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ALABAMA INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION

DECEMBER 2018

DEALER SPOTLIGHT PAGE 10

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ONLINE MARKETING | By Adam Tobias

HOW TO COMPETE WITH ONLINE ADS

5 Steps for Small Dealers

Car buying has become a primarily online activity.

According to Cox Automotive’s Car Buyer Journey Report, customers spend just a third of their time at dealerships. The rest is devoted to online research. Only after careful research do car buyers proceed to a dealership to test drive and purchase.

The challenge, therefore, is to be found online. Dealerships might have the right inventory and prices, but if they can’t get traffic to their listings, they won’t get buyers onto their lot.

Online advertising is the answer, but most small and mid-size dealerships can’t justify the cost. But there is a right way and a wrong way for small dealerships to advertise online.

And it’s expensive if you do it the wrong way.

The Benefit of Being Big Large dealerships dominate advertising on third-party websites like Cars.com and Autotrader. They can afford the exorbitant costs of buying ad space there and can blanket the Internet with ads.

Sure, they waste a lot of money on visitors who don’t buy from them, but with enough traffic, only a tiny fraction of visitors need to become customers to make the ads worthwhile. That’s the benefit of being big.

When small dealerships try the same “spray and pray” approach, they undoubtedly fail. If you can’t compete on budget, you have to use other tactics to get found online.

When They Go Big, You Go Small Small dealers can’t afford to blanket the Internet with ads, but anyone can afford to run a few highly targeted ads to the perfect customer. If you have $100, you can effectively advertise any vehicle online.

Here are five steps to developing a highvalue advertising campaign. These principles are universal for any dealership, but they’re especially powerful for smaller dealerships trying to compete with large companies.

1. What is your niche? Who is your audience?

Most dealerships already focus on specific vehicles. That’s called a niche. Maybe your niche is broader, like trucks, European cars or used vehicles. Maybe it’s narrower: a specific brand, price point or customer segment.

Having a niche is important. It allows you to define your target audience, the people who are most likely to purchase a vehicle from you. Instead of advertising to any car buyer, focus on advertising to this niche.

But how do we find these people on the Internet? And how do we show them our ads?

2. Ad targeting.

Ad targeting means creating rules or criteria about who should see your ad, when they should see it and on what platform.

Using the tools available on ad platforms, you can target your specific niche.

Targeting saves you money by showing your ads only to those people who are most likely to purchase from you. Your conversion rates will be higher, which means more people are clicking on your ads. This, in turn, gives you a better chance to make a sale.

For small and mid-size dealers, the secret to online advertising is quality not quantity.

You want each ad to make a big impact, and that starts with ad targeting.

3. Choose the right platform.

Advertising platforms vary widely on cost, features and targeting ability. Choosing the right one is often the most difficult step.

• Third-Party Car Websites Third-party websites – like Cars.com, Autotrader and CarGurus – are the most popular platform for dealer ads. They get the lion’s share of car search traffic and are often the first place buyers look.

But because of this, they are also the most expensive platforms. Only large dealerships can afford to advertise effectively on these sites. Every ad is in competition with thousands of other car ads, putting a premium on top ad space.

• Google Ads Google Ads (formerly AdWords) lets you run ads on Google searches. Advertisers target the keywords relevant to their product and their ads are shown on the results pages.

Google Ads can be affordable or extremely expensive. Broad terms like “used cars” get hundreds of thousands of searches every month, but the cost is prohibitive for most small dealers. Plus, this keyword attracts a wide audience, most of whom won’t be interested in your vehicle anyway.

Specific terms like “Honda HR-V 2016 Atlanta” are less expensive and more effective for a small dealer. This type of Google search shows buyer intent – they have done their research and are looking to purchase. This is the perfect time to show them your ad and get them to your website.

• Social Media Like Google Ads, advertising on social media can either be cost-effective or

expensive. Instead of keywords, though, sites like Facebook group audiences based on their interests. You can choose a broad or niche audience, which will determine the cost and impact of your ads.

• Display Network Display networks partner with websites and online publishers to deliver banner ads to visitors based on their search history and interests.

When you target a specific audience, the display network will show them ads when they visit a website that is part of the network. For example, your audience could see your ad on USA Today, DrivingSales.com and Lifehacker.com.

Display network ads are among the most affordable and effective. The ad space itself is inexpensive, and your ads don’t have to compete with hundreds of others.

Since they are based on search history and interests, you know you’re targeting a highquality audience.

4. Ad content.

The content of your ad has a monumental impact on its success. The right targeting is only half the battle. We’ve grown so used to seeing ads everywhere our minds have become very effective at ignoring them.

To win visitors, your ads need to be creative and provoke people to action. If you’re not using the right language, or your ad is not visually appealing, chances are visitors will not click on your ad.

Creating compelling ads is tough work. If you don’t have experience, you are probably better off seeking the help of a marketing professional. But even pros aren’t perfect, which leads us to our final step.

