Car Biz Today Magazine March 2015 Issue by CBTNews

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CAR BIZ TODAY The Official News Source of The Retail Automotive Industry

March 2015

ISSUE 12

MANAGEMENTDRIVEN LEADERSHIP JOE VERDE ...see PAGE 24

COLLABORATIVE LEADERSHIP

CREATIVITY SELLS CARS

CHANGE IS CONSTANT Mark Schienberg, president of the Greater New York Automobile Dealers Association, discusses how dealer education is playing an even bigger role in his organization’s mission. The Center for Automotive Education and Training in Whitestone, N.Y., plays a significant part in offering dealers the training they need to drive profits. See PAGE 8

KIRK MANZO ...see PAGE 10

SERVICING MILLENNIALS RICH HOLLAND ...see PAGE 32

MAKE THE MOST OF YOUR MARKETING DOLLARS GLENN PASCH

PRSRT STD US POSTAGE PAID Permit No. 1459 Pewaukee, WI

...see PAGE 14

Managing partners Will Hardeman and his sister Genny Hardeman are guiding Continental Automotive Group to meet the expectations of the next generation of shoppers and employees. See PAGE 18

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Dean Evans, left, CEO of LotLinx; and Jason Knight, founder, believe their company’s “Deeplinking” technology is the next big thing in digital marketing. See PAGE 28

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CAR BIZ TODAY M

Letter from the editor

CAR BIZ TODAY MAGAZINE Email

newsroom@cbtnews.com Phone

678.221.2955 President and Publisher Jim Fitzpatrick Vice President / COO Bridget Everett Managing Editor Carol White

Dear Readers, This month I had the honor of speaking with three gentlemen who are making a positive impact in the retail automotive industry. First, I interviewed Will Hardeman, managing partner of Continental Automotive Group in Austin, Texas. Under Will’s and his sister Genny’s leadership, the company is ahead of the curve when it comes to creating an atmosphere that keeps both his employees and his customers happy. The auto group has long provided benefits for its employees that are practically unheard of in the retail industry. You can read about their story on page 18. Next month’s New York International Auto Show marks the 115th year of the country’s largest and oldest auto show. President of the New York Automobile Dealers Association Mark Schienberg shares some insight into what attendees of the show can expect. His association’s story is on page 8. LotLinx, a digital marketing technology company, is making waves with its “Deeplinking” platform which connects dealers to their shoppers faster than the typical online lead form. CEO Dean Evans, who has an extensive background in retail, manufacturer operations and digital marketing, explains why his company’s technology has piqued the interest of dealers, third-party search companies and industry marketing consultants alike. You can read about his company’s mission and success on page 28. As always, let me know what you think! Your feedback is important in ensuring that we at Car Biz Today continue to bring content to you that is informative and relevant. And we also just like to hear from our readers! Shoot me an email and let me know what makes your dealership special. You could be one of our featured dealers in an upcoming issue. Have the best March ever!

CAROL WHITE

Associate Editors Russell Brown Creative Director Simone Tieber Designer Betsy Alvarez Production Manager Jason Lowsy Creative Director - Digital Keith Tuggle Marketing Associate Roxanne Luhr Subscription Manager Tom Domagalski

Managing Editor

Advertising Director of Sales Jane Howard jhoward@cbtnews.com d 678.221.2964 c 404.452.9551 Sales Assistant Alex Branam abranam@cbtnews.com

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Subscriptions To subscribe electronically, log on to cbtnews.com and click the subscribe link on the side bar. Alternately, forward your company name, your name, address, phone number and email address to info@cbtnews. com or CBT News, 5 Concourse Parkway, Atlanta, GA 30328. Please send address changes to the above email or mailing address. Permission to reprint or quote excerpts granted only upon written request. Advertising rates are provided upon request.

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News INDUSTRY

Michelle Primm Named Barbara Cox Automotive Woman of the Year

ox Automotive presented the 10th annual Barbara Cox Automotive Woman of the Year award to Michelle Primm, managing partner of Cascade Auto Group in Cuyahoga Falls, Ohio. The award, which is awarded to women who demonstrate business leadership and community advocacy, is named after the late Barbara Cox, one of Cox Enterprise’s owners and mother of Chairman Jim Kennedy. Cox Automotive President Sandy Schwartz presented the award during the Northwood University Dealer Education Awards annual breakfast at the National Automobile Dealers Association convention. For more than three decades, Primm has heavily supported the automotive industry. A graduate of the National Automobile Dealers Association Dealer Candidate Academy, she currently represents women dealers on the NADA Board of Directors, is chair of the NADART and serves as vice president for the Ohio Bureau of Motor Vehicles Licensing Board. Primm also is a member of the Ohio Automobile Dealers Association and Greater Cleveland Automobile Dealers Association, for which she was a past board member representing Mazda, Subaru, Audi and Porsche. In addition, she was president of the BMW Dealer Licensing Board from 2005 to 2007 and a member from 1994 to 2007. In addition to the award presented to Primm, Manheim and Cox Automotive made a $10,000 scholarship contribution to Kayleen O’Boyle, a student in the Automotive Marketing and Management program at Northwood University in West Palm Beach, Fla.

Cochran Infiniti Receives 25-Year Award

ob Cochran, left, president and CEO of Cochran Infiniti in Wexford, Pa., received a 25-year award from Jeffrey Harris, vice president of Infiniti USA’s East Region. Cochran Infiniti relocated its operations to Wexford in December, and is one of the brand’s original 51 launch retailers, dating back to 1989.

Gerrish Honda Recognized for 40 Years of Service

urt Gerrish, left, president of Gerrish Honda in Lebanon, N.H., received the 40-year award from William Bergmann, assistant sales manager for American Honda Motor Co. - New England.

Winter Park Volvo Dealer Receives 40-Year Award

illy Dingman, left, and Richie Dingman, dealer principals at The Volvo Store in Florida, received a 40-year award from the manufacturer. The dealership has been family-owned and operated since opening in 1984.

WHAT’S GOING ON AT YOUR DEALERSHIP? Send us your announcements so we can share the good news with our readers. Email your submissions to Newsroom@CBTNews.com 6

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hat is JVTN®? It’s simply the most powerful online automotive sales training in the world! Over 10 million chapters of our courses have been taken by salespeople and managers who get immediate results by developing the critical skills we cover that most would never learn otherwise. What would Joe Verde teach our salespeople? The complete sales process... How to sell a car today. No salesperson will be left behind, not knowing what to say or do when they get a customer. Word for word – we’ll show them what to say from the greeting to the delivery! How to close the sale, overcome objections and bypass price on the lot. We teach your salespeople the words and processes to handle every objection, including price, that comes up during the sale, closing and the negotiation. How to build your business by phone / internet. Phones ring and leads come in daily, so we teach salespeople the complete process of taking calls and leads and making outgoing contacts, to turn more lost sales into be-backs, and more contacts into appointments that show. How to follow up, prospect and retain your customers forever. Again, word for word on everything they need to say and do to build your future business. JVTN® even includes a powerful, easy to use mini-CRM built just for salespeople.

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Improving profits is easy, but there’s so much we weren’t taught about how to manage sales for profit that causes dealers to waste the majority of their time, money and hard work focusing on the wrong things. All of the business expenses you have now, including your payroll, employee benefits, flooring, as well as existing advertising and marketing costs are already accounted for on your financial statement. To increase your net, look at expenses and profit as your baseline, and look for future improvements that will generate good gross and improve your net profit. Finding Good Gross... When you make any additional sales that do not add any extra expense, or when you improve your gross profit… 60% becomes net profit That’s why it’s called ‘Good Gross’. Your only expense for the extra sales and extra gross is your sales and management compensation of about 40%. See how it’s done and use my new book, “Double Your Net” in your weekly management meetings to improve sales, good gross and net profit.

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CONSTANT GREATER NEW YORK AUTOMOBILE DEALERS ASSOCIATION

GREATER NEW YORK

More than a million visitors flock to the Jacob Javits Center in New York City each year to attend the New York International Auto Show, the oldest and largest auto show in the country.

Mark Schienberg, President of the Greater New York Dealers Association

The Greater New York Automobile Dealers Association still operates on many of the principles that it was founded on more than 100 years ago, while at the same time keeping its finger on the pulse of the ever-changing world of retail automotive. BY CAROL WHITE

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when he joined the organization in 1985 that its dealer members needed more. “It’s not enough to just hold an auto show, put out newsletters and hold a golf outing,” he said. “There’s so much more that retailers need and the world has been changing so quickly that, for an association, it’s important to offer services for dealers. For example, education.” Early in his career with the association, Schienberg was asked by New York’s Department of Motor Vehicles to assist with the vast amount of incorrect paperwork being submitted by dealerships. The solution was to offer education and training to billing and title clerks in proper procedures, which was highly successful and led to GNYADA’s increased focus on education for dealers and their personnel. Today it offers more than 60 different programs for every area of the dealership – everything from receptionist training, data security, BDC boot camps, sales training and even how to manage difficult people. Training in the earlier days was usually conducted at area hotel meeting spaces. “We agreed that training and education was the future of this industry, and we decided that if we were going to get serious in this area, we needed to build our own facility and house all the training programs.” In 2005, GNYADA opened the Center for Automotive Education and Training (CAET), a $28-million, 90,000-square-foot, state-of-the-art facility where all

of its education programs are conducted. Located in Whitestone, N.Y., in the borough of Queens, the center is also available for corporate meetings, seminars, product launches and even social events. The 5,000-square-foot atrium is constructed of steel and glass and boasts a 42foot high ceiling. The center also has a 40-seat, fully equipped boardroom, various classrooms, a computer lab, breakout rooms and fully equipped training bays. Thirteen manufacturers use the center for their training programs, including Toyota, which maintains permanent service bays for its training. Finding skilled technicians has been a challenge for dealers all over the country. With the average age of

Recruiting more women into all areas of the car business is a major focus for GNYADA.

PHOTOS BY DOMINICK TOTINO PHOTOGRAPHY

here are some things in retail automotive that haven’t changed much since the early 1900s. For example, the original minutes taken at the first meeting of the Brooklyn Motor Vehicle Dealers Association states that one of its missions at the time was to create an exhibition to show off the new cars being made and generate excitement with the public in hopes of making some sales. The association, now known as the Greater New York Automobile Dealers Association, also indicated that there was a need even back then for representation regarding taxes and regulations that were being handed down by local government. For more than a hundred years, dealer associations have fought the fight, and most likely will continue to long after you and I leave this earth. Fast-forward to 2015 and you’ll find that regional dealer associations still place advocacy for its members and producing elaborate car shows to entice, inform and influence today’s consumers as top priorities. In fact, this year marks the 115th anniversary of the New York International Auto Show. (See sidebar) Although many aspects of the auto industry have remained constant through the years, there are changes taking place today that dealers must embrace to ensure the vitality and future of retail automotive. Mark Schienberg, president of GNYADA, realized

CHANGE today’s service technicians being 48, that need is not going away any time soon. In answer to this dilemma, GNYADA collaborated with Lincoln Technical Institute in building a training center at the facility. “We interviewed just about every post secondary technician-training program, and what we liked about Lincoln Tech was, first of all they were willing to invest $8 million in fitting their facility out with the latest training equipment,” said Schienberg. The school’s approach to training and even mentoring the students once they graduate was another factor in GNYADA choosing Lincoln. Working with a for-profit company such as Lincoln – instead of partnering with a community college for training – provides GNYADA with more flexibility to change its course offerings as the industry changes. One area it has turned its focus on is recruiting more women into the business – not in just administrative positions, but in every area of the dealership including the service bays. “Women’s analytical and diagnostic skills are incredibly strong,” explained Schienberg, making them perfect candidates for positions in fixed ops. Schienberg also pointed out that 50 percent of all new car buyers are women, and they influence more than 85 percent of purchase decisions. Dealerships, therefore, should reflect this changing demographic. “I think the industry, lacking a better description, has been a good ‘ol boys club for way too long,” he said. “We have to break the mold. The world is changing and statistics show that the influence of women car buyers is huge.” Based on feedback he’s received from his members, Schienberg believes saleswomen probably have higher closing ratios, grosses and customer satisfaction scores than many of the men in the business. Their ability to break down barriers, put the customers at ease and listen to the buyers needs are probably big contributors to that theory. “Women come in with a fresher approach,” he said. In addition to women, the association is actively recruiting people who are more familiar with the customs of its customers in the dealerships’ communities. In Queens alone, the population is 28 percent Hispanic and 24.3 percent Asian, according to the U.S. Census Bureau. “Our neighborhoods are very diversified,” said Schienberg. “We have more languages spoken here than any other place in the country. This is a person-to-person business, and you need to be able to have people in the dealerships who speak different languages and understand the culture of those individual groups,” he said. In addition to keeping abreast of consumer trends, Schienberg and his team are keeping an eye on another movement in the industry – the emergence of publicly traded and mega dealer groups. “New York was probably one of the first places in the country to see consolidation of dealerships. So we’ve been looking at what sort of services are meaningful to those kinds of operations,” he said. “I think what’s going to happen in the years to come is, as the industry is changing from a “Ma and Pa” kind of operation with single store operators to publicly traded companies and mega dealers, we’re going to be looking at who we are and what is our role within this industry.” Schienberg believes that Warren Buffett’s, and possibly George Soros’, entry into the market is a good

sign that the future of automotive retail is secure. “These are pretty smart investors, and when you see somebody like them coming into it, they know it’s a good industry, an important industry and one that’s going to be around for a long time. “And while it may change, it’s still an industry that employs a tremendous amount of people in our communities and pays them extremely well. In many cases, it is the economic engine of their communities. And I don’t see that changing. I think the association

plays an important role in all of that and so I think the future for the retail auto industry is extremely strong.”

