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MARKET WATCH
AMERICANS DRIVING FLOOD DAMAGED CARS New Carfax Research
Hundreds of thousands of previously flooded vehicles are believed to be in driveways, on the road or up for sale around the country right now, according to new research from Carfax. The data suggests more than 271,000 cars reported as flood damaged by a state’s department of motor vehicles, insurance companies and more are back in use. It’s a nearly 30 percent increase from 2013. While waterlogged wrecks have made their way to every state, these 10 states have the most:
1. Texas: 43,000 2. Pennsylvania: 20,000 3. Florida: 17,000 4. Kentucky: 14,000 5. Illinois: 13,000 6. South Carolina: 11,000 7. Michigan: 11,000 8. New Jersey: 10,000 9. New York: 9,000 10. Louisiana: 9,000 “Flooded cars are a buyer’s
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worst nightmare,” said Carfax communications director Larry Gamache. “They’re ticking time bombs because when you least expect it, the electrical, mechanical or safety systems on these cars will fail, often without warning. Consumers everywhere need to be vigilant about checking a vehicle’s history for flood damage and getting a pre-purchase inspection to avoid buying cars that rot from the inside out.” Increasingly powerful storms and historic flooding in major areas are creating more opportunities for professional con men to clean up and resell flooded vehicles. Demonstrations show it takes
only a few hours to restore them cosmetically, at a minimal cost to the criminals. However, buying one of these dangerous cars costs unsuspecting consumers thousands. “A customer was requesting a loan on a used car, so we ran a Carfax Report as part of our underwriting procedures,” said PriorityOne Bank in Mississippi president Willie Macko. “We discovered that the car had been a total loss and the title was branded as a flood vehicle. By using Carfax, we were able to save both our bank and our customer a lot of money.” As a service to consumers, Carfax lets you check for flood damage free of charge at carfax.com/flood.
NOVEMBER/DECEMBER 2016 / DEALER NEWS 3
INSIDE
06............Strategic Ways to Drive Leads with Social Media 09................................... Simple Tech Tools with Serious ROI 10.....................................CRM Technology vs. CRM Mindset 14................................................................Scooter for Dexter 17..................................................................Planning for 2017 18.....................................Thank You from the Cassidy Family
WHAT’S NEW NLC Content Online
If you missed the National Leadership Conference in Washington D.C. in September, we have all the education filmed, edited and available for viewing on NIADA.TV! Highlights include the U.S. Department of Labor speaking about the new overtime rules and other wage issues, the FTC talking about marketing, the Department of Justice discussing fair lending regulations and servicemember issues, and the CFPB covering collections. You can view these and other industry related education sessions 24/7 on NIADA.TV.
For more information, visit www.niada.com
ADVERTISER’S INDEX
ADESA ...................................................................................... 7 Alliance Inspection Mgt. ......................................................... 8 Auto Auction of New England ............................................ IBC Autotrader .............................................................................. 15 Auto Use .................................................................................. 9 AutoZone ............................................................................... 16 Central Mass AA.....................................................................3 Lynnway Auto Auction............................................................5 Manheim .......................................................................... 10, 11 Manheim Pennsylvania.........................................................13 NextGear Capital...................................................................12 Paymaxx Pro ......................................................................... 14 Southern Auto Auction........................................................IFC Spireon ................................................................................... 17 VAuto......................................................................Back Cover
OFFICE
For information on how to become a member of MIADA, please contact Melissa Otis at 781-278-0077 or director@miada.com.
NIADA HEADQUARTERS
NATIONAL INDEPENDENT AUTOMOBILE DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838 The MA/New England Dealer News is published bi-monthly by the National Independent Automobile Dealers Association Services Corporation, 2521 Brown Blvd., Arlington, TX 76006-5203; phone 817-640-3838. Periodicals postage paid at Dallas, TX and at additional offices. POSTMASTER: Send address changes to NIADA State Publications, 2521 Brown Blvd., Arlington, TX 76006-5203. The statements and opinions expressed herein are those of the individual authors and do not necessarily represent the views of Independent Auto Dealer or the National Independent Automobile Dealers Association. Likewise, the appearance of advertisers, or their identification as members of MIADA or NIADA, does not constitute an endorsement of the products or services featured. Copyright © 2016 by NIADA Services, Inc. All rights reserved.
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Troy Graff • troy@niada.com EDITORS
Jacinda Timmerman • jacinda@niada.com Andy Friedlander • andy@niada.com MAGAZINE LAYOUT & GRAPHIC ARTIST
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SAFETY WATCH
GM RECALLS 4.3 MILLION VEHICLES Airbag Software Defect
General Motors recently said it is recalling 4.3 million vehicles for a software problem that can prevent airbags from deploying in a crash. The defect, which affects all of GM’s current fullsize pickups and SUVs, is linked to one death and three injuries.