5. A/B testing.

A/B testing is a method to gauge the performance of an ad before you spend too much money on it. Create two different versions of the same ad and run a limited campaign for each while measuring their effectiveness. Then choose the topperforming ad to run a larger campaign.

Repeat this process over time to refine your ads.

A/B testing helps advertisers ensure they are running effective ads that generate high-quality leads and, eventually, sales. It’s truly an invaluable tool.

It’s hard and scary, but you’re not alone.

Online advertising can be a full-time job on its own. It’s only natural to feel overwhelmed by the amount of work and choices involved.

Large dealerships make it hard to get the premium ad space on a small budget. And if you’re not in the premium ad spot, it’s easy to get lost in all the noise.

However, by targeting your niche audience with engaging ads on the right platform, even small dealers can compete with the big players.

Take your time, get it right and watch your sales soar.

Adam Tobias is the co-founder and COO of Dealercue, which provides dealerships with real-time, intelligent, market-driven vehicle appraisal, pricing, inventory management, and sourcing solutions. He can be reached at adam@dealercue.com.

WWW.ALABAMAIADA.ORG DECEMBER 2018 AIADA 3

DECEMBER INSIDE

2018

03..................... How to Compete with Online Ads 06.............................................President’s Letter 06................................................. 20,000 by 2020 08...................................................... Make A Wish 09.........................Limits on Rules for Employees 14..........................................................NIADA CPO

ADVERTISERS INDEX

AmTrust Financial........................................... IBC ARA GPS ..............................................................4 DAA Dealers Auto Auction Group, LLC .............. 5 Manheim ............................................................. 11 NextGear Capital................................................12 STARS GPS........................................................IFC vAuto................................................... Back Cover

WHAT’S NEW

NABD SESSIONS ONLINE Check it Out on NIADA.TV All sessions from the NABD Buy Here, Pay Here Subprime Conference powered by NIADA are now available online. The robust offering of education sessions from the BHPH industry’s premier event includes topics such as Facebook Marketplace, underwriting, the effects of the new tax laws, social media, internal controls, industry benchmarks and more from industry leaders.

Check it out at NIADA.TV.

OFFICE

120 Vulcan Road Birmingham, AL 35209 Phone: (205) 942-1000 Fax: (205) 942-3565 Website: www.alabamaiada.com To become a member of AIADA, please call (800) 239-2423

NIADA HEADQUARTERS

NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838

For advertising information contact: Troy Graff (800) 682-3837 or troy@niada.com.

The Alabama Independent Automobile Dealers Association is published bimonthly by the National Independent Automobile Dealers Association Services Corporation, 2521 Brown Blvd., Arlington, TX 76006-5203. Periodicals postage paid at Dallas, TX and at additional offices. POSTMASTER: Send address changes to NIADA State Publications, 2521 Brown Blvd., Arlington, TX 76006-5203. The statements and opinions expressed herein are those of the authors and do not necessarily represent the views of AIADA or NIADA. Likewise, the appearance of advertisers, or their identification as members of NIADA, does not constitute an endorsement of the products or services featured. Copyright © 2018 by NIADA Services, Inc.

STATE MAGAZINE MGR./SALES Troy Graff • troy@niada.com EDITORS Jacinda Timmerman • jacinda@niada.com Andy Friedlander • andy@niada.com MAGAZINE LAYOUT Christy Haynes PRINTING Nieman Printing

4 AIADA DECEMBER 2018 WWW. ALABAMAIADA.ORG

NEW MEMBERS. WELCOME. TOMMY FOWLER, GM

RODNEY WILLINGHAM

DOUGLAS ROHM

A & A Auto Sales and Services LLC Huntsville

TRAYE HARRISON

JIM JORDAN

MICHAEL KIBOI

JAMES TINKER/ ANTHONY WILLIAMS

PHILIP BENTLEY III

ANNYE ARMENDARIZ AA Auto Sales Rainsville

MICHAEL SCIVALLY

A and J Motors LLC Akron

AMMAD ATA

Alabama Carland Inc. Center Point

DOUGLAS TAYLOR/ DONNA TAYLOR Aldar Automotive Trussville

Carl Cannon Chevrolet, Buick, GMC Jasper Coastal Credit LLC Indy, IN

Credit Now Auto Inc. Huntsville

AMIR RASHEED

Dauphin Imports LLC Saraland

MARK LIVINGS/ JOHNATHON BURTON Drive Alabama Birmingham

Joe & Sons Wrecker Service Arab

Jordash Automotive Laceys Spring

LAWRENCE PANKEY M & L Economy Motors Inc. Boaz

Garner-Pierce Autos LLC Florence

GREG ANTHONY

MICHAEL HATT

GREG HINDS

Austin Hinds Motors Inc. Arab

Performance 219 Autoplex LLC MONICA KHALAF YOUSEF Madison Homewood Auto Sales C T (CHARLES) Homewood

BLAKE SOUTH

BAKARI DAVIS

Anthony’s Automotive Ft. Payne

Selma

BUSTER SHELTON

Hatt Automotive LLC Odenville

Imperial Automotive LLC Valley Grande

BETTE SMITH

NVT Motors LLC Notasulga

JOHNNY & CARRIE BRUDER

Malone Auto Sales Citronelle

MARK WRIGHT

DAVID PRESCOTT

ODETTE WILLIAMSROGERS

JIMMY HENRY

Car United Auto Huntsville

Jimmy Henry Used Cars LLC Center Point

LOUIS V HERRING, SR.

