finance sources alike.
Program to their respective members on January 24. This publication provides essential background on this issue, sets forth a fair credit compliance program template that a dealer can adopt, and contains both general and specific instructions for completing the program template. Among many other features, the program template (a) sets forth a fair credit policy that states the dealer’s unambiguous commitment to fair credit compliance; and (b) establishes a voluntary standardized method for determining the At the same time, we have provided dealers with amount of dealer compensation that may be earned additional educational resources to strengthen their in a credit transaction. efforts to comply with fair credit laws. As part of EForrest this effort, NADA, the American International The compensation method is based McConnell III Automobile Dealers Association and the National on one that was adopted by two Association of Minority Automobile Dealers issued the NADA Fair Credit Compliance Policy & ECont. on Page 35
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CAR BIZ TODAY MAGAZINE Email
EDITORIAL STAFF President and Publisher
Victoria Rodgers Russell Brown
Amy Ottman Beth Hogan Art Director
Casey Edwards Associate Art Director
Contributing Writer Bridget Everett | Managing Editor CAR BIZ TODAY MAGAZINE CBTNEWS.COM
he CBT News team is always looking for new ways to connect with the dealer community to share news, information and training. So to kick off the year, we decided to reach out in a big way with our “CBT News Road Trip.”
The CBT News team left Atlanta to hit the road for this year’s NADA Convention in a luxury motor coach. We stopped at dealerships along the way to get a pulse on the industry right from the showroom floor. We conducted interviews with some amazing dealers such as Walt Gutierrez from Toyota of Newnan, Butch Oustalet from Oustalet Ford and Royal Craft from Mossy Motors. They all had a great story to share with our viewers. You can view these interviews and more at CBTNews.com. Once we arrived at the convention, we caught up with some of the biggest names in the industry and spoke with them about what dealers should focus on in 2014. It appears it will be another big year, and dealers seemed to be very excited and optimistic about the year ahead. As always, we want to hear from you. Please feel free to contact me with suggestions, comments or questions. Thanks for your continued readership and viewership of both Car Biz Today Magazine and CBTNews.com.
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Permission to reprint or quote excerpts granted only upon written request. Advertising rates are provided upon request.
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5 KEYS TO AN INTEGRATED
DIGITAL MARKETING STRATEGY Dealerships should keep these crucial elements of a successful digital marketing strategy in mind. When it comes to automotive marketing, it’s time for dealers to get in line with online. According to the recent Millward Brown Digital/Google Vehicle Shopper Path to Purchase Study, 95 percent of vehicle shoppers use digital channels to research when they’re shopping for a car. When that many in-market consumers are making their purchase decisions based on internet research, dealers simply can’t afford to ignore digital marketing any longer. One key message dealers should take away from this study is that auto shoppers aren’t just turning to one source to research vehicles. They’re visiting a dealer’s website, looking up the dealership on social media, reading online reviews, watching vehicle videos on YouTube and much more. A shopper might compare two models on a third party site, and then return to a dealership’s site to request a quote or schedule an appointment. With so many different digital research touch points, dealers must put forth a consistent, strong and integrated message across all channels. These five elements of a digital marketing strategy will help dealers find success this year and beyond.
THOROUGH AND EFFECTIVE PPC CAMPAIGNS A lot of companies and brands make the mistake of treating payper-click campaigns as plug-and-play. They set up the campaigns and refuse to pay attention to trends in the market, or adjust their paid search budgets to account for high shopping times and increased demand. A successful PPC strategy incorporates of-the-moment trends and data to make sure a dealer’s marketing dollars are spent properly. This data can come from sources like Dataium, Polk or even Google, but its implementation is vital to ensure that the effectiveness of a paid search marketing campaign is optimized. Pay-per-click campaigns aren’t designed to “set it and forget it,” but instead must be consistently monitored and updated to maximize the value of a dealer’s ad spend.
INTEGRATED ORGANIC AND PAID SEARCH STRATEGIES Paid search and organic search are both important elements of a marketing plan, but it’s when they work in tandem that dealerships truly see success. Some auto researchers tend to click on organic links, while others prefer to click on paid links. When a dealership ranks highly on both, it is able to deliver it’s message to all types of users. Additionally, organic rankings can influence a dealer’s paid search campaigns in other ways. The higher a dealership ranks on content organically, the less that dealer will have to pay for competitive pay-per-click keywords. This alone is a great reason for dealers to devote time and money to both search engine optimization and paid search strategies.
AN OPTIMIZED, EASY-TO-USE WEBSITE For many consumers, a dealer’s website is their first impression of a dealership. Google’s study showed that 83 percent of consumers use a dealer’s website as a resource as they shop. Auto shoppers will visit a dealer’s site to research models, get pricing, schedule a test drive and more. But it’s not always easy for them to find what they’re looking for. When a potential customer can’t find what they need on a dealer’s website, particularly early in the auto shopping process, they are likely to simply find another dealership’s site to browse. Dealers with websites that are easy to navigate and clearly laid out, experience a much lower bounce rate than those with sites that are convoluted or slow to load. To keep visitors on their site, dealers should make sure that key information is easy to find. A shopper shouldn’t have to dig for a dealership’s phone number or address. Instead of burying specials deep within the site, they should be clearly laid out and easy to find. After all, this is the type of information that can sell shoppers on a particular dealership over a nearby competitor.
A STRATEGY THAT INCLUDES MOBILE Google also found that 35 percent of in-market auto shoppers use their mobile devices, such as smartphones and tablets, to research vehicles. That’s a 460 percent increase in just two years! As mobile usage soars, dealers are wising up to the fact that a successful and forward-looking digital marketing strategy puts mobile first. Dealer websites, email messages and more must be optimized to look just as good on a four-inch smartphone screen as they do on a desktop computer. If an auto shopper uses his or her mobile device to access a dealer’s website, email or ad, and it doesn’t look great or isn’t functional on that screen, they are likely to abandon it for a business that utilizes mobile responsive design.
USE THE ASSETS YOU ALREADY HAVE Dealerships that invest in traditional advertising often already have videos, like television spots. These videos can be incredibly effective as elements of a digital strategy as well. Google found that 84 percent of video researchers intend to watch auto videos the next time they shop for a vehicle, so why not make the most of these video assets by posting them online? Whether they’re dealership promos, vehicle highlights or any other type of videos, this type of media can promote engagement when shared on social media sites like Facebook, or entice visitors to spend more time on a dealer’s website. They can also be repurposed for use as a pre-roll ad on YouTube, or simply placed in a dealer’s YouTube channel. Think auto shoppers aren’t watching these videos? Think again. One in four auto shoppers surveyed by Google watched more than an hour of videos while doing their research, and 65 percent of people said they were able to narrow down their options after watching videos online.
Consistent branding and comprehensive messaging that spans all channels should be on every dealership’s list of goals for 2014. Putting these elements into place within an overall marketing strategy is the best way for a dealership to take full advantage of the fact that the digital realm is where today’s auto shoppers dwell. CBT Amy Farley is a Copywriter on the Digital Marketing team at Force Marketing based in Atlanta, Ga.
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I shopped all over town and found the best deal on my new Camry right here at Hometown Motors. I recommend them to all my friends if they want to get the best price on a new Toyota.
I had a very bad experience at USA MOTORS. The salesperson lied to me about the value of my trade-in and told me the payments would start in 90 days. The first payment was due in less than 30 days. DO NOT BUY A CAR HERE!!
Overall I had a very pleasant experience when i bought my used car at Pasch Chevy. Brian and Glenn were very nice and even threw in a free key chain.
To tell you the truth I think I could have gotten a better deal somewhere else but I like the salesman and the payments are very affordable. the car runs great!
Never, Never, Never buy a car at Cheatum Motors. This place is an absolute RIPOFF !! They lied about the used car they sold me and said it was never in an accident. This car was hit by two frieght trains!! I would NEVER recommend this place!
“I SELL NATIONALLY!
WHO CARES ABOUT REPEAT BUSINESS?” Yes, that was a real comment I heard recently at a convention I attended. It was overheard between two vendors at a party and it struck me as archaic and as someone who thought his market was so big that the employees of his company could do whatever they wanted.
audience. Depending on how creative they are (check out the United Airlines guitar video on YouTube), a consumer’s response could go viral, which means hundreds of thousands of people online will see it and it even has a chance to get picked up in traditional (TV) media as well.
THE ARCHAIC WAY OF BUSINESS
Everything is connected now and our social community has no boundaries. Businesses need to focus on the experience they deliver.
Think of the dawn of selling on TV or in magazines. It must have been such a revelation to early adopters of this advertising because their reach was enormous. Even if they did not really care about the quality of their products or the service they delivered, they could still feel pretty good knowing that the odds were in their favor. All of us who are of a certain age have ordered products from the back of the comic books and thought they were the best things ever. Remember the seahorses you could grow, the bulging eyeglasses or even the Charles Atlas ads promising great results? We got the box, opened it up and were usually disappointed immediately, or even more upset when it broke in a day. Now I am not saying any of these were purposely sold as poor products, but what I am saying is that they had the odds in their favor that one’s voice would not impact business nationally. What were the odds back then that if two people in the same market got a poor product that their voices would go far? As long as nothing was illegal, if someone thought the product was junk, they just felt a little ripped off.
BACK TO DOING BUSINESS NOWADAYS The vendor I overheard at the party was wrong because the odds are now in the favor of the consumer. The power of review sites and social media has swung the pendulum, empowering individuals to share their experiences with a large 8
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I recently mentioned that the customer experience is the new currency for businesses. Instead of thinking that it does not matter what customers say, why not harness the power of them to become your evangelists and guide them to market for you? Here are a few suggestions: 1. DELIVER EXCELLENCE. IF YOU CAN’T DO THIS, THEN DO NOT MOVE ON TO STEP TWO. FIX STEP ONE FIRST. 2. ASK FOR REVIEWS OR TESTIMONIALS AFTER EACH TRANSACTION. 3. PROVIDE CUSTOMERS WITH AN EASY WAY TO HELP YOU (E-MAIL LINKS TO REVIEW SITES, E-MAIL SURVEYS, GET A QUICK TESTIMONIAL VIDEO). 4. LEVERAGE THIS ON YOUR SOCIAL MEDIA AND MARKETING. 5. CONTINUE TO REINFORCE STEP ONE EVERY DAY.
Remember that hearing words like reputation management may be overwhelming or make you feel that you need to be doing something differently than before, but in reality dealers have been doing business and asking for referrals for years. Successful dealers have grown their business (or not) based on the experience they deliver. In a small market you only had to rely on that to grow your business. Nothing has changed. Do not get caught up into the false sense of security that the Internet has given you freedom to ignore your customer’s needs.
Nothing could be further than the truth. If you are unsure of how to create a process to leverage your customer feedback, ask for help. But make sure you ask the right questions: 1. HOW ARE YOU GOING TO HELP ME MARKET MY REVIEWS? 2. WHO IS GOING TO DEVELOP THE PROCESS? 3. HOW INVOLVED SHOULD MY TEAM BE? 4. HOW DO I HOLD YOU ACCOUNTABLE?
The reason I stress these questions is that you cannot outsource your reputation. Make sure to partner with someone who will help you expand your customer experience online. By focusing on delivering excellence, and leveraging the customer’s, experience you will not have to hope that people are talking about you; you are encouraging this dialogue. The more people who know about your service excellence, the more you stand out and ultimately the more successful you will become. That vendor who I overheard? I am sure he will be out of business sooner than later. The Internet has actually made the world smaller. CBT
Glenn Pasch CEO of PCG Digital Marketing
Glenn is a trainer at heart. He is a highly sought after speaker, writer, coach and operations strategist as well as a customer service fanatic. He has spoken throughout the US and Canada, educating audiences on a variety of topics that cover business leadership, change management, digital marketing and the impact of this new technology on culture, business and society.
President and COO of Friendemic
Whether you are just testing out the waters or totally diving in deep, nearly everybody in the automotive industry has a social media presence these days. But there’s a big difference between a presence and a strategy. And there’s a huge difference between a ho-hum strategy and an effective strategy. After all, what’s the point of putting a message out there if no one is taking the time to interact with it? And if no one is interacting, how do you know they are even reading the message?