SAFETY WATCH
MAZDA RECALLS CARS FOR AIR BAG ISSUES Moisture May Damage Unit
Mazda North American Operations is recalling 41,918 model year 2009-10 Mazda6 vehicles manufactured Feb. 4, 2008, to Dec. 3, 2009. The protective coating may not have been properly applied to the air bag control unit and, as a result, moisture may damage the unit causing it to malfunction. Failure of the ACU would illuminate the air bag warning light and prevent
the air bags from deploying in the event of a crash, increasing the risk of injury. Mazda dealers will replace the ACU, free of charge. Parts, however, are not currently available. Mazda will send interim notifications to owners beginning Oct. 3 and will mail a second notice when remedy parts are available. Mazda’s number for this recall is 9816H.
EXECUTIVE COMMITTEE BOARD OF DIRECTORS PRESIDENT Bob Hayes Auto Town Rentals Inc. bobh4433@aol.com VICE PRESIDENT Juan Mendez JC Auto Sales TREASURER Rick Schneider The Garage rickthegarage@gmail.com SECRETARY Brent Landes Landes Family Auto CHAIRMAN OF THE BOARD John Eleftherakis John’s Auto Sales johnnycars@comcast.net
Ed McLaughlin MASS Car Mart Bob Shaw Sr. Shaw Auto Leasing
Tim Hoegler tim.hoegler@manheim. com
Dana Duchak Lynnway Auto Auction
John Perro Perro’s Auto Sales
Dave Chandler Toy Store Auto Sales
Harold Proodian Wagner Group
Luke Semmelrock Central Mass Auto Auction
Robert Shedd II The Auto Brokerage
EXECUTIVE DIRECTOR Melissa Otis director@miada.com
Steve Newcomb Royal Administration Bob Baker Jr. Dorchester Motor Sales
PAST PRESIDENTS Steven Carnes - Worldwide Preowned LLC Tim Collins - Quincy Auto Auction Eddie Coolbrith - S & E Auto Ron Dial - Dialworks Phil Greenstein - Central Auto Parts of Natick Inc.
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Rich Copponi Auto Use/Auto Loan
Don McKenna - Patriot Motors Inc. Fred Moschetto - Moschetto Brothers Inc. Louis Tedeschi - ASPI Motor Cars Ron Dial - dialworksauto@comcast.net
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INDUSTRY PERSPECTIVE BY MELISSA OTIS, MIADA EXECUTIVE DIRECTOR
I’M CAR SHOPPING, IS YOUR DEALERSHIP READY FOR ME? Customer Service is Key
I have been shopping for a specific car for a few months now. Having been in the automotive business for over 15 years, I am very particular about the vehicle I am searching for and the condition it is in. They are rarely seen at auction so as one pops up in my online searches, I travel to the respective dealership, not letting them know who I am or my automotive background, and engage in the car buying process. I have been quite surprised at the customer service I have received, or lack thereof, which prompted me to ask our members the following: • Do you train your sales staff in customer service? • Do you follow up that training after a certain period of time? • Have you ever spot tested your sales people with an outsider to see how good they really are?
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• Does your sales staff make calls and send texts to customers from their personal cell phone, which you never monitor, see or have access to? • Are they pressuring customers to make split second decisions about purchasing what is typically the second largest purchase consumers will make in their lifetime? • Do you survey your customers on their experience at your dealership? Everyone is entitled to a smooth, friendly car buying experience. Customers should have the “warm fuzzies” when they leave your dealership. You want their repeat business. Correction, you need their repeat business! In this day and age, competition is stiff no matter what product you sell – Buy Here-Pay Here, cash customer, or generic financing. If your team isn’t up to par, customers will simply move on to the next dealership and you may never know what prompted them to leave. Out of the nine dealerships I have visited thus far, all very well known dealers, one treated me with the type of customer service I feel warranted them an A+. I will not mention names, but I have visited both independent and franchise dealerships and truly understand the frustration of consumers making purchases. Here are some examples of my experiences: • Misrepresentation of the condition of a car to get me there. • The salesman exhaling his last puff of
cigarette smoke into the car as we’re leaving on the test drive. • Pulling the car around and revving the engine like a Top Fuel dragster waiting for the green light so I could “feel the power.” • Sending inappropriate, non-car related texts to my personal cell phone from their personal cell phone. • Returning from a test drive and being asked if I’m ready to sign all my paperwork without any discussion of price, warranty, etc. or asking if I even liked the car. • The salesman having a half smoked cigar in his pocket, prompting me to wonder if the previous owner was a smoker or if it the sales person that smelled so bad. It is important for you as an owner, as well as your managers, to keep tabs on what your employees are doing. Are they giving you a bad name without you even knowing it? Perhaps doing a little investigating could help keep your customers coming back for many years to come. I have yet to make a purchase. Is your dealership ready for me?
