AutoSuccess May 2015 by AutoSuccess

2015

MAY

Right buyer Right offer Right channel Right everything

Finding opportunities is one thing. Nailing the execution is another. Too many of today’s dealers mine their data, find ready buyers and still fail to close because they don’t know enough about their customers. That’s why we built Target directly into VinConnect CRM. It’s the only data mining tool that automatically combines CRM and website data so dealers know how to turn every opportunity into a lasting connection.

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SPINNER IN AND OUT OF THIS

“Sales have blasted off since we got two spinners.” — Dale Dillon, Tipton Auto Group “It is Great! You gotta have it. It’ll be the best thing you’ve ever done in your market.” — Jimmy Payne, Owner of Payne Auto Group “We got rid of newspapers to get three AutoSpins, and WOW what an ROI.” — Charlie Hicks, Owner of Ed HIcks Nissan, Infiniti & Mercedes “Wish I had this years ago! Wouldn't be without it! Best advertising I’ve ever done!” — David Sloan, GM of Greeley Subaru

2300 Hurstbourne Village Dr, Suite 1200 Louisville, KY 40299 / p 877.818.6620 / f 502.588.3170 / AutoSuccessOnline.com/AutoSuccessPodcast.com / info@autosuccessonline.com

“If you are waiting for the right time to gather all your stakeholders to deal with both your short-term recon challenges and the long-term recon efficiency, that time is now.”

DealerPanel ENGAGING WITH MILLENNIALS: Marketing to Millennials, PART 1

sales & training solution RudyMartin

“...since the overwhelming majority of today’s buyers use the Internet to get a sense of their vehicle’s value before stepping foot in a showroom, you need to be smart about how you’re engaging them there.”

MarkTewart SEVEN CRITICAL POINTS TO CREATE GROSS PROFIT IN THE DIGITAL AGE

MarshBuice THANK YOU, MR. VIC

JackGarrity WHICH LIFETIME WARRANTY PROGRAMS KEEP CUSTOMERS COMING BACK?

marketing solution

Hannah Philpott, Media Director hannah@autosuccessonline.com

Customer Loyalty and the Pleasant Surprise

“...which brings me to the story of how a dealership made $30 off me and blew at least $2,000.”

NathanUsher THE MODERN DEALERSHIP: Online Shopping Has Changed Everything

AlexWoodward MARKETING 101: If It Is Not Trackable, It Is Not Applicable

LarryBarditch HOW SOCIAL MEDIA AFFECTS YOUR SEO

EdLouis 15 FREE WAYS TO GET PEOPLE TO DOWNLOAD YOUR APP

Brian Ankney, Account Manager brian@autosuccessonline.com

GAIN $30, LOSE $2,000:

DaveDavis

IT’S ALL ABOUT THE TRADE

Dave Davis, Editor & Creative Strategist ddavis@autosuccessonline.com

TimByrd BASEBALL’S LESSON FOR BUSINESS

Thomas Williams, VP & Creative Director design@autosuccessonline.com

RECONDITIONING WORKFLOW GOES MAINSTREAM DennisMcGinn

Susie Horne, Account Manager John Warner, Sales-Improvement Strategist shorne@autosuccessonline.com jwarner@autosuccessonline.com

ScottPechstein LOOKING FOR LEADS IN ALL THE WRONG PLACES? ASK YOURSELF THESE QUESTIONS

30 34 36 38 44

THE “CAUSE” MARKETING DRAW AND HOW NEW ENGLAND ACURA DEALERS RAISED $1 MILLION SusanGivens

DalePollak THREE WAYS TO BOOST USED VEHICLE PROFITABILITY WHILE SELLING MORE CARS

20 28 40 42

AdamRobinson WHY IS HIRING SALESPEOPLE SO DIFFICULT?

14 18 24 26

SeanV.Bradley IS YOUR DEALERSHIP LOPSIDED?

AutoSuccess Magazine is published monthly at 2300 Hurstbourne Village Dr, Suite 1200 Louisville, KY 40299; 502.588.3155, fax 502.588.3170. Direct all subscription and customer service inquiries to 877.818.6620 or info@autosuccessonline.com. Subscription rate is $69 per year. AutoSuccess welcomes unsolicited editorials and graphics (not responsible for their return). All submitted editorials and graphics are subject to editing for grammar, content and page length. AutoSuccess provides its contributing writers latitude in expressing advice and solutions; views expressed are not necessarily those of AutoSuccess and by no means reflect any guarantees. AutoSuccess accepts no liability in respect of the content of any third party material appearing in this magazine or in respect of the content of any other magazine to which this magazine may be linked from time to time. Always confer with legal counsel before implementing changes in procedures.© All contents copyrighted by AutoSuccess Magazine, a Division of Systems Marketing, Inc. All rights reserved. Reproduction in whole or part is prohibited without express written consent from AutoSuccess. AutoSuccess may occasionally make readers’ names available to other companies whose products and/or services may be of interest; readers may request that names be removed by calling 877.818.6620. Printed in the USA. Postmaster: Send address changes to AutoSuccess Magazine, 2300 Hurstbourne Village Dr, Suite 1200 Louisville, KY 40299.

Susan Givens, Publisher sgivens1@autosuccessonline.com

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- ILM (Internet Lead Manager) - Robust communication template library (email, text, print to mail, phone scripts) - Custom Dealership Data Integrations - Bulk Email - Email builder/editor with SPAM check - Data Filtering, Sorting, and Targeting - Data Import / Data Export - Compliance: Includes opt-out, DNC, etc. across all contact mediums (phone, text, etc.) - Comprehensive and customizable reporting - Advanced Reporting Suite - Third-Party Integrations Including Call Tracking Integration (vendor to provide list) - Full featured mobile app - Configurable workflow automation, escalation, and management alerts - Showroom Manager / Desk Log - DMS Integration - Campaign Manager - Inventory Management - Texting - ability to communicate via text messages to and from CRM. Solution available to market on Dealer Website and other marketing properties. - Equity and Data Mining with opportunity alerts - Data Hygiene (Monthly) - NCOA, de-dupe, opt-outs, CASS Certification, email Append - Desking - Complete incentive and tax integration; Rates and residuals integration; and Insured deal calculations - Inventory Manager - includes dealer inventory and the ability to easily manage pricing and syndication to Dealership and 3rd party websites

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SusanGivens

marketing solution

THE “CAUSE” MARKETING DRAW AND HOW NEW ENGLAND ACURA DEALERS RAISED $1 MILLION Today, companies that focus their efforts on causes that sustain and strengthen society will, in turn, strengthen their own reputation, morale and customer loyalty. Skeptics of this type of advertising believe that it does not lead to a direct or measurable return on investment. However, there are major benefits to participating in “cause” marketing that will show up on any financial statement. The New England Acura Dealers Association (NEADA) and their involvement with the Boston Children’s Hospital is one example of how cause marketing can convert into higher sales and increased market share. A Barkley study says that 64 percent of consumers would pay more for a brand because it supports a charitable cause. Because of this, it’s no surprise that the New England Acura dealers — Acura of Auburn, Acura of Boston, Acura of Peabody, Herb Connolly Acura, Prime Acura, Prime Acura North and Sunnyside Acura — partnered with Boston Children’s Hospital, a brand and institution that is recognized by 98 percent of people in New England. “Boston Children’s Hospital is a great institution delivering miracles daily. There isn’t a better organization to support,” said Chris Connolly, NEADA president and general manager at Herb Connolly Acura. Boston Children’s Hospital has been ranked as one of the nation’s best pediatric hospitals by U.S. News & World Report for the past 21 years, is the primary pediatric teaching hospital for Harvard Medical

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New England Acura dealers present $1 million check to Boston Children’s Hospital on April 17, 2015

School and is the largest provider of healthcare for children who live in Massachusetts. On April 17, the NEADA presented a check for $1 million to the hospital. The donation, which is raised from a portion of the proceeds of every Acura sold, goes toward the Children’s Fund, an unrestricted fund that supports the hospital’s areas of greatest need in patient care, research and community health. Furthermore, The NEADA has had impressive growth — and this type of cause marketing is a big reason for it. Since starting in 2013, the seven stores that encompass the NEADA were up 14.7 percent in sales, while the zone was up 7.09 percent. According to a Landor branding survey, seven out of 10 people in the world will be brand loyal to brands that support a cause during in a recession. It’s no surprise that in 2014, a recession year, the NEADA was up .3 percent while the zone was down 2.11 percent. In addition, they have steadily increased their share of the zone from 14.2 percent in 2012 to 15.6 percent in 2014. “At the association level, supporting charitable events such as these engages an audience that is not always thought of,” said Scott Fletcher, partner at Tier10, the NEADA’s advertising firm, “and in turn, an extraordinary amount of growth can happen.” NEADA will also continue to serve as a top-level sponsor at all signature fundraisers benefiting the hospital, including the recent Champions for Children’s event which was hosted on December 2. Here, the NEADA raffled off an all-new 2015 Acura TLX that was on display during the event. The proceeds of the raffle were added to the nearly $4 million raised for Boston Children’s Hospital that evening. During the past two holiday seasons, the dealers also donated 10 percent of their customers’ service or repair bills and raised an additional $50,000.