The Camp Jeep exhibit at the New York International Auto Show allows the manufacturer to show off the brand’s capabilities in all terrains.

115 Years of Awesome! The New York International Auto Show is one of the greatest – if not the greatest – marketing events in the country. “Where else can you go to see, under one roof, virtually every make and model that’s available and be able to talk to people who are experts in those different lines? And it’s a non-threatening environment for the consumer,” said Mark Schienberg, president of the Greater New York Automobile Dealers Association, which sponsors and orchestrates the show. “They’re looking to have a good time, but they’re also looking to make decisions.” Of the 1 million attendees at the show, GNYADA estimates that more than 50 percent are 12-month intenders, those consumers who plan on purchasing a new vehicle within the next year. The association also found that a large number of those people came to the show interested in a particular model but left with additional choices (32 percent). “That’s really showing that the show is doing what it’s supposed to do,” said Schienberg. “It’s giving them a lot of information and helping them make some decisions on what to buy.” In its 115th year, this year’s show is expected to be more spectacular than ever with an estimated 60 new reveals, more than ever before. The luxury and exotic car sections of the show will see new offerings from Cadillac, Porsche, Rolls Royce, McLaren, Aston Martin and Bugatti, to name a few. “The exotic car manufacturers are really embracing New York as the place to be and do their introductions,” he said. Manufacturers spend millions each year to bring their vehicles, exhibits and staff to New York City, but it’s worth it for them. “This is one of the most powerful markets for vehicle sales in the country,” said Schienberg, adding that all the major media outlets are located in New York City which gives the exhibitors exposure for the entire duration of the show, not just during the designated press preview days. Over the years, the NYIAS has evolved into a hybrid auto show – a mix between a show for the public and a trade show for people in the industry. GNYADA decided years ago to reinvent the show – making it more than just putting cars on carpet, explained Schienberg. A series of roundtable and panel discussions, symposiums and forums are organized around the show each year. This year’s Automotive Forum, co-sponsored by J.D. Power, NADA and the New York International Automobile show, will feature a keynote speech by Warren Buffett on how industry and economic conditions will shape the future of automotive. Press days at the NYIAS are April 1 - 2 and is open to the public from April 3 -12 at the Jacob Javits Center in New York City.

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Believing in your people before they have proven themselves is the key to motivating people to reach their potential. 3. TRUST. Similar to the first characteristic, do you trust them? Do they trust you? What can you point to as an example of that trust in practice? 4. RECIPROCITY. Life and relationships are a two-way street. How have each of you displayed “acts of selflessness” to benefit the other person? The true sign of maturity is not age, but rather when we accept that it is not about us. Success comes when we accept and realize it’s about them! We must learn to move from “I” to “we.” 5. MUTUAL ENJOYMENT. Relationships

require spending time together. Do you enjoy them being around you? Do they enjoy your company as well? People don’t care how much you know, until they know how much you care. It may be cliché, but it is certainly the truth.

LEADERSHIP

Moving from Command and Control to Collaboration By taking time to invest in your employees, you increase your chances of slowing down the revolving door. BY KIRK MANZO

or the past several years, dealerships have struggled to achieve full staff. The formula to attract and retain top talent continues to elude many operators in our business. The solution lies in accepting that the answer lies within an audience that our industry unfortunately has difficulties connecting with – the under 32 crowd. Some folks prefer the millennial label, let’s just be practical here, it’s candidates under the age of 32. One of the dynamics that we must examine is the continued use of the “command and control model” for operating today’s dealerships. It has been the dominant model for the past 30 plus years and, to be candid, has served our industry well, which is probably why so many are reluctant to let it go. In order to provide the type of experience customers want, should we not first examine the employee experience first? Gallup’s Q-12 employee satisfaction and engagement survey tells us that only 30 percent of U.S. workers are actively engaged. One reason for this may be the responses to the questions on the survey related to their organization/dealership’s “valuing their opinion.” In a command and control model, team members’ opinions are viewed as irrelevant. I am the manager, I am in charge and if I want your opinion I will simply give it to you. Harsh, but how many dealerships continue to operate under this antiquated philosophy and culture? The journey to create a more appealing work environment for the next generation of workers begins 10

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by applying a more collaborative approach when operating a store. Creating a team structure can help foster the type of interaction and interdependence that connects your people. In turn this helps reduce employee turnover and increases both employee and customer satisfaction, and who doesn’t want that? John Maxwell identifies success as being able to connect with others by establishing solid relationships. So how do you know if you have built solid relationships with your team? Look for these five characteristics in those relationships:

1. RESPECT. Do you respect this person’s opinions? Do they respect yours? If yes, then how do you show them that respect?

2. SHARED EXPERIENCES. Have you been to the mountain top together? Have you endured the fires of hell and come out the other side? When was the last time you did something together outside of work?

Moving to a more collaborative approach means that managers (leaders) need to move towards their people versus waiting for them to come to you. We must make the leap of faith that they are capable of getting the job done. Encouraging them to stretch to their potential is part of our job as the leader. Believing in your people before they have proven themselves is the key to motivating people to reach their potential. Taking the time to invest in your people is the best way to ensure your dealership’s success. Your level of success will be determined by those closest to you. Without their support you are limited to what you can accomplish alone. The Law of Significance states, that one is too small a number to achieve greatness! So work to identify those people around you who are both capable and motivated to learn what it takes to rise to the next level. With you as their guide, there is no limit to what you can accomplish together. Provide the vision and pour into the team and watch them help make the impossible happen!

WORDS TO HELP IMPROVE COMMUNICATIONS WITH THOSE AROUND YOU: The least important word is: “I” The most important word is: “We” The two most important words are: “Thank you.” The three most important words are: “All is forgiven.” The four most important words are: “What is your opinion?” The five most important words are: “You did a good job!” The six most important words are: “I want to understand you better.”

KIRK MANZO President of The Manzo Group As a nationally recognized speaker and professional trainer, Kirk has conducted hundreds of in-dealership programs nationwide and was a featured speaker at the 2008 NADA Annual Convention in San Francisco. As a certified member of the John Maxwell Team, Kirk facilitates mastermind groups, in-dealership workshops and coaching services based on Maxwell’s strategies on leadership and communications. Visit his website at Manzogroup.com.

2015 DMSC Will Focus on Strategy and Process

he 5th Annual Digital Marketing Strategies Conference is slated for April 12-14 and will feature presentations from representatives from Google, Twitter and Facebook who will be sharing their latest marketing platform updates. Also, top dealers from around the globe will be participating in panels to discuss the future of automotive

retailing. “If 2015 is the year that auto dealers take back control of their dealership, they must be able to inspect and manage their web presence,” said Brian Pasch, one of the workshop and general session leaders of the conference. “While it’s great to have a marketing team that knows online marketing strategy, executives cannot lead a dealership, in a digital age, without understanding their own online marketing KPIs.” The three-day event is an executive-level conference designed to assist automotive owners and managers with creating a market-dominating digital marketing strategy and sales process. Workshops and keynote speakers will concentrate on the most successful digital marketing strategies and processes that should be implemented in the dealership. All workshops and panels are intimate, highly engaging and filled with rich content, said Pasch. The DMSC program is geared to the dealership that wants to fully understand digital strategy and stay ahead of their local competition. This year’s conference, which is limited to 100 attendees, will be in California’s Napa Valley. This design enables workshops to be engaging and interactive, according to Pasch. This dealer-centric approach allows for personalized attention and examples directly from attendees. Each workshop is focused on one central team,

Brian Pasch of PCG Consulting

providing dealers with a clear vision of their priorities on each topic. Workshop topics will include industry benchmarks and KPIs your team should be measuring, cutting-edge sales processes and the latest digital marketing strategies your team should be employing. Attendees will return to the dealership not only ready to embrace digital marketing, but to lead the charge in the entire marketing strategy, said Pasch. Other workshop and general session leaders are Sean Stapleton, Darren Haygood, Cliff Banks, Patrick Kelly, Glenn Pasch, Marc McGurren, Phil Aime, Lisa Salabritas, and Thomas Gage. For information or to register for DMSC, visit digitalmarketingstrategies.org.

Jeﬀ Cowan is now on CBT Automotive Network!

LEADERSHIP

IMPLEMENTING CHANGES

That ‘Stick’ With Your Dealership Teams What you can do to narrow the ‘knowing – doing’ gap when implementing change in your dealership. BY TOM KUKLA

“When you are through changing, you are through.” – Bruce Barton

arch already! The NADA Show in San Francisco is history. The boss just got back from the first 20 Group meeting of 2015. Everyone knows what that means – there are going to be changes, new initiatives and programs that need to be implemented. It’s your job, as the manager, to make sure your team implements effectively and that the new initiative sticks.

IMPLEMENTATION – EXECUTION - ADHERENCE So is the “Knowing – Doing” gap alive and well in 12

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dealerships today? Ernst and Young found that 66 percent of corporate strategies are never executed. Kaplan and Norton stated that 90 percent of wellformulated strategies fail due to poor execution. Jack Welch said, “In real life, strategy actually is very straightforward. You pick a general direction and implement like hell.” So, as a leader, what is your first reaction when you are given a new initiative to implement? Your initial reaction holds a clue as to how your team will react.

“Our dilemma is that we hate change and love it at the same time; what we really want is for things to remain the same but get better.” – Sydney J. Harris

KAPLAN AND NORTON STATED THAT 90 PERCENT OF WELL-FORMULATED STRATEGIES FAIL DUE TO POOR EXECUTION. STEP 1 – BE LASER FOCUSED ON THE INITIATIVE ITSELF This may seem obvious but it is the main reason for the knowing – doing gap. We know the importance of the initiative, and how it will affect the dealership but we don’t follow through; we fail to follow through completely; or we give up too soon. So what can you do to get your team laser focused? • Set the vision. • Simplify it – put the vision in easy-tounderstand terminology, then break it into steps. • Give them the “why” behind it. • Help your team visualize what it looks like when it is done right. • Keep it in front of them (make it visible) by using a “tote board,” emails and signage. Set expectations and hold them accountable. • Celebrate when it is executed correctly. Coaching Tip on Focus: Managers need to break down new initiatives into a step-by-step process that team members can visualize and follow easily. For example: Your dealership is introducing a new initiative of enhancing how every customer – whether in person, online or over the phone – is greeted, responded to and followed up on. Team members need to know the role they will play and your expectations. • Pull the team together, lay out the new initiative and set expectations. • Break their role down into three things that must happen during every customer interaction. • Start each day reinforcing the “why” behind the new initiative. • Publically praise when initiative is executed effectively. Ask your manager to participate • Privately coach when initiative is not executed thoroughly. • Don’t let them “off the hook”.