NOVEMBER/DECEMBER 2016 / DEALER NEWS 5
SOCIAL MEDIA BY KATHI KRUSE
10 STRATEGIC WAYS TO DRIVE LEADS WITH SOCIAL MEDIA Leveraging the Power
One of the most overlooked and underutilized practices in digital marketing is leveraging the power of social media to drive leads and sales. There are a lot of obstacles for dealers to overcome, including a true appreciation of the value, a lack of skills, and certain business cultures that don’t lend themselves to being social. However, if a dealer can eliminate the stumbling blocks, there are strategic, lucrative ways to drive leads with social media. Unfortunately, many dealers and GMs think of social media as an afterthought. Many believe its only value is in creating interest in the dealer’s brand. If this is your mindset then listen up because you’re leaving money on the table. Social media is a quickly evolving beast. Forty percent of marketers believe social media has become increasingly difficult in the past 12 months. Platforms are constantly changing algorithms, releasing new features and “changing the rules.” This requires dealership marketers to think on their feet and quickly adapt their approach at the drop of a hat. The landscape to grow your business with social media has never been more fertile: • 70 percent of the U.S. population has at least one social networking profile. (Statistica) • 52 percent of online adults now use two or more social media sites. (Pew Research) • In 2015, Facebook influenced 52 percent of consumers’ online and offline purchases, up from 36 percent in 2014. (The Drum) Laying the required groundwork is the key to driving leads with social media. Listening to understand your customers improves marketing success. Leveraging social media to engage people before you try to sell them something keeps customers coming back. You save big money because you laser-focus on interested buyers instead of blasting unwanted messages to strangers. Groundwork produces seedlings and the opportunities become plentiful. The next steps are to enact strategies to drive leads with social media. Be open to the possibilities here. Your level of willingness to adapt to the new ways of reaching customers has a direct effect on your results.
10 STRATEGIC WAYS TO DRIVE LEADS WITH SOCIAL MEDIA 1. Begin with a good plan. So many dealers admit they don’t have a marketing plan. They know how valuable marketing is in general, and make some marketing efforts, but inevitably they feel like they need to spend all their time on operations and sales. I totally understand how the day-to-day activities involved in running a store can make you wish there were more hours in a day. The irony is you can actually save time with a marketing plan because you’re operating more proactively rather than being in reactive mode. Mapping out a plan also means you can more easily hand off the work of implementing it to somebody else. Better time management is just one perk of a marketing plan and here are six additional ways a marketing plan can benefit your business: • Reinforces your brand. • Positions your company in the marketplace. • Nurtures current customers. • Attracts new customers. • Prepares company for growth. • Helps to analyze what works. 2. Publish useful, high-quality, original content. Content strategy means getting the right messages to the right customers at the right time. This involves everything from your website content, blog, social media, and social advertising. High-quality content does not happen without a content strategy. Here are some benefits of developing a content strategy: • Influences buying decisions. • Improves brand equity and reputation. • Earns customer loyalty. • Attracts more of the right buyers. • Competitive advantage. • Increased leads and sales.
3. Be social. Always genuinely engage with your audience. Yes, you really do need to be social on social media. Instead of broadcasting the “benefits” of products and services to strangers, add the steps to attract interested buyers by engaging with them on social media. • 71 percent of those who receive positive social care are likely to recommend your brand to others. • Only 19 percent of those who don’t get any response are likely to recommend that brand. When comments show up, respond. When online reviews are posted, respond. Be more accessible and you’ll notice more customers engaging. 4. Incorporate social selling tactics within your sales process. Social selling is the act of developing referrals, leads and sales using social media. Seventy-nine percent of salespeople who use social media in the sales process outperform those who don’t. Social selling is just like any other sales process. Salespeople build a network (online or offline) to increase referrals and leverage relationships to create warmer leads. Talented sales professionals already have an offline network they’ve nurtured for years. Savvy social salespeople have already been working social media to develop leads. But these individuals are your top performers. What will you do to engage the bottom 90 percent of your team? To attract, engage and sell to today’s hyper-connected buyers, dealers need to build a social selling process within their organization. 5. Leverage the awesome power of Facebook ads. No matter what your Facebook marketing goals are – grow page likes, boost reach and engagement, drive leads, etc. – Facebook ads will help achieve those goals. CONTINUED ON PAGE 8
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Facebook ads are by far the most powerful way to advertise your business on social media. 6. Use well-designed landing pages to capture leads. When a shopper is in the final stages of their research and ready to take action, strategic landing pages guide them further down your sales funnel. Capture their attention through Facebook ads and convert buyers with actionable, urgent offers they can’t resist. Don’t forget the all-important call-toaction and include a lead form to track and follow up. 7. Re-market to people who visit your website with Facebook ads. The more advanced Facebook ads strategies are difficult to master but the results are hard to ignore. Perhaps one of the most powerful tools Facebook has to offer is the ability to serve personalized ads to people who have visited your site. Use the targeting option “Custom Audience – Website Traffic” to re-market to people who have visited your site within a set time frame. Once you’ve placed a Facebook pixel on your site (a piece of code that tracks visitors), you can set up specific audiences with filters based on pages they’ve visited. 8. Leverage the power of LinkedIn. If you’re a salesperson, there is no reason not to use LinkedIn to build your network as one of the ways to drive leads with social media.