Vic’s Custom Paint & Body Mobile Vulcan Truck & Equipment LLC Alabaster

ADRIAN PARKER

C & S Auto LLC Odenville

J E Wholesale Blountsville

RON WARREN

APRIL PLANT

MALONE

New South Auto Sales LLC Mobile

CLINT WALLACE

The Used Car Factory Mobile Mobile Tuscumbia Auto Sales Tuscumbia

JBSMI LLC Foley

Buster’s Trinity

The Car Broker Birmingham

NICK WILSON

NIC BROOKS, TRICIA MARIE BROOKS, KENNY BROCK

Alfa Insurance Arab

JOSHUA YARBER

ARTIS MURPHY

MMI LLC Huntsville

RONNIE GARNER/ELMER PIERCE

Safari Auto Sales Brimingham Shoals Autoplex Tuscumbia

ARTHUR & LAURIE VAUGHN

THOMAS SHELTON

Rohm Automotive Group LLC Cropwell

Prescott Automotive Winfield

RICHARD RUSSELL Russell Auto Sales Grant

BOARD OF DIRECTORS PRESIDENT

TREASURER

Joey Bryant Sylacauga

Del Miles Jacksonville

Tuscaloosa

Lance Turner Anniston

Kelly Steely Hoover

Danny Delich Georgia

Willie Colvin Tuscaloosa

Chris Mundy Columbiana

Ricky Young Boaz

EXECUTIVE DIRECTOR

Tim Duke Trussville

Patrick Graves Moody

DIRECTORS

Jay Saul Jasper

Jennifer Gant Harlow Arab

Chad Tillery Jemison cktillery@hotmail.com

Randy Crump Jasper fas_jasper@yahoo.com

PRESIDENT ELECT

CHAIRMAN OF BOARD

Robert Case Hartselle robertsautosales1@live.com

Todd Oden Birmingham mtomotorsinc@gmail.com

VICE PRESIDENT

Roderick Underwood Bessemer runderwood@ anthonyunderwood.com

SECRETARY

Erek Yarbrough Pleasant Grove yarbroughbiz@yahoo.com

Randy Jones

Barry Searcy Muscle Shoals

Randy Little Satsuma

Michael Bratton Jr. Phenix City

Jerry Giles

Mike Osaji Harvest Jeff Demetris Hoover

ASSOCIATION NEWS |

By Chad Tillery

PRESIDENT’S LETTER

AIADA Continues to Grow

First, I want to thank the association for allowing me to serve as president for 2018-2019 and be part of an organization that not only gives knowledge back to our independent dealers but allows friendships to be created within the industry. It is an honor and privilege to work with AIADA’s outstanding board members, staff, and association members.

On that note, if you are not a member of the Alabama Independent Automobile Dealers Association, let me encourage you to join and reap the benefits. Be part of an organization that puts the dealer members first when it comes to compliance, legislation, and

requirements for the dealers while pursuing a goal of success for our independent dealers.

Two weeks after our annual convention, Randy Jones and I flew to Texas to the TIADA convention to seek ideas to further improve our conventions. Seeing different associations and learning how they gain more dealers and sponsors gives us the opportunity to grow our convention and membership.

While in Texas, we gained a good list of potential sponsors and speakers.

We will be vetting them so we can try to bring new ones to our convention.

We have received numerous compliments throughout the years from our vendors, speakers and dealers on our conventions. While our conventions are always great, there is nothing wrong in trying to make them greater.

The 2019 event will be our 50th annual convention, and we are working to make it

bigger than ever. We can do that with your attendance.

The convention dates are July 18-20. We encourage you to mark your calendar and be on board with us. It is a great time of learning and friendship.

Throughout the year, we have local chapter meetings. There is always one close to you and I encourage you to attend.

There are always new subjects covered at these meetings to keep you informed.

Randy Jones, our executive director, is very knowledgeable of industry changes and is always ready to share with you. The chapter meetings provide free dinner and free knowledge for your business. Watch your emails for any chapter meeting in your area.

I realize being president of this association is a great challenge, but with your help, we can become more beneficial to this organization and to the automobile industry.

There are many ways you can give back as an individual and a dealer, so I challenge you to not miss your opportunity in playing an active role. We have seen great power in numbers, especially legislative-wise.

I am committed to serving this association, the members, the board of directors and the staff to the best of my ability, and to promote the growth of this organization and the independent dealer.

I want to have a positive impact on this association. Join me in committing yourself to do the same. With your help, we can certainly achieve our goals and our voices will be heard.

COVERSTORY

ASSOCIATION NEWS | By Paul John

The NIADA Begins New Membership Initiative The National Independent Automobile Dealers Association has begun a new nationwide membership initiative. Its goal is to reach 20,000 members by 2020.