Change is inevitable. Implementing that change is tough in any organization. Change fosters growth. Growth fosters opportunity. Just think about how the Internet has changed the way your dealership advertises. Execution is simple in theory but difficult to put into practice. Implementation is all about execution – in short executing the plan. Consistently executing the plan creates Adherence – Adherence to the plan. Good plans are important but if there is no execution (and thus no adherence), it’s just a plan. Lee Colan introduced a logical “Adherence Equation” in his book Stick With It. In the equation, Adherence comes from a combination of focus, competence and passion. If any of the three are missing, adherence is nonexistent. No adherence means no growth. So how do we develop adherence and foster needed growth from new initiatives? Or, how do we implement the plan for implementing the initiative? The three critical factors in the equation above drive the execution of that new initiative on your dealership team. All management levels need to participate in the following three steps.

STEP 2 – TRAINING AND EQUIPPING THE STAFF WITH THE SKILLS NEEDED Don’t assume your team knows how to execute. With many new initiatives failing due to poor execution, you can assume team members may not know how. Use this as a training and leadership opportunity to build new skills and reinforce existing skill sets. • Train the vision by setting the example. You get good first. As the leader, you should be the strongest member of the team. Be very specific about what “good” looks like. • Train everybody consistently. • Tap into top performers and let them lead the training. Try teaming people up. • Train them again on the “why.” • Hold everyone accountable. Tell them when they get it right and coach them when they get it wrong. Be systematic.

Coaching Tip on Competence: Managers can’t assume everyone will know how to execute a new initiative, especially if it involves customer interaction. Keep your team’s skills sharp by: • Identifying and describing each team member’s strengths in customer interactions and how those strengths add value. • Conducting weekly training sessions so initiative stays top-of-mind. Keep training fresh by modeling and changing trainers. Involve your manager in the training. • Provide feedback to team members that is immediate and only focused on the initiative. • Tie positive behavior into results.

STEP 3 - BE PASSIONATE ABOUT IT Everyone has a role to play in the success of the new initiative.

“Every single soldier must know, before he goes into battle, how the little battle he is to fight fits into the larger picture, and how the success of his fighting will influence the battle as a whole.”

– Field Marshall Bernard Montgomery • Own the vision. Be intentional. • Paint the picture by doing your part. The team will return to you what you give to them. • Make it fun. • Make it important. • Tell them the “why” once again! • Connect their efforts to the end goal. Coaching Tip on Passion: Managers can’t assume everyone will own the vision without a little help. How you present the new customer interaction initiative, and make it live, makes all the difference. Get your team on board and consistently implementing by: • Painting the picture, weekly, of the deeper purpose behind the initiative. Follow it up in writing, showing progress of the team’s activities and consistently describing what’s in it for them. • Going beyond minimum expectations. Create new rituals that are tied to initiative. • Constantly looking for positive performance and praising often. It’s up to you. When leading your team through change or a new initiative, communicate openly and honestly. State the facts but always explain the “why.” Express your belief that this new initiative is needed to grow and prosper. Change is hard so don’t just communicate what is changing but also communicate what is staying the same. Be available when team members have questions or get stuck. Remember, praise goes a long way to making sure the changes you are trying to see in your dealership stick.

TOM KUKLA Principal and Founder of Tom Kukla Credere Leadership Tom is a highly experienced Leadership coach, speaker and trainer. Prior to founding Credere Leadership, Tom spent 38 years in retail and medical sales, sales management and management and leadership development. He developed a world-class management-training program from the ground up in the highly competitive pharmaceutical industry that served hundreds of sales and marketing colleagues. As a John Maxwell certified coach, teacher and speaker, Tom offers organizations management and leadership workshops, seminars, training and coaching in order to guide the personal and professional growth of managers of all levels and tenure. You can reach Tom at tom@credereleadership.com.

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MARKETING

Make the Most of Your Marketing Dollars Paying close attention to three key areas could prevent you from wasting 20 percent or more of your marketing budget. BY GLENN PASCH

ou could be wasting 20 percent of your marketing budget. In fact, I think for some dealers this percentage might be higher. My opinions are based on what I see when I am brought in to provide clarity to the leaders of dealer groups. What would lead me to make this claim? There are a few reasons but I will boil it down to three areas so I can explain my reasoning and provide possible solutions. If you are reading this article, you are already ahead of 70 percent of your competition. When the statistics show that reading levels are at an all time low, working to educate oneself shows a real trait of success. Which leads me to my first point:

LACK OF CONSISTENT EDUCATION

Too often automotive leaders are overwhelmed – they have multiple responsibilities to their business, their financial institutions, their employees, their families, etc. Being pulled in a million directions leaves little time to analyze all of the marketing spend and execution to ensure they are being the most efficient they can be. Add to this, a lack of time to educate oneself on the newest ways to improve efficiencies. This begins the trickle of wasted dollars. If you do not understand what your vendors are doing, how can you hold them accountable for maximizing results? The biggest hurdle for many dealers is understanding the realm of digital marketing. It is still a bit unknown. The rules change as fast as ever so it is easier to ignore something or skim the surface than really owning the information to propel your business forward. There are many ways to educate yourself beginning with reading articles on the topic. Attending conferences, webinars or classes are incredible ways to learn from some of the best educators, as well as from other dealers who can share their struggles and successes with practical applications. Whoever from your dealership attends these sessions should be required to bring this information back to the

THE BIGGEST HURDLE FOR MANY DEALERS IS UNDERSTANDING THE REALM OF DIGITAL MARKETING. group, teach it to everyone and see how it could be implemented in their day-to-day business model. If you do not require this step, then you are adding to the trickle of wasted marketing budget. This lack of education pairs well with the next aspect of wasted marketing dollars:

VENDOR REPORTING AND TRANSPARENCY

Many vendor reports are way too complicated and contain way too many touch points that mean nothing to the dealer in a practical sense. In some ways this is an outgrowth of point No. 1, because if the dealer does not understand certain metrics, then vendors rely on the volume of information to demonstrate their efforts. Vendors should streamline their reporting to show actionable data to the dealer. Dealers themselves do not have to be experts but they should be demanding that their vendors explain in layman’s terms what they are getting for their marketing spend each month and how it is helping to achieve their marketing goals. This applies to all vendors – traditional agencies, digital, process trainers and sales trainers, as well. If vendors cannot explain in simple terms what they are doing and show you the results, then they either need to fix this or be replaced because this lack of transparency is another contributor to wasted marketing dollars. 14

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The third area of wasted marketing dollars comes from:

THE LACK OF ACCOUNTABILITY TO YOUR CUSTOMER PROCESSES

Dealers spend thousands of marketing dollars to drive traffic to the web, phone, email or showroom. I cannot fathom why more dealers are not aware of the ratios of engagement or execution of their processes. They know final sales and service numbers; they know what they spend. But they are not really diving into the step-bystep journey of their customer and understanding how the lack of inspection is adding to this wasted marketing effort. Let’s say my first two points are maximized. By not paying attention to this third point, you allow staff to waste your money and then have the gumption to ask for more leads. Crazy when you think about it. Track your efforts. Set higher standards for utilization of the CRM. Make sure your team is tracking everyone who contacts you. Make sure engagement levels, and appointment levels are as important to you as front-end gross. Solid processes can make up for struggles with points one and two, so maximize this by hiring a trainer or just holding folks accountable to the process you have in place. Finally, I am asked many times as I travel and teach: is there a way to increase sales without spending any more on services or vendors? Is there a way to be able to monitor everything, especially when it changes so much? Who can you trust? Which leads to my recommendation:

SET HIGHER STANDARDS FOR UTILIZATION OF THE CRM. MAKE SURE YOUR TEAM IS TRACKING EVERYONE WHO CONTACTS YOU. HIRE A TRUSTED ADVISOR What is lacking at the leadership table of many groups is someone dedicated to finding the efficiencies mentioned above. At times there are individuals who may manage one of the silos, but in my opinion there needs to be someone who manages this budget of money – many times not insignificant – and lead in the creation and execution of the marketing strategy. They need to make sure they have the right vendor mix and then hold everyone accountable. They need to make sure the internal processes are set up and then hold the people accountable. My recommendation is that you may have to look outside of your current team for this person or hire a company to help you in the short term. This advisor benefits from not being in the day-to-day running of the company and they have the training to be laser focused

on reports to know what needs to happen to improve performance. If you have someone internally, then make sure that you are not loading up their day with tasks that pull them aside. This is a multi-million dollar business and maximizing efficiencies should be a top-of-mind priority. Get the help you need instead of letting this continue. Twenty percent is a large amount of money to be wasting each year.

GLENN PASCH CEO of PCG Digital Marketing Glenn is a trainer at heart. He is a highly sought-after speaker, writer, coach and operations strategist, as well as a customer service fanatic. He has spoken throughout the U.S. and Canada, educating audiences on a variety of topics including business leadership, change management, digital marketing and the impact of this new technology on culture, business and society. Visit the website www.pcgdigitalmarketing.com

Many dealers are becoming more aware of the importance of lighting in their lots and how the right lighting, from an operational standpoint, can help drive profits.

Since installing energy-efficient lighting at the dealership, Kia AutoSport in Columbus, Ga., has seen a 20- to 33-percent increase in energy savings.

Driving Cost Savings with

LED Lighting New lighting can help dealerships reduce energy and maintenance costs while creating an inviting atmosphere. BY ANTOINETTE MILETI

hen it came time to build a new Mercedes-Benz dealership in Fort Mitchell, Ky., Collection Auto Group President Bernie Moreno had one goal in mind: create an all-LED lighting facility inside and out that drives the client experience beyond expectations. “Our goal was to build the greatest dealership in the world,” Moreno explains. “We designed the building to be intuitive – here are lights that clearly guide you to each area. Every single lumen on the property is LED, from the post tops out front to the hanging fixtures in the showroom to the lights in the service bay.” Collection Auto Group is not alone in its choice of LED lighting. Today, auto dealerships are looking for ways to reduce energy and maintenance costs while still drawing the attention of prospective buyers. And many of them are turning to LED for the solution. By improving the quality of lighting, dealers can benefit on both the top and bottom line. First, high-quality lighting delivers improved color rendering on the cars’ exteriors as well as better luminance inside the vehicles to showcase upholstery and interior designs. Second, reduced light levels and longer lamp life drive energy savings and lower maintenance costs. 16

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THE ROAD TO SAVINGS areas, including a café, is a collection According to the National Automobile of fashionable LED troffers that blend Dealers Association, lighting accounts into the ceiling and linear bands of light for 18 to 55 percent of electricity conintegrated within it. Throughout the sumption for most businesses. service center, suspended pendants and Energy-efficient LED lighting is one blade-like fixtures also help cut a striking way auto dealers are saving money on aesthetic while reducing costs. their lots while beautifully showcasing Meanwhile LED High Bay fixtures vehicles, adding a measure of security deliver crisp, uniform light across the and enhancing the customer experience. shop floor, detail bay and parts departCollection Auto Many dealers are becoming more aware ment, meaning mechanics won’t be left in Group President of the importance of lighting in their lots the dark whether under the hood or in the Bernie Moreno and how the right lighting, from an operpit—where LED lighting is also installed. ational standpoint, can help drive profits. A comparison showed that MerThere are four common lighting application cedes-Benz of Fort Mitchell will use about 40 spaces in a dealership where LED can make an percent less lighting energy with LED than with impact by replacing various legacy technologies conventional technologies, saving $46,000 a year. like linear fluorescent lights and high pressure “When we looked at the energy savings we’re sodium (HPS) fixtures: outdoor lots, showrooms, getting, and that it’s really the right thing to do for service areas and ancillary spaces like back offices. the environment, it’s just a win-win for everybody,” At Mercedes-Benz of Fort Mitchell, Collection Moreno says. Auto Group uses GE Evolve™ LED Area Lights and ADDITIONAL BENEFITS Evolve™ LED Post Tops to illuminate its driveway In addition to energy savings, the potential for and inventory. Advanced optics aim light precisely reduced maintenance costs are another benefit of where it’s needed and away from neighbors’ yards longer-lasting LED technology. These maintenance adjacent to the property. savings are particularly attractive when it comes to Illuminating Collection Auto Group’s lavish replacing difficult-to-access lamps, such as those showroom, inviting offices and captivating client

LED High Bay fixtures deliver crisp, uniform light across the shop floor, detail bay and parts department, meaning mechanics won’t be left in the dark whether under the hood or in the pit—where LED lighting is also installed.

found in service bays. With fewer maintenance responsibilities, employees can focus on helping customers and servicing vehicles—not climbing ladders. Plus, installing LED fixtures in your dealership offers the ability to better control the lighting. Occupancy sensors and intelligent lighting controls can keep lights turned down until movement is detected. Dimming and on/off scheduling allow for maximum energy savings. “People are blown away when they come in and see the amount of lighting and the control of the lighting—the way it doesn’t overwhelm, the way it spreads and provides a natural color for everything throughout the dealership, inside and outside,” says Moreno. For Monroe Lee, owner of KIA AutoSport, reducing energy consumption and maintenance costs were driving factors for investigating new lighting solutions in a key area: dealer lots. Outdoor lighting is often the first impression customers see when entering the facility, as well as one of the largest users of electricity at a dealership. Instead of traditional metal halide high intensity discharge (HID) fixtures, Monroe chose LED outdoor lighting fixtures with timers in his new Columbus, Ga., KIA AutoSport dealership. “We tried to use energy-saving techniques throughout the whole design of this new dealership, which included energy-efficient lighting fixtures and timers to control when the lights are on,” said Lee. The result was a 20-33 percent increase in energy savings and reduced maintenance costs after installing the new lighting fixtures.