Friendemic is the world’s most effective social engagement agency. Started in 2010 and based in Salt Lake City, Friendemic has managed social media and online reputation for hundreds of clients across the United States and Canada. The team at Friendemic builds brands, improves online reputations and generates leads through promotions, daily posting and online reputation management tools and strategies.
An effective social media strategy can be cultivated if you put the focus on being truly social. This kind of strategy strengthens your brand, grows your customer base, builds loyal fans, and ultimately leads to more sales. In short, this kind of strategy produces results. If you’re getting low reaction and response rates, then you know it’s time to check the demographics MEASURING SUCCESS For example, you can look for people talking about of your audience. You may need to target a new Once you’ve committed to being social — that is, “car shopping” within 25 miles of your dealership. fan base, or change your content to appeal to your actually interacting with your potential customers And unlike Facebook, which requires that you wait existing audience. for the fans to come to you, Twitter allows you to on and offline — you’ll have to measure the success of your social media strategy in a new way. No longer proactively start a one-on-one conversation with DIRECT TRAFFIC — BY ASKING FOR IT should you be putting the focus solely on Facebook anyone you’d like. likes and Twitter followers. Instead, you’ll want to Our Twitter tips: don’t be overly salesy, have fun One of the ultimate signs of social media success is look at things like: with your conversations and remember that even an increase in call traffic, web traffic and foot traffic. These kinds of traffic give you the chance to be even more social via email, phone or face-to-face. Each • ENGAGEMENT LEVELS form of communication will leave a lasting impact • REACTION RATES on your potential customer, building a stronger • RESPONSE RATES bond that is enhanced with social media interaction. So how do you get those results with social media? • QUALITY TWITTER CONVERSATIONS
• CALL TRAFFIC, WEB TRAFFIC AND FOOT TRAFFIC
The first step is identify what you want people to do, then simply ask for it. Include links to your website in your posts. Provide easy access to your dealership’s phone number and address on all of your social media sites. Next, you’ll want to give your audience even more enticement to visit your website, call or come into your store. To do this, offer special deals, run promotions and partner with local businesses to create community events that will get people in your door.
If these terms sound a little foreign, don’t worry. We’ll explain them in greater detail as we go. For now, read on to learn five basic ways to redirect your social strategy. Whether you’re working with a vendor, you’ve hired an in-house social media manager, or you’re going at it on your own, here are some areas to focus on.
FOCUS ON YOUR COMMUNITY
RESPOND TO COMMENTS Time and time again, we see brands committing the cardinal sin of not responding to questions and comments from their audience. If you’ve taken the time to post something to your online community, you need to be prepared for the follow-through and regularly check back on the post to continue the conversation. In the fast-paced world of social media, people expect a quick response. That’s one of the perks of engaging with a brand online, after all. We recommend responding to questions within one hour, and even giving a response, like or favorite to comments that don’t necessarily require an answer.
USE THE ADVANCED SEARCH TOOL ON TWITTER At this point, having a Facebook page is pretty standard for any business. But many businesses in the auto industry have yet to really get a grasp on the power of Twitter. There’s a lot more to Twitter than just pushing updates from Facebook or tweeting about your business hours. Use the advanced search tool to look for people talking about keywords in your area.
if someone isn’t looking for a car at the moment, building a relationship with them could lead to a car sale a few months from now.
START MEASURING REACTION AND RESPONSE RATES Reaction and response rates are the best metrics to gauge whether or not your Facebook page is actually social. You could have hundreds of thousands of likes on your business page, yet not have any comments, shares or likes on your posts. Considering Facebook has an ever-changing EdgeRank algorithm, which could mean that none of your fans are ever even seeing your posts. Or it could mean that your content simply isn’t interesting to the audience you’ve cultivated. To find out how your posts are doing, calculate your reaction rate by adding up likes, shares and comments on the post, then dividing it by the reach of the post. This will show you the percentage of people giving some sort of reaction to your post. To calculate your response rate, divide the number of comments by the reach of the post.
As we just mentioned, turning the focus to your community will lead to more foot traffic for your dealership. You’ll draw in people of various interests and build a good name with word of mouth recommendations, the ultimate marketing tool. To start, think about the relationships you’ve already built in your community. Then extend those to the world of social media by interacting with those businesses on their social media sites, mentioning their special events and tagging them in posts.
Once you’ve covered those bases, cultivate new relationships specifically tailored to build your social media audience and engagement. Look for partners that have an outstanding social presence themselves, then propose a giveaway or event collaboration that you can both benefit from. Local charities and sports teams are usually good bets, but you’ll want to consider the demographic your dealership usually goes after. For example, if you have a high-end clientele, think about partnering with an art gallery or expensive restaurant. CBT
CAR BIZ TODAY
THE AUTO INDUSTRY
& THE TEXT TRANSFORMATION
Scott Pechstein Vice President of Sales, Autobytel Inc.
I think it’s safe to say change is occurring at such a rapid pace when it comes to text message usage, the statistics quoted here will probably be out of date by the time this article is published. However, one thing is crystal clear based on the data – texting is becoming the world’s preferred method of communication, and not just between family members and friends. Consumers are shopping online and they want to communicate digitally too. Just run your own focus group. Ask someone you know how many unopened emails are in their inbox and how often they check their email. Now ask them how many unread text messages they have and how often they check their phone. At this moment, I have 43 unopened emails in my inbox, yet zero unread text messages on my iPhone. Still not convinced? Ask someone you know that if they really needed to get in touch with their children, their significant other, or a colleague or friend with a pressing matter, what method is most effective for getting a quick reply (or any reply at all) – by phone, by email or by text? Chances are, the latter will usually always be the most effective.
In addition to knowing that text messaging is a primary means of communication today, we also know certain things about the way consumers buy cars. B Car buyers access automotive data on desktops, tablets and smartphones with tablet usage heaviest in the evenings during TV viewing hours and steady smartphone usage throughout the day. Desktops are becoming more of a daytime work device and are most popular in the morning. C 63 percent of auto shoppers research and shop online while at a dealership using their mobile device and 62 percent of those left to visit another dealership, according to a January 2014 study by Placed, Inc. So how do you take advantage of the opportunity to create a dialog with consumers while they’re on your lot, and more importantly, how do you create a dialog that keeps them AT your lot? The smart approach is to implement a complete mobile strategy that coordinates standard texting dialogue with your mobile site and/or your mobile apps, and then enhance all of these programs with a smart text message marketing program. Most importantly, keep in mind consumers expect a timely response once a dialogue starts; it should be a continuous back and forth. Do you have a dedicated BDC or Internet staff that is always available to have a text dialogue (at minimum, during normal business hours)? If not, consider outsourcing your texting efforts like you might outsource your traditional web chat product. In particular, by employing text message marketing campaigns within your overall mobile strategy, you can create open lines of communication between yourself and your customers with two-way dialogue, ultimately increasing your chances of keeping customers on your lot and in your cars. How do you do this? By featuring keywords and short codes within all of your advertising and on all of your window stickers – such as “Text STATE (key word for State College Ford) to 50123 or “Text 2SELC2
ETo see more from Scott Pechstein go to CBTNews.com
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(key word for the last six digits of a VIN number) to 50123.” Beyond responding to the initial text message with links to your mobile content, you can now offer another opportunity for reciprocal conversation – one that is initiated by the consumer. And don’t forget to enable consumers to initiate a text dialog with your dealership by displaying “Text for Help” links on both your desktop and mobile websites. The links should be prominently displayed with inventory listings, request quote forms and as an option for how to contact the dealership. Text message programs, including text message marketing, are more important than ever before. Today, statistics show many people will leave your website once they get to the lead form and many more will drop out of the process when asked to key in their personal information on a smartphone. By leveraging the use of text message technology the right way, you can capture and retain a larger percentage of customer prospects. Unfortunately, some dealers have encouraged their sales staff to pick up their personal smartphones and send a text message to Internet prospects if they can’t get in touch with customers by phone or by email. This raises two issues. First, the phone number may be a landline and incapable of receiving a text message. What’s more, this renegade approach to texting outside of a dealership’s CRM, DMS or other similar tracking system exposes the dealership to potential legal liability and penalties (not to mention the lack of any conversation documentation). Recent TCPA regulations lump text messages into the same category as phone calls, which are covered by specific rules – one of which allows consumers the ability to text “STOP” to block any future messages. Without a system to track all text communications and to accept “STOP” messages, dealerships are subject to significant fines. So how can we continue to do business in a culture that prefers to text when our hands are seemingly tied by government regulations? The solution is to text in a safe, secure and compliant manner. Here are some tips. B Texts messages should be initiated by the consumer NOT by the dealership.
Scott Pechstein began his career with Autobytel in May 2000 and today serves as the vice president of sales. Prior to joining Autobytel, Scott worked for the Tuttle-Click Automotive Group. With over 15 years’ experience in the automotive industry, he has been able to apply his strong skills in e-commerce and internet based solutions to dealerships nationwide. Scott provides dealerships with best practices and knowledge to increase sales and better understand the evolving Internet consumer and digital marketplace.
C All text messages should be stored in a system. Beyond having a documented record of the dialogue for legal purposes, you should want documentation of the dialogue text conversation for your CRM/DMS. D The storage/message system should recognize “STOP” and automatically lock out any further text communications with that consumer. Can you sell a car and get a consumer into the dealership solely by texting? Probably not. But you DO establish trust. You establish a relationship. By asking permission and receiving a returned and confirmed “OK” to send messages in the manner people prefer, you create a communication pipeline that gives you the capability of capturing a larger share of customer prospects while they’re on your lot, or before they drive off – or drive by – on their way to another dealership. From a 2012 Accenture Automotive Consumer Study, 68 percent of consumers welcome the ability to chat with a dealer. You need to have the ability to communicate with consumers in a manner they are most comfortable with, and today’s statistics point to the fact that texting is rapidly becoming that most comfortable form of communication. Technology always leads to change. The Model-T made the horse less valuable. Cell phones made landlines less valuable. And texting is increasingly making email less valuable. The bottom line? The steps to selling a car are the same, but how we communicate during the car buying process is rapidly evolving. Those who stay at the forefront of this evolution stand to come out on top. CBT
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David Lewis President of David Lewis & Associates Since 1986 David has been training dealers, general managers, sales managers, F&I managers and salespeople on the “Art of Inspirational Selling”. His unique ideas have helped thousands of dealerships nationwide achieve their sales and management goals. In 2007 David shared his ideas in a book titled, “The Secrets of Inspirational Selling”, which gained immediate popularity. He has also written “The Leadership Factor” and “Understanding Your Customer.”