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Make sure you have a 100 percent complete profile – no “lazy bones jones” on this one. People want to know about you and a well-constructed profile with a nice picture says, “Hey, I’m here to help.” Don’t waste time trying to connect with “everyone.” Be deliberate and thoughtful about who you’d like to know and who can introduce you or recommend you. Pro tip: write and publish a weekly article on LinkedIn that displays your knowledge and expertise. It will develop your “personal brand” as a thought leader and trusted resource. 9. Use Twitter for prospecting. To many companies and their salespeople, it seems like Twitter is a huge waste of time. And sometimes it is – if you’re just messing around on the social network and pitching folks to get on a demo, it probably won’t be that helpful to you. Why? Because the goal of using Twitter isn’t to sell something at the very second you tweet. By using Twitter wisely, you can be part of the most relevant conversations as they happen. Spot opportunities first, build relationships, deepen customer trust and make a name for yourself. However, just having a presence on Twitter doesn’t lead to conversions. It’s how you use it that makes the difference between tweeting into the void and generating leads. Spend the time and effort to:
• Find prospects. • Discover buying signals. • Gain insight on companies. • Accelerate deals with conversation. • Build your following. • Build relationships with influencers. 10. Show another side of you on Instagram. Instagram is a great place to promote your company’s personality. Spend 10-15 minutes each day engaging with other users. I know a dealership that has gotten leads via their Instagram content. Ready to convert leads? Instagram now has more advertisers than Twitter. Facebook (who owns Instagram) allows ad creation and publication through the Facebook Ads Manager platform. Are you ready? These 10 strategic ways to drive leads with social media make it possible to eliminate the obstacles to converting your fans into customers. If you’re ready to take it to the next level, Kruse Control helps companies just like yours navigate the social media landscape. Please email me at kathi@ krusecontrolinc.com. Kathi Kruse is an automotive social media marketing expert, blogger, consultant, author, speaker and founder of Kruse Control Inc. Kruse Control coaches, trains & delivers webinars focused on integrating social media and online reputation management into dealership operations.
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ACCELERATE / BY GWC WARRANTY
3 SIMPLE TECH TOOLS WITH SERIOUS ROI >> Simple Tools that Yield Big
EVERY BUSINESS is in search of a golden ticket – that tactic or tool that requires little time or monetary investment but yields major financial returns. Enter technology. Understandably, some technology is easier to use than others. And large scale technology changes to something like your website or DMS could take more time and money than they’re worth. But when you find an easy-to-use technology that’s affordable and has real profit opportunity tied to it, you’ve struck gold! To help simplify your ROI gold-mining expedition, here are three simple technology tools that can yield fast and impactful bottom line gains. Video Video is no longer a way to stand out from other dealerships. Rather, it’s quickly becoming a must-have just to compete. But just because video is becoming a necessity doesn’t mean your video needs to have Spielberg-like quality on a studio film budget. Take a tool like Covideo, for example.
For a manageable monthly subscription, you’ll get a custom video platform and all the equipment you need to quickly film and email vehicle walk-arounds, sales follow ups, service reminders and more. And since Covideo is proven to increase unit sales by 7 percent and showroom shows by 27 percent, it’s a breeze to recoup your monthly investment several times over. Online Reputation Management From time to time, you’ll encounter aspects of your business out of your control. For example, a vehicle breaks down despite a solid inspection or a competitor undercuts you on price. But one thing in your control is effort – and that’s all it takes to manage your online reputation. A negative review can be severely damaging, but only if it goes ignored. Be sure to respond to online reviews and negative social media mentions quickly, professionally and, most importantly, empathetically. It will go a long way toward showing past and future customers you genuinely care about their satisfaction. Mobile Technology According to Autotrader, 43 percent of car buyers use multiple devices to shop for cars. That’s up from 24 percent just two years prior. At this rate, it won’t be long before almost all your website traffic is coming from mobile technology users. But you already know how important a mobile responsive website is. Where you stand to get a leg up on the competition is integrating this technology into your sales
and F&I processes. For the price of a tablet or two for your dealership, you can begin using mobile apps during both the sales and F&I processes – many of which are free. You’ll quickly begin to see how customers appreciate their preferred shopping method being carried over into their experience on your lot, not to mention the customer satisfaction rewards you’ll reap after the sale.