A CUSTOM SOLUTION While there is no one-size-fits-all solution for the right dealership lighting, a professional lighting audit is a simple way for dealers to evaluate their current system and explore how other lighting technologies may look better, perform better and ultimately save money. When it’s time to invest in your dealership, consider an LED lighting solution as a first step to improved operations savings.

“People are blown away when they come in and see the amount of lighting and the control of the lighting—the way it doesn’t overwhelm, the way it spreads and provides a natural color for everything throughout the dealership, inside and outside.”— Monroe Lee

When it came time to build a new Mercedes-Benz dealership in Fort Mitchell, Ky., Collection Auto Group President Bernie Moreno had one goal in mind: create an all-LED lighting facility inside and out that drives the client experience beyond expectations.

ANTOINETTE MILETI Retail Marketing Manager for GE Lighting Antoinette Mileti leverages an understanding of retailer needs to drive strategic marketing initiatives aimed at meeting the demands of retail stores in North America. For more information on LED lighting for auto dealerships, visit GElighting.com/auto.

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Under the leadership of the brother and sister duo, Will and Genny Hardeman, Continental Automotive Group is looking to appeal to the next generation of shoppers and employees.

Whipping up lattes and cappuccinos for the customers in his dealerships’ cafes is one of Will Hardeman’s favorite things to do.

DEALER PROFILE

CREATIVITY SELLS CARS

at CONTINENTAL AUTOMOTIVE GROUP

nlike a lot of second-generation dealers, Will Hardeman and his sister Genny Hardeman had other intentions than joining the family business. After graduating from the University of Texas in economics and Southern Methodist University in finance, respectively, the two set out to carve their own career paths. But after a few jobs and a few bosses in the outside world, the two came home to nest, so to speak, in the dealership group their father, Bryan Hardeman, had built in Austin, Texas. “It took a few years to realize how great the opportunity is in automotive,” said Will, 33, who is a managing partner, along with Genny, 31, of Continental Automotive Group. Genny’s twin sister, Joy, attended the University of Texas Law School and currently lives

in Washington, D.C. In 1978, Bryan Hardeman, at the age of 29, purchased Continental’s Honda and Mercedes Benz dealerships, making him the youngest authorized dealer for those brands in the country. That same year, he opened Continental Collision Center. Over the years, the group bought and sold several dealerships. Today, it owns four dealerships in Austin – First Texas Honda, MercedesBenz of Austin, Austin Infiniti and Austin Subaru – along with three collision centers, three wholesale parts distribution centers and its own insurance and in-house marketing agencies. It recently partnered with BMW of Corpus Christi – its first venture outside the Austin city limits in eight years. “We are in full acquisition mode, looking to grow whenever we see a deal that we see value in,” said Will.

At 120,000 square feet, First Texas Honda is the largest Honda dealership in the United States and includes a showroom large enough to showcase 100 new and pre-owned vehicles.

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In 2001, Bryan Hardeman opened Wholesale Parts Direct, a separate parts distribution center, which sells to independent automotive service shops and handles distribution for almost 70 different manufacturers. “We basically outgrew the dealerships’ parts departments so we moved to a new 50,000-square-foot warehouse,” said Will, explaining that most of the growth is in aftermarket sales. A couple of years later, Continental opened a new 30,000-square-foot, state-of-the-art collision center. A unique feature of Continental Auto Group is its onsite insurance agency, which not only insures its employees, but also is available to customers and noncustomers alike. Since all car buyers are required by law to have auto insurance, it made sense to offer the convenience of that service to its customers. “Some of them need to upgrade their insurance or have different insurance needs on the spot,” said Will. “We’re able to help them out and capitalize on that.” The agency, which provides coverage from multiple top-rated insurance carriers, offers home, commercial and life insurance in addition to auto insurance. Since joining the family business in 2007, Will has focused on the company’s e-commerce efforts while Genny’s attention has been in F&I practices, procedures and training. According to Will, she’s experienced great success in that area increasing the auto group’s PRU by $250 in about four years. Their father is still active in the company, but most of the day-to-day management is in the hands of the siblings. Aside from their father’s tutelage, Will and Genny have a vast pool of mentors, many who have been with the company long before they were born, to help them learn the ropes. With more than 500 employees, the average length of employment at the group is an astounding 17 years. Chris Hirsh, for example, service manager for the Mercedes brand joined the company 42 years ago, and Jim Olmstead, president of First Texas Honda, first starting working at Continental in 1969. There’s a reason Continental Auto Group has landed

PHOTOS BY SHELBY RAE PHOTOGRAPHY

Outstanding employee benefits and a focus on a creative selling environment lies at the core of the auto group’s success. BY CAROL WHITE

Chris Hirsch, left, service manager for Mercedes-Benz of Austin, has been with Continental for 42 years. Pictured with Hirsch are members of the parts team Kate Pittman, Hector Arellano, and Parts Manager Lee Godfrey.

The company’s parts distribution center, which sells to independent automotive service shops, handles distribution for almost 70 different manufacturers.

Mercedes-Benz of Austin has been named an Official Mercedez-Benz Best of the Best Dealer, and consistently ranks as among the top 10 dealers in the country in certified pre-owned sales.

on the Austin American-Statesman “Best Places to work “ list for four straight years. The secret, according to Will, is his company’s long-standing philosophy of “doing what’s right for the employees, and they will do what’s right for our customers.” That includes offering outstanding benefits, such as 100-percent companypaid medical, life and dental insurance; a matching 401K; an employer-paid onsite wellness clinic; full access to the company’s in-house marketing agency; and an employee vehicle purchase assistance program, to name just a few. These perks, uncommon in most dealerships, certainly add to the employee-satisfaction index, but the “fun factor” has a lot to do with it. Will gives all the credit to his managers for maintaining a fun atmosphere in the dealerships. For instance, every hour on the hour the product specialists and managers at First Texas Honda drop to the ground to “plank” for 60 seconds, which is a fun team-building and physical activity in which even the customers have been known to participate. The Honda dealership also boasts a permanent stage in its showroom where the musical members of its staff frequently entertain shoppers. And to attract current and potential customers, the dealership throws elaborate customer-appreciation parties complete with food, fun, music and dancing. Olmstead is no stranger to the stage and is always willing to entertain the crowds at these events, many of which bring in about 700 guests.

Continental opened a new, 30,000square-foot collision center in 2003.

“ENJOYMENT IS DIRECTLY TIED TO PRODUCTIVITY AND SUCCESS. ONE THING I ALWAYS SAY IS ‘IF YOU DON’T LIKE DOING SOMETHING, YOU’RE UNLIKELY TO WORK HARD ENOUGH AT IT TO BE SUCCESSFUL.’”

“I think having fun at work is one of the foundational pillars of employee satisfaction,” said Will, who added that turnover within the auto group is lower than industry standards. “Enjoyment is directly tied to productivity and success. One thing I always say is ‘if you don’t like doing something, you’re unlikely to work hard enough at it to be successful.’” Creating an employee-centered culture not only helps the auto group’s retention rates, but it also works in its favor when recruiting new talent. Will’s strategy is to align the company to appeal to the next generation of employees. “If I were starting a career as a salesperson or a service advisor, would I want to come to work here? Would I look forward to coming in everyday and feel good about it?” The company’s move to a one-price, no-haggle sales process is another factor in the employee happiness quotient. Currently, the Honda store is the only one that has a no-haggle sales process, which was implemented in 2011. “I think that, whether you like it or not, that’s the way the industry is moving. So it’s not a question of if but when (the other stores) will be there,” said Will. “There’s no way to just dabble, or dip your toe in the water with no-haggle selling. You have to go all in and you have to have buy-in from management. They have everything to do with the success or failure of it.” That’s not to say that First Texas Honda didn’t have its share of pushback when the concept was first introduced. They lost employees who had spent their entire careers perfecting their sales skills and were

unwilling to make the transition. That’s the hard part about transitioning your business model, but it has paid off for the dealership, according to Will. “Our product specialists like it because it’s very easy to sell cars, and our customers like it because they realize they’re getting a good deal,” he said, pointing to all the five-star reviews it receives almost daily. “I believe that is the absolute best way to retail automobiles. Our customers love it and our employees love it.” It may have taken him a few years to appreciate the opportunity within the family business and make the move back to Austin, but it’s one that he says has allowed him to be an integral part of the company’s commitment to its community through its many philanthropic endeavors. “Austin has been a wonderful place to grow up, go to college and do business all in one. We want to support the community that supports us and has made us successful. We want to give back and perpetuate that cycle. That’s what we believe.”

PHOTOS BY SHELBY RAE PHOTOGRAPHY

LEFT: Every hour on the hour employees at First Texas Honda drop to the ground to “plank” for 60 seconds. Leading the team is Winthrop “Winnie” Ellsworth, new cars sales manager at the dealership. RIGHT: Jim Olmstead, far right, president of First Texas Honda, with Courtney Audain, product specialist, at the dealership’s “Night Fever” customer appreciation party last year. The house band, Bee Gees Songbook, is made up of members of the dealership’s staff including Audain, Tim Boss, Mike Robberson, Steve Carter, Jeff Tveraas, David Road and Paul Mills.

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Be sure to present yourself as you would if you were at your desk or place of business. It’s important to be deliberate in any social setting. business page. Why? Because I’ve seen too often where a dealer or manager has left the social media up to someone, that person is no longer working for them and then they can’t access their own page. The best thing to do is when creating an account to run your business page with, always use an email address with your business’ domain name so you have control over it. Once you’ve got your business page created, you can add trusted users –including your own personal profile if you have one – as admins on the page.

FACEBOOK FOR SALESPEOPLE AND ENTREPRENEURS For a salesperson or solo-entrepreneur, such as an independent wholesaler, the answer to “Do I need a separate Facebook account for business?” is more complex. It’s mega-important to identify what you feel comfortable with. Social media should be a positive experience for you. If it isn’t, it will show in how you connect and engage. Here are a few scenarios to help determine if you need a separate Facebook account for business: 1. If you’re new to Facebook and don’t know what to do, start with a personal proﬁle. Create an account using your email address. Fill in all your contact information and remember to put your work contact info, not your personal info. That way, you can make your pro�ile public without worrying about your personal data. When your pro�ile is public, you’ll be found by customers and prospects.