To say that self-confidence is beneficial for a person in sales would certainly be an acceptable statement to most professionals. Success breeds success, and to be successful you must have the aptitude, ability and training to reach your desired goals. As an industry, we invest less per employee than the local McDonald’s does in a teenage kid who just works part-time, yet we expect so much more. No other industry places more value on its sales efforts, yet provides so little training and support. We build beautiful facilities, inventory large dollar amounts in product and spend thousands of dollars in advertising just to lure the customer to our place of business. Wouldn’t it make sense to make a proportional investment in those who are now going to be selling our product or managing the team of people who will ultimately be involved in determining our level of success? Training is the cornerstone of all industries. That is why we place so much emphasis on higher education. Would you go to a doctor who had not been formally educated or fly on an airplane if the pilot had not been properly trained or certified? Of course not! So why would you not want the same for your staff? As a trainer, I constantly hear dealers and managers state, “We just hired a few new green pea salespeople, let us see how they work out first before we invest any money in training them.” I cannot think of a greater formula for failure than that thought process. We then wonder why we, as an industry, have
ETo see more from David Lewis on sales training go to CBTNews.com
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trouble finding, hiring and keeping talented people. The exciting rebound of auto sales in 2013 was an optimistic relief for those who survived the drastic downturn of the previous five years. Still, we must not be cavalier in our judgment by assuming that this is to be maintained without substantial preparation for the future. Just as our customers have changed and become more informed of how our business works, we too must take the same initiative and train our people for this new paradigm. In other words, we cannot rely on doing things just because “that’s the way we have always done it.” The future belongs to those who prepare for it. There are no secrets to success. It is the result of preparation, hard work and constant training. Training that is done every day as a commitment to making those who we employ stronger and more productive. As we know from history, those who don’t learn from their failures are bound to repeat them. Those who make the investment in the training and development of quality staff and processes can expect to see themselves maintaining and growing their position in our industry. The benefits of training depend upon the quality of instruction and the effectiveness of its delivery, but one does not have to be an expert trainer to be effective. Training is all about providing new ideas that the student can utilize in their daily events. Once that idea has been accepted the key to continued success is ongoing role playing, rehearsal and review. With strong sales results being predicted for this year, now is the time to consider your investment in staff training and development. Do you believe that business growth just happens or do you understand it is something that must be earned and competed for? If nothing else, the last several years have taught us that everything can change suddenly without much notice. We live in a fragile world where the only thing that is certain is that everything changes. Preparing today is the best insurance for a bright tomorrow. Investing in the things that make for success is the most likely way to keep your dealership growing and thriving. As an owner or manager, empowering your employees with the best training available will greatly increase their chances for success. When they do well, your customer base will grow and your profits will increase. That is when you will truly begin to understand the benefits of training. CBT
Training Benefits Checklist teaches someone ment - Effective training Training supports achieve move forward, lize them. Before you can how to set goals and rea want to go. you ere you are and where it is important to know wh you will how can then make a plan for Once you know this, you ted to ribu att and success will be random get there. Without this, ality. things like luck or person a well ent repeatable process – Training develops a consist confidence in ee ploy igned to give the em structured process is des these three en Wh and their dealership. themselves, their product higher and s ces suc l, the chances for things are presented wel profits increase.
view your work teamwork – Learning to Training teaches effective effective way s with others is the most as a collaborative proces like those you en Wh career mindset. to develop stability and a ere. In our wh else go and e likely to leav you work with you are less dealership to tend to move a lot from business, salespeople often rk as a team t employees trained to wo dealership. It is proven tha nt. This is productive work environme creates a more stable and satisfaction. customer experience and also shown to enhance the
ome cynical in nfidence – It is easy to bec Training produces self-co you. Believing tomers tend not to trust a business where your cus ive tendency to overcome the defens in yourself is the best way listening and By developing new skills for of most car shoppers. prepared to earn ers, most will be better understanding the custom the future. their business now and in
her than the job s career management rat Effective training teache g in earnings the results of their trainin mindset - Those who see what they nt have a greater view of and professional achieveme e more fun doing it. do for a living. Plus, hav cation and training le results - Effective edu Training produces provab consistently, ed s which, when practic teaches a repetitive proces g except its inin tra ults. Nothing validates produces measureable res results. industry have no – Most managers in our Training develops leaders skills. It is tion hip, coaching or motiva formal training on leaders they cannot If s. ine our ultimate succes our leaders who determ suffers. n atio cess, the entire organiz continue the training pro
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7 SIMPLE STEPS TO
FEELING EMPOWERED with Your Marketing Strategy
I get a lot of emails every month with marketers and business owners asking me, “What should I be doing to increase leads and sales?” I always ask a few questions then share one or two strategies I feel would benefit them with the least amount of work and effort. I also try to share ideas that won’t cost them thousands of dollars. For this article I’ve compiled the seven things you can start doing immediately to generate significant increases in your leads and opportunities. The biggest benefit of these tips? They improve your mental awareness. What I hear is most people feel like they have no direction and feel lost. Follow these steps and you will once again feel engaged and in charge of both your marketing strategy and business. Have a question or need clarification? Tweet me or drop us a note on our Facebook page and we’ll be happy to give you an answer.
KNOW YOUR CLIENTS
Create a swipe file and document every question a client or prospective client asks you. These questions should be reviewed and answered weekly at your sales meeting. It’s important that the entire team has the same answers. When you take the time to review the questions and work collectively to formulate the proper answers, you will eliminate costly mistakes, build confidence in your team and ultimately build respect with clients. This is not meant to be a temporary practice. Rather, it should be in place for every day you want to be in business and be the most respected. Additionally, this newfound resource of information should be used as social posting on Facebook instead of worthless chatter like, “What’s your favorite color car?” or “What are your plans this weekend?” Become a resource to your clients and future clients; don’t forget to use this information in your monthly email newsletters.
JOIN IN THE CONVERSATION Now that you have all of these questions
from clients from the step above, why not become the topic of conversation? It’s time to get these questions with answers on your website in the written form under a FAQ section. To bump up your credibility, record an audio or video with the questions and answers on your website. Some individuals prefer to read while others would prefer to watch a video. By placing the information into both forms you ensure that every member of your audience can utilize your resource. This type of content will rarely become dated so it’s a great practice to start doing weekly.
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GREATNESS DOES NOT GO ON SALE Start referring to customers as clients.
Professional services like medical doctors, accountants, attorneys, and personal trainers are consultants and have clients whereas retail stores like Best Buy and Walmart have customers. Customers are driven by price while Clients are loyal and pay more for a professional service. Clients also refer their trusted advisor more often than a store with cheap prices. When was the last time a friend suggested you use their trainer, accountant or attorney with enthusiasm? When was the last time you heard a friend rave about Best Buy? If they did it was based purely on a price savings or simple availability of a product, not the kind of service you hope to provide your clients.
WHAT’S IN IT FOR ME?
Develop a unique selling proposition and think of a client’s needs and wants, not your own accomplishments. Your unique selling proposition should match your client’s benefit. Things like President’s Awards, years in business, and friendly staff have little or no value to a client. Clients want both financial and convenience benefit, it must be a quick and easy benefit to the client. A unique selling proposition should focus on free car washes, free loaner cars, no cost maintenance, and discounts. When developing the USP don’t forget you will need different ones for sales and service.
KNOW YOUR BUSINESS NUMBERS
Every website has various conversion rates that you should know every month: number of unique visits divided by leads, number of return visits divided by leads, number of unique visits divided by chat leads and number of unique visits divided by phone calls. It’s important to track all four of these metrics each month. Learn from them and work to improve the conversion of your website. This will require the creation of landing pages, improved site navigation, a color test and content building. One of the most difficult parts of this process is making the mistake of putting your value on your beliefs and wants. Rather, base all of your decisions on the numbers from A/B testing. A/B testing is an easy and inexpensive process, and with a Google search, you will find several to choose from. Most don’t require any coding ability; if you can use MSWord you can do A/B test. I am not saying every quarter you throw out the new, just makes subtle tweaks. Imagine the benefit you will receive when the conversion is improved by .25 percent.
MINIMIZE PEER PRESSURE
Dump the social links and any link that takes a shopper off your website. The vast majority of dealer websites have social links prominently displayed that redirects visitors off the site… Stop it. It is the same thing as if a client was to visit your dealership and a sales person was to say, “WAIT! I have a bus that is taking everyone who visits to the local water park for free. Get on and you can visit and meet new friends before you shop.” I understand that dealers and marketers think this is a way to say, “See, we are social too just like you,” but your website is your virtual dealership and Facebook and YouTube are used to drive traffic to your website. Why risk losing a potential lead when you have them exactly where you want them?
YOUR SATURDAY SALES MEETINGS
WILL NEVER BE THE SAME INTRODUCING...
EMAIL IS DEAD
How many self-proclaimed experts have you heard saying email is dead? I must be odd man out since I check my email more often than anything else. I can assure you email is not dead, but don’t abuse it either. Every company needs a quality email marketing strategy with valuable content. A strategy where the subject line is well written and consistent with the content of the email. Minimize the sales pitch, links and images in an email and it will make it to inboxes at a much higher rate. If you are thinking of utilizing your CRM for email marketing, think again. I am not aware of any CRM companies that are approved providers for email deliverability. The CRMs are normally great at one-off emails, but when you get into dozens and hundreds of emails at a time problems start. If you are going to spend the time creating a great email then don’t skimp on the delivery tool. Look at programs like Mailchimp, Constant Contact, AWeber, and others that will ban a company from use that has high opt-out, bounce and spam rates. Email is where you want to do A/B test. Create an email with two or three different subject lines. Send the email with subject line A to 500 people, send the other with subject line B to 500 different people, etc. Review the open rates for each version and go with the high performer. You can even do this same process with the content of the email and see which performs better with click thru rates. Yes, it’s more work, but isn’t the goal to get the best return possible? If your goal is to maximize conversion and opportunities, it takes more work otherwise you are wasting money and losing opportunities.
Paul Potratz COO of Potraz
Potratz covers all aspects of Internet marketing and is a Google AdWords Partner. Paul has been featured in The New York Times, The Wall Street Journal, NY Post, and CBS. He has also been a featured speaker for NADA, Driving Sales, Auto Dealer People, Dealer Elite and Automotive Digital Marketing.
ETo see more from Paul Potratz go to
TUNE IN TO CBTNEWS.COM EVERY SATURDAY MORNING FOR A HIGH ENERGY SALES MEETING DELIVERED BY ONE OF THE NATION’S CBTNews.com 15 CAR BIZ TODAY TOP AUTOMOTIVE TRAINERS MARCH/APRIL
President of Jeff Cowan’s Pro Talk Inc.
Jeff is generally recognized as the creator of the modern day walk around and selling processes for service departments. For 28 years Jeff Cowan’s Pro Talk, Inc. has been recognized as the nation’s number one service advisor training company and enjoys strategic partnerships with the NADA, NCM and Associates, EasyCare and MPi.
of Price Comparison Boards
As I stated in the last issue, I will be delivering a short series of articles entitled “The Myths and Facts about..” regarding different products and services I consistently get asked about. Last month the topic was The Myths and Facts about Express, Quick and Lite service centers”. Just like when I talk about those in my meetings and present my findings and opinions, I strike a nerve. I struck a nerve with the article too since most of what I said did not coincide with the information most people receive when venturing into that area. This edition is likely to do the same for the same reason. Price comparison boards. These have been around for a long time. They come and they go. It seems about every other year one of the auto manufacturers sets an initiative to get these in all of their stores. The myths they use to sell price comparison boards to you can do a lot of damage to your sales, customer retention and survey scores. Here is why.
MYTH: Price comparison boards
show the customer that you are competitive and or have better pricing. FACT: People that visit car dealerships for service do so because of factory trained technicians, factory parts, factory warranties and factory trained service advisors. Your fee structure has very little to do with why a customer will or will not do business with you. To prove my point, what is one thing the American media has been very successful in as it regards to car dealership service centers? That you are over priced and are not trustworthy, right? But what happens every single day when you show up to work in your service department? How many people are waiting outside your door in line waiting to do business with you? Five, ten or more? Then once you open for business, how many more people show up during the day to do business with you? Another 30, 40, 50 or more? Now let me ask you another question. If you were shopping or in need of a product or service would you go to the place that had a reputation of being over priced and dishonest? No, you would not and neither will your customers. They visit because you are perceived by them to be the best.
MYTH: Price comparison boards
MYTH: Price comparison boards
I have yet to see a price comparison board displayed where the dealership displaying it had the lowest price in every category. Even though the price of your service may include more then the competitors who you are comparing yourself to, all the customer will see is the price and that you are higher. Once a customer sees that what the media has been saying about your pricing is true it is not only hard to convince them to buy, if they do, but getting them back in becomes a real challenge.
Recently when I was on a service drive, I noticed a couple that was dropping their vehicle off and was waiting to be helped. While they were waiting, they started reading that dealerships price comparison board. After a second or two the wife looks at her husband and says, “I didn’t know there was a Jiffy Lube in the area.” Now she does.
create sales. FACT: Price comparison boards create objections.
MYTH: Price comparison boards
are necessary to prove value. FACT: A proven selling system that is executed by professional sales people and is based on benefit based presentations sells value. If a service department is relying on a price comparison board to prove value to its customers, then what they are really saying is our staff does not know how to sell. This is why the price comparison boards get a new life every so often. A manufacturer sees that their parts and service sales are down. They reason that the cause of this is because people think dealerships are over priced so instead of training the dealership in the art of selling they look for the quick fix. The average service advisor that helps just 15 customers a day will generate more gross profit for your dealership then an automotive sales person that delivers 30 vehicles in a month. If you want to prove value and ensure that your customers really see the value and quality in your products then train your staff how to deliver that message. Your money will be much better invested.