Get Certified Today

DealerRater.com/CDP 800.266.9455 Starting January 2015, the New England Acura Dealers Association extended their initial Nov. 2012 pledge of $500,000 over two years to $1 million over four years for Boston Children’s Hospital. Susan Givens is the publisher of AutoSuccess. She can be contacted at 877.818.6620, or by email at sgivens1@autosuccessonline.com.

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DennisMcGinn

leadership solution

RECONDITIONING WORKFLOW GOES MAINSTREAM A typical reconditioning workflow installation has a minimum of three principal stakeholders: the used car manager, the fixed operations manager and the general manager. In the early days of reconditioning workflow, starting around 2010, the scenario was a bit different than it is today. At that time, the used car manager, in some cases, blamed service as a bottleneck that kept sales from hitting their weekly and monthly sales targets. In the last 24 months, we have seen a definite shift. While workflow initiations from the sales side are still significant, it is now the GM who accounts for more than half of the initiatives to find a solution. In fact, a GM, or a group-level manager, is directly involved 90 percent of the time. Simply put, reconditioning is finally receiving the appropriate managerial attention and respect that is warranted based on the value. It has risen to the same level of importance as any other part of the complex job of running a dealership. Underlying this is the fact that technology has evolved to the point where accountability, ease of use and verifiable proof

are all direct benefits. This is most evident by the fact that sales, fixed-ops and general managers are seeing the results and communicating these facts to other dealers in their 20 Group meetings. The measurement and management capability of workflow enables setting standards across multiple rooftops while taking into account the processes, resources and culture differences between stores. During the early phase of recon workflow, the goal was to solve today’s immediate problem as fast as possible. Now, both the short-term fix and the long-term needs can be addressed with the same properly designed workflow foundation. Looking at this from the investment side, it’s not so much the cost of setting up a workflow system or the monthly license fee, but the cost to you of not establishing a solid foundation that supports both the immediate and long-term needs that is paramount. Jumping into a solution with the assumption that everyone “must use the tool” is not a recipe for success. This is where the ease of use, in the form of less work, must be evident to you and your users. When that happens, everyone wins and this, in turn, produces the motivation for continuous process improvement. Hardly a week goes by where I do not hear the phrase, “A system is only as good as the people who use it.” You can’t blame managers for making this point due to all the failed attempts to fix their recon process. It is easy to write this off by saying that adopting a workflow system would create extra work. When workflow becomes mainstream, it’s because it is so simple and intuitive to use that efficiency and productivity improve with an actual decrease in effort. If you are waiting for the right time to gather all your stakeholders to deal with both your shortterm recon challenges and the long-term recon efficiency, that time is now. Dennis McGinn is the founder and CEO of Rapid Recon. He can be contacted at 866.268.3582, or by email at dmcginn@autosuccessonline.com.

IS GAINED WHEN A BUSINESS ACQUIRES ATTRIBUTES THAT ALLOW THE ORGANIZATION TO OUT PERFORM ITS COMPETITORS. THESE ATTRIBUTES MAY INCLUDE NEW TECHNOLOGIES WHICH AID IN THE BUSINESS PROCESS. Wikipedia

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GALPIN CONTINUES TO LEAD THE INDUSTRY WITH GROUNDBREAKING NEW CUSTOMER EXPERIENCE MANAGEMENT TOOL Q & A With Beau Boeckmann, President of Galpin Ford

In the automotive industry, Galpin Motors is a name widely known for being synonymous with words like “innovation,” “consumer-driven” “and excellence.” The family-owned and operated dealership, located in North Hills, California, continues to set the standard for all others, particularly in the realm of automotive customer experience. As the No. 1 volume Ford dealer in the world for 25 consecutive years, Galpin Motors is a leading authority on Ford cars, trucks and SUVs and pioneered the “dealership as destination” concept, hosting the first full-service Starbucks inside an automotive dealership, and the first restaurant. The dealership offers Club Aston, the luxury showroom designed to deliver an unequaled customer experience, and has recently opened Jewell’s Exquisite Timepieces and Accessories Boutique as its latest addition. Making news these days is Galpin Auto Sports (GAS), a division of Galpin Motors. Located across the street from the main dealership, GAS is the premier destination for vehicle customizations for everyone from collectors to consumers. Galpin Auto Sports’ recent partnership with Danish Designer Henrik Fisker resulted in the release of the 725hp, coach-built Super Mustang aptly called the Rocket. The Rocket is the ultimate American muscle car, a modern-day love letter to the Ford muscle cars of the late 1960s and early 70s. Galpin’s most recent partnership with MotoFuze, a division of FuzeCast, is one Galpin President Beau Boeckmann believes is another game changer; a partnership that will solidify Galpin’s reputation as the industry trailblazer for customer experience and employee engagement. We recently sat down with Boeckmann to ask how his dealership rose to the top of the industry, and to discuss some of his plans to remain there, both now and in the future. AS: How does Galpin stay No. 1 year after year? Beau Boeckmann: So many things go into staying No. 1, but our focus remains on providing our customers with the best car buying experience they’ve ever had. Our overall strategy is rooted in our mission and values, and its foundation is our Customer Bill of Rights. Although the ways we connect and communicate with our customers have changed, our goal has remained the same. We know interaction with our brand begins well before the customer enters the dealership, so we encourage our employees to engage on social media. We rely on insights based on data to support our efforts and recognize opportunities to influence. For example, we know that 73 percent of automotive shoppers cross-shop brands, and only 20 percent of those consumers end up buying the vehicle they started out researching. Capturing buyers in the research phase of their journey requires your dealership to have content designed to answer the questions consumers ask. Customer experience with your brand begins with a search engine for the overwhelming majority of consumers. It takes a well-rounded strategy to stay on top of the SEO game. There will always be paid advertising, but dealerships are discovering the power of custom content and authentic social engagement to grow their brand online.

Mike Dullea, CEO of Motofuze

Beau Boeckmann, President of Galpin Motors

AS: What is your primary strategy for delivering the best customer experience in the industry? BB: Galpin exists to serve our internal and external customers, so their concerns are always at the forefront of our business. We strive to serve our customers with a genuine humility that leaves no doubt they are the sole focus of all of our endeavors. We haven’t changed anything about our philosophy through the years; we’ve just adapted to changes in technology when it serves our customers to do so.

Dealerships that want to deliver an excellent customer experience have to adapt quickly to the needs of their customer. Data insights tell us that fully engaged employees contribute to more than 80 percent of a customer’s overall experience with your brand, and we genuinely care about our employees. The values that have made us successful have quite naturally created a culture where our employees feel valued, and understand their contribution to the customer experience. AS: Tell us more about the ways you infuse your culture with a servant attitude. BB: At Galpin, we’re highly invested in our employees. We believe we have two types of customers: internal and external. Internal customers are our employees, and we are as committed to act in their best interests as we are our external customers. Our intention is to engage and inspire them by caring about the things they do. We need strong teams internally to serve our external customers with excellence. Engaged employees are more tuned in to the needs of customers and will go the extra mile because they love our brand and see their work as a reflection of themselves. We’ve been voted “Winning Workplaces: Best Culture” by the Los Angeles Daily News, and are proud to be known throughout the industry for our commitment to the core values of servanthood, teamwork, continuous improvement and integrity. These promises to our customers, and our employees, are what drive our daily activities. Galpin team members are the face of our brand, and though the legacy of our brand reaches far and wide, it only makes sense to leverage the reach of our employees online. We have open access to social media and encourage employees to share dealership events as well as the work we do in the community, because it benefits everyone. We can always pay to advertise, and we do, but our employees reach a far broader audience more effectively. AS: What do you believe are the critical strategies dealers need to implement to successfully engage employees? BB: The strategies for engaging employees vary by department and look a lot like the ways we engage our customers. We are authentic in every interaction with our employees and our customers. We invest in the tools we believe will improve our ability to serve one another well. We believe in empowering our employees to be social brand advocates, though we’ve found this comes naturally for many of our team members because they are genuinely excited about what’s happening at the dealership. We encourage social media engagement and even reward our top sharers with Starbucks cards or other perks because we sincerely appreciate them. From a purely data-driven perspective, we know employee-branded messages are shared 24 times more than our brand messages, and convert to sales seven times more often than any other leads, including paid advertising. On the flip side, we know that a disengaged employee costs an average of $3,400 for every $10,000 in salary, so it only makes sense for us to invest in engagement. Businesses that master engagement remain profitable year after year, so, as it turns out, our commitment to carrying out our core values is a good business decision. We would like Galpin to be liked, shared and followed on social media more than any other dealership in the world. Our goal is to continue to lead our industry, anticipating the future to continuously improve our customer experience. We empower our employees to use social media to connect with consumers and have training programs in place to cultivate a social culture within our dealership. A social culture creates a sense of shared mission and purpose and strengthens our brand. We encourage open communication between managers, employees and teams at all levels, in order to help us adapt to customer needs quickly.

“We strive to serve our customers with a genuine humility that leaves no doubt they are the sole focus of all of our endeavors. We haven’t changed anything about our philosophy through the years; we’ve just adapted to changes in technology when it serves our customers to do so.”