MARKETING

Strategy Before Tactics When It Comes to Facebook When deciding whether to have separate Facebook accounts for business and personal, it’s best to examine your marketing goals. BY KATHI KRUSE

’m not trying to be Captain Obvious here but unless you’ve been on a deserted island somewhere, you should know by now that Facebook is a valuable tool for marketing yourself and/or your dealership. Salespeople leverage it to stay in touch with customers and network with new ones. Dealerships make it part of their marketing to generate leads and sales. Almost anyone can benefit from Facebook’s reach and it’s crazy to ignore it. I get asked a lot, “Do I need a separate Facebook account for business?” and the answer is not as simple as it seems. Everyone talks about Facebook. The media loves to hate on Facebook. So it’s hard to know for sure whether the answer is yes or no. The answer to “Do I need a separate Facebook account for business?” depends on whether you’re a salesperson, a soloentrepreneur or a dealership. It’s important to understand what your goals are first before venturing out onto any marketing platform. Always put strategy before tactics. 20

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FACEBOOK FOR BUSINESS As a business participating on Facebook, you’re required to engage Facebook as a “business page.” It’s actually against Facebook’s terms of service to have a personal profile for a business. You wouldn’t want to do that anyway because a personal page doesn’t get access to Facebook ads, which can drive traffic to your website and get you leads. You will however, need a personal profile in order to act as administrator on your business page. All Facebook business pages are administered through personal accounts. It’s best to create an administrative Facebook personal account for the

2. If you have a robust network already on Facebook with your personal proﬁle, then continue leveraging that account. Be sure to present yourself as you would if you were at your desk or place of business. It’s important to be deliberate in any social setting. You wouldn’t show up to a formal affair in shorts and �lip-�lops, right? This is where personal branding comes in handy. It helps you know how to present yourself online. 3. If you really want to drive leads and sales, create a Facebook business page for yourself and utilize Facebook ads. You’d be surprised what you can do with $100-200 a month in ads budget. What we’re talking about now is “social selling” – leveraging social media to network for referrals and sales. This option is for the more advanced user who should have his/her personal branding in place, along with a website and a blog. More and more, consumers are searching for quality. They’ve experienced a great customer experience from brands like Amazon and Zappos and they expect the same from you. Look at your marketing through your customers’ eyes. Master Facebook with the goal of delivering the customer experience they’re searching for. Chart your best course of action and go for it!

KATHI KRUSE President of Kruse Control Inc. Kathi is an automotive social media marketing expert, blogger, speaker, coach and author. Her passion for the car business spans a 30-year career managing successful dealerships in Southern California. Kathi is the author of “Automotive Social Business – How to Captivate Your Customers, Sell More Cars & Be Generally Remarkable on Social Media.” Her Kruse Control blog is the leading automotive social media blog in the U.S. and Canada. Visit her website at KruseControlinc.com.

REVEAL THE PRINCE ON

YOUR USED CAR LOT.

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Be proactive and proud of your price by initiating the price discussion up front so that while you are presenting the product the buyer is not wondering about it the entire time.

to happen as efficiently as possible, without seeming rushed or sluggish. Don’t waste time with small talk; the customer is not there to get to know you or talk about their life. Show the buyer you are there to get down to business as quickly as you can and then they will naturally tell you about themselves.

SHOW PRICE; DON’T TALK PRICE Well before you get to the presentation, disclose the price of the product the customer has shown interest in and then offer alternatives to that, one higher and one lower. Don’t wait for the buyer to ask for a price. Be proactive and proud of your price by initiating the price discussion up front so that while you are presenting the product the buyer is not wondering about it the entire time. We did this for a dealer and immediately recognized a doubling of demonstrations and write-ups.

5. SALES

Less Time – More Proﬁts Today’s car shoppers have already done their homework, so starting them out at Point A is a waste of time. BY GRANT CARDONE

ime is killing your sales. The longer you spend with a customer today the less likely you are to make a sale and to make any money. I am happy to prove this to you if you like, as we have tracked over 2 million automotive transactions and have validated that when you increase your negotiation time beyond 12 minutes, the gross profit drops by 75 percent Your customer values time more than money unless they don’t have any. Those with no money and can’t buy will spend all day with you but those that can buy and do have money will not. If they have to spend all day with you to get a deal done they will penalize you in gross profit and in customer satisfaction scores. Here are five steps to help you maximize your time – and your buyer’s – by closing deals faster:

SHORTEN THE SALES PROCESS The average buyer is spending up to 11 hours on the Internet doing research and only visiting 1.4 dealerships. Let the buyer know you can get this done as fast as they want or you are willing to take as much time as they like. We are using a mobile app with customers today, where the 22

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salesperson is able to talk payments in the greeting as a way to expedite the process. As a result, writeups, demos and gross profits have increased.

FACE OBJECTIONS HEAD ON Customers won’t buy for four reasons: time, money, stalling or product. If you bring these points up before the customer does you will remove obstacles, unspoken objections and get the buyer communicating and increase buyer confidence.

BE UP FRONT AND CLEAR WITH YOUR INTENTIONS The goal is to introduce yourself and make a good impression to set the buyer at ease – you want to set the stage for the entire sales cycle

BREAK YOUR DEMONSTRATION INTO FIVE PARTS Twenty years ago you had to show the entire product. Today the buyer has done so much research that this may be unnecessary with some of your buyers. Break your presentation into five parts, and at the end of each segment of the demo ask, “Have you seen enough to make a decision?” There is no reason to continue to show parts of your product once the buyer is ready to buy. You can do a complete presentation at delivery. You should constantly check for opportunities to allow the buyer to purchase your product and not sell beyond that point. This shows the customer your concern for their time and your own. This is the point when you stop selling, get the buyer to take action, and have the critical exchange of value that I talk about in the Closers Survival Guide.

STAY SOLD ON YOUR OFFER You were likely convinced by your parents, teachers and other mentors that getting your way is a bad thing. If you believe in your company, your product and yourself then stay sold on that and insist the buyer do business with you. That means you must repeatedly insist on the business, make sure a manager meets the customer before leaving and always follow up and keep following up no matter what. When you are completely sold you never give up. Let’s face it, your customer is doing more homework than ever to buy a car and your product has less of a margin and more competition than ever. You must improve your skills so that you, not the product, are exceptional. This means you must get in a regimen of daily sales motivation, daily sales training, practicing, drilling and rehearsing and keep sales solutions within arms reach during your workday. Be great because nothing else pays (much).

GRANT CARDONE Entrepreneur and New York Times best-selling author Grant, a national speaker and motivator, is a respected, highly-regarded master salesperson whose passion is to teach people how to sell themselves, their products and services regardless of economic climate. His books, audio packages and seminars provide people of all professional backgrounds with the practical tools necessary to achieve high levels of success. Follow him on Twitter @grantcardone.

SALES

MANAGEMENT-DRIVEN LEADERSHIP If you want to develop a winning team, spend the time and effort coaching and training them. BY JOE VERDE “It’s better to have one person working with you than it is to have three people working for you.” — Unknown

oo many of us were led to believe that our sales-people work for us. While that is technically a correct statement, it is not a reflection of the attitude you should have in management if you want your business to grow every year. Our company has 48 actual employees – not temps, subs or outside contractors – who as a group have been with the company a total of more than 500 years. Other than the technicality of the employer/employee relationship, my managers and I don’t really think of people as working for us. In order for us to grow each year, we have to become a team that works together, and so do you. Working with your sales team requires that “I’m with you” attitude. It requires respect, honesty, 24

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caring and most important, it requires that you do everything in your power to make them successful. The best teams have the best coaches working with them. You’re the coach of your team. If you want to develop a winning team, just spend the same time with your team and each person coaching and training them as you would with every kid if you were coaching a little league or hockey team.

“You’ve got to be careful if you don’t know where you’re going, because you might not get there!” — Yogi Berra

hat are your goals this year? How many units will you sell, how much gross will you generate, what level will each of your salespeople achieve this year, how much repeat business will you generate, what percent of your business will come from repeat and referrals? To control your success this year, you have to

determine what success this year means and then you need a step-by-step plan in place to get you there. If you delivered 1,000 new units last year, what’s your goal for this year? What’s realistic? What can you really plan for and accomplish? That depends. Sure, I keep talking about training and management because that’s what we do. The point to make here is: if you’re not training and not really managing salespeople now but you’re willing to, the only limit at all is management’s level of commitment to make it happen. Two plans of action are: Plan A – If you did get your education on how to lead a team of salespeople to the Super Bowl, if you did train them on their core skills, and if you did start managing them and their activities daily this year, delivering 2,000 units by the end of the year is very realistic, and the plan is easy to implement and follow. Plan B – If you don’t choose to go all out on training and managing, and if you plan to just keep running ads and grinding out deals, that’s your choice, so then a 10 percent to 20 percent increase is still realistic. You just need to carefully pick your targets.

“If you pay people less than they earn, they’ll soon be earning less than they’re paid.” (Or else they quit.)” — Unknown

How to Use Levels in Sales LEVELS ARE BASED ONLY ON ROLLING 90-DAY AVERAGES (CURRENT AVERAGES). Clearly spell out how many units are sold for each level. For example:

So if you plan to go all out with “A,” read my new book, Pure Proﬁt: Double Your Net In Just 90 Days ASAP. If you choose “B,” read, Pure Proﬁt: Double Your Net In Just 90 Days ASAP. Whether you choose A or B, my free book is the quick and easy solution.

n every dealer/manager class we offer, we always ask, “How many of you used to work at a dealership that cut your pay?” Dozens of hands go up on this because nobody wants to work hard, succeed and then be punished for their hard work and success. If you’re planning to grow this year, the opposite has to happen. By using “Levels” in sales, you will help good salespeople earn the recognition and money they deserve and prevent below average salespeople from getting bonuses – which by definition are for extra, not less, than average sales – they don’t deserve. (See Box) Won’t your top salespeople complain? No, your actual top salespeople will be very excited because they’ll be listed on top in your levels charts.

Level 1 = 1-10 Level 2 = 11-15 Level 3 = 16-20 Level 4 = 21-25 Use the same ﬁve-unit increments I just spelled out – there’s a reason. Start listing top salespeople on the board by their current averages, not by how many units they sold last month. RULE: Stop counting no-effort house deals in their selling averages. On those, they didn’t sell anything, so give them the money, but not the unit count. Those do-nothing house deals make people’s averages look better than they are and qualify for bonuses they didn’t earn. Use Levels for all your monthly bonuses instead of hat tricks, 12 units, etc., and see a rush to improve their averages. For example, put an amount based on the level a salesperson achieves. Level 1 = $0 Level 2 = $500 Level 3 = $1,000 Level 4 = $2,000 In this example, a salesperson who is or becomes a Level 3 would get $1,000 bonus for that month. Print your levels charts monthly and post them in the sales oﬃce and training room. If you will, you’ll see a dash for the cash and for the recognition that goes with Levels.

JOE VERDE President of Joe Verde Sales & Management Training Inc. Joe has been in the car business since 1973. He has been the “eight-car guy” and the 38-car sales professional, a manager and dealer principal. His company was founded in 1985, and under his leadership, is consistently rated the No. 1 automotive sales and management training company for producing immediate and long-lasting results for its customers. He has authored several books including his newest Pure Profit: Double Your Net in Just 90 Days. For a free copy, visit his website at JoeVerde.com or email him at info@joeverde.com.

Your Blueprint For Greater Success April 12–14, 2015

5th Annual

Napa Valley Marriott Hotel & Spa Napa Valley, CA The 5th Annual Digital Marketing Strategies Conference (DMSC) is an executive level conference for dealership owners and managers. This intimate event allows dealers to amplify their investment in education and focus on strategy and process, allowing instructors and speakers to work with all dealers in attendance. Our workshops are hands-on, highly engaging and rich in content. All workshops are geared for the dealership employee who wants to fully understand digital strategy and stay ahead of their local competition.

DMSC 2015 will include: Executive level workshops – not sales pitches Breakfast, lunch and cocktail receptions Excellent peer networking opportunities Latest digital marketing strategies Dealer round tables High quality content Dealer led workshops

Who should attend

Dealer Principals | General Managers | Sales Managers | Marketing Directors Advanced Admissions and Ticketing • Discounted Room Rates Available • Advanced Registration for VIP Wine Events

Call Carrie Hemphill for personal registration assistance

908-601-6475 www.DigitalMarketingStrategies.org

CONFERENCE HOSTED BY

PHONE-UPS… SALES

Does Your Staff Sound Like Everyone Else?