ETo see more from Jeff Cowan on increasing service revenue go to 16
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show that we are not afraid of the competition FACT: Price comparison boards tell the customer who you think your competitors are.
Smart businesses never acknowledge their competition to their customers. They don’t because they know if they are the best at what they do then there is no need to bring up their competition because it will not matter. For an example, I was lucky enough on a business trip last week to be invited to dinner by the meeting host. I accepted and the dinner was at the local Ruth’s Chris’s Steak House, a five star restaurant. The restaurant had everything a five star restaurant should have great bread, salads, side dishes, beef and desert. One thing they did not have was a price comparison board that said McDonalds has beef for $1.09, Red Lobster has steaks for $19.99 and Applebee’s has beef for $14.99. Why? Because in their mind they have no competition. They know they have a staff that is thoroughly trained to tell their story and a staff that will deliver the absolute best of everything. In the end, there are no quick solutions to selling your products and services. That is why I always ask in every meeting I am in. “What do tablets, price comparison boards, express/quick service, multipoint inspection sheets, software programs, menu boards, social media, alignment testers, battery testers, websites, etc., all have in common? Not one of these items can look a customer in the eye, make a benefit based presentation and ask for the sale. Only your staff can do that. If you want to invest your money wisely then start with your staff and invest it in them. If you train them to tell your story and deliver the highest quality product your investment will come back a thousand times. A price comparison board will never come close to doing that. CBT
KEY CONTROL. Simplified. Monthly Fees Contracts Licenses
“A GLOBAL COMPANY”
Rebecca Chernek President/Founder of Churnek Consulting
“Transparency” has been a buzzword in our industry ever since Saturn first introduced the concept of no-haggle pricing back in 1985. AutoNation took it a step further in 1997 when they introduced no-haggle mega-stores offering one-price pre-owned vehicles. And more recently, TrueCar has brought the concept of one-price pricing to the Internet. Today, there appears to be two camps when it comes to whether or not no-haggle pricing and transparency is a good thing for our industry. In one camp are those who insist that car buyers really want to negotiate and “play the game,” regardless of what they might say in an anonymous survey. Whatever value price a dealer offers will never be good enough, the thinking goes.
Rebecca Chernek has an impressive automotive retail background spanning over 25 years. Her hands-on, proven experience in automotive retail include sales, director of finance and general management. CCI-Chernek Consulting was founded in 2001 to provide finance & insurance training to automotive, RV power-sport & marine dealers nationwide. Rebecca specializes in mastering the techniques of transparent selling in the negotiation of auto sales and finance while significantly increasing profits limiting dealer liability. Rebecca has worked with industry leaders, such as JM&A, and AutoNation and offers customized in-dealership training and workshops throughout the United States. Rebecca has hundreds of satisfied dealers nationwide! For more information contact 404-276-4026.
In the other camp are those who recognize the power of real transparency, in both sales and F&I, to attract customers and give them a positive buying experience. Buyers really are tired of playing the game. This thinking goes: The idea of negotiating back and forth with a dealership and running all over town brandishing different dealer quotes is not something that appeals to them.
PAYING A FAIR PRICE
Count me in the latter camp. In 2001, I was promoted to run a Saturn store. Even then, plenty of people were saying that the one-price concept would fail, but people loved it so much that we couldn’t get enough inventory to keep up with demand. Of course, Saturn failed in 2009, but this was due to mismanagement on the GM side, not their no-haggle concept. I believe that the Saturn concept demonstrated without a doubt that car buyers enjoy a more relaxed buying experience — and that they’re willing to pay a fair price for a vehicle if they believe they’re being treated “fair and square.” The success of AutoNation and TrueCar are proof of this. The fact is, dealers today that have adopted market-based pricing and a no-haggle sales process is consistently selling more vehicles. One of the problems with the negotiation game from the buyer’s perspective is that they don’t really know what winning the game looks like. Sure, they can spend hours doing Internet research trying to find out what a “fair” price really is, but if they find out later that they paid more than someone else for the same vehicle, their win suddenly looks a lot more like a loss.
THE RIGHT BUYING EXPERIENCE
Most buyers understand that car dealerships are in business to make a profit, and they don’t begrudge them for this. Rather than take the time, and expend the emotional energy required to play the negotiation game with dealerships, they would prefer to do business with a dealership that gives them the kind of buying experience they want — a satisfying, trustworthy experience with no gamesmanship or tricks. And the key to providing this kind of buying experience is, quite simply, transparency. Being transparent means that the total price of the vehicle is straight-up right from the beginning. There are no hidden fees or extras added and sprung on customers when they get back to F&I to sign all the paperwork. The sale is a seamless process from the sales floor all the way back to F&I, with the front- and the back-end of your store working together every step of the way. Some in our industry don’t think there are enough car buyers out there who truly want to see real transparency to make a one-price, or value pricing strategy, successful. I strongly disagree. Dealerships that embrace transparency and sell based on value, integrity and credibility — and not on playing sales games with customers — are going to lead the way in the future.
But doing so requires a culture change at your dealership, and this change must start at the top. It’s up to the owner and general manager to instill a culture of transparency within the dealership and continue to nurture this culture over the long term. CBT
ETo see more from Rebecca Chernek on F&I training go to 18
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, Who s the AT YOUR DEALERSHIP? A few months ago, I finished the biography of Abraham Lincoln, “Team of Rivals,” that inspired the award-winning movie, “Lincoln.” The book struck me as more than just a masterfully written look back at one of our nation’s best presidents. In fact, I found “Team of Rivals” offered multiple lessons in leadership, revealed as Lincoln addressed ever-thornier challenges during his ascendancy to the presidency and the darkest hours of the Civil War. One of Lincoln’s greatest challenges came from an assortment of generals who, in the heat of battle and beyond, proved to be ineffectual leaders. Their missteps and mistakes caused repeated setbacks for Lincoln’s goal of ending the Civil War and uniting the nation.
I thought of Lincoln’s struggles with top generals after talking to several dealers at the recent National Automobile Dealers Association (NADA) event about their current difficulties in used vehicles. The dealers are in varying stages of implementing what I call the Velocity strategy for used vehicles— where market data and return on investment (ROI) are the chief guides for inventory management, pricing and merchandising decisions to maximize turn and profitability. The dealers offered a variety of pain points—prices too high for the market, an inability to recondition cars quickly, persistent inventory age issues, too many appraisals that “bury” the car, too much discounting with customers, sloppy merchandising, difficulty finding the “right” inventory and others.
Dale Pollak Founder of V-Auto Best-selling author on used car sales in his book Velocity. Dale Pollak is the chairman and founder of vAuto, Inc., a company that provides retail automotive dealerships with a better way to appraise, manage and price their pre-owned vehicle inventory. In addition to serving as vAuto’s spokesperson, Dale is responsible for strategic planning and development.
ETo see more from Dale Pollak go to CBTNews.com
I asked these dealers what they would consider the No. 1 reason their dealerships weren’t able to work through these problems. The most common response: A lack of “buy-in” from key managers at the dealership, including the general manager or GM. “I’m definitely losing my patience,” one dealer told me. “The reasons I get from the GM sound an awful lot like excuses.” That’s when Lincoln and “Team of Rivals” came to mind. The book notes that Lincoln sometimes faced direct resistance, if not insubordination, from top generals. It also highlights how Lincoln remained loyal toward these generals, even as they disappointed him with their performance. I started wondering about the parallels between Lincoln’s generals and dealership managers charged with reinventing their used vehicle operations. To be sure, the challenges are different, but there are key similarities.
First, the terms of engagement are different. Today’s used vehicle buyers shop online and largely find the car they want before they get to the dealership. This shift has significant implications for the way dealers acquire, price, recondition and retail their used vehicle inventories. Yet, many dealership GMs and managers stick to what they know, which sinks their chances for the outcome their dealer expects. Lincoln’s generals faced a similar challenge. Their conventional rank-and-file style of engagement was often ineffective against the guerilla and trench warfare tactics their Confederate counterparts employed. Second, the little things matter a lot more than they used to. I often say, “there’s a thousand things a dealer has to get right on every used vehicle” to expect a profitable outcome. That’s not much of an overstatement considering the importance of getting the “right” car, reconditioning it, and then putting it online with quality photos, compelling descriptions and market-guided pricing. In this environment, it’s easy for dealership GMs and managers to get distracted, and focus on the wrong things, or lose their focus on the “turn and earn” strategy entirely. For his part, Lincoln fretted on more than one occasion that a particular general lost sight of broader campaign strategy in the heat of battle, leaving an opportunity untaken or another Union force vulnerable. Finally, the most-successful dealerships achieve higher levels of profitability and success only after they tear down silos, get all departments to work together and align every objective to maximizing the “total gross” of the dealership. In my latest book, Velocity Overdrive: The Road to Reinvention, I describe how the used vehicle department functions as the hub of a “wheel of fortune” that can lift sales and profitability across the entire dealership. It is difficult for some GMs and managers to shed their backgrounds and biases toward a particular department and embrace this “total gross” management mindset.
Lincoln also struggled to achieve harmony among his generals. Eventually, though, he appointed Gen. Ulysses S. Grant to command all Union forces. Together with other generals, Lincoln and Grant aligned Union forces under a strategy that simultaneously engaged Confederate troops and cut off their supplies. The strategy ultimately resulted in Confederate General Robert E. Lee surrendering to Grant at Appomattox Court House. I liked how one dealer at NADA digested the comparisons I made between Lincoln’s struggles with his generals and the difficulties dealers encounter as they transform their used vehicle operations: “I need to be more like Lincoln, and my GM needs to be more like General Grant.” “Bingo,” I said. CBT MARCH/APRIL
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YOU CAN’T MANAGE TIME
YOU CAN ONLY MANAGE YOUR ACTIVITIES Management consultants in almost every industry all agree that most managers waste on average about 25% of their day at work. Because ‘time is money’, and wasted time equals lost sales and money, ‘time management’ has always been a buzzword in sales and sales management. We talk about this in our Team Leadership workshop, and everyone agrees time management is one of their biggest problems. The real problem: You can’t manage time, you can only manage the activities that use up your time. So I’ve listed some common ‘time wasters’ dealers and managers always talk about in our workshops, and we’ll discuss some solutions for you. ACTIVITY MANAGEMENT... First mistake – stop calling it ‘Time Management’. You can’t control time and I can’t either. It’s actually ‘Activity Management’ that buys you back the time you need to be more productive, because you can’t control time, but you can control your activities. So the goal is to learn how to prioritize and focus on your activities, so you can start to manage your day more effectively. And remember, everything you do affects everything else you do too.
AN EXAMPLE OF THE RIPPLE Your deadline for getting the ads ready for the weekend is noon on Wednesday. You put off (procrastinate) picking the cars, taking the pictures and writing the ads until the last minute. Now, on Wednesday morning you have to drop everything else you had planned to do (including the training meeting you had scheduled) because now you have to meet your ad deadline.
THE RIPPLE EFFECT WASTES MORE TIME Since you keep skipping the sales training with your salespeople, this causes even more problems, one of which is constant turnover. Then turnover causes its own time problems because now you have to take even more time you don’t have to recruit, hire and train new salespeople. Unfortunately, because you never have the time to train new people correctly (since you didn’t get your ads done on time), you’ll continue to have turnover. Worse, since salespeople never get enough training to be good, you end up spending way more time than you needed to working deals to put something together. And since you didn’t have time to teach them paperwork and negotiation, you had to cancel training again, so you could unwind two deals from the weekend that blew up.
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Instead of the training you planned next week, you and the managers will have to spend time in meetings with the dealer to go over why you aren’t selling more. Then to try to catch up, you’ll end up scheduling a BIG EVENT to try to put more people on the lot so your untrained people can sell something. Oops, your best salesperson just quit because you didn’t have time to locate that vehicle he needed, and another one of his customers ended up buying somewhere else. Bummer!
$10 AN HOUR STUFF & FIRE DRILLS Managers spend their days doing no-brainer things that an administrative assistant could be doing and end up running from fire drill to fire drill all day instead of focusing on activities that buy back time.