AS: What drove your decision to partner with MotoFuze and the FuzeCast CEM? BB: Galpin is committed to using the best technology available to serve customers well. We were actively seeking the best customer experience management (CEM) tool for us and, through due diligence, connected with MotoFuze. FuzeCast CEM has all of the features we wanted. The company’s CEO, Mike Dullea, has always been at the forefront of the automotive industry technology space, and our partnership with them exists because we believe the CEM has the tools we need to stay on the edge of emerging technology. We were looking for something that was designed to specifically address the needs of dealerships and to overcome every roadblock to engaging employees and delivering excellent customer experiences. Very few dealership employees work at a computer all day. The FuzeCast app puts CEM in the pocket of every employee, from service to sales, and with every interaction, reinforces our mission and commitment to the customer. The research is clear; disengaged employees decrease bottom line profitability and have the potential to negatively impact customer experience. Galpin chose this CEM system because we believe it will deliver a steady infusion of our mission and vision to our employees. FuzeCast delivers content consumers are searching for online, measures interaction, monitors our brand, provides social media messaging for employees customized to personal interests as well as branded content, and maximizes real-time communication with the built-in internal messaging tool. Since it’s also available in Spanish, we can effectively engage our Hispanic employees and consumers. It’s a win-win all the way. It’s not easy to stay on top. It takes dedication to excellence and a willingness to adapt to the customer. If your dealership wants to improve communication and engagement and stay focused on delivering a consistently excellent customer experience, you need tools that allow you to see, hear and respond to consumers in real time, and fully engaged employees to fuel your dealership in a customer experience economy. For more information about the success Galpin Motors has achieved, contact Don Favero, the vice president of sales for Motofuze. He can be contacted at 866.626.7128, or by email at dfavero@autosuccessonline.com.

AdamRobinson

leadership solution

WHY IS HIRING SALESPEOPLE SO DIFFICULT? When you hire the right sales resource, you see instant results and amazing things begin to happen. On the other hand, when you hire a mediocre (or worse) salesperson, you shell out paycheck after paycheck and begin to feel like you’re running a corporate welfare program. Most of the issues that come up during the hiring process are due to one of the following:

years, it shouldn’t matter what they tell you in the interview; they didn’t cut the mustard.

1. Great Salespeople Are Always in Demand

The beautiful thing about judging sales performance is that all you have to do is look at the scoreboard — their W-2 or 1099. Did they make the number? Can they prove it? Don’t be taken by smooth-talking sales candidates who proclaim to move mountains. Check the math.

Problem is, there are so darn few of them. That means that for you, the hiring manager, the market for the most productive sales resources is always tight. Even in the midst of the economic slowdown, with millions of layoffs across the planet, the top salespeople were virtually downsize-proof. This supply-side constraint forces you, as a manager, to make one of two choices. Your first choice is to up your recruiting and interviewing game to be able to locate and hire the top prospects in the market. Your second choice is to fish in a pond stocked with mediocre sales talent because that’s who’s in the market and easy to pick off. The choice is clear. 2. Mediocre Salespeople Are “A-players” When it Comes to Selling Themselves

If only they sold your products and services as well as they sold themselves in that interview, right? Most sales candidates are fairly adept at talking about the act of selling — what to do, what to say, how to act and the other common tools of the trade. But did they actually do any of it? If they haven’t made plan for the past three

3. Great Salespeople Are a Product of Environment

Our data show that when salespeople classified as “top performers” by their employers left their position to work at another firm, they were classified as “top performers” by their new employers less than 50 percent of the time, because the reasons for sales success have as much to do with environment as their sales ability. You need both to be successful. Take Bob Superstar, who’s worked at ABC Motors and was their top producer for the last three years. ABC has an outstanding marketing department and is a wildly profitable operation. It’s managed well, and customers love them. Bob is wooed by XYZ Automotive and leaves

his job for a new gig that pays twice as much base salary. XYZ has no marketing department to speak of, has service delivery issues, and is a much less profitable store. Bob struggles mightily at XYZ and quits after 18 months of beating his head against the wall. Did Bob suddenly become a bad salesperson? The point is this: You could hire the best salesperson in the universe, but if you have bad process, weak support and unreferenceable customers, then no amount of sales talent is going to get you where you need to be. 4. We’re Desperate!

“We need a new salesperson, now! Just find me someone!” Are you still carrying around that mirror in your back pocket to screen sales candidates using the “fog” test? That’s what your doing when decide to “throw them on the floor and see if they sink or swim.” The solution isn’t to hurry; the solution is to plan ahead so you don’t keep finding yourself in the same jam. I tell dealership teams that managers should be spending at least 30 percent of their time recruiting, interviewing and hiring. Before you tell me how busy you already are, I’ll suggest that there’s no better use of your time than building your best possible team.

Adam Robinson is the chief hireologist at Hireology. He can be contacted at 866.455.1671, or by email at arobinson@autosuccessonline.com.

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RudyMartin

sales & training solution

IT’S ALL ABOUT THE TRADE

Handling a prospect’s trade-in can have a huge impact on new and preowned sales performance. And, since the overwhelming majority of today’s buyers use the Internet to get a sense of their vehicle’s value before stepping foot in a showroom, you need to be smart about how you’re engaging them there. According to NADA, 60 percent of vehicle transactions in 2014 involved a trade, and 66 percent of retail used vehicle inventory comes from trade-ins. This means: • Trade-in value is important to six out every of 10 Website visitors viewing vehicle inventory. • Nearly 70 percent of your used vehicle sales are dependent on the ability to convert those visitors into customers. • Prospects with a trade-in represent a better profit opportunity for the dealership than others. A 2014 IHS study concluded that more people engage with the online trade-in appraisal tool on third-party sites than search their inventory. Since none of these sites can take trades — only

Congratulations to Toyota of Hollywood…

1Dealer

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In The Southeast Based On Total Retail Sales Of New Toyotas In The Southeast Region For 2014 Per SET.

you, the dealer, can do that — why are your most valuable potential customers going there? Do a Google search for “What’s my car worth?” or “Trade-in Value.” What results do you see? Get smart — Assuming you already have an online appraisal tool — if not, that’s the very first thing you should do — consider taking some of the money spent on third-party lead providers and reallocating it directly into Google AdWords for the aforementioned search terms, linking the ads directly to your appraisal tool. Secondly, eliminate obstacles shoppers encounter getting the estimated value, such as requiring contact information in order to view the value, something unnecessary on the third-party sites. “I sell cars, so I need leads from my trade appraisal tool,” you might be thinking. “How is doing that going to help me?” The answer is that leads are good, but appointments are better. What’s your Internet lead close rate? What is it for appointments? By providing the information online shoppers are seeking without a “catch,” you’re not only keeping them on your site, you’re developing all-important trust. When — not if — they visit a competitor’s Website that doesn’t provide that transparency, you’ve gained a competitive advantage without saying a word Get really smart — If your appraisal tool has the ability to display the estimated value range without requiring contact information, you’ll need relevant calls-to-action on that page providing a tangible benefit for scheduling a vehicle inspection at the dealership. A common benefit is a coupon. Ideally, you’d want to be able to determine the value of the offer based on their trade-in’s desirability for resale, relationship with the owner and their proximity to your dealership. I’m confident making the suggested changes will help deliver incremental sales from the 60 percent of online buyers who have a trade-in. Rudy Martin is the managing member of AutoMark Solutions. He can be contacted at 866.409.6755, or by email at rmartin@autosuccessonline.com.

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SeanV.Bradley

leadership solution

IS YOUR DEALERSHIP LOPSIDED?

While I could go in a lot of directions with a title like that, this article will refer to your showroom sales team versus your Internet sales initiative.

This equation is seriously lopsided. Here is something to consider: This is an import dealership in the Northeast. The overall dealership delivers 240 units and only 40 units online and the phone. How is this possible? Between 92 and 99 percent of people go online before they ever step foot into the dealership.

I was recently in a dealership that had 25 sales consultants on the showroom floor, plus three sales managers and a GM, for a total of 29 people to handle the showroom sales opportunities. In March 2015, this dealership had 750 logged “Ups” in the showroom and delivered 240 units. Let us not forget about the other three BDC reps in the department. They are focused on: That means that the dealership’s sales team averaged 9.6 units per person. • Unsold showroom traffic follow up • CSI • Lease retention • Retail retention and data mining On the BDC/Internet side of the business, things were a little different. • Miscellaneous efforts They had a total of five BDC reps in the department and a BDC director • Direct mail follow up but only two of the reps were responsible for the Internet leads and The situation in this dealership is severely skewed. Remember that there incoming phone Ups. Here is the crazy thing: The dealership averages are eight ways a showroom sales consultant can sell an automobile: 300 fresh Internet leads, a residual flow factor of 400 (carry-over leads • Be-back • Walk in for the last 90 days), plus an additional 150 or more phone ups. That • Phone Up • Internet is a grand total of 850 opportunities to work within a month, and the • Service department delivered a little over 40 units in March. That means the two • Prior customer/orphan owner • Prospecting BDC reps were responsible for, on average, 20 units delivered per month. • Referrals How in the world does this make sense that a dealership has 29 human resources on deck to handle 750 prospects in one month in the dealership, but the Internet department had only two BDC reps to handle 850 Internet and phone ups? If you gauge ROI or effectiveness, you will have to agree that a salesperson averaging 9.6 units is nowhere near as productive or powerful as a BDC rep averaging 20 units.