The organization will reach this goal by focusing on the states with the highest growth opportunity. This simple strategy measures current market share – number of members compared to number of licensed dealers.

NIADA state-affiliated associations that provide more dealer educational programs and effective advocacy at the state capital – and are able to negotiate exclusive member discounts for their members – generally have a bigger footprint, typically between 30 and 60 percent market share penetration.

NIADA has already begun working with the state organizations by working closely with the state directors and their board members to understand their state-specific challenges as

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T H E O R G A N I Z AT I O N W I L L R E A C H THIS GOAL BY FOCUSING ON THE S TAT E S W I T H T H E H I G H E S T G R O W T H O P P O R T U N I T Y. T H I S S I M P L E S T R A T E G Y MEASURES CURRENT MARKET SHARE – NUMBER OF MEMBERS COMPARED TO NUMBER OF LICENSED DEALERS. well as develop a clear understanding of their goals. And more importantly, NIADA is working with states’ leadership on specific strategies that will pave the way for state associations to grow and stay relevant.

Paul John is NIADA’s vice president of national field operations. He can be reached at paul@niada.com or 770-616-5156.

ASSOCIATION NEWS

MAKE-A-WISH GRANTED

Asher Wallace

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Shoals North Alabama Auto Auction in Muscle Shoals, Alabama, is where AIADA started its Make-A-Wish work five years ago. SNAAA owner John Fikes had no idea where it was going or all the good that would come forth.

Fikes, general manager Jason Isbell, office manager Sue Amerson, inventory manager Kyle Baker and Sodonia Barnes from dealer services planned this year’s Make-A-Wish auction around their 10th Anniversary Sale.

The goal was to raise $7,500, an amount never before reached at any SNAAA Make-A-Wish auction.

Thanks to donations from Zippy Auto LLC, Long Lewis, OverDrive Wholesale, Jeremy’s Auto Sales, J43 & Associates, Henslee Auto Sales, Kennedy Used Cars, JR Used Cars, Brian Barton of Brian Barton Outdoors, Go Auto Sales, Scott Crump Toyota, Quinn Auto, Southern Skillet Catering, auctioneers, Chuck Bradley, Mike McAllister, Ed Abernathy, Big Dave Roberts, AIADA Ladies Auxiliary, Fikes Chevrolet and the SNAAA staff and dealer family, the goal was well surpassed with a record amount of $11,476!

Let us tell you a little about this year’s Shoals North Alabama Auto Auction’s Make-A-Wish child.

In December 2015, 3-year-old Asher Wallace was diagnosed with retinoblastoma, a rare form of eye cancer. He began several rounds of chemotherapy shortly thereafter, traveling to Philadelphia for treatment.

Asher has been a brave little boy. His family has tried to help him stay positive during the long, hard chemotherapy visits.

Asher is from Cherokee, Alabama. When Make-A-Wish Alabama found out about his situation, they knew they had to give him his one true wish.

Wish volunteers visited Asher’s home and spent time playing with him and getting to know his family. Asher loves to play with cars, show off his Hulk fist and spend time outside. He loved showing them his favorite toys. Soon they discovered his wish was to go to Disney World to meet the characters from Cars, as well as the Hulk and Captain America. The Wish volunteers had a great time hearing about Asher’s love of cars and trucks and knew he would love finally meeting those characters in person!

Because of his treatment, Asher had to wait for his Disney trip. However, MakeA-Wish kept in touch with him to make sure he never forgot that as soon as he could go, his wish was waiting!

In February 2018, Asher and his family left for an amazing week at Disney World. Every detail was taken care of and Asher and his brother had a blast meeting all their favorite characters, going on rides and experiencing the power of a wish. Make-A-Wish Alabama covered all the expenses and made sure the family’s every need was taken care of while they were on their trip.

Asher’s dad, Mark, has written a book about Asher’s experience and the impact it has had on him as a father. What an amazing family!

Asher encouraged the Make-A-Wish Alabama staff with his kindness and perseverance during such a difficult time.

He inspires them to grant more and more wishes.

Make-A-Wish Alabama is grateful to the Alabama Independent Automobile Dealers Association for helping with Asher’s wish!

Because of partnerships like this, Make-AWish’s mission of granting wishes is more possible for Alabama wish kids like Asher.

Make-A-Wish Alabama has 267 kids waiting on a wish in Alabama but will only be able to grant 156 wishes this year.

Thanks to Shoals North Alabama Auto Auction, Dealers Auto Auction of Huntsville, ADESA Birmingham, America’s Auto Auction and other auctions that have come on this year. AIADA, auction partners, vendors and dealers from all over Alabama will help raise the amount needed for Alabama wish kids to receive their one true wish!

LEGAL MATTERS | By Jeff Ingram

REGULATORY MATTERS | By Blair Witter

New Guidance Clarifies

ONE OF THE BIGGEST THREATS TO YOUR BUSINESS

LIMITS ON RULES FOR EMPLOYEES

There have been a lot of changes and resulting confusion the last several years regarding the types of policies employers can have for employees. Some common-sense policies that were once common were called into question. Employers that failed to keep up with the changing landscape placed themselves in danger.