MANAGEMENT GAMEPLAN BY SCOTT BERGERON
CRM TECHNOLOGY vs. CRM MINDSET It’s a Tool, Not a Crutch
Have you ever wondered how dealerships sold in volume before CRMs, before the Internet, before websites and Internet leads? I consider myself an old-school car guy who knows how to use technology. I still believe there’s a place in this business for pen, paper and all the high-tech programs that make our lives easier.
CR
I started my career in the ‘80s and was lucky enough to work for a top 100 nationally-ranked dealership. We sold 500 vehicles, both new and used, per month. We did it directing our focus on advertising, ordering correctly, training, and a CRM mindset. In other words, we wanted all the information and we collected as much as we could. It wasn’t efficient compared to the tools we have now, but it worked because everyone was on the same playing field. Technology today works like a champ, when it’s used as a tool and not a crutch. There are more ways than ever for potential customers to connect with a dealership. Online shopping is, by all estimations, the starting line for over 80 percent of all transactions.
In the dealership, the CRM software is used to track, assess, notify and persuade consumers. It also lets you track the steps of the sale as well as who’s performing on your sales floor, and who needs help. We’ve all heard the phrase “garbage in, garbage out.” Technology is only as good as the information that goes in, and the process to get the information back out to reconnect with is where most dealerships lose deals. I’ve been in dealerships where their CRM reported a 100 percent closing ratio. They must have some pretty great salespeople, or they’re only entering their sales into their CRM, and forgetting about the other 80 percent of unsold prospects. And even if the leads automatically populate into the CRM, it doesn’t do any good unless someone is following up. CRM technology is limited without a common sense process within the dealership to make sure everyone gets touched, whether they’re Internet leads or face-to-face prospects. One thousand online leads and 300 visits in a month should show as 1,300 prospects, less the conversions to sales, which likely won’t show a 100 percent closing ratio. I’ll take bad news that’s accurate any day over grossly inflated closing ratios. An article on Adexchanger.com elaborates on the importance of dealership CRM as an all-encompassing relationship tool, not just technology, concept. Headlined “CRM: A Philosophy That Goes Beyond Data, Technology and Channel,” the article by digital specialist Mayur Gupta notes, “CRM software is not enough… Establishing a lifelong customer relationship and loyalty is not just a technology problem. Marketers need to bring the strategy, data and technology together to establish and operationalize a CRM capability. To do this, they must establish a customer relationship and experience strategy.” In the dealership, it’s as simple as asking, “What’s happening to my customers? Is my CRM helping me make more deals, or is our process breaking down?” So how does a dealer combine technology with a selling mindset that provides customers your undivided attention and connection before they say yes?
10 DEALER NEWS / NOVEMBER/DECEMBER 2016
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RM How much tech is too much tech? How do you feel when someone is talking to you, but texting? How would you feel in a selling environment if your salesperson was entering data into their phone while they were showing you a vehicle? Probably not very good. But it’s reality in many dealerships that have invested fortunes in high tech, thinking it will “revolutionize their sales process.” Most customers aren’t buying it. No matter what a salesperson is doing on their phone, a vast majority of customers think they’re being ignored. In my opinion, when a salesperson is in front of a customer, their eyes need to be up and directed toward their customer. Look down at your phone and you’re likely to lose a deal. So the challenge really is how much technology do we need, and when is it best to use good old-fashioned rapport building and eyeball-to-eyeball selling? Old school or new school – It’s all good, if it’s done right. Once the sales force has learned (or relearned) the more traditional side of relationship-building and management, it’s time to show how mindset and technology together can forge a highly successful sales program. Technology can be a catalyst to help build traditional relationships to reach more people in more ways. When done right, it results in more deals. Used properly, tools such as Internet Lead Modules and CRMs can prime the pump efficiently. Using prospect and customer information, a smart CRM can store critical information about a prospect’s wants and needs, as well as timeline and budget. Technology does the heavy lifting, while customer engagement closes the deal. High Tech & High Touch High tech allows your sales team to be efficient. High touch, or client engagement, is what’s required to be effective. In other words, it doesn’t matter how efficient I am at auto responding to prospects if they don’t show up and buy. Most of us still want to do business with people we like, respect and trust – and that requires one-on-one interaction. For the best and most effective results, brainstorm about how best to use/blend the two – high tech and high touch. Then, test it
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in your next sales training session. Here’s one scenario using email as the springboard: Do what the others don’t. Instead of canned auto-responders for inbound leads, try a catchy, clever and, most importantly, personalized email that will spur a visit or at least put you higher up on the radar than the other guys. Try a subject line like, “Scott, I’ve been waiting for you to email me!” Most prospects shop online because they fear entering a dealership. They don’t want some pushy salesman. But, knowing you were low-key and fun to work with could help start a dialogue. Today’s customers don’t want the old sales gimmicks, but they also don’t
want to be ignored, or feel like they’re going through a line at Walmart to buy a car. This is a huge buying decision. They deserve your attention, your personality and the best experience you can provide. Remember, they can go anywhere in the world to buy their vehicle. Give them every reason to buy from you. Ultimately, it’s CRM technology and a selling mindset together that make customer relationship management work effectively in today’s auto sales world. Former dealer executive Scott Bergeron is the founder and principal at Daily Gameplan.com - a sales team performance company. Scott can be reached at 303.918.3169 or scott@ dailygameplan.com.