Stop Using the Same Playbook as Your

Competition

There is no way that this dealership is truly maximizing all eight ways to sell an automobile —not if the dealership’s overall average is only 9.6 units per sales consultant. And, on the flip side, the Internet department is understaffed, unsupported and looked upon as the “bastard child” of the dealership. The dealership tries to overcompensate for mediocrity on the showroom floor by flooding the floor with sales consultants and having a BDC that does unsold showroom follow up. Even with all of that energy, by my math, the dealership is underperforming. The dealership should increase the Internet and Phone Up department staff and double its Internet/phone sales immediately. Then, I would scale up the Internet/Phone Up department with additional leads and even more BDC reps and take this 240-unit-per-month dealership and turn this store into a 300-unit-per-month money-making machine. You want more? I would also seriously train the showroom sales team on how to sell cars in 2015. Having “road to the sale” and product knowledge does not make you an automotive sales professional, nor does it make you an “owner of your own business.” The showroom sales team needs to be trained additionally on: • How to be their own Internet/BDC Department through the use of social media (Facebook, Twitter, LinkedIn, Google+), video (VSEO, video emails and communication methods such as Skype, Ovoo and Apple’s Facetime) and online reputation management (Google Reviews, Yelp and video testimonials) • Digital marketing • Time management and organization • Maximizing the use of common technology, such as cellphones, cameras and apps • Dealership-provided resources, including maximizing CRM opportunities • Updating the traditional training needs with a modern approach, including the new “road to the sale”; identifying the modern customers’ wants, wishes and expectations; overcoming objections and using better rebuttals; and improved closing skills. I can go on and on, but if you have any questions or would like a free test drive on Bradley On Demand, contact me at the address below.

Download the whitepaper: nakedlime.com/resources/whitepapers

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Sean V. Bradley, CSP, is the founder and CEO of Dealer Synergy, a nationally recognized training and consulting company. He can be contacted at 866.648.7400, or by email at sbradley@autosuccessonline.com.

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DalePollak

sales & training solution

THREE WAYS TO BOOST USED VEHICLE PROFITABILITY WHILE SELLING MORE CARS

In its 2014 report on dealership financial performance, the National Automobile Dealers Association (NADA) highlights a disturbing trend in used vehicles.

The NADA report notes that franchise dealers enjoyed a 6 percent increase in used vehicle sales compared to 2013 — an increase similar to what dealers saw in 2013, compared to 2012. Yet, net profits for used vehicles declined last year, which leads to a key question: “What gives?” To answer the question, I took a deeper look at the data from 2012 to 2014. I found two data points that help explain why dealers are selling more cars and making less money: 1. Dealers relied more on auction purchases in 2014 than they did in the prior year. NADA reports auction units made up 26 percent of used vehicle acquisitions, while trade-ins remained relatively flat year over year. In 2013, auction cars fed 25 percent of dealers’ used vehicle inventories, up from 24 percent in 2012. 2. Dealers continue to sell more expensive

vehicles. In 2014, the average sales price of a used vehicle ran $18,846, up 4.1 percent from the prior year. The change marked the fifth consecutive year where the average dealer investment in a used vehicle increased.

Some of you may be thinking, “Thanks, Dale. You’ve just re-stated the obvious. We all know it’s tough to acquire the cars we need at a price that provides sufficient front-end margin.” But, in light of a market where you can’t source all the used cars you need at your door, and you’ve got to pay more than you’d like to buy units elsewhere, here’s the question dealers should be asking: What are we doing to retail these units faster to maximize profit and minimize risk? Unfortunately, the NADA data suggests most dealers aren’t asking this question at all. I say this based on evidence from dealers who do ask the question, and do so diligently. These dealers beat the NADA averages. Their used vehicle net profits have increased in recent years, and keep getting better. The following are three best practices these

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dealers follow to sell more used vehicles and make more money: Know your opportunity/risk right away. The successful dealers recognize that the more they know about a vehicle’s retail potential before they acquire it, the better. By evaluating each vehicle’s Market Days Supply and Cost to Market metrics, the dealers know pretty well, if not precisely, how their investment in the vehicle will perform. With this knowledge, the dealers can plot the best retail exit strategy that will maximize front-end margin and minimize losses. It’s also not uncommon for these dealers to have more aggressive retail exit plans for auction cars, given the cost/margin challenges these vehicles pose in today’s market. Press down your days-in-inventory average. I would encourage every dealer to conduct a two-pronged test of their past three months of used vehicle sales. First, assess the front-end gross profit and return on investment (ROI) for each sale. Second, segment the sales by days in inventory. If you’re like many dealers today, you’ll find that most, if not all, of the units retailed after 30 days performed significantly worse than those sold in less than 30 days. I suspect you’ll also find the bulk of your breakeven and money-losing deals occurred after the 30-day mark. Top-performing dealers accept this 30-day reality. They approach it like investors. They know they’ve got 30 days to maximize the margin/ ROI on every car and, if a unit is or becomes especially troubled, they’ll work even faster to retail the unit and redeploy the investment dollars in a vehicle with better potential.

I encourage dealers to maintain at least 50 percent of their used vehicle inventory under 30 days of age at all times. Anything less, I’m afraid, means you’re under-cutting your department’s net profit potential. Source more cars in your store. In addition to showing that dealers relied more on auction vehicles in 2014, NADA stats indicate that dealers acquired more trade-ins from new vehicle sales (42 percent compared to 41 percent in 2013), while getting fewer tradeins from used vehicle customers (24 percent compared to 25 percent) and off-the-street purchases (4 percent compared to 5 percent).

“Top-performing dealers accept this 30-day reality. They approach it like investors. They know they’ve got 30 days to maximize the margin/ ROI on every car...” You could read these stats one of two ways: Dealers saw fewer retail-worthy units from used vehicle trade-ins and off-the-street purchases, or they did a better job acquiring cars from new vehicle buyers, while letting other in-store acquisitions slip. Either way, the stats indicate dealers are probably missing cars that, if acquired, would offer better margin/ROI potential and reduce the reliance on auctions. In a year from now, it’ll be interesting to review the NADA data for the current year. In particular, I’ll be curious to see how well dealers have reversed the trend of selling more used vehicles and making less money.

Dale Pollak is the founder of vAuto and a best selling author. He can be contacted at 866.867.9620, or by email at dpollak@autosuccessonline.com.

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DaveDavis

marketing solution

GAIN $30, LOSE $2,000 Customer Loyalty and the Pleasant Surprise

Having been the editor of AutoSuccess for almost a decade now, I find myself in an interesting position when it comes to dealing with cars and dealerships. I’m not a salesperson (never have been), and I’m not responsible for managing a team. What I have done is read hundreds, if not thousands, of articles from automotive professionals about selling vehicles, running a dealership and maintaining customer loyalty, which has given me the feeling of being almost a “super consumer” when it comes to my personal vehicle and my relationship with the dealership.

light, my wife and I made an appointment and brought it back to the dealership. They were pleasant, professional and charged $30 for the repair.

Which brings me to the story of how a dealership made $30 off me and blew at least $2,000.

The car’s a little older now, and new tires are probably the next thing on the maintenance agenda. So, who do you think I’m going to buy tires from the next time?

I live in the Louisville area, and one thing this area is becoming known for is road construction, with two major bridge projects going on and highways being redesigned. There are so many projects that, in the space of a year, I managed to pick up a nail in a tire on three separate occasions. The car was new and still under full warrantee, so when we got the first “low tire pressure”

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The next time that light came on a couple of months later, I decided to try the local tire retailer. It was closer to my house, didn’t require an appointment and I had done business with them for years. I figured that they certainly weren’t going to charge more than the dealership did. Since I didn’t buy the tires there — they came with the car — and I had no “road hazard” warrantee agreement with the retailer, I expected to pay to have it fixed. What I didn’t expect was being told “No charge — just remember us next time you need tires.” A few months later, the light came on again, and the retailer fixed it for free — again — and just asked me again to remember them when I needed new tires.

I’m also the type who tends to hang on to cars for a long time. Figuring a conservative $125 per tire, and probably four tire changes over the life of the vehicle, the $30 fee for fixing a flat cost the dealership around $2,000 in the coming years for the life of that vehicle, along with the loyalty hit. That’s not even taking into account that our second vehicle will need tires along the way, and that word-of-mouth marketing will be on the tire retailer’s side. Do I expect free service? Absolutely not. Will unexpected free service build loyalty? Absolutely. Dave Davis is the editor of AutoSuccess. He can be contacted at 877.818.6620, or by email at ddavis@autosuccessonline.com.

DEALER PANEL THE

TimByrd

THE PANEL WILL SEE YOU NOW!

leadership solution

BASEBALL’S LESSON FOR BUSINESS

Play ball! It’s baseball season. Whether you are a fan or not, baseball can teach you something about business. If you have read some of my articles, you know I have been around this business we love for a very long time. Of course my passion, for many years, is in reinsurance. Why? Because it is one of the smartest ideas of all the many smart ideas in this ever-evolving business. Many things have improved in the game of baseball over the years. Some changes were better than others. Did you know that the bat size was unregulated until 1863? Did you even know they played baseball in 1863? Another interesting fact: Base on balls, called a “walk,” at one point was eight balls. That must have made for long games. The rule did not change to four balls until 1889. This 2015 season has now included a timer for the pitcher because people are complaining that the game is too long. Many things have also improved in the car business over the years, as well. Just look at the quality of cars we sell now. How many of you sold cars in the 1980s? Good grief. Through it all, we have also had good and bad ideas. Like baseball, we have had occasion to have our priorities out of order. In baseball the “cup” was implemented 100 years before the helmet was.