The Office of the General Counsel of the National Labor Relations Board has recently issued new guidance on some of these policies.

Thankfully, this guidance restores some rationality to what employers can do. With this, employers now have clearer rules about what policies are always allowed, what policies are subject to specific scrutiny and what policies are never allowed.

Rules that fall into category (1), i.e. always allowed, include the following: •C ivility rules. These rules require employees to act in a civil manner towards customers and employees. Examples are rules that prohibit conduct that is “rude, condescending or otherwise socially unacceptable,” “negative or disparaging comments” about fellow employees or customers, “discourteous or unbusinesslike behavior” and offensive language.

•R ules against photography or recording. These rules can prohibit the recording of “conversations, phone calls, images or company meetings with any recording device without prior approval.”

Employers however cannot ban cell phones at work if the employees’ main method of communication during the work day is by cell phone.

•R ules against insubordination. Such rules can prohibit conduct such as “being uncooperative with supervisor or otherwise engaging in conduct that does not support the employer’s goals and objectives” and “insubordination to a manager or lack of cooperation with fellow employees or guests.”

•R ules against disruptive behavior. This can include rules against creating a disturbance on company premises or creating discord with customers or employees.

•R ules requiring confidentiality with customer and proprietary information. Such rules can state “information concerning customers shall not be disclosed, directly or indirectly or used in any way.” These rules can also prohibit “unauthorized disclosures of business secrets.”

•R ules against defamation or misrepresentation.

•R ules banning disloyalty, nepotism and self-enrichment.

Category (2) rules, which are subject to scrutiny on a case-bycase basis, include the following: •B road conflict of interest rules that do not specifically target fraud or self-enrichment. These rules cannot prohibit membership in or voting for a union.

•R ules regarding disparagement or criticism of the employer.

•R ules restricting the employee’s right to speak to media on their own behalf as opposed to on behalf of the employer.

•R ules banning off-duty conduct that might harm the employer.

•R ules against making false or inaccurate statements.

The important point in analyzing these rules is the effect the rules might have on the employee’s right to collective activity regarding their working conditions.

Category (3) rules, that should never be implemented, include the following: •R ules requiring employees to keep wage, benefit and working conditions confidential. Such rules include rules prohibiting employees from disclosing salaries or the contents of employment contracts or rules prohibiting the disclosure of wages, commissions, performance or the identity of employees.

•R ules against joining outside organizations if the rule could be interpreted to prohibit joining a union.

The short rule is that employees have a right to take collective action regarding their working conditions including wages, benefits, hours, etc. Any rule that prohibits employees from engaging in such actions is prohibited. Rules that will be interpreted to impact such rights must be balanced against the employer’s interest.

It Could be You

Yes, really. Despite the record sales you’ve brought in. Despite the cost saving measures you’ve put in place. Despite the efficiency of the organizational procedures you’ve implemented.

If you’re the person putting GPS tracking devices on the vehicles you’re selling – without disclosing it to the consumer – you might be putting your business at risk.

The use of GPS devices to help mitigate the risk for creditors in the subprime auto finance industry has been around for a long time. Yet, even after all this time, there are GPS providers – and dealers or creditors – who still operate without obtaining written disclosure from the consumer when using this type of technology.

Let’s not kid ourselves. It is not the technology that’s the problem. It’s your choice not to disclose the use of that technology – or failure to comply with state and federal regulations – that is the problem.

This decision could make you a threat to your own business.

Why should you be disclosing?

Well, depending upon your state, it might be illegal not to.

Several states, including California, New Jersey and Nevada, have recently passed laws requiring disclosure of GPS devices to the consumer. The laws vary by state on exactly what must be disclosed and exactly how it must be disclosed, but disclosure itself is not an option.

Even if it is not specifically illegal not to disclose in the states you are doing business, by choosing not to disclose the use of GPS devices to your customers, you are still exposing your business to some serious liability.

With Right-to-Cure laws, Consumer Protection Acts, and Consumer Privacy Acts, not disclosing the use of the device could open you up to legal issues such as fines or even civil action.

Hudson Cook LLP partner Tom Hudson encourages dealers to disclose the use of devices: “Every state that has legalized devices by statute has also required a dealer or finance company to disclose that a vehicle has been equipped with a device. Further, more than one state has fined dealers for failing to disclose the devices for engaging in an unfair, deceptive or abusive act or practice. You’d have to be braindead not to disclose the presence of the device.”

And, of course, the CFPB could take notice of your position not to disclose.

If you think you’re too small to get the attention of the CFPB, I wouldn’t count on it. Just look at Y King S Corp., which does business as Herbies Auto Sales, in Colorado. Last year, the company was ordered to pay $700,000 in redress to consumers for what the CFPB called violations of the Truth in Lending Act and the DoddFrank Wall Street Reform and Consumer Financial Protection Act. Would the CFPB consider failing to disclose the use of GPS technology a violation as well?