Joe Verde President of Joe Verde Sales & Management Training, Inc. (JVSMT) Joe has been in the car business since 1973. He’s been the ‘8-car guy’ and the 38-car sales professional, a manager and dealer principal. In 1985, he founded JVSMT and is the leader in dealer management and sales training worldwide. Joe can be reached at: email@example.com
Get serious and take a hard look around right now at what’s really going on. You’ll see you’ve collected a bunch of underachievers waiting for an UP, who do the same thing day after day, and give you the same excuses for not selling more. Then replay what you and your desk partner keep saying and you’ll hear those same old, “You just can’t find good salespeople these days,” excuses you keep using to justify why you have them, but don’t train them. When you get tired of tough days in management filled with fire drills and the frustrations of working with underachievers – train yourself first. Stop fighting it. If you’ll embrace learning more and get to class, we’ll show you how to do the job you’re capable of, and I promise you’ll be able to go back to your dealership after class and do somersaults in sales and gross. CBT
SO WHAT BUYS BACK TIME? Yep, you heard it coming a mile away. The one thing managers swear they don’t need, and have no time for, is the only thing that buys back that extra time they desperately need: Training. The only reason you’re spending so many long hours there, the only reason you spend so much time trying to fix things that are wrong, and the only reason you’re taking calls and going in on so many deals instead of doing your job – is because you aren’t training your salespeople to do their own jobs. The reason you aren’t training them, is because you haven’t trained yourself. And you aren’t trained because your dealer said they give up trying to help you. They said you create a stink, complain so loudly, and huff and puff and threaten to blow the house down when they try to send you to our management courses on training, coaching and managing your salespeople.
ETo see more from Joe Verde on sales and management training go to CBTNews.com
Dennis Galbraith Chief Marketing Officer at Dealer E-Process Dennis is also the author of two books, Sales Integration and Online Automotive Merchandising. Dennis ran the automotive internet division of J.D. Power and Associates and was Vice President of Advertising Products and Training for Cars. com. He owned several successful companies, Dennis Galbraith Marketing Services and Revenue Guru. He earned an MBA from University of Southern California and taught marketing for Embry-Riddle Aeronautical University and NADA Academy.
Dealers have access to a mountain of data, and many are concerned they may not be analyzing everything they should be. As someone who has been analyzing automotive marketing data for decades, I assure dealers analyzing everything is not only unnecessary, it’s impossible. What is possible, practical, and profitable is the practice of using dashboards and composites. These tools allow dealers to see where problems and opportunities may lie. They can also direct dealers to the proper portion of that data mountain to explore specific areas for more complete answers.
True to their name, dashboards often include permanent gauges for constant monitoring of Key Performance Indicators (KPIs). This may be in the form of a single metric, like the number of site visitors, or it may show trending, like a line graph of the number of site visitors per day for the past 30 days. The trick to KPIs is holding the number of them down to a manageable size. Try to identify the few which are truly key to running your business. Most metrics should only be seen when they are a problem. A car’s dashboard uses warning indicators or “idiot lights” to tell us when a metric is outside of safe parameters. It may direct you to a specific problem or simply let you know a critical situation requires further investigation. The dealership’s marketing dashboard should function in the same way. As an example, a dealer may not need daily reporting on the exact number of chats coming in for service from shoppers on a mobile device. However, if that metric generally falls into a range between 5 and 15, the dealer certainly needs to know if that number falls to zero. The warning indicator needs to be automatically activated, and the dealer needs to immediately know where to go in the mountain of data to see the details around the problem. The dealer’s digital marketing is a patchwork of interrelated systems. Links do break down, and those breaks do have an impact on store traffic and sales. For decades, dealers have been using financial composites in the 20 Group or Performance Group meetings. The group typically does not go over every metric from every store. The composites are designed to highlight particular issues at individual stores where underperformance or fantastic performance may be of interest. Expert moderators know where to direct the group for additional data to drill into and understand the complete situation. In recent years, Internet 20 Groups and Internet Performance Groups began using marketing composites in the same way. Member dealers are able to learn from the successes and mistakes of others. Often, the exploration for 20 Group or Performance Group members does not stop at the meeting. The
composite itself can only hold a fraction of the data available. Members often need quick and easy access to the mountain of data for additional, detailed analysis on problem or opportunities core to their strategy. Today, it is sometimes difficult to link from the dashboard or composite to the mountain of data available to the dealer. It’s necessary for vendors to not only provide data freely to these types of products but make it easy to map back to the details within the mountain of data they provide. It does a dealer little good to know the performance of their Search Engine Marketing campaign is not as high as it was, or could be, if the dealer cannot quickly access the details to find out where the campaign is falling short. Of course, vendors need to be transparent about providing data, but they also need to make it easy to find the right data when a dashboard or composite suggests additional exploration is needed. The industry is in a confusing phase regarding standard terms and uniform meaning for marketing metrics. Vendors are correct in their passion for seeking better ways to demonstrate the value of their products, yet some inconsistencies are thinly disguised attempts at cover up product shortcomings. Some standards are emerging. For website performance metrics, Google Analytics (GA) became the standard across our industry and most others. Twenty Groups and Performance Groups use GA exclusively, as do many
leading vendors. Google makes the analytics package free to site providers and owners and maintains clear and consistent definitions for its terms. Many dealer groups are now insisting that all store sites include GA. It is a sure way of comparing apples to apples across website providers. The shortcoming of GA is its lack of industry specificity. As an example, no one would expect an Acura store with 120 new vehicles in stock to achieve the same number of monthly visits as a Honda store carrying 400 units. However, the number of visits per vehicle should be comparable. Leading dashboards and composites combine GA data with CRM or DMS data to form new metrics, like visits per vehicle. One way to turn inventory quicker is to attract more high-quality visits per vehicle. The marginal quality of additional visits can be measured based on conversion rates, but also Time on Site, Pages per Visit, and Bounce Rate. It’s important to look at the complete basket of metrics and understand why real differences exist. Time on Site and Pages per Visit can go up when the site’s navigation is made more complex, but to the detriment of conversion rates. Conversion helps us understand weather other quality metrics are a function of greater engagement among visitors or greater frustration. The desire to understand how metrics work together is one of the forces driving 20 Group and Performance Group participation, as well as the continuing growth in digital marketing conferences and marketing consultants. It’s important for dealers to have access to reliable dashboards and composites linking back to the mountain of data from vendors and internal systems. Data can identify both problems and opportunities on the road to greater profitability. CBT
ETo see more from Dennis Galbraith go to CBTNews.com
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“Sales are missed by a few words not a few dollars!” – Joe Verde
written by Randy Sutherland
Contact At Once! began with a realization that consumers were no longer shopping for cars the way they once did. Instead of traveling to showrooms their search began on the Internet, but rarely at the dealer’s own website. How could dealers connect with potential buyers who were doing their research online? For more than 13,000 dealers the answer is Contact At Once! This software as a service enables dealers to connect with individuals through chat, text and video across multiple platforms and websites. “The idea was to tie two things together,” says Marc Hayes, the company’s founder and executive vice president of strategy. “It allows shoppers, wherever they may be on the internet, to communicate directly in text based communication or chat with the dealers that want to sell them something.”
Of internet sales managers say they sell more cars because of chat Source: Contact At Once! 2013 Dealer Survey
Today Contact At Once! software can be found on the major car shopping sites like Edmunds, Cars. com and AutoTrader.com, as well as dealer and OEM specific pages such as Acura, Honda and Kia.
A consumer who wants to initiate chat and text conversations with the dealer can do so and get an immediate response. The Contact At Once! live chat solution enables dealers to conduct these conversations via desktops, tablets or smart phones, so they can respond even when they’re not sitting at their desks. In 2013 over 15,000 U.S. dealers had at least one Contact At Once! chat while the number of chat sessions between shoppers and dealers hit almost 6 million in total. All that chatting and texting enables dealers to engage more closely with customers and increase conversations by an extra 20 percent. In fact, 33 percent of those identifiable shoppers who engaged in chat purchased a car within 60 days, according to Polk analysis. “Polk analysis showed that chats from dealer sites
converted into sales, but it also proved that chats originating from manufacturer sites and from third party search sites like AutoTrader.com all converted into sales at an almost equal rate,” he explains. Car buyers typically spend about 18-19 hours shopping for a car before making a purchase with 60 percent of their efforts spent online. All that web browsing means that they are less and less likely to call the dealer or fill out an email lead. For about 70 percent, the first contact is when they walk into the dealership. While some dealers have been reluctant to embrace chat and text, consumers have flocked to the technology as the number of smart phones has exploded. Text messaging has exploded since 2007 when text messages outnumbered phone calls placed for the first time. And that gap has only widened since then. While calls have risen only 20 percent the number of text messages has exploded by nearly 1700 percent, according to Hayes. “This is how shoppers wish to communicate with dealers and enterprising dealers will take advantage of that opportunity,” he explains. “Moreover shoppers have spoken loudly about their preferred communications mechanism.” While unopened emails can pile up on the typical phone, text based messages are usually read quickly. That provides a real time indicator of the importance of this type of communication, according to Hayes. When he and CEO John Hanger originally launched Contact At Once!, it was important to build the technology and the solution from the ground up so that it could meet the specific needs of the auto industry. The solution had to work whether it was deployed on the dealer’s website or a third party site to instantly connect shoppers from a variety of online locations with dealerships. “Shoppers visit OEM sites, online ads, social media and more when they’re car shopping,” says Hanger. “We’re the only software that instantly connects them with dealerships from all the places they’re researching. That’s the network effect.” The app that resides on the dealer’s computer or iPhone or android device had to be easy to use – and download from the respective app store. Dealers are often concerned about how chats will be answered and Contact At Once! offers a variety of options. “Our solutions give dealerships the ultimate
John Hanger CEO, ContactAtOnce! 24
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Source: Contact At Once! 2013
flexibility to choose whether they answer some or all of their chats and texts,” says Hanger. “The most common choice lets them answer when they can and then automatically routes chats to our automotive professionals when dealership personnel aren’t available.” As text and chat has grown, the amount of time consumers spend on mobile devices has also exploded as well. In fact as much as 40 percent of searches and visits to websites now occurring in the digital auto world come from smart phones or tablets. “The good news is there’s a lot of mobile shopping and searching going on,” notes Hayes. “The bad news for the individual dealer is that completion rates for the traditional lead form on mobile are close to nonexistent. Shoppers won’t fill out a lead form on a mobile device. The numbers are staggering.” The effectiveness of text and chat sessions lies in their ability to create a conversation and a bond between dealer and buyer. Unlike a lead generation form that asks for personal information, but provides no immediate return to the buyer, chat becomes a two way street.
r e q u i r e m e n t s ,” explains Hayes. The company is also seeing growth in video communication between dealers and customers. This service is particularly effective in answering questions and actually letting the customer see it through streaming video. The success of Contact At Once! and its acceptance within the auto industry can be seen in its expansion. The company has grown almost 400 percent over the last three years, landing it on Inc. Magazine’s list of Fastest Growing Private Companies and Deloitte’s Technology Fast 500. CBT
From Left, Skip Dowd, SVP Automotive Solutions; Marc Hayes, Co-Founder; Scott Bogartz, Co-Founder
Contact At Once! text messaging is a similar one to one communication that provides answers and helps build a relationship. All texts between dealers and buyers are managed through the Contact At Once! platform, which provides tracking and helps ensure compliance with privacy regulations such as the Telephone Consumer Privacy Act, as well as, mobile lead capture. “Dealerships can respond and follow up with consumers one to one via text without having to worry about getting into trouble with compliance
Shoppers who initiate chats
Sales Come From Everywhere 35.3% 3rd-Party Ad Sites 31.5% Dealership Sites 31.6% OEM Sites
Source: R.L. Polk
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fter spending a week in New Orleans for the American Financial Services Association (AFSA) conference and the National Automobile Dealers Association (NADA) convention, there is no doubt in my mind that the future is bright for the success of the business office. There was plenty of talk, recommendations and insight concerning the federal oversight looming over the finance reserve issue and the buzz for inside the business office is and will continue to be technology. According to the “experts”, the industry saw changes in the market with some of them being good and some do raise some concern. Depending on your view on the impending changes in our industry, the light at the end of the tunnel may be one of two things; however there is a third. If you have been in the automotive industry for any length of time, you know the one constant of our industry, change. Things change. The product, the customer, the dealerships, the owners, the laws, the credit, the finance companies, and regardless of the changes, we adapt and overcome. We are now seeing the changes in real time. In the past the change would happen and it
Tony Dupaquier Director of Training F&I University American Financial & Automotive Services, Inc. As Director of Training for American Financial & Automotive Services, Inc.’s F&I University, Tony is responsible for the content, direction and marketing for the F&I University’s training curriculum. Tony conducts various F&I and Advanced F&I workshops throughout the year in locations nationwide. Tony earned a Communications degree from Sam Houston State University prior to beginning his retail automotive career in 1990 as a salesperson in Houston, TX. Before joining the American Financial team in 2000, Tony held the positions of Salesperson, Business Manager, Fleet Sales Manager, Sales Manager, and General Manager. Throughout his retail sales career, Tony was consistently a top producer as well as a multi-year recipient of numerous manufacturer awards. In 1995, Tony earned the prestigious title of Nissan National Walk-Around Champion. Tony has presented to various 20 groups, state, national and international dealer associations, and was a featured workshop presenter at the 2014 NADA convention. Tony is the master of ceremonies of the F&I Conference and Expo in Las Vegas, NV.