Our Dealer Panel gives voice to dealers, GMs and sales professionals to share their experiences — sales techniques, new technologies and ways to motivate staff — giving our readers the benefit of their experiences.

Cars were not mandated to be fitted with seatbelts until 1968, and it was some 20 years later before the campaign to actually wear them really took off.

SEE PAGE 26 FOR MORE...

As great a tool as a dealer-owned reinsurance company is, there has been one thing that has always been a time-consuming pain in the neck: convenient access to the underwriting profit. Now, there were programs that gave you access — too much access. A dealer obligor program allowed unfettered access to premium reserves, which proved to be a disaster for many undisciplined, unscrupulous dealers and their customers.

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It is hard to believe now, with today’s customer satisfaction being so important, that we used to advise customers in the 1980s to make sure they “tightened up all the screws” when they got home with their new car. Like it or not, can you imagine where we would be if some car companies had not made quality their top priority, or if Uncle Sam had not looked out for the consumer? As a result, we have better-built cars today than ever before. Last month, I wrote to you about “The Right Reinsurance.” Just as in baseball, in the car business and in just about everything else, new ideas are coming to reinsurance.

Administrator obligor reinsurance companies put an arm’s length between a dealer and the premium reserve, through a fronting insurance company, making it safe and secure for all involved. This was great, but there are some dealers out there who don’t want to wait two, three or four years to start using that money to pay down their floor plan, build a new facility, pick up another franchise or any number of important business-building projects. If you have the volume, wouldn’t it seem that after the first year there would be enough actuarial data to support early access to what will surely be underwriting profit? Well here’s an idea whose time has finally come true. Just like the evolution of good ideas in baseball, the evolution of good ideas in reinsurance is making the “game” much more attractive. Great ideas come along, and then someone figures out how to take that idea and make it better. That’s true in business and true in baseball. I am proud of the changes that have made the car business what it is today. And I am very excited about the changes we are seeing in my field of expertise, reinsurance. Now, let’s play ball!

Tim Byrd is founder and president of DealerRE and author of the new book Race to the Finish Line. He can be contacted at 866.347.6022, or by email at tbyrd@autosuccessonline.com.

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the dealer panel

part 1

ENGAGING WITH

MILLENNIALS: Marketing to Millennials

Chris Saraceno AndrewDiFeo Marsh Buice Danny Benites Brian Benst ock As their buying power increases, the Millennial generation is becoming an ever-growing factor in the success of auto dealerships across the country. This generation, the first to grow up with the Internet and the concept of “online shopping,” offers both challenges and opportunities. For the next few issues, we’ll be talking with our Dealer Panel on what they’ve found to be effective in marketing to, selling to and working with this generation.

they want, when they want it, which is usually “now.” They’ve come to realize they don’t have to settle. You have about one minute to grab their attention, so you had better put your best foot forward up front. This generation, more than any other, has more choices, more competition, and more information at their fingertips. They have smartphones, and they’re not afraid to use them.

AutoSuccess: How does marketing to Millennials differ from marketing to other demographics? What do they expect that previous generations might not? Andrew DiFeo, GM of Hyundai of St. Augustine: This applies to

AS: How can a dealership best integrate effective marketing to Millennials in with their overall marketing message? AD: Millennials are focused on the social aspect of their lives, and

all demographics, but one thing we focus on in all aspects of our business, whether it be with marketing or the customer experience, is honing in on creating trust with the consumer. That starts with your advertising — that there aren’t any games or gimmicks, and that everything you advertise can be fulfilled once the customer decides to do business with you. Trust is important with any demographic, but it seems to be that Millennials respond more to the trust aspect of the transaction. Chris Saraceno, VP and Partner of Kelly Automotive Group:

Millennials were raised on social media, so they have come to expect short answers with even shorter waiting times. Anything over two sentences is considered too long and is skipped. In fact, social media has slowly started to reflect this. Facebook allows users to post however much they wanted. Twitter restricted it down to 140 characters. Instagram allows one picture. How much can one picture say? To Millennials, more than enough. We turn to ad agencies who are experts on social media marketing. They’ve told me, “You have to tell an entire story in one moment, whether it’s a set of three catchy words with a link or a captivating photo. The only media that can take more than two seconds of their time is a video, and even that shouldn’t be more than four to five minutes.” With this quick-pace advertising also comes the expectation of instant service. Sales consultants are no longer the face of the company. Millennials instead turn online to double check accuracy, answer questions and, above all, ask their friends. Since there’s always the likelihood, however, that no one in their circle has bought from a certain business, online customer reviews and ratings are the fallback. Kelly Automotive uses Dealer Rater, Google Reviews and Women-Drivers to compile their customer’s online reviews for easy access. Brian Benstock, VP and GM of Paragon Honda and Acura in New York City: With so many ride-sharing services, such as Lyft or

Uber, or even car-sharing services in the metro markets, Millennials are not as concerned about having or owning a car as previous generations. They want reliability, a reputable product and transparency in getting that product. You’re probably not going to find them coming in from a radio ad. Marsh Buice, Sales Manager of Mark Dodge Chrysler Jeep:

The first thing other generations should not do is insult this generation’s intelligence. Where older generations came to us to get information, Millennials are well informed before they get to our dealership. They’ve read the reviews — not only about your dealership but also about the vehicle they are interested in. They want a dealership to respect them, their time and their influence with others. Danny Benites, GM of Greg Lair Buick-GMC: To begin with, they’re impatient. In the technology age, they’re used to getting what

THE

DEALER PANEL

on the Internet. Third-party reviews and getting them involved in the discussion are things that really resonate with this generation. We find that Millennials don’t respond well to interruptive forms of advertising as they do to advertising that involves them in the process.

CS: Like any generation, Millennials bring unique insights and opinions to the table. Classic focus groups are a good way of targeting the demographic and presenting them with new marketing plans. However, to get the attention of Millennials, one need only have a good online presence that interacts with the public, creating a voice that people can trust. The attention needed for running an online presence like this can interfere with business, so many dealerships turn to a good ad agency to run their social media and integrate new media. BB: You’ve got to be consistently there. You have to look at the media

they’re actively using, such as Facebook or Instagram. You also can’t be too “sale-sy”; you have to be more realistic. They buy a lot on peer and social influence, so you want to integrate in every medium. There’s probably not one that’s more important than the other, but you’ve got to have consistency across all the various tiers of advertising. For Millennials, it’s about engaging with the brand. They want to see the product, and see their friends use the product. Getting referrals is great, and you can also referrals from local sponsored events, where they can touch and see the product. Often, people don’t really consider a brand; it’s who gets them first when they’re in the market for a car. Millennials are certainly that way. It’s who they engage with first, and that engagement is critical to make the sale.

MB: Be real — I think it’s important for a dealership’s authentic voice to be spoken through social media channels. Millennials want to have a conversation — they don’t want to be shouted at or told what to do; they want to be part of a tribe. I think the dealership whose voice aligns with their actions will come out the winner. In short, say it, but then show it. DB: I think we need to rethink the old “best deal” soapbox speech.

Millennials don’t want to hear it. Furthermore, they’ll find the best deal — I guarantee it. They are using aggregators at breakneck speed. Quite simply, they are looking for a conversation. The message that I want to get across to them is “We’re listening.” As an industry, we need to keep our big mouths shut and start listening to our customers. We have shifted heavily into the social media space and mobile technology. Millennials want to be heard, and they only want to listen to people they trust. Those trusted people aren’t wearing leisure suits. Next month, we’ll turn our focus from marketing to Millennials to the sales process, and what works, and doesn’t, when it comes to delivering vehicles to this generation. If you have questions or are a dealer who would like to be considered for the panel, please contact us at thepanel@autosuccessonline.com.