NOVEMBER/DECEMBER 2016 / DEALER NEWS 11
ONLINE MARKETING / BY CHELSEA MAGEE focused on providing high-quality information. Did you know that Google knows the difference between high and low quality? This is one of Google’s 200 ranking factors! Make sure you create a schedule you can maintain by creating an editorial calendar. >> 3. Tackle current issues. Talk to your staff and find out the “top 10” EVERYONE LOVES FREE INFORMATION. And free questions they answer on a regular basis. You information brings in customers. In fact, 90 can do this for both sales and service. Make percent of future car buyers report they search sure to write posts about your local area and online for answers to their questions about their events because this will also boost your local next vehicle purchase or service. relevancy. Another hint? Review everything! THREE STRATEGIES FOR BLOGGING SUCCESS Customers often add the word “review” to Because of this push for knowledge, blogs are no many of their searches. longer a luxury. But you have to do it right if you Keep in mind that you must write fresh want to get the best results for your dealership. content instead of copying and pasting from 1. Become an industry expert. your manufacturer’s website. Google and your Defy the stereotypes! Show future buyers that customers know the difference. dealing with car dealers actually can be better The icing on the cake? Ongoing than eating worms! Online research can frustrate communication is like marketing: You have customers, partly because we often let third-party to stay top of mind with your clients. How sites educate them with inaccurate and confusing else are you going to provide customers with a information. steady stream of information without scaring Blogging is one of the best ways for your them away? Customers may ignore your ads, dealership staff to establish authority and but blogs include content they actually want to expertise. Once Google realizes you’re an authority read. Supplying this content gets them to your on the topic(s) customers are searching for, you’re website and helps humanize your dealership. going to see increased traffic from search engines. And who doesn’t want to drive more traffic to their Chelsea Magee has been involved in digital throughout her website? career. She is the Client Success Director at NCM and oversees 2. Stick to a schedule. their online training website, digital marketing and social media. I often see dealerships post a few blogs and end This article originally appeared on NCM’s Up to Speed blog up quitting. You have to blog regularly and remain (http://blog.ncminstitute.com) and is reprinted with permission.
Does it Really Work?
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DEALERSHIP BLOGGING
1. 2006 Toyota Avalon 2. 2007 Honda Accord 3. 2010 Honda Civic 4. 2008 Toyota Corolla 5. 2008 Ford Crown Victoria 6. 2006 Subaru Outback 7. 2007 Nissan Maxima 8. 2007 Subaru Impreza 9. 2006 Mazda MX-5 Miata 10. 2010 Kia Soul >> KBB.com editors noted the Avalon is “big, quiet and comfortable,” as well as highly reliable. TODAY’S NEW CARS may be chock-full of the latest “Our master mechanic suggests that obtaining technology and features, but that comes at a 200,000 miles of largely trouble-free driving is a price. In fact, the average price of a new car is distinct possibility,” they said. $33,801. The other Toyota on the list, the 2008 Corolla, Because many people cannot afford a large was noted by KBB mechanics as “a great choice monthly payment (let alone buy a new car for a used car if all maintenances have been outright), there exists a healthy market for performed. affordable used cars. Still, prices for used “Like most Toyotas, the Corolla seems to be vehicles run the gamut. ‘overbuilt’ compared to other cars in its segment, With affordability in mind, the editors at and that translates to solid reliability with few Kelley Blue Book’s KBB.com have named this problems,” they continued. year’s 10 Best Used Cars Under $8,000. Coming in at No. 10, the Kia Soul’s aesthetics “While spending $8,000 or less won’t get were likened to a common kitchen appliance. you the newest tech or the shiniest paint job, it “Some would tell you it looks like a toaster, can buy you solid, reliable transportation that but if it does it is a very useful toaster,” KBB said. will last for the next several years if you play “Larger than you might guess it is, the Soul will your cards correctly,” said KBB.com executive swallow up a lot of cargo and haul five passengers editorial director and executive market analyst in surprising comfort. If you can’t swing the cost of Jack Nerad. a small SUV (and don’t need all-wheel drive), the “For those who feel a keen ache in their Soul will fill the bill.” checkbook thinking about the prospect of a big To see KBB.com’s full coverage of the 10 Best monthly payment, this year’s list of KBB.com’s Used Cars Under $8,000 for 2016, including vehicle 10 Best Used Cars Under $8,000 should provide photography, pricing details and editorial reviews, some relief, because there are good used car visit www.kbb.com/car-reviews-and-news/topalternatives to a more expensive vehicle.” 10/best-used-cars-under-8000/2100000852/.