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would filter down into the dealerships and then into the business office. Today we see it coming by reading it, hearing it and seeing on the CBT News. Being able to see the changes in real time, gives us the opportunity to make adjustments in our processes, so when we have no choice in the matter, we are already prepared. If you have not started preparing for the loss of finance reserve as we have known it, the time is now. It is happening with some finance companies now and soon all will be required to comply. This is not an option for the finance companies. I heard it directly from the Assistant Director of the CFPB. It was clearly voiced that discretionary pricing at the dealership level should not be allowed. The good news, dealerships should be compensated fairly for the work and effort to secure a loan for customer, as long as it is not based in a discretionary form.
There were several recommendations given to compensate the dealership. A flat fee With many factory incentivized rates, many dealerships are accustom to this A percentage of line 5 (amount financed) Many of our finance companies already offer A hybrid This was the new one. A mix between a basic flat, a percentage of line 5 and compensation based off of the term of the loan The last day of the NADA convention, NADA had a workshop and handed out a Fair Credit Compliance Policy & Program. It outlines the recommendations from NADA on how dealerships may want to handle finance reserve for the time being. This is a fantastic initiative by NADA encouraging a written process at the dealership level. This sends a message to the federal agencies that we, as an industry, want to do what is right to discourage any type of discrimination at the dealership level.
Change is the law of life and those who look only to the past or present are certain to miss the
- John F. Kennedy In my opinion, and I hope I am wrong on this, the federal oversight hammer will come down and the ability to negotiate the sell rate from the buy rate, will be no longer. My advice, take the flat and focus on your product sales. Not the most popular position, however the dealerships that focus on reserve, that light at the end of the tunnel will be a train. Technology is a major focus by the factories on the sales floor. More and more factories are requiring the sales team be equipped with a tablet to assist in the sale of the vehicle. We know many of our customers are becoming more accustomed to technology in their everyday life and the retail automobile industry is responding. When it comes to the business office office, the move to more technology is not always embraced at the same level, as the floor. Do not be afraid of the technology, it can help and as time moves forward, it may make our lives, as business managers, a bit easier. Many companies have introduced tablet based F&I presentation tools and solutions, and these releases have come with a mixed emotions, with good reason. One thing is clear, the customer want to be involved and the tablet technology allows the customer to be involved, however is the business manager involved? This is where many business managers have a severe disconnect with the use of the tablet. As a dealer, general manager, finance director or business manager, you may be looking at a tablet or digital piece for your business office and I encourage you to look, however you need to find the right fit for
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RECEIVE DAILY NEWSCASTS, FEATURED STORIES, INTERVIEWS, AND MORE... situation. The wrong tablet or digital piece has proven to be detrimental to the success of the business office numbers.
debt, more money, allows for more cars sold and these customers will be able to afford more F&I products.
Many of the tablets are almost designed to be a digital business manager, reducing the amount of interaction between the business manager and the customer. This is a primary objection to many business managers. If you have a Business Office that is struggling and the talent pool available in your dealership is shallow, this is a viable option. If you have good or even strong business manager, make sure you go with a tool that is more of a tablet electronic menu. I saw a new one at the NADA show that will be released this month. This is a great â€œsplit the differenceâ€? between something the customer can work with and something familiar enough to the Business Manager, that they will use. Do you need a solution or a tool, there are two distinct differences, find the one that will work best in your Business Office. The light at the end of this tunnel is the glow from a backlight.
84.8% finance and lease penetration on new vehicles and 54.6% pre owned, shows the finance companies have the money to lend out and more importantly, willing to lend it out. This is being pushed by higher credit scores of an average of 716 for new and 648 for pre owned. The increase of the credit score comes from less debt and more disposable income. This is a double bonus for our industry.
There was a fair amount of statistics about the automotive industry from the finance side provided. Looking at the numbers, we have to be prepared for the direction the industry is moving. Longer term loans, the popularity of leasing, the amount of disposable income; these are all factors that directly impact our industry and more specifically, the Business Office. All of the economic indicators show another strong year for 2014 with an increase of disposable income. What has helped this is less debt per household, less
The average loan amount for 2013 was $26,685.00 with an average payment of $459.00 with an average term of 65 months. The interesting point here is, the average loan amount and payment stayed about the same, however the length of term increased. 72 months is now the new normal for new car loans. With longer term loans becoming more accessible, 19.3% of all new car loans exceeded 72 months. For the sales department, this increases the length of time to have a customer come back into the buying cycle, however for the business office; this generates plenty of need for GAP and service contracts. From a statistical outlook, the light at the end of the tunnel is a bright and shiny opportunity for the business office. 2014 has all the indicators for a strong year in the automobile industry. The factories are producing fantastic products with the marketing behind them to drive customers into the dealerships. The credit scores are up, the finance companies have money to lend out and the customers have more disposable income. Drop in some technology to work with the customer and the business office will have a strong if not another record breaking year. CBT
A staple of Internet marketing, land
THE OFFICIAL NEWS SOURCE OF pages drive visitors to do what you THE RETAIL AUTOMOTIVE INDUSTRY
them to do. When used in tandem w Facebook ads, Facebook landing pa give you an opportunity to create m value and carry visitors further dow sales funnel.
ETo see more from Tony Dupaquier go to CBTNews.com
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& LOWER EMPLOYEE TURNOVER CONNECTION IS THE KEY It’s 1985 and you’re a new salesperson at the dealership. Your customer has been challenging and with much effort you have managed to secure a commitment to purchase the vehicle you just drove. In haste, you attempt to fill in all the required paperwork to start the deal. As you approach the sales desk your anxiety begins to rise, having witnessed the wrath of the “Desk Manager” informing the last salesperson that their forms were completed incorrectly. The papers go air born as the hurling profanities ensue. For many of us this was simply the rites of passage into the fraternity that is the car business! A sort of initiation that others had previously experienced and that you too now needed to endure. Fast forward the tape to 2014, nearly 30 years later and ask yourself how much has changed? Perhaps now it’s not the desk manager literally throwing up papers, but has the conversation evolved to a place that allows the salesperson to truly feel heard and appreciated? order to provide a great experience for customer’s we must first provide a great experience for our team members. To make the move to Level Two Permission requires a relationship with EACH member of your team, and it all starts with CONNECTING.
In New Orleans at the NADA Annual Convention there was a lot of buzz around the importance of a more customer centric process, that the experience for buyers must be transparent. While there have been significant improvements in technology to address ease of purchase, how much progress has been made in creating a productive working environment at the dealership?
The ability to connect with others (employees and customers) begins with understanding the value of people. Jim Collins, author of Good to Great observes, “Those who build great companies understand that the ultimate throttle on growth for any great company is not markets, or technology, or competition, or products, it is one thing above all others – the ability to get and keep enough of the right people.
In conversation with many dealership managers, staffing of salespeople continues to be one of the greatest challenges. When asked, candidates often comment that they would prefer to stay on “unemployment” than sell cars, tragic. So what can we do to turn this trend around? Several years ago at the ChickFil-A Leadercast conference I had the opportunity to hear John Maxwell speak live on his 5 Levels of Leadership. The idea that title or position alone would only produce the minimum required resonated with me and others in attendance. The key to increased productivity was to rise from Level One - Positional Leadership to Level Two - Permission. The difference in commitment is clear when your team is doing things not because they “have to” or else, rather because they “want to”. In
The task of connecting with others is critical in rising up to the Permission Level (2) of Leadership. To accomplish this we must first value others in order to add value to them and the relationship. Connecting with team members is the key to getting the most out of each player (salesperson). Doc Rivers was interviewed by NBC just prior to the USA Olympic basketball team taking the court in London to play for the Gold Medal. He was asked by Al Michaels why he thought Coach K (Mike Krzyzewski) was successful as a head basketball coach. Was it the X’s
and O’s during the game? Was it his ability to recruit the best players? At the time Doc Rivers’ son was finishing his college career playing for Coach K at Duke. Rivers commented that while Coach K was effective both in the game as well as recruiting, he felt that Mike’s ability to connect with his players on a deeply personal level was the difference maker at Duke. You see anyone can recruit great players and execute effective plays. It is in those moments of adversity when a player and a team are tested and need to dig down deep to achieve greatness that makes for a championship team! This drive comes from a desire to not disappoint Coach K or their fellow teammates. So ask yourself this question, “How well do you know your salespeople?” Simple test: If your dealer were to indicate that you may keep your job as a manager only if you can answer the following questions… from memory… no notes. Would there be some anxiety? 1. WHAT IS THEIR SPOUSE/ SIGNIFICANT OTHERS NAME? 2. WHERE DOES THIS PERSON WORK? OCCUPATION? 3. HOW MANY CHILDREN?
Cared about People as well as Profits Viewed Subordinates Optimistically Sought Advice From Those Under Them
Concentrated on Production Were Focused more on their own Status
Were Preoccupied with their own Security
Were Reluctant to Seek Advice From Those Under Them Listened Only To Superiors
Showed a Basic Distrust of Subordinates Didn’t Seek Advice Avoided Communication and Relied on Policy Manuals
**Jay Hall of the consulting firm Teleometrics has studied the performance of 16,000 executives and found a direct correlation between achievement and the ability to care for and connect with people. Here are a few of the findings above.
NAMES? AGES? 4. AN INTEREST THAT EACH CHILD HAS OUTSIDE OF SCHOOL? 5. AN INTEREST THE TEAM MEMBER (EMPLOYEE) HAS OUTSIDE OF WORK? Having conducted this exercise with numerous dealership clients over the years there were few exceptions, most hesitate to attempt the task. The good news is now that you are aware of the gap, you begin to address it immediately. CBT
ASK THE THREE KEY
Here are three connecting questions to consider: 1. Do you care for me? 2. Can you help me? 3. Can I trust you? Key Concept: Connecting begins when the other person feels valued. Question: “What can I do to increase my value of others?”
Kirk Manzo President of The Manzo Group
The Manzo Group is specializing in working with Automotive Dealerships in Sales, and Sales Management to increase profitability by establishing defined process standards. As a Certified Member of the John Maxwell Team, Kirk facilitates Mastermind Groups, In-dealership Workshops and Coaching Services based on Maxwell’s strategies on Leadership and Communications.
ETo see more from Kirk Manzo on sales training go to CBTNews.com 30
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CBT NEWS ON THE ROAD TO NADA 20 CBT News aired special coverage of this yearâ€™s NADA Convention in New Orleans. The CBT News team hit the road in Atlanta, stopping at dealerships along the way where they broadcasted right from the showroom floor. Once arriving at NADA, CBT News interviewed more than 50 auto professionals to talk about the car biz. You can find these interviews at CBTNews.com.
Bill Wittenmyer Partner at EleadOne
Mike Haeg Director of Business Development for Century Interactive
Chief Executive Leader of SCI Marketview
President of Minority Dealers Association
Avi Steinlauf CEO of Edmunds.com
From Left, Jim Fitzpatrick, Founder/CEO CBTNews.com; John Fitzpatrick, President/CEO Force
Mike Williams VP Mobile Solutions for Black Book USA
CEO of Potratz Advertising
VP of Sales for Contact At Once!