MarkTewart

sales & training solution

SEVEN CRITICAL POINTS TO CREATE GROSS PROFIT IN THE DIGITAL AGE

See if these buzzwords sound familiar: “Internet shopping,” “educated buyers,” “increased speed of the buying process,” “transparency” and “gross profit compression.” All are legitimate challenges for today’s automotive retailers. And, for many, those challenges have become excuses to not make the gross profit they deserve. There are, at minimum, seven critical points that grow or eliminate gross profit. Point No. 1: Website Visit

There has been a proliferation of templatebased Websites where the homepage acts as a portal. A common theme has been to throw as much on the homepage as you can to attract attention for whatever the customer’s interests may be. The unintended consequences are that customers are easily confused. I invite you to use the theory of “TOT” — The One Thing. If there’s one thing you want a customer to do — and it’s the one major thing they want to do — then utilize TOT and simplify your homepage based upon that theory. Point No. 2: VDP (Vehicle Display Pages)

Your VDP should make it simple to educate the customer and answer questions about the car and have a simple but effective call to action. If it is a new vehicle, describe the option package, rather that just listing all equipment and leaving the customer to figure it out. If it is a used vehicle, then tell a story about the vehicle. Facts tell and stories sell. Utilize simple but intriguing call to actions, such as a button that offers “Get ePrice.” Point No. 3: Phone Calls

Answer leads quickly. Do not hide behind emails and auto-responder emails. Pick up the phone, call quickly and call often. Be prepared by addressing the customer’s concerns and directly solve their problems by asking questions. If you are using phone scripts, avoid “form speak.” Be human. Point No. 4: Emails

Answer quickly with a video email introduction. Personalize all emails while avoiding the robotic-sounding email templates. Video is personal and utilizes more communication modalities. Use a cell phone or Google voice number in the subject or body that will create a clickable link to increase response.

autosuccessonline.com

Point No. 5: Engagement at the Dealership

Realize that traditional “road to the sale” processes are outdated and must be modernized. Ask the customer, “What stage are you in the process?” “What are you trying to accomplish today and how can I assist you in making that happen?” “Have you been to our Website?” Acknowledge the time they have spent in the education and shopping process. Point No. 6: Sales Process

Move the trade-in up front. The trade-in is a comfort zone of the customer and is often a point of contention. Go to the trade-in up front to save the customer time and do a better job of fact finding and discovering their buying patterns. Always be thinking about “HFG” — What is the customer’s Hope for Gain? Utilize a “pick-two” process by offering two alternatives to every customer. More than 50 percent of customers will choose other options if given the opportunity. Educated consumers want to know their alternatives. Utilize a Disneyland-type presentation. Pop the hood, trunk and all doors and make the presentation special. Don’t act like you are a commodity selling commodities. Don’t skip demo drives. The Internet shopping process has become an excuse of many not to take customers in a test drive. You should not only take test drives, but you should take 15- to 20-mile test drives. Don’t ask customers to spend thousands of dollars without letting them completely experience the vehicle.

Point No. 7: Proposal Process

Utilize printed proposals. Stop using green sharpies. Be prepared for the trade-in discussion. You can show a trade value as follows: Front Line Ready Value $ ____________ - Average Reconditioning - Miles - Tires - Windshield = Today’s Market Value $ ____________ Explain and justify the value of the trade-in and build in a top and bottom parameter for negotiating. Give three budget options for all proposals. Do not show the longest term available and do not start proposals with zero down or lowest down payment options. Show 20 percent investment on the “buy” options and show a lease on all new car proposals. Explain the 20 percent cash investments as equity-building options and let the customers know that, if they would like to see different options, it would be no problem. Stop asking deal-killer questions such as: “How much do you want to put down?” and, “Where do you want your payments to be?” Start the proposal, instead of letting the customer start at a figure you cannot reach. Ask the customer which options works best for them and close. This is a scaled down version of seven critical points. There is a lot more detail to each point, and there are other critical points, as well. Realize the importance of these MOTs – Moments of Truth — and utilize these suggestions to increase your gross profit. For a free special report — “Critical Points of Creating Gross Profit in the Digital Age” — email me at the address below with the phrase “Profits in the Digital Age” in the subject.

Mark Tewart is the president of Tewart Enterprises, and the author of the best seller, How To Be A Sales Superstar. He can be contacted at 866.429.6844,or by email at mtewart@autosuccessonline.com.

ScottPechstein

marketing solution

LOOKING FOR LEADS IN ALL THE WRONG PLACES? ASK YOURSELF THESE QUESTIONS

There’s no doubt millions of consumers visit Websites to research their automotive purchases each month — to compare multiple brands as they narrow down their buying decision. Unbiased third-party automotive Websites were important to consumers 20 years ago at the beginning of the automotive Internet, and they remain a critical component to the car research and shopping process today. But, let’s face it: For dealers, selecting a quality third-party lead provider is a lot like dating. The starry eyed honeymoon phase can quickly lead to relationship problems if conversion rates or profit margins dwindle — it’s like realizing your partner throws dirty laundry all over the floor or snores like a 426 Hemi.

So, you break it off, and you wonder why you didn’t do your homework ahead of time before diving head first into a full-blown relationship. To avoid lead-provider heartbreak, ask yourself the following questions before leaping in: Do they deliver quality consumer connections? The days of lead slinging are over — at least for some of us. It’s not a lead; it’s a customer, and your vendor should focus on connecting you to customers you aren’t able to reach with your own marketing efforts — in this case, quality consumer connections to help you grow sales. Do they help you optimize your own Website traffic? They should offer the tools and services to help you convert your own Website traffic

autosuccessonline.com

to a sale, and to communicate with consumers the way they prefer — with a texting platform or virtual showroom technology, for example. The better the connection, and the deeper the engagement, the greater the likelihood a consumer will buy from you.

other marketing spends, quality third-party connections represent a value for dealers. When you couple this with new and innovative ways to reach consumers — such as mobile, texting and Web co-browsing capabilities — positive ROI is easily achieved. Don’t expect anything less.

Do they put your brand above theirs? Just because a vendor spends tens of millions of dollars in mass media advertising doesn’t automatically mean the leads they deliver are from consumers who will result in the best ROI for you. Do they offer products and services that help you build your brand? Perhaps the best partners are the ones that work diligently behind the scenes to drive consumers to your business, not theirs — partners that invest in products that actually help you sell more cars and grow your revenue. Sometimes less is more.

Are they a true partner? Is your lead provider your partner? Do they offer education programs to help you fine tune your sales processes? Do they provide you with detailed reporting, such as lead info matched to actual state vehicle registrations to help you determine which vehicles were ultimately purchased and from whom? Do they legitimately care about the quality of consumers with whom they connect you? These are all pertinent questions to help you get to one bottom line: A true partner helps you improve your bottom line.

Do they let you dictate price? We all know car buyers are as unique as fingerprints; no two deals are identical. Factors such as credit score, trade-in value, down-payment amount, vehicle availability, your willingness to be more flexible with longstanding customers, and a host of other factors ultimately impact price. That said, third parties shouldn’t get between dealers and consumers, especially on price. That conversation should occur directly and confidentially between you and your customers.

We all make relationship mistakes, but this is business. Be sure to work with a company that connects you to quality consumers; one that cares more about your brand than its own; one that lets you dictate price instead of dictating it for you; and one that offers positive returns while acting as a partner to help you sell more cars and grow your business.

Do they offer positive ROI? Compared to

Sure, breaking up is hard to do, but if you answered “no” to any of the questions above, you should probably start writing that “Dear John” letter now.

Scott Pechstein is the vice president of sales for Autobytel Inc. He can be contacted at 866.423.9019, or by email at spechstein@autosuccessonline.com.

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NathanUsher

marketing solution

THE MODERN DEALERSHIP: Online Shopping Has Changed Everything

According to a recent survey by AutoTrader.com, 56 percent of Millennials said they go out of their way to avoid salespeople. This directly affects the automotive industry, which has always survived on face-to-face communication. Consumers are now using the Internet to obtain their information about vehicles. Whether it is to research, purchase, finance or repair their vehicles, consumers now have the upper hand. Know that your Website is your true first impression — not your dealership or service drive. Each generation is drastically changing from the previous one, so you must stay up-to-date with trends

to optimize your dealership accordingly. Be Transparent For Every Customer

Don’t hide information from your consumers. Be honest with them and provide detailed and accurate information for any specific service. State what you can and cannot do. This is important to recognize because, to Millennials, another dealership is only one click away. Every chance you can demonstrate to your customers that you’re here to assist them builds a loyal customer base who will do business with your dealership day-in and day-out. Integrate Your OEM’s Overall Messaging

What customers see on your Website, whether it be OEM commercials or advertisements, should directly reflect what they will ultimately experience at your dealership. Integrate your OEM’s overall brand and messaging throughout your dealership and all your marketing. This applies to your entire dealership, but especially the sales floor and BDC department. Create an environment worth visiting. The saying goes, “Make a good first impression,” and that starts on your dealership’s Website. Familiarize The Buying Experience

According to a recent survey by National Retail Federation, more than 52 percent of consumer shopping will be on the Web. This number is up from 40 percent the year prior. Dealerships must prepare for this by creating a buying experience that is familiar to the consumer. If you want to make the buying process straightforward, the automotive industry needs to create a simplified approach to buying a vehicle. Simplify your Website layout to directly communicate to the consumer about the price, specs and available features. Establish VIP Treatment

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Millennials want to be part of a community. So what’s the solution? Deliver an environment worth returning to. Making the customer feel like they are receiving VIP treatment can ensure customer loyalty and retention. The modern dealership can’t be a concept or idea anymore. It has to become reality. The way Millennials and future generations make buying decisions should be studied and adapted, because they are the future of retail.

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Don’t treat your customers like strangers. According to Century Interactive, 39 percent of calls fail to reach a qualified employee. Assisting a customer effectively can guarantee the correct and qualified employee is helping them.

Nathan Usher is the director of product development for DealerSocket. He can be contacted at 866.538.6697, or by email at nusher@autosuccessonline.com.

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Data Sources: Sales number from IHS Automotive/Autobytel Collaborative Study based on consumers that submitted a lead through the Autobytel network. IHS Automotive is part of IHS Inc. IHS acquired R.L. Polk in 2013. "Over 50 million" leads number from Autobytel internal lead totals from 1997 - 2014. "$275 cost per sale" number based on $22 lead price and estimated average 8% conversion rate. © 2015. Autobytel Inc. All rights reserved.