MARKET WATCH / BY AUTO REMARKETING STAFF
KBB’S BEST BETS FOR USED VEHICLES UNDER $8K
12 DEALER NEWS / NOVEMBER/DECEMBER 2016
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Good Affordable Used Cars
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ASSOCIATION NEWS
SCOOTER FOR DEXTER
MIADA Members Raise $20,000 MIADA member Wagner Motor Group became aware of a special little boy named Dexter Turner who is battling cancer. Wagner owned a scooter they planned to keep in one of their showrooms when their wholesale manager, Harold Proodian, suggested it would better serve as an auction item to raise money for Dexter and his family. Three year old Dexter was diagnosed
with neuroblastoma, a deadly cancer that often goes undiagnosed because it shows no symptoms. Dexter was Stage 4 when diagnosed, the cancer having spread to his brain and other parts of his body. Over the past year, Dexter has spent many months in and out of hospitals and treatment centers fighting for his life. He spent many months in isolation and underwent numerous surgeries to remove tumors from his leg, brain and arm. Dexter had two stem cell transplants and chemotherapy treatment. With all of these treatments come medical bills, travel expenses, etc. Joe Smalley, managing partner at Central Mass Auto Auction, is Dexter’s great uncle. He, along with his team, put together the
fundraiser for the Turner family. Manager Luke Semmelrock spearheaded the event and kicked off the live auction of the scooter August 11. The scooter, valued at $1,600, sold for an astonishing $14,000! MIADA member 401 Auto Sales of Smithfield, Rhode Island, was the highest bidder. Owner Robert Lourenco clearly wasn’t in it for the scooter. He said, “It just happened. It was for the boy.” He then wrote out a check for $15,000. The second highest bidder was Bassam (Sam) Chebbo, owner of Sam’s Auto Sales in Cranston, Rhode Island. Even though he lost the bid for the scooter, Sam still wrote a check for $5,000 to the family. Dexter is now NED – no evidence of disease – and is undergoing antibody therapy, which is designed to help prevent a relapse. Dexter and his family are so grateful for the support from the dealer community and were truly moved by their generosity. “Job well done” to our friends at Central Mass Auto Auction and the Wagner Motor Group. Thank you to all the dealers who participated and raised $20,000 for Dexter and the Turner family. It was a day they will never forget!
14 DEALER NEWS / NOVEMBER/DECEMBER 2016
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BHPH PERSPECTIVE / BY DAVID MEYER
HOW MUCH RISK ARE YOU WILLING TO TAKE?
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>> A Way to Cut Costs and Mitigate Risk
AFTER YEARS OF declining sales, the automotive industry is once again on the rise. Fueling much of the resurgence in vehicle sales is the recent growth in subprime automotive financing. So what is fueling the increase in subprime auto loans? In the wake of the recent economic crisis, increasing numbers of car buyers found themselves saddled with poor credit resulting from job loss, foreclosure, bankruptcy and other financial woes. While still struggling with low credit scores, many of those customers are now moving toward financial recovery. They’ve found new jobs and careers, are earning decent salaries, have wiped the slate clean and are lowering their debts. Despite that progress, those creditchallenged customers still cannot qualify for traditional auto financing. But they still need vehicles. To meet that demand, increasing numbers of dealerships and lenders are approving more subprime auto finance, and are going deeper and deeper in the process.
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According to a recent report by Experian, “The percentage of auto loans to buyers with the poorest credit ratings is growing faster than the rest of the auto finance market.” Almost 21 percent of open auto loans are held by individuals with subprime and deep subprime credit ratings. However, with the uptick in auto loans, we are also witnessing one of the largest increases in auto loan delinquency rates on record. According to Fitch, increased loan originations, higher lender competition and looser underwriting standards in the subprime loan market have caused an influx of higher auto delinquencies. That’s a problem. Higher delinquencies mean higher rates of default. Which leads to the question: How can you better manage your portfolio and risk for success? As subprime auto lending continues to gain momentum and loans dive deeper, the associated risks continue to rise. Dealerships and lenders who offer subprime auto financing should be prepared for an increase in delinquencies, defaults, repossessions, collection staff time and resources – all of which come with significant costs that cut into profitability. BHPH dealers and lenders are now turning to GPS tracking as a smart business strategy that cuts costs and mitigates risk while also encouraging their customers to pay on time and improve their credit.