Proper training in taking phone-ups opens the door for effective dialogue with the customer and increases your chances of getting them into the showroom.

BY DAVID LEWIS

ne of the most necessary things to accomplish in sales is to be different from your competition. For some, this may not be so easy. In automotive sales, this is especially important since most salespeople have been trained from the same playbook that has been used for decades. It is hard to change the mindset that says, “That’s the way we have always done it.” By utilizing new and fresh ideas, as well as having a well-structured sales process, you can distinguish yourself from what customers have come to expect when they call a car dealership to speak with someone in sales. My main priority over the years has been to create new training methods and materials that, when utilized, will advance the skills and success of those who use them. As you know, if you have read my book, Secrets of Inspirational Selling, my unique sales techniques are designed to distinguish those we train from the typical salespeople working in today’s dealerships. By being unique and different from what customers have come to expect, a salesperson can increase their results substantially and impact their customers in a way that brings them back whenever they or someone they know needs a new vehicle.

BY AVOIDING TALKING ABOUT PRICE, CREDIT, DOWN PAYMENT OR TRADE-IN, YOU CAN FOCUS PRIMARILY ON QUESTIONS AND STATEMENTS THAT WILL NOT RAISE THE CUSTOMER’S DEFENSIVE LEVELS. 26

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Though it is not common knowledge among car salespeople, the most reliable source for buyers is the phone-up. Reliable industry statistics have shown that phone-up customers become buyers more consistently than those just walking onto the lot in their search for a vehicle. Many salespeople tend to prefer the walk-in customer and that is certainly understandable. When someone comes to your dealership, you want to make sure they are greeted as quickly as possible. However, learning how to properly handle a phone-up should be at the top of your list if you are looking for ways to increase sales, profits and income. This makes phone-up skills a critical part of the car sales tool kit. To begin with, it is important to understand why the phone-up customer offers so much potential for making a sale. Today’s shoppers are highly informed. With more than 80 percent of them having Internet access, it is highly likely that they already know what you sell. Also, if they have spent any time on your dealership website, they probably have specific information on some of the vehicles in your inventory. Subsequently, by calling your dealership, they have in a sense, already partially qualified themselves for you. With that knowledge and the three known priorities that buyers have when they are looking for a vehicle, you can now focus your efforts on giving them reasons to make an appointment to come to your dealership. A shopper’s three main buying priorities are the right vehicle, the right salesperson and the right dealership. Now, here’s the problem: Most salespeople have the right goal in mind when they take a phone-up, but they rush to it within the first 30 seconds of the call. They immediately try to get the shopper’s phone number and make an appointment for them to come to the dealership. This approach only makes the customer more defensive and confirms in their mind that the salesperson’s one and only goal is to get them to the dealership where they can be pressured into buying ASAP. This is certainly not creative selling and in most cases, has no real effect on the customer’s decisionmaking process. If anything, it makes them sound like every other salesperson they may have already spoken to. Unless they can stand out by being unique and inspiring, their chances of getting the customer in for an appointment are no better than the next guy’s. If they sound just like every other salesperson, why should the customer expect to be treated any differently if they go to their dealership? The goal of the “Inspirational Selling” concept is to make the customer feel good about the salesperson and the dealership. It lets the customer know right away that they are sincerely interested in helping them achieve their purchasing goals. By taking the time for a proper meet and greet and asking the right questions, the salesperson can discover what the customer is looking for and quickly focus on helping them accomplish their goal for calling. This helps to relieve their natural defensiveness and creates the potential for effective dialogue. The verbiage you use can make all the difference in whether they will open up to you or stay on the defense and focus their questions on price and

RELIABLE INDUSTRY STATISTICS HAVE SHOWN THAT PHONE-UP CUSTOMERS BECOME BUYERS MORE CONSISTENTLY THAN THOSE JUST WALKING ONTO THE LOT IN THEIR SEARCH FOR A VEHICLE. availability. By avoiding talking about price, credit, down payment or trade-in, you can focus primarily on questions and statements that will not raise the customer’s defensive levels. Your using unique verbiage helps them feel like you are putting their interests before your own. Terms like “information gathering” takes pressure off of the customer and will give them the sense that you aren’t trying to rush them into the sale. When the customer says they are just starting to shop and the salesperson responds with, “So I am going to treat this conversation as an informationgathering process for you,” this eliminates the customer’s fear of losing control and creates an opening for non-threatening dialogue that can lead quickly to an appointment. Shoppers who spend time on the Internet are gathering information that will help them when they are ready to purchase. When you acknowledge their right to do that and offer to assist with that process, you give yourself a good chance for creating an ongoing dialogue and earning their business. By doing so, you can catch customers pleasantly off guard and by using unique verbiage, you have a better chance of keeping them in the conversation and securing an appointment. Being well prepared to take a phone-up when one comes your way is important for getting the best result. When taking a phone-up, you should be alert and in a place where you have paper and pen ready to write down what the customer is saying. It helps to be standing up as well since this tends to create a sense of professionalism and confidence that will subconsciously transfer over the phone to the customer. Having a well structured sales process that will keep you on track toward the goal of getting an appointment is far better than shooting from the hip with each new caller. When making the appointment, you should always ask for the customer’s permission to get their contact information and give them yours in case something comes up that

would require rescheduling. If the appointment is for another day, you should let them know you will be calling them to confirm as a matter of courtesy and to clarify that they have good directions to your dealership. This gives you a good reason for asking for their contact information and will not seem unreasonable if they are serious about the appointment. Being different from the competition is not something that is achieved by luck or chance. It is accomplished by a determined effort to learn a better way to sell cars. Doing things the way they have always been done is a sure way to get the same results you have always been getting. Today’s customers are changing and you must change as well if you expect to get your share of the business that is out there in today’s highly competitive marketplace.

DAVID LEWIS President of David Lewis & Associates David Lewis is the president of David Lewis & Associates Inc., a national training and consulting company that specializes in the retail automotive industry. He is also the author of four industry-related books, The Secrets of Inspirational Selling, The Leadership Factor, Understanding Your Customer and The Common Mistakes Automotive Salespeople Make. Visit his website at DavidLewis.com.

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VENDOR PROFILE

The Next Wave of Digital Marketing CEO of LotLinx Dean Evans explains how his company’s “deeplinking” technology is changing the way dealerships connect with online shoppers. BY CAROL WHITE

igital marketing is one area that leaves a lot of dealers scratching their heads. It evolves at such a dizzying pace that it’s hard to keep up with. The sheer number of vendors selling products and services these days can also add to the confusion. It’s enough to make you want to – do nothing. “Dealers can get locked into making no decision because they’re so overwhelmed they don’t recognize innovation and a competitive advantage when often it’s right under their nose,” said Dean Evans, CEO of LotLinx, a company whose first-ever Deeplinking ™ technology has marketing consultants sitting up and taking notice. “Our average customer moved their inventory 50 percent faster with an average spend level with

LotLinx,” said Evans. “That average spend level is approaching $2,000 per month and climbing, as dealers become more confident in LotLinx’s value. What our customers like most though is that the shopper traffic we deliver is mostly showroom traffic, not a form lead or phone call. Ask any dealer and they would rather have showroom traffic over lead volume traffic any day. A showroom lead is easier and faster to convert. Think about it, if the average customer today is only shopping 1.2 to 1.4 dealerships prior to purchase versus four to five dealerships five years ago, you better like showroom traffic close rates!” Evans came to LotLinx after spending years in both retail and OEM operations, and in a number of online startups including Cobalt, Dealix and

The company’s “deeplinking” technology is designed to connect the customer with the dealers faster than typical lead forms. Pictured are Jim Bauman, left, VP of account management; and Dave Shefferman, VP of product management. 28

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Dean Evans, CEO of LotLinx Dealer.com. “All of the startups I have been fortunate enough to be a part of have taught me a lot about turning a small business into one with rapid growth.” After being introduced to LotLinx and its role in the future of digital marketing, Evans said he “could not help but to jump onto this next wave of digital marketing evolution.” According to its website, LotLinx’s founders and leadership hails from some of the industry’s most successful companies including AOL Search, Autobytel, Google, Chrysler, GM, Ford, Subaru and Audi. The company’s platform now powers more than 200 automotive search sites, including TheCarConnection and Car and Driver, which reach more than 85 percent of all auto shoppers. In the not-so-distant-past, 10 to 12 percent of consumers visiting a third-party website would fill out the pop-up lead form in order to gain access to the vehicle they were scoping. Today, that number is less than 1 percent, according to Evans. And with millennials becoming more and more prevalent

LotLinx technology doesn’t require an onsite install and can be set up in a matter of minutes. Pictured are Savina Ortez, standing, manager of account management; Griselda Abdelaziz, left, account manager; and Danielle Nichols, set up specialist.

“IF THE AVERAGE CUSTOMER TODAY IS ONLY SHOPPING 1.2 TO 1.4 DEALERSHIPS PRIOR TO PURCHASE VERSUS FOUR TO FIVE DEALERSHIPS FIVE YEARS AGO, YOU BETTER LIKE SHOWROOM TRAFFIC CLOSE RATES!”

in the car-buying arena, that number will drop even further. “Millennials have what I call a giveget ratio that’s different from baby boomers,” said Evans, explaining that boomers are more willing to give their personal information in order to get more information about a particular vehicle. Millennials, on the other hand, aren’t buying in – they are much more reluctant to fill out lead forms. Besides, filling out a lead form on a smartphone can be a challenge in itself. What to do? Evans believes his company has the answer. Deeplinking, he says, makes car shopping easier for the customer and helps dealers connect with consumers faster. Here’s how it works: When a shopper visits a third-party search site and clicks on a vehicle they like, they are directly deeplinked, through LotLinx, to that dealer’s website and vehicle details page – no annoying form to fill out. And isn’t connecting shoppers with the dealers the whole point in the first place? “We feel the most important action a

person can take is clicking through to the VDP,” he said. “These are the low-funnel shoppers who are often at the last part of their buying research. By giving them the information they need upfront, without throwing up an obstacle like a lead form, these shoppers are able to take the next step with that dealer, usually in the form of a dealership visit to buy the car. “Simple concept, enormous customer experience impact and huge opportunity for a dealer to get access to millions and millions of in-market buyers. It’s a win for the customer and a win for the dealer.” But won’t this take the shopper off the third-party’s website, you ask. Yes. Is this a problem for those sites? Not according to Evans, who says that that Deeplinking actually increases customer engagement and gets customers to circle back because it gives them a better shopping experience on that website. The average customer today does a “zipmake-model” search 84 times before they buy. If they click on a vehicle that’s in a LotLinx dealer’s inventory, they’ll go directly to the VDP. If they click on one that is not in a partnership with LotLinx, they’ll get the popup lead form, which leads to two different customer experiences on the same website. “What they will do is go back to that third-party site and look at another vehicle. It’s not like they go to the dealer’s website and never come back; they’re going to shop on that third-party site like they had the intention to do.” Getting the shopper the information they need sooner is really the key to moving the metal faster. So once a customer lands on a dealer’s VDP, it’s important to be sure that page delivers the information the customer wants and incorporates the processes the dealer needs to make a conversion. “There is growing importance on the value of VDP views and the use of quality tactics to get the numbers where you need them to be as a dealer,” said Evans. The use of photos, videos, tracking numbers

and chat help drive consumers to the showroom. Dealers today are faced with the ongoing battle to sell more cars and service for less cost per sale, said Evans. “Digital used to be the low-cost alternative with better quality and targeting capabilities. Most of the choices today have risen in price and/ or come down in efficiency and value. Dealers should constantly be looking at all of their channels or media choices and decide the optimal mix for the month, quarter and year. “We provide the most-targeted and lowest cost digital you can buy today. That helps reduce the overall cost per sale significantly. So if you are have to sell more cars, you know that by just adding LotLinx you will increase your sales numbers and reduce your cost per sale average. On the other hand, if you have to sell the same level of cars but need to take down your cost per sales average, LotLinx is also for you. At $100-200 cost per sale range, you can’t get a better conquest activity, at that price point, today with any other media. Not paid search, not third party leads, not display.”