AlexWoodward

marketing solution

MARKETING 101: If It Is Not Trackable, It Is Not Applicable

Half a century ago, Marshall McLuhan wrote the book The Medium is the Massage. The thought was that the medium from which a message was delivered had more influence and impact than the message itself. This was a time when mass media (radio, television and newspaper) were kings of the communication world. Well, someone has moved their cheese and they have not found it yet — and may never, for that matter. There are not enough statistics to counter the exponential erosion of listenership, viewership and readership. And what compounds the issue of buying traditional media is, with all the colossal erosion in ratings and readers, all these mediums have continued to raise their rates year after year, after years in the midst of catastrophic decline. Coming from a media background, I have a hard time justifying a purchase with such obvious undervalue. I am not saying there are not some smaller markets in the U.S. where one or more of these are still a valid choice for your media mix, but the reality is that there are just fewer users, and those left are fragmented over an ever-growing number of outlets. Our message to the media is, “I will take what’s behind door No. 2, please.” So what do we do? The first thing to ask ourselves is, “Do I want to brand my dealership, or do I want to drive traffic?” Asking this question will determine what media path you will go down. Do not start saying you want to brand and build traffic. Most Tier 3 dealerships do not have the financial resources to both brand and drive the immediate traffic you need. Yes, there are the mega-dealers and consolidators that have the budget to brand, but for the average dealer out there, branding is not an option. If you want to brand, I will discuss that in a future article. Measurability

Measurability is the key to staying on point and getting you to your objectives. It is what dealers have been clamoring for and, in

this direct digital age we live in, you can get it. Inquiries, appointments, visits, demos, write-ups and converted sales: These are the metrics of your sales department and the foundation of your dealership’s success. They have been around for years and have not changed. Whether it is online or showroom traffic, these measurements are interchangeable on both platforms. The same applies to your media choices. All your media should have measurability to a specific execution. If you cannot measure it, you cannot afford to do it. Simple as that. Messaging

How many ways are there to say “sale?” If you ask the music industry how many ways there are to write a love song, they will tell you there are infinite ways. It is not our job to send the message of how “cool” our vehicles are. That is the OEM’s job. Telling the consumers about how long you have been in business, how nice you are, how clean your dealership is or what charity you support means very little to very few. Those are experiential phrases that can only enhance your message; it cannot be the message itself. These alone will not motivate them to visit you. So, what are you left with saying in an advertisement or promotional execution? Value offers. Value offers of price, payment, selection and trade-in value are the last bastion of offense we have and, quite frankly, they always have been. Every OEM,

even luxury brands, use value offers in their national television campaigns. At the end of every sale, the customer wants to know they got the best value for their dollar. Your message needs to tell them that your store is the place to find it. Medium

Last, but certainly not least, there is the medium. What are the measurable media choices in this arena? Let us break it out into two categories: “non-wired” and “wired” media. On the “non-wired” side, we are looking at direct mail. Direct mail is fast, effective and efficient when you are mailing to the right list — a quality list that is not fatigued and the prospects are in the buying cycle. The best mix of your previous customers and conquest customers that are likely to switch to you is the key. The data truly makes the difference. On the “wired media” side, we have email marketing, search engine marketing, digital display ads, retargeting/remarketing, online third-party lead providers and digital classifieds (AutoTrader.com, Cars.com, Carfax.com, etc.). Your dealership is most likely already involved with most of these choices and perhaps, is finetuning the mix. Each day, there is another angle on how to better your digital spend, and it is ever-changing. One thing for sure is that these choices are measurable down to the keystroke and you will always know where your buyers and prospects are coming from. Driving traffic is your objective. Keep your message clear, value-based and remember: If it is not trackable, it is not applicable.

Alex Woodward is the senior vice president of The Ross Companies. He can be contacted at 866.618.8257, or by email at awoodward@autosuccessonline.com.

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LarryBarditch

marketing solution

HOW SOCIAL MEDIA AFFECTS YOUR SEO

The evidence is clear that SEO is both directly and indirectly affected by your social media. A recent Moz Search Ranking study shows search results with Google +1, Facebook likes, tweets, comments and Google Reviews tend to rank higher. And a Search Metrics report shows seven of the top 10 ranking factors were from social channels. Google considers more than 200 factors when ranking Websites, including social signals and links from social media. Social sharing directly increases the visibility of a page. It’s both the actual social activity that matters, and what happens as a result of that activity. Google handles two-thirds of all search engine traffic. They own the search engine, they probably own the browser you use (Chrome is the world’s most popular browser) and they own the most popular analytics tool. They know what the searcher typed in as keywords and they know how long the searcher stayed on the page. Google uses these interaction signals, along with time on site and bounce rate, to determine quality and relevance of links. Social interactions also determine whether people thought the page was relevant. Social media correlates with quality, and quality correlates with higher rankings. Social media can increase the volume of traffic visiting your Website, which is a key factor in search engine ranking. Often, the items being shared on social media that drive the most traffic are videos, event listings or other interesting content. If that content is interesting enough to get users to stick around and read the entire page or watch a full video before visiting other pages, then you may be rewarded in the organic results. Google considers linking to be “social activity.” There is a report in your analytics that shows new links to your site from social channels. You can find this report under: Acquisition > Social > Trackbacks. Not only does Google consider linking to be a social action, they report on how many times the link was clicked. The World Wide Web is an ever-growing public library filled with content and no central filing system. Google gathers pages during its crawl process and then creates an index for us to find things when we are searching for it. Google uses social channels like Twitter to discover new content. Google looks at how many times content has been tweeted and retweeted to give relevance to indexing it. Other social media factors that increase your ranking are reach and resonance. Google looks at how many people you’re able to reach with your content and how many people you are engaging with that content (and the time frame in which it was shared). Content that gains social traction will be indexed more quickly in search engines. The keywords used throughout social media factor into where content ranks in search engines from two sources: the content being posted and the profile of each social account. Start by ensuring that all of your social media profiles are filled out as much as possible with relevant information about your dealership, while naturally incorporating the name of the dealership and your most important keywords. The name, URL and bio are typically the most important aspects of your social media profiles that search engines take into account. When searching your brand, most of the top organic results on the first page of Google are your brand’s social profiles, next to the Website and recent news articles. Local search is increasingly important to dealerships. With the rise of mobile use, a majority of local searches for business are conducted on the go with a smartphone. Be active where users are searching for you on every relevant location-based social network like Yelp and Foursquare, as well an updated location listing on each search engine. For Google, their business listings are on Google+ local pages. Ensure that your various local listings are kept up to date, providing the correct address, company name, phone number and accurate directions to your location. Rankings are an outcome, not an action. Becoming active in social media allows you to leverage these indirect benefits to increase your rankings.

Larry Barditch is the vice president of digital strategy and innovation for MSA Advertising. He can be contacted at 866.590.1624, or by email at lbarditch@autosuccessonline.com.

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MarshBuice

sales & training solution

THANK YOU, MR. VIC

When my daughter MacKenzie says her prayers at night, I let her free flow whoever and whatever she wants to pray for. One night as she was praying, she prayed for a name that I’d never heard before: “Mr. Vic.” When I asked her who “Mr. Vic” was, she told me that he was the janitor at her school. “I’m praying for him, because he’s always nice to me,” she said. The other day Mack forgot her lunch, so I told her I would drop it off on my way to work. With only a few minutes to spare, I rushed into her school and placed her Lunchable on the table next to the lunchroom entrance alongside of a half dozen other kids who had also forgotten their lunch. As I whirled around, the man mopping the school’s floors stopped swaying the mop from side to side and, with a big, toothy grin, asked me how was I doing. In a rush, I smiled back and told him I was doing fine and in turn, asked him how he was doing, but I didn’t have time nor the inclination to wait for his answer. As I waved goodbye to the ladies in the school’s front office it hit me — the man I had just spoken to in the hallway was Mr. Vic. Turning around I walked back down the hallway and asked him, “Are you Mr. Vic?” he smiled and said that he was and as I shook his hand I said, “Thank you for what you do, Mr. Vic.” Stopping his mop, he pridefully looked around and said, “Oh, I’m just trying to keep it looking good around here.” “No,” I said, “Thank you for what you do while you’re here.” I went on to tell him how my daughter prayed for him and that I appreciated how nice he was to her. “Sir,” he said, “I’ve been here a long time, but I’m not here for the money — I’ve been offered opportunities to work at other places for way more money, but I don’t feel like that’s the position