GPS tracking, in its most effective form, is a system that enables dealerships and lenders to verify customer information faster, ensure more on-time payments and locate vehicles in real time to manage their liability with highrisk vehicle collateral. The more advanced GPS vehicle tracking and collateral management systems include additional features such as payment reminders and advanced reporting. Those features further reduce business costs while also promoting on-time payments that help customers stay in their vehicles and rebuild their credit. In a study conducted on Spireon’s GoldStar GPS vehicle tracking, 87 percent of vehicle finance customers saw an increase on their return capital. Further, 77 percent saw a significant improvement of their customers’ credit ratings. The right type of GPS vehicle tracking can improve business profitability, reduce risk, help maintain CFPB compliance and help customers improve their credit. David Meyer is executive vice president of sales and client services for Spireon, bringing more than 28 years of vehicle finance and BHPH industry experience to his role overseeing the company’s Automotive Solutions Group.
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MANAGEMENT MATTERS BY KENNY ATCHESON
PLANNING FOR 2017 Make Necessary Adjustments
“If you always do what you’ve always done, you’ll always get what you’ve always got,” said Henry Ford. Albert Einstein said, “The definition of insanity is doing the same thing over again and expecting a different result.” Now is the time to plan what you will do differently next year to succeed. I’ve had conversations with dealers who spend from $5,000 to $120,000 per month in advertising. I have discovered that regardless of the budget, there are some people who are so afraid of change they choose to continue getting mediocre results in lieu of making any adjustments. The resistance to change is not budget specific, but it is success specific. In other words, most successful dealers are ready to make a change at a moment’s notice as long as there is evidence there is a need for it. An interviewer asked Lee Iacocca what order he used to make changes when saving Chrysler. Iacocca said, “Order? We did everything at the same time.” Iacocca made lots of changes at the same time. It’s a good practice when necessary. In his book, Power to Change, Jim Jackson explains how some people only make changes after a crisis. According to Jackson,
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“You are right where you have chosen to be.” If you sell 40 cars or 240 cars per month, you have chosen how many cars you are going to sell. You may “desire” to sell 15 percent more cars, but that requires the decision to make changes. I’m not saying you should chase every shiny object you hear about from media agencies, a Twenty Group meeting or an article. Invest in consultations with an expert who will give you the bold truth. Don’t approach someone at an ad agency and ask what they have for sale. Carl Sewell, author of Customers for Life and owner of Sewell Automotive with dealerships located throughout the country, wrote about how important consultants have been to him. He doesn’t always take their advice, but at least he knows he is getting the opinion of an expert rather than a sales pitch for services. Another advantage to professional consultation before investing in new strategies and media is you get “outside eyes” diagnosing and analyzing your strategies and tactics. Outside eyes are typically free from bias. They are not emotionally tied to anything in particular. Let me explain what I mean by “emotionally tied.” I’ve consulted for dealers who have done something one way for up to 88 years. They are emotionally invested in a particular method. It is what got them where they are. It may be something that lifted them from poverty
to riches. That creates an emotional attachment. It took an outside set of eyes, a different angle and explanation of a new strategy, to get them to realize it was time for some tweaks. Your existing strategy and plans may be good, and only require minor tweaks to be great. Find out. Kenny Atcheson is the president of Dealer Profit Pros and author of Marketing Battleground: How to Deploy an Army to Battle for Your Business. Kenny teaches workshops, speaks at conventions and 20 Groups, and his company offers several marketing and advertising programs. His website is www. DealerProfitPros.com.
NOVEMBER/DECEMBER 2016 / DEALER NEWS 17
THANK YOU! >> From The Cassidy Family
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ASSOCIATION NEWS /
AS MANY OF YOU HAVE HEARD , Darcy Cassidy, daughter of auctioneer Mike and his wife Cathy, was diagnosed with an AT/RT (Atypical Teratoid Rhabdoid Tumor) in 2008 when she was just 4 years old. Since then, Darcy has been in and out of treatment facilities fighting for her life.
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MIADA hosted an event in May to assist the family with financial needs. Over $90,000 was raised in a matter of weeks with the help of our members and extended dealer community. The Cassidy family could not be more grateful and wanted us to share this letter on their behalf. Please continue to pray for Darcy. The Cassidy family and Darcy’s team of doctors feel it is nothing short of a miracle that we see her smiling face as she runs across the
lobby at ADESA Boston. We at MIADA are proud to be part of such an amazing industry of people who stepped up and rallied to help one of our fellow brothers.
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