Mike McFall President of Black Book Online Division
Dale Pollak Christian Zeigler
Founder of vAuto
COO of Dealers United
Jared Roe President of Kelley Blue Book
Bob Morris Dave Page President of Dealer e Process
Director - Southeast Region of The Tim Lamb Group
Ryan Leslie Director of Reputation Management for Dealer Rater
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To Watch Complete Interviews Go to The Archive Section at CBTNews.com
014 IN NEW ORLEANS Go to CBTNEWS.com for more A special thanks to our NADA Sponsor Force Marketing
Jason Barber President of Friendemic
Vice President of Dealership Development Services for Ally Financial
Larry Gamache Communications Director of CarFax
President of Colorado Dealers Association
Mike Goicoechea CEO of DealersLink
Melinda Zabritsky Senior Director of Product and Marketing, Automotive Finance for Experian
Karl Brauer Senior Director for Kelley Blue Book
Greg Easterly President of DealerMatch
Kirk Manzo President of The Manzo Group
e Marketing; Bridget Everett, Managing Editor CBTNews.com; Russel Brown, Anchor
Larry Dominique Executive Vice President for TrueCar
Executive Automotive Analyst for NADA Used Car
Joe Webb Founder of Dealer Knows
Dave Raphael Director of Marketing and Dealership SalesMighty Auto Parts
Steven Szakaly Chief Economist of NADA
John Fitzpatrick President of Force Marketing
David Kain President of Kain Automotive
Raj Sundaram Executive VP and Group President for DealerTrack
Jeff Coates CEO and President for Autobytel
John Hanger CEO of Contact At Once!
Dave Winslow Chief Digital Strategist for Dealer.com
Jim Franchi Division President of Media for AutoTrader
John Dobrick Director of Sales Training of The McDavid Group
Mitch Cummings President of Opportunity Max
To Watch Complete Interviews Go to The Archive Section at CBTNews.com
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POSITIVE POWER PRESSURE of
In consulting with companies across continents and industries over the past fifteen years I’ve become convinced that one of the most under-appreciated words in language is “pressure”. Just saying it aloud can evoke a wince or flinch from those recalling how pressure in a marriage, with finances or from a job caused stress and pain. But without a doubt, pressure is one of the most useful things in God’s creation. It gives rise to life; a baby being born doesn’t enter the world without pressure. Filthy coal is unable to become a priceless diamond without pressure. Without blood pressure the patient flat lines. Pressure creates energy that moves ships, locomotives and space shuttles. In business there is a distinct difference between a healthy and unhealthy pressure to perform. Pressure can work against you when it’s a manager’s first tool of choice to increase production, as he resorts to creating fear-based adrenaline rushes any time he needs to raise his people’s performance levels. Threats and intimidation are pervasive in sick cultures, led by inept or old school leaders. Employees in such places comply but never commit; their unproductive stress levels eventually curtail their performance rather than improve it. On the other hand, in a high performing culture pressure is a fixed culture asset that consistently raises levels of alertness, urgency and performance. Expectations are clear and high; feedback is fast and honest; accountability is swift, firm and fair; and driven and talented people routinely push themselves and others to excel. Even in great cultures there is occasional unhealthy pressure from time to time, but the healthy pressure is dominant day-in and day-out. Here is a partial list of fixed cultural assets that will create an ongoing healthy pressure to perform. Evaluate to determine their level of prominence in your dealership:
RIGOROUS HIRING PROCESSES STRUCTURED TO ELIMINATE FROM CONSIDERATION PEOPLE WITHOUT INTERNAL DRIVE AND EXTERNAL ENERGY
Since you can’t teach someone drive or energy it’s essential that you hire driven and energized people. People with these qualities will respond more favorably to healthy pressure to perform. Here are two clues you may have people on your team with deficient levels of these assets: A.The team member requires daily pep talks, motivation or “winding up” to get them into motion. B.Deadlines, incentives or threats are your primary tools for getting them to produce. Since your best predictor of future performance is past performance, an intelligent hiring process will dig into someone’s life in search of clues the candidate is both driven to achieve, and has the stamina to perform at the level necessary to attain the results you require.
CLEAR AND HIGH EXPECTATIONS FOR DAILY, WEEKLY AND MONTHLY ACTIVITY AND OUTCOMES While most organizations have some sort of monthly outcome objectives for their people—forecasts—fewer have daily activity expectations that when consistently
executed will achieve the monthly work requirement. The problem with only having a monthly outcome forecast is that it can take the pressure off staying productive and focused on essential disciplines daily; especially at the beginning of the month when the monthly forecast requirement can seem a long ways off. Daily, weekly and monthly activity and outcome expectations make Isaac Newton’s Law of Motion a daily ally for creating healthy pressure: Objects in motion tend to stay in motion; objects at rest tend to stay at rest. A significant benefit of organizational clarity established by clear daily, weekly and monthly expectations is that non-performers can be more readily identified, flushed out and removed when not meeting job requirements.
PROMPT AND HONEST FEEDBACK THAT ELIMINATES GRAY AREAS, REINFORCES PRODUCTIVE PERFORMANCES, AND CONFRONTS POOR PERFORMANCE Once expectations are clearly established, leaders are more easily able to deliver essential feedback that either affirms or corrects. Fast feedback produces positive pressure when it’s used to reinforce productive behaviors as team members strive to repeat what has
been acclaimed by the leaders they respect and want to please. The feedback will also check poor performance before it has a chance to be repeated and become a bad habit, creating pressure for a straying team member to correct their errant performance. Astute leaders consistently offer fast feedback in either case as they are aware that the longer it takes to reinforce or confront, the less impact the feedback has. By eliminating gray areas a leader facilitates pressure to perform, and by failing in this responsibility he significantly weakens his culture as performance will decrease in direct proportion to the increase in gray area within an organization.
PEOPLE ARE FIRED FOR NON-PERFORMANCE In a growing organization poor performers are fired quickly, professionally, and humanely. It’s a negative reality that not everyone in an enterprise wants to keep up or is able to keep up with the new expectations and responsibilities that come with growth. The leader’s responsibility is to find a more suitable role for the laggard, get him or her better, or remove them and bring someone on board who is better. Firing a nonperformer should not be considered as the problem; keeping him and allowing him to inflict himself on the organization, its customers and everyone working there is the problem.
There’s a law of physics that explains well the need for ongoing pressure brought about by the four fixed cultural assets listed in this piece. To paraphrase the Second Law of Thermodynamics: things naturally wind down rather than up, unless outside energy is applied. The positive power of pressure is one of a leader’s greatest tools to create that outside energy. CBT
ETo see more from Dave Anderson on sales training go to CBTNews.com
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President of Dave Anderson’s Learn To Lead ® Dave is president of Dave Anderson’s Learn To Lead®, an international sales and leadership training and consulting company. Prior to beginning Learn To Lead®, Dave enjoyed an extensive and successful career in the automotive retail industry. Dave has given over 1,000 workshops and speeches over the past decade on sales and leadership development and has spoken in 14 countries. Dave is the author of 12 books, including the TKO Business Series, Up Your Business, If You Don’t Make Waves You’ll Drown, How to Run Your Business by THE BOOK, and How to Lead by THE BOOK.
MESSAGE FROM THE CHAIRMAN
E CONTINUED FROM COVER PAGE
written by Scott Patterson
dealers in 2007 to resolve Department of Justice allegations of unintentional credit discrimination. It generally involves establishing a set amount of dealer participation that a dealer adds to a buy rate and only deviating from that amount if certain procompetitive factors that are unrelated to the consumer’s background are present in the transaction FORREST McCONNELL III and are properly CHAIRMAN OF NADA 2014 documented. The NADA template also contains sample forms to facilitate this process and it creates management, training, oversight and reporting guidelines to ensure the program is properly carried out. ZV
o you’re in the car business and your image matters to you. I’m willing to bet that you’ve tabbed 2014 as THE year that you’re going to improve that image. Maybe you want to drop a few pounds, get to a certain body fat percentage, or even just get off that cholesterol med that your doc has been pushing on you for years. Problem is, you said the same thing about 2013. And probably 2012. So before you buckle down and try the same approach one more time and start meticulously counting calories and reading entire novels while on the treadmill, I have some advice for you: DON’T! That’s right, I am in fact telling you that if you want to be healthy, stop counting calories and spending hours on the treadmill. You don’t have time for that anyway. Sound crazy? Keep reading. Now let’s be clear, I’m not just telling you to say screw it and move into the apartment above Ben and Jerry’s. I’m just trying to show you a more simple, sustainable, time-efficient approach. Lets talk about food first. And I’ll use myself as an example. I never count calories. I have absolutely no clue how many calories are in a cheeseburger or a filet of salmon or a Bon-Bon and I don’t care. When I graduated high school, I weighed 180 lbs. Today, I weigh 180 lbs. So, unless by some amazing miracle I have eaten the exact number of calories that I have burned since high school, then there’s a lot more to the weight management story than just calories. So what does matter? FOOD SELECTION. And that’s just about it. I have an acronym for you: JERF. You can make your own jokes about what that sounds like, but it means Just Eat Real Food. Real foods are those that can be hunted or grown. In particular, go
for high-quality meats and non-starchy and start swinging and slamming for veggies. These are the foods which similar intervals. Get creative! There trigger the most satiety hormones are plenty of options. Throw in with and help your body to recover. Avoid this approach some resistance training grains and other starchy carbs as much 2-3 days/week for 30-40 minutes and as possible. They keep your insulin you’ll see extreme improvement in your elevated and not only cause your body body composition and overall health. to store fat, but also wreak havoc on So, unless you enjoy long walks on the your body’s ability to regulate its blood glucose. Aim for <50 grams per day. treadmill and eating a diet similar to By following this approach, your body the north American house sparrow, lets will spend more time burning fat and switch it up this year and say cheers to detoxifying and less time increasing its being on the right track to fitting your backside into that sports car again! CBT own diameter. And everybody wins. Now as far as exercise, sticking with any program is all about time efficiency. If your workout takes 3 hours every day, you’re likely to stick with that for about 0 days. There just aren’t enough hours in the day for a busy professional to commit to a time-consuming regimen. So, mindlessly walking on a treadmill while watching three episodes of King of Queens is easy, but it’s certainly not time efficient. And doing 7 crunches while sending out a hilarious tweet doesn’t take long, but it’s obviously ineffective. So, how do we get in a 20-minute workout that will create a great hormonal response and improve body composition? Sprint! No, you don’t have to run like Carl Lewis and certainly no one wants to see you in a singlet. What I mean is short bursts of maximal effort physical activity with moderate rest periods. And though it’s one of the best options, you don’t even have to run (though I’m sure your dealership has plenty of outdoor space in which to do so). You could do repeated vertical jumps at maximal height and frequency for 20 seconds, take 1030 seconds of rest and repeat 10-15 times(depending on your current level of fitness), or my favorite: find a local gym with some kettlebells and ropes
Adopting the NADA program template, or any portion of it, is an individual dealer decision and is strictly optional. The program does not constitute a “safe harbor” for complying with federal law and no federal agency has endorsed it. However, NADA believes the program, if properly adopted and faithfully executed, will strengthen the dealership’s ability to comply with the federal Equal Credit Opportunity Act. Dealers can access a PDF of the NADA Fair Credit Compliance Policy & Program at nada.org/faircredit. Additionally, NADA members can access a Word version of the program template on that web page by entering their user name and password and consenting to a licensing agreement. Dealers should consult with their attorney to determine appropriate fair credit compliance procedures for their dealership to adopt. Stay tuned for more educational information on this topic and the NADA Fair Credit Compliance Policy & Program, including an NADA University webinar that will be announced to dealers in the near future. CBT
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GREAT PEOPLE and KEEP THEM One of the greatest challenges facing auto dealers today is finding great people for their fixed and variable operations. I assure you that car dealers are not the only ones facing this challenge. It’s difficult to find self-starters, who are ethical, motivated and know how to interact with customers. There are plenty of educated and skilled workers who lack motivation and problem solving abilities. Combine that with the complications that come from characteristics specific to new millennials and your challenges increase.