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I’m supposed to be in. Maybe one day, but right now, I’m right where I’m supposed to be. My position is right here with these kids.” Life is a blur and then we die. It becomes a blur because we’re so focused on titles that we give no thought at all to our position in life. We’re so fixated on the words printed below our name on our business card, so hellbent on trying to schmooze with certain people, so adamant about rubbing elbows with a certain others, and are so seemingly obsessed with who we can step on, beat out, or crossover in our quest for a title, that we’ve lost sight of the most impactful part of our lives: our position. One day you could find yourself wearing a title, if you don’t already, that you don’t care for. Maybe you’re working for someone who you feel is inferior to your skills and expertise, or perhaps you’re being asked to shoulder more responsibility with no more pay. It’s conceivable that you find yourself standing in the ashes of a once promising career — one that for years you climbed the ladder of success, literally

sacrificing everything — only to find yourself today back on the bottom rung having to start all over again. Ground Zero is where most people stall in life and ask, “Why?” “Why was I passed over for this promotion?” “Why am I the one singled out to do more work while others stand around and get the credit?” “Why did injustice prevail and ruin my life?” People who ask “Why?” park in life and become bitter. The better question to ask is, “What do I do while I’m in this position?” If you work for someone who you feel is inferior to your level of expertise and knowledge, your job is to make them look better. You have to understand this one position is not the end game in life — unless you allow it to be. Use your vantage point to not only shore up their areas of weaknesses but also to gain a bird’s eye education into the pressures and decisions that they must make on a daily basis. If they’re poor at building relationships, you help build it for them; if they’re unorganized, you keep them on task; if they’re short sighted, you help them set the long-term vision. Stop competing for their title and begin completing their position. Not only will you earn her trust, but also you’ll build the morale of the entire store. Remember, you’re teaching those who work under you how they should think and act. If you want it done to you, do it to others; if you want it done for you, do it for others. If you keep getting volunteered for more work, shut up and do it. It’s been said that if you want something done, give it to a busy person. Don’t think like those who want to get the most for doing the least. Learning and teaching a new skill keeps you out of your comfort zone, raises your level of expertise, and makes you more valuable. Don’t wait for something catastrophic to occur to decide that you need to raise your game. Don’t get ready; stay ready. If you find yourself back on the bottom rung in life, you’re not alone. We’ve all been there. I worked hard and lived fast until, in 2008, I lost it all. I was financially, mentally and spiritually bankrupt and had to start all over again. With my ego stripped, my position removed, and my hope lost, I was scorched earth. But out of the ashes come new growth. It was at that time that I had to take responsibility for my life, put my feet back in the stirrups, and ride life’s horse again. I learned how to appreciate the good times and the bad; I realized that I could never be satisfied with what I already knew, and I had to lean on God to remind me that I still had more to give and much more to do. What you’re reading is my position; it is my testimony to let you know that you are not alone.

for titles — all the awards you amassed, all of the boards you sat on and all of the ribbon-cutting ceremonies you attended will be printed on that piece of paper. But eulogies are for position. What will your eulogy be? What impact did you make for those you were around? Use your position to friend the porter who eats alone at lunch; use your position to encourage the accounting clerk who can barely pay rent and day care; use your position to develop the salesperson whose last resort is the car business. “Why?” is not the question; “while” is. Use your position to go make an impact. They’re waiting on you. Thank you, Mr. Vic. Marsh Buice is the sales manager of Mark Dodge, Chrysler, Jeep. He can be contacted at 866.535.5006, or by email at mbuice@autosuccessonline.com.

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JackGarrity

sales & training solution

WHICH LIFETIME WARRANTY PROGRAMS KEEP CUSTOMERS COMING BACK? For a few years now, some dealers have been using lifetime programs with the intent to create retention from the sales to service departments. These programs do vary and their effects will produce different results. The most common are lifetime powertrain, lifetime tires, lifetime engine and a few lifetime batteries and wiper blades. Let’s take a look at each and see which produces the best results. Lifetime Powertrain

These programs are normally used as a sales tool more than for retention. The customer is given a lifetime powertrain warranty at time of purchase. This can be for new/used vehicles; it is often offered on both. To keep the warranty in effect the customer must do all of the regularly scheduled maintenance on the vehicle. They can do this maintenance at their choice of service centers, but they must keep all records and produce them in the event of a claim. This is a great incentive to purchase but does little to drive the customer back to the dealer’s service facility. It really doesn’t answer the “why buy here/why service here” retention mantra. You will also get some flak from the F&I department about their inability to sell service contracts due to the coverage. Lifetime Tires

This program offers more of a retention tool for both sales and service departments. Normally it is on new cars only. The first drawback is it leaves out half the customers you are trying to retain. That said, every customer loves the idea of free tires for life. And, unlike lifetime powertrain programs, the customer must do all of their regular service at the dealership where he purchased his vehicle, thus driving the customer back to service for as long as he

or she owns it. To most customers, this is an easy trade off. However, this program is not without its own set of problems. First, nobody’s tires wear out at the same rate. This program will only replace tires when they have 2/32” of tread left on them. Rarely will this happen to all four tires at the same time. We have a built-in potential customer/service writer confrontation with every visit. The biggest issue, however, is how to expense it. Most dealers either don’t reserve for replacement costs or they didn’t reserve enough. As the replacement costs start piling up, service numbers usually suffer. Lifetime Engine Guarantee

This probably has the least amount of sales appeal, especially on new vehicles. Most new vehicle customers realize that it is not very likely they will ever replace their engine; used vehicle customers, however, do have that concern. This is the most expensive part of the vehicle to replace and, for the few who do have to replace an engine, they are glad they have a guarantee. As a retention program for service, this tends to have the most promise. Since it is given away on every vehicle as a guarantee, with the only stipulation that the

customer does regular maintenance at the selling dealership, we have given the customer a reason to not only buy here but service here, as well. The cost is a fraction of lifetime tires or lifetime powertrain, it doesn’t set up a confrontational scenario every time there is a service visit and has little or no effect on the sale of service contracts.

“Lifetime programs are a great way to thank your customer for their loyalty and, at the same time, give them good reasons to visit our service department on a regular basis. The key to success with lifetime benefits is picking the right program that works for both you and the customer.” Lifetime Batteries/Wipers These benefits have too little value to create any real retention. Lifetime programs are a great way to thank your customer for their loyalty and, at the same time, give them good reasons to visit our service department on a regular basis. The key to success with lifetime benefits is picking the right program that works for both you and the customer.

Jack Garrity is a partner at Dealership for Life. He can be contacted at 866.871.0240, or by email at jgarrity@autosuccessonline.com.

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EdLouis

marketing solution

15 FREE WAYS TO GET PEOPLE TO DOWNLOAD YOUR APP

Getting people to download your dealership’s app can be easy, fun and free. It doesn’t take a ton of money to market your app and get customers using it. Dealers around the nation have experienced increases in sales, customer retention and customer satisfaction when they actively promote their dealership’s app. Dealers recognize that since people love apps, giving them a app that offers an easier way to do business and communicate is a very good thing.

There are many ways out there to promote your app for free, or at least without spending more than you already do every month to market to your customers. Here’s a list of 15 creative options to get your app on the phones of your existing and potential customers:

community. There are many free press release services out there that dealers and vendors use to let people know about a new service or to make an announcement. 6. Use email blasts. You have been gathering emails for years and sending out emails regularly at a high-dime rate with a low-read rate. Make mention of your app on these very same emails. An email list of people who have opted in is a powerful marketing tool. 7. Post on Pinterest. Use blog images,

infographics and visual content from your app to create content on your Pinterest board. You can even use happy customer photos or hold contests.

8. Get your staff involved. If your proud

1. Build a microsite. This one or two-pager showcases your app to the Web audience. You can find a great example at www.berniemoreno. com/custom/Bernie-Moreno-Companies-APP

staff tells their family, friends, prospects and customers to download your app, imagine how many more downloads you can get. Give them an incentive to do so.

2. Use your mobile site. Create a banner

9. Local business promotion. Reach out to

or pop up on your Websites that gives your visitors the option to download your app. People love choices, so why not give them one? Check out www.victoryfordonline.com on your smartphone for an example.

local restaurants, businesses and gas stations to have them promote your app. Do this by crosspromoting business services using coupons, discounts via push notifications and geofencing. People love coupons and discounts.

3. Share your content. Use your Twitter, Facebook, Google+ and LinkedIn profiles to promote the app several times in a week.

10. Run a contest. For example, you can encourage people to tweet and share content on their social networks promoting your app. A random person every week can win a prize just for downloading your app and entering in their profile information.

4. Create a product video. Make it creative, funny, thought-provoking or personal. Tell the story, but in a way people can identify with. Here’s a great example from Laird Noller Auto: http://youtu.be/q3MAJ8bKPuU 5. Get press — tons of it. Write a press release to announce your app to everyone in your

11. Take advantage of voicemail. Include a

creative mention of your app on your phone’s voicemail recording.

12. Be obsessive about resolving negative reviews. Remember: A happy customer is a brand ambassador for your app. 13. Optimize your email signature. Provide a catchy one-liner about your app, along with the link to download it in your email signature. 14. Use your CRM System. Add the QR code and downlink for your dealership’s app to all automated or triggered messages that get sent out to customers and prospects. 15. Use the “traditional” way. Tell your customers about your dealership’s app in your TV or radio commercials. Add it to your billboard. Add it to your mailers. Why not? You are doing these things anyway.

Your existing marketing or advertising agency can do most of these things for you. After all, you spend thousands of advertising dollars every month for them to promote your dealership. Mobile should be the No. 1 way to get this done. If they don’t understand how important it is to incorporate mobile apps into your digital marketing strategy, you may lose out on valuable business. Who can afford to do that? You can also partner with a mobile solutions provider that offers a turnkey solution that will do most of these things for you. Remember, the best way to profit from push notification messages is to get as many people to download your dealership’s app.

Ed Louis is the CEO and co-founder of DealerApp Vantage. He can be contacted at 866.604.6710, or by email at elouis@autosuccessonline.com.

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