LotLinx’s headquarters is located in LaFayette, Calif., outside of San Francisco. Pictured are Jason Knight, COO and founder; and Dean Evans, CEO. MARCH

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FIXED OPPS

AVOIDING THE PITFALLS OF YOUR POSITION

Understanding your role in the dealership and how it contributes to the success of the entire operation leads to satisfied customers, higher profits and greater job satisfaction. BY JEFF COWAN

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IF YOU WISH TO MAXIMIZE YOUR OPPORTUNITY YOU HAVE TO PREPARE YOURSELF TO MAXIMIZE YOUR OPPORTUNITY.

ecently, I was in a meeting where I was asked to set aside 30 minutes at the end of my presentation for questions and answers. This group was very interesting and diverse. It consisted of, in equal parts, dealer principals, general managers, fixed operations directors, service managers, technicians and service advisors. What started out as one simple question, ended up becoming a game of “one-upmanship.” No one wanted to look like the bad guy and what resulted was one of the most interesting question-and-answer periods I have been a part of. Based on the group’s reaction, I know they enjoyed it, too.

The whole Q & A session was centered on one simple question: “What is the biggest mistake that (dealers/general managers/fixed ops directors/ service managers/technicians/service advisors) make?” The following are my answers. Dealers: When a dealer fails to learn and understand their fixed operations as well as they do the variable operations, the result is lost opportunity. By not immersing themselves in this all-important part of their business, they are forced to rely on information from those whom they pay to understand it for them. When this happens, the dealer principle is forced to run this department

WHEN A DEALER FAILS TO LEARN AND UNDERSTAND THEIR FIXED OPERATIONS AS WELL AS THEY DO THE VARIABLE OPERATIONS, THE RESULT IS LOST OPPORTUNITY. Fixed Operations Manager: This individual is the overseer of multiple locations. The problem arises when they fail to brand their locations and enforce consistent customer handling processes from location to location. When I visit a chain restaurant, hardware store, clothing store and the like, I do so because I know by the name on the sign exactly how I will be treated and what the experience will be like. I can bank on it and that is what draws me in. By allowing the service manager of a given location to run that location as they see fit, you will be guaranteeing one thing: that from location to location very little, if anything, will be the same. When that happens, and it happens a lot, it is frustrating for your customers and bad for business. Service Manager: Very few service managers truly understand the art and skill involved in professional selling. This is a problem since one of the most important components to their department is the service advisor team – or as I like to refer to them, the sales team. How can you effectively manage a sales team if you don’t truly understand the process of selling or have never sold to customers yourself? One of the biggest secrets to being a successful sales manager is being able to actually deliver a sales presentation at least as good as your best salesperson. As a manager of salespeople, you yourself must be able to do all of the things you want and need your team to do. You need to be able to greet customers, ask diagnostic questions, walk around a vehicle, point things out, make a professional presentation, ask for the sale, handle objections and all of the other things a professional salesperson knows how to do. The best way to get a sales team to listen to you and take your instruction is to show them that you can do everything you are asking them to do to the letter.

based on how that particular person sees fit. Many times this does not match the dealer’s approach to business and is usually very costly. A manager’s style of running a business is typically based on maintaining business, while a business owner’s is usually based on taking chances and promoting growth. In short, the person who knows the most is most likely to get their way. General Managers: General manager means generally managing all departments – being the leader, the one to inspire, encourage and create a cohesive team that works seamlessly together. At least that is what I tell my general manager. In the auto industry however, too many times the GM becomes an extension of the sales manager. This is because that is from where most general managers are promoted. That being the case, the fixed operations get overlooked because of unfamiliarity and the “front end / back end” mentality that exists. Sometimes, there is not just one big team that works together for the common cause to serve, excel and grow, but a team of “us vs. them.” A house divided is not a house that is going to be one of maximum production.

Technicians: Technicians must fully inspect every single vehicle every time. It’s easy to see why sometimes they don’t. If you take the time to fully inspect the vehicle, fill out your multipoint inspection sheet, present the multi-point inspection sheet to your service advisor and they, in turn, can’t sell what you so painstakingly found, why waste the time? I wouldn’t. Technicians hold all of the cards in this scenario. The need for highly skilled and motivated technicians is at an all-time high. If you are in a shop that does not allow you to work in the most efficient and profitable manner possible, I would shop my talents. Of course, I recommend that you first talk with management about your concerns, but if your concerns in this area are not addressed within 90 days, they never will be. Trust me, if you cannot get the work done efficiently and in a profitable manner for your service advisors, they

are not going to stick around. Your profession is not a game. Maximize your opportunity and position yourself to work with like-minded professionals and inspect every vehicle every time. You have the right to be successful too, and in my opinion, it is not fair for you to be held back by those who can’t do their jobs. Service Advisors: Service advisors should take more personal responsibility for their careers instead of waiting for the dealer, the general manager, their manager, their co-workers or the factory to supply all the solutions, training and opportunity. As a professional salesperson you cannot wait. You have to invest in yourself, your career and your future. Sign yourself up for all of the free sales information you can on the Internet. Invest in books, magazines, webinars, videos, workshops and seminars. Be open-minded. The information you seek out does not have to be specific to the auto industry. Some of the best tips, practices and advice I have ever received have been from sources outside my immediate industry. As a professional salesperson you should set aside between 2 and 5 percent of your annual income to invest in your education and self-improvement. Over time, that investment will reward you at least tenfold. The salesperson that rarely reads will experience a bad economy more often and deeper than the salesperson that does read. Of course the picture I have painted here is not a reflection of all people who hold these positions, but it sadly does reflect the majority. As you can see, the underlying theme here is taking responsibility, stepping outside your comfort zone and taking steps that are oftentimes uncomfortable but best for your career. If you wish to maximize your opportunity you have to prepare yourself to maximize your opportunity. The sooner you start the better. Start today because you will run out of tomorrows.

JEFF COWAN President of Jeff Cowan’s Pro Talk Inc. Jeff, in his 28th year of training, is recognized as the creator of the modern-day walk around and selling processes for service departments. Currently partnered with NADA, EasyCare, NCM, MPi and other vendors and manufacturers, Jeff is the nation’s authority when it comes to training service advisors and service support staff. Visit his website at AutomotiveServiceTraining.com and sign up for free, weekly training.

MARCH

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RETAILERS ARE CONTINUOUSLY TRANSFORMING THEIR BUSINESS MODELS TO ACCOMMODATE THE INSTANT GRATIFICATION DESIRE OF THESE YOUNGER CONSUMERS.

FIXED OPPS

SERVICING MILLENNIALS Now is the time to embrace the way this generation shops not only for cars, but also for service, and adapt to their digital lifestyle. BY RICH HOLLAND

ealership and fixed operations retention has always been a vital ingredient in the health of a dealership. While huge budgets are spent on the acquisition of new sales customers, the service department is in the background ensuring that the dealership has a solid foundation and can sustain it during economic downturns. Keeping the service bays full and customers lining the drive is imperative to profitability. However, dealerships are facing a twofold challenge. First, consumers inherently distrust dealers. Second, the service market is highly competitive – independents dominate consumer service business with vehicles outside warranty. And for new vehicles, dealers have two to three years to build that trust before they risk losing that consumer to an independent, should they fail. Many dealers have settled into a predictable retention marketing strategy, with service reminders, coupons, etc., to keep service customers coming back to the dealership and entice those who have gone missing. Past generations are accustomed to these more traditional forms of communication

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– phone calls and direct mail pieces. These strategies have been working well – until now. Times have changed. With new technologies arriving seemingly every day, things will continue to change at an increasingly rapid pace. Today’s car shopper grew up in a much different world filled with smart phones, iPads, blazing-fast Internet and instant information at their fingertips. These consumers are used to fast, constant connectivity. Retailers have long been buying their attention, and consequently their business with digital interactions and incentives. These consumers don’t know a world that requires effort to shop different dealers for the best price or service. Meet the millennials. In a recent article in Time magazine, industry expert Dale Pollack stated that millennials will account for 75 percent of all vehicles purchased by 2025. Dealers would be wise to understand this quickly growing consumer segment and analyze how to adapt to entice – and keep – this new customer base. Those that adapt will likely be clear frontrunners for winning sales and service business over the next few decades.

WHAT EXACTLY DO MILLENNIALS WANT FROM A SERVICE EXPERIENCE? Millennials are accustomed to a world in which they can buy a refrigerator online in seconds and have it delivered almost immediately. Retailers are continuously transforming their business models to accommodate the instant gratification desire of these younger consumers. Millennials are impatient. They want information when, where and how they want it. They are price shoppers to a degree, but will pay more for quality and convenience. Because they favor consistency and reliability, millennials have their vehicle serviced at a franchised dealer over an independent – at least while their vehicles are under warranty. They pay for convenience and peace of mind – seen in the increased popularity of service contracts. This trend could be an advantage: more time to build trust and value in dealership service. SO WHAT DOES A DEALERSHIP NEED TO DO TO BUILD LOYALTY AND RETAIN MILLENNIALS? Build trust – Building trust is the single most important thing to create a loyal millennial. In

service, this translates to consistent inspections and service recommendations. It only takes one visit with contradictory service recommendations to lose that trust. Enable these customers to validate any recommended service through third parties, and in a manner that they can understand. Be sure to reinforce a consistent process. If your service advisor recommended something on their last visit, which the customer declined, it’d be wise to ensure it’s also recommended on their next visit. Millennials are very visual. They are used to using electronic devices to access information that includes pictures and video. Simply advising the need for a new air filter is no longer enough. It is advantageous to build trust through visual education. Show them their old filter and teach them the benefits of changing it through photos and video. Provide information – Millennials expect access to information. You can be sure they have heavily researched the vehicle – price-checking, understanding warranties, and looking out for any recalls. In many cases they come armed with more information than the dealer. Transparent information is a crucial element to winning their business. Dealerships must strive to provide any and all information, whether that is about pricing or recommended repairs. Failure to provide information is a critical reason why millennials switch to independents once their warranty has expired. Independents advertise their pricing and make it easy for millennials to access. There’s no doubt that the independents’ price transparency contributes to the perception that dealer service is, in general, more expensive.

Communicate Better – Millennials are the most digitally connected generation in history. Technology has provided myriad ways for them to communicate. The lynchpin to their trust: communicate with these customers in the way in which they prefer. We can no longer rely solely on phone calls and direct mail. Many millennials don’t listen to voicemails, and ignore calls from unknown numbers. They will, however, respond to a text message in seconds and read their emails. You will find faster response times to service recommendations and spend less time tracking these customers down. The ability to communicate with millennials in their preferred method can increase shop efficiency and provide a better customer experience. Additionally, electronic tools can make all the difference when presenting recommendations. In our research, we found the use of tablets to present inspection results and service recommendations led to an increased acceptance of those recommendations. And, even more interesting, the customer was willing to pay more when they received the estimate and recommendations electronically. Millennials are changing the way business is

done by seeking better experiences. Innovative businesses capitalize on this and use technology to better service this demanding new generation. Domino’s Pizza, for example, provides real-time status updates on the progress of any pizza order, while Amazon sends tracking updates for packages via texts. As new technology transforms retail, millennials will increasingly demand similar experiences from dealerships. Consumers used to be satisfied with the ability to gain access to information – tracking, order status updates, etc. – by visiting a retailers website. Now, simply providing the information isn’t enough. Millennials are expecting that businesses deliver that information to them, instead of having to retrieve it themselves. Building trust, providing information and communicating better are key to winning – and keeping – millennials’ service business. This can only be accomplished through concerted effort that incorporates consistency, transparency and technology to provide the experience they demand. Technology will always continue to guide millennials’ actions. Adopt these changes and cement your place in this new world of technology.

RICH HOLLAND Managing Director of AutoPoint As a frequent speaker on the future of automotive dealership service, Rich believes in an “adaptor-die” theory of innovation. With more than 30 years of diverse experience, he is a recognized expert in information technologies and creating customer loyalty through digital excellence. Visit the website at Autopoint.com.