It is fair to say that having a customer sign a written disclosure about the existence of a device, how it operates, and how it will be used by the creditor helps reduce the liability of your company. It could prevent a lawsuit or other type of consumer complaint.

So, if your GPS provider is saying you don’t need to disclose, maybe you should ask them if they are also offering to cover your legal fees, a potential fine from the CFPB or a class-action lawsuit for invasion of privacy down the road.

Choose a GPS provider that offers technology that is compliant with state and federal regulations. Additionally, use a company that employs certified compliance officers and offers advice, recommendations and training such as webinars to its dealer customers.

Does your provider do that?

Blair Witter is PassTime’s vice president of sales for the Southeast Region. His vast experience includes 11 years at Credit Acceptance and founding and managing two large-volume dealerships in Biloxi, Mississippi, and Mobile, Alabama, for over a decade. Contact Blair at (239) 240-6913 or bwitter@ passtimeusa.com.

WWW.ALABAMAIADA.ORG DECEMBER 2018 AIADA 9

DEALER SPOTLIGHT

AUTOMOTIVE DOT COM LLC

Small Town Success

Automotive Dot Com LLC opened May 2010 in Fort Payne, Alabama. Jared and Melissa Williford and Jared’s brother Jason are the owners and operators.

The Willifords wanted to be in a small town, where they could get to know their customers and their families. They also wanted their kids to enjoy all the fun of growing up in a small-town environment.

Since kids grow up way too fast, they thought a small town was a great place to start building these memories.

Jared was working at the Marriott in Birmingham as a bellhop at Greystone Country Club Golf Course when he decided to try his luck at selling cars. He started his career in car sales as a new car salesperson and made a good living for the next 11 years.

In March 2010, the lot where Jared was working closed its doors and Automotive Dot Com became more than a thought.

Thankfully, Melissa was working as a waitress at a local restaurant, which provided some type of income.

Jared, Melissa and Jason decided to look into opening Automotive Dot Com. They invested every dollar they had. They literally had less than $100 left after buying their

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first two vehicles. The trio bought these two vehicles off Craigslist, one for $800 and the other for $2,200, to compile their small beginning inventory.

Melissa continued to work as a waitress while Jared was left to run the lot mostly by himself. Jared continued getting the vehicles ready for sale, servicing, detailing, and performing office duties, all while trying to handle customers by himself.

When they sold the first vehicle, thankfully the customer traded in a vehicle.

This allowed them to have the funds to purchase another vehicle. With the trade in, they increased from two vehicles to three.

After two more months, the Willifords were blessed by getting a floorplan for $20,000. Jared and Jason, still both very new, started learning the ropes of buying their vehicles at auctions. Soon, they learned buying vehicles at auctions could be a very expensive lesson!

Later Melissa was able to start working at the dealership during the week while still having income from working at the restaurant on weekends. This eventually led to her working full-time with Jared. This was a very scary decision, as it left them solely dependent on the success of the dealership!

When Jared II arrived, there was no extra money for daycare. Melissa went to work every day, including weekends, with young Jared II in her arms.

Automotive Dot Com LLC is now going on its eighth year in business and has

developed a great loyal customer base. The dealership averages about 20 vehicles a month in retail sales.

“We were able to figure out most things out by trial and error,” Jared said. “But if I had to do it over again, joining AIADA would have been one of the first things done in opening our business. We have been an active member of AIADA for over seven years. They keep us updated on laws and regulations while working in Montgomery and Washington, D.C., on regulations that affect our dealership and our customers.

“Joining AIADA was one of the best decisions we made. AIADA and NIADA are always trying to stay one step ahead of problems that could arise in our industry.

We have used them a lot for information and it gives us the security of being up to date on operating our business.”

Jared had car sales experience, but no prior experience in finance, management or running a lot. Jared did know how to sell a car, and was not scared to take a chance, with lots of hard work, a strong woman behind him and a loving brother.

They are now a big part of Fort Payne, Alabama. Automotive Dot Com is helping build a stronger community for the Williford family and their customers.

AIADA is proud to have dealers such as the Willifords, and Fort Payne, Alabama, is blessed to have Automotive Dot Com calling it home.

REGULATORY MATTERS |

By Anthony Cacciatore & Adam Steele

FTC USED CAR BUYER’S GUIDE

Three Things Auto Dealers Need to Know

Though its usage rules may seem straightforward, the Federal Trade Commission’s Used Car Buyer’s Guide includes several requirements that seem to catch many auto dealers off guard.

First and foremost, the FTC requires it be displayed on all used cars sold by a dealer.

The guide must contain details concerning the vehicle’s background along with any warranties available to the buyer.

Failure to perform these steps can lead to private class action lawsuits and FTC enforcement penalties reaching $41,484 per incident.

Don’t Forget to Display the Entire Guide The FTC requires the guide be affixed to the vehicle in such a way that both sides of the guide are easily readable by potential buyers. This rule, however, presents an initial challenge because the guide is two pages long.