New York Times Best Selling Author Grant Cardone is an international business and sales expert. His early work in automotive sales led to his creation of Information Assisted Selling (TM), a method that offers a non-confrontational approach with emphasis on presenting solutions based on full understanding of customer needs. Cardone offers sales training tools, audio books, training seminars and other speaking events to htelp sales professionals achieve high levels of success. Follow Grant on Twitter at @GrantCardone
Let’s face it, selling and servicing cars today is more demanding than ever. Shrinking margins means lower commissions, manufacturers demand that you deliver an exceptional customer experience, and hey, sometimes you aren’t the easiest person to work for (not kidding). Dealers have told me, “Grant, there aren’t any good people in our market.” Well I believe that you should not be looking for good people, you need to find great people with great sales abilities. They are out there! Selling cars or selling service is not for anyone. As a business owner, I understand the frustration with finding great people. When I am looking for great sales people, I don’t settle for good or average. Great people are hard to find in any position and you cannot and will not find them if you don’t believe they exist. You have to pursue them. You have to be willing to pay them right, take care of them and bring them into an environment that inspires them.
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Here are a few tips to finding great sales people: Don’t settle for average. I know managers and dealers who won’t hire experienced sales people. They prefer to hire people they can control and teach to do things their way. What are the chances of finding a great sales person who has never cold called, never handled a customer or closed a deal of any kind? I would love nothing more than to find great sales people who don’t need to training on the basics, who I don’t have to motivate and are able to think and operate on their own.
What do great sales people look and sound like? I assure you they don’t look and sound average. They impress you immediately. They dress great, speak hold themselves with confidence, make eye contact and know how to hold and control a conversation. They will be early for the interview. They will follow up and they will be very interested in earning money. Be sure the person interviewing them is not easily intimidated and threatened by the candidates earning potential.
Look for a great attitude. Everyone believes attitude influences the sales process and will influence the customer’s decision and experience. A great attitude is important of course and starts with the individual. The ability to turn on a positive attitude when needed is what separates the average from the great. You should test the person for attitude. Don’t tell me what you would do, show me. Tell them, “show me a great attitude, show me your best smile, show me how you would handle a disgruntled buyer.” Either then can or they cannot and you’ll know.
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Are they reliable? Punctuality, accountability and reliability are all important traits. Look for these things from the start. In my world, early is on time and on time is late. When did they arrive? Can they be trusted to show up everyday and go the extra mile? Are they ethical and honorable? Find out who they are and walk them to their car and look at their current transportation. How a person keeps their car is almost as good as a urine test and, it tells me a lot about how reliable that person is.
Ask them “why do you want to work here?” If they don’t know and haven’t taken the time to do the research, they probably aren’t the right person and certainly are not great. A great salesperson researches a company they want to work for and they know how to sell themselves on why.
Do a quick look at how the applicant uses social mediums. I am not looking for what they are posting on Facebook, Twitter, Google or Linked-in. I am looking for how savvy they are and how they use these platforms and if they use them to prospect business.
Finding great people means you have to look for them and believe they exist. Getting great people means you need to seek them out aggressively and pay them great. When you find a great sales person pay them so much they will never want to leave. Don’t penalize great producers because you have a whole bunch of people that are average. A great parts sales person, new car sales person, a guy that can sell you 30 used cars every month or a top producing service writer, should all be rewarded for production. These are the most valuable people in your organization and their pay plans and incentive structures should reflect their greatness and retain them so they can continue to produce more.
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ETo see more from Grant Cardone on sales, management, & motivation CBTNews.com
Vice President of M5™ Management Services
BUSINESS “Slow down and you’ll be so much faster!” I will never forget those words… As a young man growing up in Pennsylvania and learning to race sprint cars, I was all about going as hard and fast as I could. After a number of weeks of little to no success, and a whole lot of smashed race cars, I reluctantly asked one of the regular winners what I needed to do to win like him. He looked at me almost as if he didn’t want to answer and then said those words that still stick with me today….”you’re simply trying too hard”, he said. “If you’d just slow down and concentrate on doing it right, you’ll be way faster.” It made absolutely NO sense to me whatsoever. But reluctantly, I climbed back in the car and took his advice. Within a few weeks I found myself winning about every time I competed. All because I concentrated on the little things that made a fast lap, instead of simply trying to make a fast lap. Well, the years went by and I eventually gave up the dream of racing full time to concentrate on my career in the automotive industry and when I had the opportunity to become a consultant, I found that the same advice that once was given to me was exactly what I felt was relevant to most service advisors. Well…almost the exact same advice. What I found was that most service advisors are so focused on selling the business that they become almost obsessed with it. This is then perpetuated by their manager defining a “good job” almost solely on their hours per repair order. And to make matters worse, they have a pay plan that awards performance in sales and hours per repair order to go with all of that. So what’s a poor advisor to do? They understand that they have got a family to take care of and so, just like me, they try to go hard and fast. They focus on selling the business and they end up stepping over the first rule of customer service…”Give the customer what they want!” Think of yourself as a consumer walking into a grocery store. You typically bring a list with you, don’t you? And on that list are the items that you need to replenish your empty (or almost empty) pantry and refrigerator. Your plan is simply to BUY those items then go home and put them away. Now imagine that you go into the very same grocery store with your list, but instead of picking up a cart and walking the store, you get the pleasure of dealing with a “grocery advisor” whose job is to get you all of your items. While to those of you, like me, who aren’t big fans of grocery shopping that might sound like a pleasure, but let’s now imagine that your grocery advisor is paid on sales and items per customer and he or she is going to make sure that they are helping pay their mortgage that month. Instead of looking at your list, all they are focused on is taking you to the high gross items. Like filet mignon instead of the hamburger that’s on your list, or to the lobster tank instead of the fish
Rick Yanac of M5™ Management Services is an automotive professional with over 25 years’ experience in the business. A resident of Pennsylvania, he started his career as a counterperson at a local auto parts store eventually moving to a dealership parts department. A few years later, he became Parts Manager at the largest dealer in his hometown where he spent 15 years. During his tenure there, he also worked as a Service Advisor, Service Manager and finally Service Director. He began his consulting career in 2006 and since has developed a client list that includes some of the highest operating stores and dealer groups in the business. He currently serves as the Vice President of M5™ Management Services and in addition to working with his clients and various new vehicle manufacturers, he helps recruit and develop their consulting staff.
sticks that you were planning on buying. How likely are you as a consumer to go back to that grocery store? You may say, “Well that’s nothing like my store.” But is it really all that different? All of your customers at some point know they need to visit a service facility. Maybe their maintenance light has come on, or they have reached a mileage threshold, or they have an issue they want corrected. They really only have one decision to make…who will be their vendor of choice? It is my contention that they will make that decision based on a prior experience. If that experience was a negative one, what do you really think the chances are of them returning? Yep, you guessed it…somewhere between slim and none. So how do we improve this? First you must define a good job. Every advisor needs to know that your definition of a good job is “serving the customer in a manner that earns their future business”. The key word here is earn. You must earn their business. They will not simply award it to you in today’s competitive market place. And you will never earn it by playing mind games with them and concentrating on how much money you can extract from them per visit by using word tracks designed to confuse them or force them into buying. Instead, why not focus on selling them on the little things you do to make each visit a positive experience. You make an attempt to satisfy them every time they come in, right? Why not talk to them about that? Haven’t you tried to build certain conveniences into your business plan? Maybe you have extended hours or you offer loaner cars, or you have a shuttle service. Talk to them about your conveniences so that they know you offer them…and more importantly, that many of your competitors don’t! Sell them on the experience of your technicians. Rather than telling them that you have factory certified technicians, why not do a quick calculation of how many cars you serviced last year or how many hours of training each of your technicians has. Now the next time a customer comes in with a strange electrical issue, instead of telling them you’ll put your “best technician on it”, you can advise them that you have a technician who specializes in that type of repair. In fact, he has had well in excess of 300 hours of training and has serviced over 6,000 cars just like theirs last year alone. When you serve the customer in this manner and they choose to return to you, guess what happens? You got it….they buy additional hours from you. And in the end, you have slowed down and gone way faster… You’re well on your way to winning! CBT
ETo see more from Rick Yanac on service training go to CBTNews.com
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EVERY GARDEN WILL BE Richard Keeney Co-founder of the Mar-Kee Group and eAutotraining.com
PROTECT THE NEW HIRE I remember going to a mandatory personal development seminar long ago, one that I benefited from greatly. Yet, I can’t deny my first thoughts about going... As soon as I was notified my first thoughts were, “After 12 hours of working deals and putting out fires, I have to go where? And listen to who? For how long?!” Anyway, in this excellent seminar, the facilitator stated, “Every garden will be invaded... not to think so would be naïve.”
of salespeople due to long hours and unpredictable income.” “Oh, I almost forgot. We need to teach him the wisdom of a skipped demo and the 5 liner application before he wastes too much of his valuable time on someone with bad credit or some unrealistic jack leg. I bet I can have him trained and even talking just like me in about 30 days. That is, if he
absence of a well thought-out plan, the garden (his head), will indeed be invaded. Develop a plan for quick and frequent monitoring of their progress. Guide their perception of this career opportunity. Build their morale and right the sails before one steers too far off course.
I found myself reflecting on that statement due to the recent quantity of salesperson recruiting ads both online and in the local paper. The purpose of this message is simple: I believe it is healthy for managers to evaluate the experience a new employee might have at your dealership upon arrival, especially for the first 90 days or so. And a big part of this evaluation involves analyzing the impact other employees will have on the new team member’s perception of the industry. We need to make certain that we don’t have “garden invaders” disrupting our mission of building the ultimate team. As is too often the case, many of us have witnessed the execution of new salespeople by those already on board, just trying to help of course... “Excuse me, you want me to share a limited number of “ups” with someone who, if he does exactly what management instructs him to, will do well, therefore making us look bad?... I thought we were running this place.” “Oh please, let me help this kid. I can handle this. I’ll tell him what he needs to know. I have a good amount of spare time on my hands and I owe this new kid some awareness about weak banks, slow F&I people, packs, pencilwhipped commissions, unpredictable income, the kook that orders new cars, the water in the used car department and of course the divorce rates
“So you’ve made it through the first day of training here at WE LOVE YOU MOTORS. Now let’s introduce you to the rest of the sales force.
doesn’t blow out like most of them, and it still puzzles me as to why they leave so quickly.” Yeah, I know, I‘m being cynical. But maybe it’s time to assess some things: Are we putting our best foot forward with new team members? Are we being truly supportive? Are we providing the sort of experience that lets new team members know the decision to come on board was a great decision, indeed? Are we making sure there are not people who are “invading the garden?” Please remember: In the
Richard has over 35 years of automotive training, sales and management experience. Having worked as a salesperson, general manager, and every management position in between, he brings a wealth of practical skills and knowledge to each of his clients.
“You must pull the weeds out early, before they take root,” said the facilitator of that seminar, “They’re always easier to pull in the earlier stages.” Therefore, be sure your 1-on-1 feedback sessions begin as soon as possible. Keep your finger on the pulse and never assume all is peachy. Good people are still hard to find... Speaking of brand new salespeople, here’s a question worth considering...
WHAT CAN A NEW SALESPERSON EXPECT? •Proper orientation to the facility? •A meeting with all department heads? •A clearly defined job description? (Another reason for a written and signed off on “Sales Process”) •A thorough understanding of dealership standards, including productivity, dress code and conduct? •Great foundational sales training? •Ongoing training that’s wellstructured and productive? •Support from all on the sales team? •Professional and encouraging treatment at the sales desk? (I know the “new- puppy” fatigue) •Respectful treatment from the main office, accounting, etc...? •The opportunity to earn enough money (in their view). Do you even know what they need? •Supervisory support regarding their individual goals? •Patience from the management team? •Adequate time off, some balance in life? •Frequent constructive feedback from management? 1-on-1 sessions with management? •A management team that works well together? •Motivation? •Good dealership morale? •Fair disbursement of leads? •Someone to keep them challenged? •Opportunity for advancement? I recommend we investigate these matters as a management team and shore up any areas that could use improvement. Thank you and remember... I invite your call should you desire a chat. CBT
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