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HOLOGRAMS: COMING TO A DEALERSHIP NEAR YOU? Will holographic technology make the tablet – or even the F&I manager – obsolete? BY GEORGE ANGUS

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mericans love technology. That’s a fact. And staying abreast of new technology has become an American obsession. That obsession has extended to the car business to some extent. Certainly some innovations like F&I menu software, e-contracting and programs designed to speed up the buying process have found favor with dealers. With new technology coming down the pipeline on a daily basis, we are bound to see technology that was once considered science fiction become science fact. For instance, holograms could very well become an integral part of our daily lives. In fact, holographic computing is already here. A little over two years ago I did a Saturday message on technology. In that message I mentioned that our IT guy attended a meeting for processor manufacturers that updated them on a variety of emerging, near-term, commercially available technology. Since he is familiar with the F&I process after working with us for a few years, he came back from this meeting raving about what he said could be the next “revolution” in technology that could be adapted to F&I. He told me that Microsoft and a couple other software giants had perfected software that actually generated a lifelike hologram. It was estimated to be available in as little as four years. Well, guess what, it got here sooner than expected. Microsoft has incorporated holographic capability to the new Windows 10 platform. The company has not announced a release date, but industry insiders speculate it will be commercially available by the end of 2015. This software generates a “live” hologram that will soon be able to be programmed featuring a professional actor delivering a scientifically developed product presentation able to answer thousands of questions, and can even be programmed to overcome an infinite number of objections. And because it’s incorporated into Windows platform, it will be inexpensive enough for general use. Simple, hand them the special holographic headset and away we go!

BUT WILL HOLOGRAMS, OR SOMETHING JUST AS EXOTIC, REPLACE THE F&I MANAGER? Right now, the market is saturated with dozens of software companies selling iPad or tablet software to present F&I products. And while these products fascinate many in the media, they are still being used by a very small percentage of dealerships around the country. There is currently a lot of debate as to why these programs haven’t become the “next big thing.” We have been measuring the results of several different iPad, tablet and F&I presentation software programs for more than three years now. But since we do not sell software or any other products, and have no financial interest either way, we have approached the technology from an unbiased view. And the criteria we use in evaluating any product or service reflects that approach. ARE TABLETS ALREADY LOSING THEIR NOVELTY? Computer and software technology is developing so rapidly that it’s a moving target. Any technology

you bought six months ago is probably already obsolete. Two years ago Bloomberg News predicted there would be a massive growth of tablet sales into 2015. However, just last month they backed off that prediction in a series describing the “surprising” decline in tablet sales. While tablet sales have stalled in the past 18 months, the sales of laptops and mobile phones have increased. I fly somewhere almost every week and I have noticed this trend. Just a year ago, I would be on a flight and see tablets everywhere. Now, I see more and more laptops and smart phones being used by business travelers. Almost every airplane has Wi-Fi and people are being more productive while in flight rather than playing video games.

improvement. However, I’d guess there’s a pretty good chance that if you start at $300-500 per unit, almost any change in your process would improve your numbers.

WILL THE F&I MANAGERS USE THEM? The developers of any new F&I presentation technology will have to sell the idea to the F&I managers or, believe me, it won’t get used. Selling the dealer or GM on the idea is great, but as we all know, if the F&I managers don’t want to use it, it won’t work. And if you peruse some of the websites where F&I managers are free to express their opinions, you find that many don’t seem to like these devices. This was reinforced in our study in dealerships

THERE IS CURRENTLY A LOT OF DEBATE AS TO WHY THESE PROGRAMS HAVEN’T BECOME THE “NEXT BIG THING.” Our Gen Y and Z interns tell me that the “cool factor” drives a lot of this and that having the latest device is a status symbol. Pulling out a tablet to younger people is like pulling out a Blackberry just a few years ago.

DOES IT FILL A NEED OR ARE WE JUST CHASING THE “COOL FACTOR”? Everyone wants to be on the cutting edge of technology. No one wants to fall behind. But the one thing that comes with any new technology is cost. Even the current, very simple F&I presentation programs out there require the purchase of some kind of device from $600 to even $26,000. And the monthly fees can run from $300 to several thousand dollars. As I have reported before, we conducted a fairly comprehensive performance review and follow up survey measuring the actual results in dealerships already using these electronic F&I sales tools. And to give the products the benefit of the doubt, we focused on already above average performing F&I departments who were provided versions of these “pad” or “tablet” type tools. I think it’s safe to say that if something doesn’t produce added income, reduce F&I time, or show any benefit in CSI scores for those people, it probably won’t for the rest of us. You see, we don’t sell these products. And for us to recommend that dealers and agents invest in a new process, it will have to prove to do something our current process doesn’t do. It will have to fill a need that isn’t already being fulfilled.

that had already spent the money for the iPads, software, Smart Pads, etc. In a surprising number of these dealerships the iPad or other devices were stuck in the drawer of the F&I managers’ desks. When we asked them about their usage, they would say, “Oh, I use it once in a while” or “When the boss makes me use it”.

THE FUTURE? To replace or enhance the current F&I processes and get F&I managers to accept any new technology, it will have to make their job easier, faster and produce more income than whatever they are using now. The key factors in the success of any new technology will depend on the speed and ease of use, its effectiveness, how it survives examination by the consumer protection enforcement entities and the willingness of F&I managers to use it. But our analysis and study continue and we’re still looking ahead. It’s clear that there are some new technological developments coming down the pike that may offer some promise and we will be watching and measuring their results very closely.

DOES THE TECHNOLOGY WORK? Well, it depends on what results you are looking for. For example, in a recent article in a trade journal, a dealership was featured that adopted a particular tablet program. Their success story was that they had increased their per unit average $300. That sounded pretty impressive until, in the next sentence they said their next goal was to reach $1000 per unit. For them, this was a great

GEORGE ANGUS Training Director for Team One Group George has been referred to as the “Father of F&I Menus” in various trade publications for his ground-breaking work in introducing F&I menu processes nationwide in the early 1990s and is a recognized authority on F&I process development. After spending 17 years in retail automotive management positions, George left retail in 1994 and was part of the development team that created the concepts that popularized F&I menus. Since then, George has trained thousands of F&I managers and his popular “Saturday Morning Messages to F&I Masters™” has more than 11,000 subscribers. For information, go to www.TeamOneGroup.com or email training@teamonegroup.com.

MARCH

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On the Set With CBT Automotive Network Chris Patton, President of Mike Patton Auto Family in LaGrange, Ga.

Bo Scott, President of Regal Nissan in Atlanta

Paul Wagner, CEO of CloudEngage

Kevin Leigh, Co-Founder of Dealer Simplified

Bobby Jorgensen, President of Kistler Ford in Toledo, Ohio

David Kain of Kain Automotive Jeffrey Gitomer, Sales Trainer

John Krafcik, President of TrueCar Mat Koenig, CEO and Founder of KonigCo

Mike Burgiss, Founder of MakeMyDeal

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Roger Smith, CEO of Service Dynamics

David Metter, President of HookLogic, Automotive

Phil Dupree, Executive VP and Scott Pechstein, VP of Sales at Autobytel

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management or fixed ops, our contributors are the go-to professionals for reliable, relevant advice for dealership personnel. You have access to the foremost authorities in the retail automotive industry. Need a new closing technique? Wondering what’s the best way to increase sales in the service lane? Send us your questions at AskThePros@cbtnews.com. We’ll forward your inquiries to our ensemble of experts.

I’VE HEARD THAT HAVING LIVE CHAT ON MY DEALER WEBSITE IS IMPORTANT, BUT I’M NOT COMPLETELY SOLD ON ITS BENEFITS. CAN YOU EXPLAIN THOSE TO ME? – Keith R., Carmel, Ind.

Brian Pasch: Chat is a communication channel that a subset of auto shoppers prefer to use. Let me turn around the question; Why would you limit the communication choices offered on your website? To put it in perspective, would you ignore the lead forms submitted on your website because you felt that the consumer should have called or walked into the dealership if they were “serious?” At one time in the past, dealers ignored those leads. This year dealers will start to offer texting as a communication channel on their websites. The automotive industry must always provide the channels of communication that consumers prefer or dealers will limit their sales opportunities. If your dealership is not staffed to answer chats promptly and professionally, seek an outsourcing partner. The choice to not offer chat on a dealership website, is one made in ignorance of the way consumers’ collect information and select a dealer to do business with.

ultimately rely on others to create their success. A successful leader is one who has demonstrated characteristics of some of the following key elements: caring, understanding, a desire to learn and grow, enjoy helping others achieve their goals and a team player. There also has to be the element of past success, a drive to succeed and most importantly, the ability to orchestrate the sale of cars and the creation of revenue. Another key area to consider is how the other members of the team feel about that individual. Do they consider them to be that ultimate team player or just someone who thinks they have earned the right to be a leader? Nothing kills the excitement on the showroom floor more than promoting someone for the wrong reason or promoting an individual who wants the position with erroneous motives. The easy part of the equation is the training. An individual who displays these qualities can easily be taught the mechanics of how to be a great Leader by any good trainer or training program. Fail to train this individual and all you will have is the same management style and results of the previous leader, which is fine if you are satisfied with the past results and just adding to the leadership team or replacing a retiring leader. Pick the right person and provide the right training and you will have a formula for success.

HOW DO YOU REACH BOTH MILLENNIALS AND BOOMERS – TWO VERY DIFFERENT POPULATION SEGMENTS – WITHOUT IMPLEMENTING TWO COMPLETELY DIFFERENT MARKETING STRATEGIES? - Kristen B., Maplewood, N.J.

Paul Potratz: When building your marketing strategy you need to begin with a goal. What are you looking to accomplish: do you need to sell more Camrys, or do you need more service traffic? Determine your goal, budget and media. Then create the strategy. All too often, when building a marketing strategy we focus on segments too heavily. Yes, millennials and boomers are two different population segments. Millennials tend to spend more time doing their research online before visiting a dealership with online research driving 95 percent of their decision. However, this difference is only in the total time spent online researching. Both millennials and boomers research their upcoming purchase online on all devices prior to filling out a lead form on your website.

WHEN LOOKING TO PROMOTE SALES ASSOCIATES TO MANAGEMENT POSITIONS, WHAT TRAITS SHOULD I BE LOOKING FOR? – Bryan S., Portland, Ore.

David Lewis: This situation is a tough one as most of us hate to lose a productive salesperson from the showroom floor. Logic tells us that if someone is successful selling cars then they will also be successful as a leader, but this is not always the case. Many times successful salespeople work best in an individual environment, like selling cars, versus as a leadership role where they 38

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The goal is to engage the client first and let them build a relationship with your dealership during their research phase.

The focus needs to be shifted to research content rather than targeting segmented demographics. There are over 500,000 combined monthly searches for “car loan calculator” and “car payment calculator” on Google. So I ask you: what is your digital strategy and how is your website capturing these auto shoppers? You need to start with content to get them to your site not segments. Here are three recommendations: create a strategy that drives traffic to an interactive page where customers can see vehicles priced within their budget, a white paper on how to finance a vehicle, or a stand alone payment calculator. By developing these as well as other content-rich pages you will engage clients at the start of their research, and drive them all the way through to a lead form. The goal is to engage the client first and let them build a relationship with your dealership during their research phase. There is value in being a resource while interpreting client digital body language to further target them with content based on their needs. Failure to do this leads to clients researching on the manufacturer’s website or third-party websites, and then you’ll be fighting your competitors for that one appointment.

WHAT IS THE IDEAL NUMBER OF SERVICE CUSTOMERS THAT OUR ADVISORS SHOULD BE HANDLING DAILY AND WHY? - Chris J., Flagstaff, Ariz.

Jeff Cowan: It depends on what you are trying to accomplish? If you want to have the highest customer retention percentages, highest survey scores, the highest customer paid labor sales and gross profits, then the number is between 12 and 15. If your mission is to be a high volume shop and these afore-mentioned items are not important to you, then 16 plus. Many shops ignore this most important question and allow their advisors to help as many customers as they can. They then wonder why they struggle with survey scores, customer retention, etc. It is simple really: If you want to have the best and highest results, then you need to give your advisors enough time with your customers to get the best and highest results. Anytime an advisor writes up more than four customers in an hour when you open, and handles more than 15 customers a day, your chances for success in all areas of writing service diminish very quickly.

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