Per the FTC, compliance can be accomplished by: • Displaying the guide on one of the vehicle’s windows so that both sides may be read.

• Hanging the guide from the vehicle’s rearview mirror.

• Placing the guide in a plastic sleeve on the outside of the vehicle so buyers may remove and read it.

• Another creative solution that doesn’t prevent the consumer from seeing the full document for the vehicle.

What doesn’t work?

• Using a double-sided print so that the

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reverse is only available by looking through the other side of the car window.

• Placing the guide in the glovebox or under the seat.

“As Is” Provisions Don’t Prevent All Consumer Claims Another area that is particularly sticky for the Buyer’s Guide is warranties. Many dealers are under the false impression that checking the “as is – no dealer warranty” box prohibits all consumer claims. Unfortunately, that isn’t the case. The reality is that a dealer selling a car “as is” only prevents claims arising from implied warranties.

Implied warranties can be disclaimed.

There are two so called “implied warranties” involved whenever a car is sold – implied because they exist whether they are ever spoken aloud or written. They are the implied warranty of merchantability and the implied warranty of fitness for a particular purpose. In laymen’s terms, this means warranties that a car is fit for sale (i.e., merchantability) and will be useable for driving (i.e., fitness for the particular purpose).

Express warranties, on the other hand, cannot be disclaimed through the use of an “as is” provision or some other expression the car is offered without warranty. Dealers, and especially sales personnel, have to be particularly careful when selling a used car not to cross the line from sales puffery to an unintended warranty. Express warranties are created when a salesperson makes a verbal or written statement that essentially guarantees product performance or quality.

Example of express warranty: “This car will last you 200,000 miles!”

Example of sales puffery: “This car is in good condition and a great value!”

Express warranties also obligate the dealer to claims concerning those representations.

Dealers need to be careful about what representations they make about a car to buyers because an “as is” provision doesn’t nullify those representations.

Upcoming Enforcement Arguably, the most important thing dealers need to be aware of concerning the Buyer’s Guide is that regulators will be cracking down. The guide has been on the FTC’s watch list ever since rules governing the guide were revised in 2016.

Earlier this year, the FTC performed a random compliance audit of more than 2,300 vehicles nationwide to see if dealers were following the rules. They weren’t. In fact, over 50 percent of those vehicles failed to either include the guide or display it properly.

Seeing such a huge red flag, the FTC is surely signaling an increase in regulatory crackdowns. Savvy dealers will take steps to ensure compliance with these regulations and avoid potentially substantial fines by working with experienced automotive counsel that can advise and audit their guide use and related consumer compliance obligations.

Anthony Cacciatore and Adam Steele are attorneys with Ohio law firm Mac Murray & Shuster LLP. For more information, call 614.939.9955 or visit www.mslawgroup.com.

DEALER PERSPECTIVE |

By Robert Case

AIADA MEMBERSHIP

Dealer Testimonial

Membership in AIADA has been one of the best decisions I've made since getting started in the car sales business.

I am a mechanic by trade and didn't know much about selling cars.

I was looking for some guidance on how to do things the right way.

AIADA has been an invaluable asset to me and my business. Since becoming a member I have met a lot of good people. They have gone out of their way to help me understand how things should be done.

Judy Benton, Randy Jones, and the law firm of Galese and Ingram, as well as individual dealers and vendors, have all contributed to my understanding of this business. They have helped me get to where I am today.

If you are a dealer or thinking about getting in the car business you should consider joining AIADA. They have all the correct forms you need, knowledge about the business, and are willing to go out of their way to help you. If you have a problem they can help you find a solution.

Being a member has a lot of perks.

The coupon book can save you $12,000 a year on buy/sell fees at auctions throughout the state. ADESA, ABC, Manheim, as well as local auctions offer savings on fees every month.

Our lawyers know the car business inside and out. They are available to answer your questions for free should you need them.

Having that resource available is well worth the yearly membership fee of $260.

Access to lenders and vendors who can help you is also great for you and your business.

Being a member of AIADA has made a major difference in my life and my business. I know it will in yours as well. You have nothing to lose and everything to gain by joining.

Join AIADA today and learn how to make the most of your business!

ACCELERATE |

ASSOCIATION NEWS |

By Randy Jones

PAC FUND

Making Our Voice Heard In September, several AIADA board members traveled to Washington, D.C., for the annual NIADA National Policy Conference.

Most people would assume the purpose of the conference was for dealers to gather from around the nation to network and to celebrate or lament how well or poorly the car industry is treating them. I would concede those activities probably do occur at the conference but the primary objective is for dealers to gather together in our nation’s capital to meet with their respective legislators to provide a voice for the independent car dealer.

Despite the best efforts of hard working independent car dealers to provide their customer base with dependable transportation at an affordable price, the tired and outdated stereotype of the used car dealer as a cheat who will use any means necessary is alive and well. As independent dealers we must work hard to denounce those negative depictions within our community and especially within the legislative system that creates laws that could help us or put us out of business.

Ensuring our voices are heard is the primary function of the Political Action Committee Fund, which is why it is so important all dealers contribute to this fund. Without a financially healthy PAC Fund, our concerns could not be voiced and would lead to the creation of laws made with misinformation by those uneducated regarding the realities of the car industry.

If we do not represent ourselves and our industry, who can we depend on to fill that void? If we do nothing, the void will be filled, but more than likely it will be filled by decisions that are not in the best interest of the independent car dealer.

I encourage all dealers to contribute to the PAC Fund. No amount is too small – a small contribution from all dealers will go a long way.

Randy Jones is the executive director of Alabama Independent Automobile Dealers Association.

By GWC Warranty

EARNING TRUST IN F&I

Showing Customers the Value of F&I Products

Perhaps the most difficult obstacle to overcome in the F&I office is getting your customers to trust that the products you’re offering will be worth the added cost. Establishing that trust is the first step in building the foundation for long-term F&I success.

But how do you go about gaining the trust of someone whose money you’re looking to spend on additional products like a vehicle service contract?

Just like most things in life, honesty is the best policy in the F&I office. Being upfront about monthly costs, coverage limitations and the company backing your products will help customers feel the confidence they need to feel to make a service contract purchase.

Payment Transparency For the vast majority of customers, you’re negotiating on monthly payment and getting them on board with how the cost of a service contract impacts what hits their bank accounts each month. At a glance, the added cost can be staggering, especially in a world where 78 percent of people are living check to check. But breaking it down by daily cost could help overcome this hurdle.

For example, the daily cost of a $300 payment is roughly $10 a day. If you add $50 per month for a service contract, that daily cost is just over $11 a day.

This nominal daily increase compared to the cost of major repairs can help customers see the value in added vehicle protection.

Coverage Transparency Not all coverage levels were created equally. It’s important to impart this on your customers.

If you’ve mastered your menu selling strategy, working backwards from the highest level of coverage achieves this goal for you. Focusing on what customers miss out on and using this technique in tandem with highlighting small daily cost differences, it’s easy to spell out value that will help your customer see you have their long-term financial interests in mind.

Provider Reputation Customers may object to a service contract due to the industry’s reputation.

But working with a reputable partner has its benefits – most notably your ability to showcase that reputation to customers.

When you can show customers the product you’re selling is backed by a company with decades of experience and billions in claims paid, peace of mind will come easily – and quickly.

Showcase Past Results Does your customer still not trust your F&I process?

Even the most difficult customers can’t deny real-life results. Keep close a file of past work orders or a claims paid report and show that difficult buyer all the money VSCs have saved your past customers. No customer can refute the value of a VSC after seeing exactly what it’s done for people in their shoes.

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ASSOCIATION NEWS

NIADA PARTNERS WITH DEALERSHIPS TO OFFER CPO VEHICLES Two New Dealerships Added to the CPO Family

RLB Sales & Leasing and 6th Gear Auto – both of Fort Worth, Texas – are now proud members of the NIADA Certified family. To celebrate, NIADA held kickoff launches at both dealerships.

“It’s important to us to be here,” said Warrantech business development manager and program administrator Mike Sims.

“Not only to us as a whole, but to these dealerships as clients, as partners of ours with NIADA.” Scott Lilja, NIADA’s senior vice president of member services, was also on hand to offer support and explain the benefits of partnering with NIADA. “We’ve been around for 73 years protecting dealers’ interests, putting together programs to help them get to that next level in terms of differentiation and quality, and trust and transparency with consumers. And that’s what the NIADA CPO program is really about.”

The NIADA Certified Pre-Owned Program offers high-quality used vehicles backed by a powerful warranty with nationwide reach, and backed by NIADA – a national association whose more than 15,000 members are dedicated to integrity and subscribe to a strict code of ethics.

For a vehicle to be considered “NIADA Certified,” it must undergo a 125-point inspection conducted by a licensed repair facility and be backed by a rigorous vehicle history report. Once all requirements have been met, dealers are then able to offer these vehicles to their customers along with a number of features and benefits, including the following: • A CARFAX vehicle history report.

• Special financing for qualified customers.

• Flexible, fully customizable warranty options.

• Roadside assistance, towing, vehicle rental and lost key/lockout service.

Offering these benefits is already paying big dividends for both dealerships.

“My turnover is in the 40s now and that’s what I’m really proud of,” said 6th Gear Auto Sales owner Chris Johnson. “We’re selling cars faster, but more importantly, our systems, our procedures and our policies through Warrantech have helped us sell more cars through our training processes.”

“It adds value to what we’re doing here,” said RLB Sales & Leasing general manager Shane Collins. “It adds value to every vehicle we sell. We’ve already seen the uptick. We’re pacing 60 cars this month when last month we did 30, so we’re excited. It’s going to be a long, happy journey.”

To learn more about how your dealership can become NIADA Certified, visit niadacertified.com/dealers or call 1-877-3100288 to sign up today.

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6th Gear Auto – Fort Worth, Texas

RLB Sales & Leasing – Fort Worth, Texas

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