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O R E G O N I N D E P E N D E N T A U T O M O B I L E D E A L E R S A S S O C I AT I O N NOVEMBER 2016
CRM TECHNOLOGY vs. CRM MINDSET Page 10
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V I S I T U S AT W W W.O I A D A .C O M
COMPLIANCE MATTERS BY DANIEL J. DOMAN
TACKLING COMPLIANCE Best Practices to Keep Consistent Standards
Process, by definition, means “a series of actions or steps taken in order to achieve a particular end.” Think about that for a moment, and then think about your dealership’s compliance strategy. Does it follow a regimented process that helps ensure your dealership’s employees are taking the necessary actions on every deal to meet your dealership’s compliance requirements? Managing your dealership’s compliance requirements can be daunting. Regardless of the size or complexity of your dealership, ignorance is not an excuse. Adverse action, privacy policies, identity verification, risk-based pricing – there is a lot to comprehend and consider implementing on every deal. Below is a list of key compliance items your dealership should fully understand and some best practices for implementing them on every deal. Privacy Policy According to the FTC website, “auto dealers that extend credit, arrange financing or leasing, or give financial advice must notify customers about the information they collect, who they share it with, and how they protect it.” Any personal information you collect to provide the above-mentioned services is covered by the Privacy Rule. Personal information includes “name, address, phone number, or other information that could be used to identify them individually.” Your privacy policy should be offered at any point of entry when gathering consumer data, including both your online credit application and in-store experience. If you don’t already have a privacy policy in place, your credit application system can provide you with a complimentary privacy policy form builder you can tailor to your dealership’s policies and procedures through the use of the Federal Reserve Board’s Model Privacy Notice. If your dealership already has a privacy policy, it can be easily uploaded into your credit application system to be presented when gathering consumer information. OFAC Checks Before conducting business with a potential purchaser, dealers must run a check with The Office of Foreign Asset Control to ensure they are not unintentionally conducting business with a specially designated national. These checks can be run for free online or you can set preferences to automatically run an OFAC check upon every credit application submission in your credit application system. Automation in this arena can help ensure your dealership’s employees are
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taking required actions and following your dealership’s compliance process. Identity Verification Today, identity fraud is big business. For example, a 2016 identity fraud study by Javelin Strategy & Research, found $15 billion was stolen from 13.1 million U.S. consumers in 2015. Under the Red Flags Rule, “many businesses and organizations [must] implement a written identity theft prevention program designed to detect the ‘red flags’ of identity theft in their day-today operations, take steps to prevent the crime, and mitigate its damage.” Help reduce your dealership’s risk by validating every consumer’s identity. This is another step in your dealership’s process that can be automated with every credit bureau request. Choose an identity verification solution that has customizable settings and allows you to set tolerances for alerts to best suit your dealership’s risk strategy. Credit Score Disclosure Notice (RiskBased Pricing) The Credit Score Disclosure Notice can be used as one process for complying with the Risk-Based Pricing Rule under the Fair Credit Reporting Act. The CSDN should be given to “all consumers who apply for credit and contains their credit score as a way to provide greater understanding of how they are evaluated during the lending decision process.” CSDNs can automatically be generated in your credit application system by selecting your credit bureau(s) and risk model(s). Once you have selected these settings, it can automatically generate a CSDN upon display of each credit bureau report. Adverse Action Notice When using a consumer credit report to make a credit decision, you have legal obligations under the FCRA and Equal Credit Opportunity Act. In particular, “if you deny a consumer credit based on information in a consumer report, you must provide an ‘adverse action’ notice to the consumer.” Generating an adverse action notice and manually printing is a complimentary feature in your credit application system. However, to ensure adverse action notices are consistently generated for all deals necessary, you can additionally subscribe to a mailing service that will identify, generate, print and mail notices on your dealership’s behalf based on the compliance strategy your dealership selects. Again, automating these compliance activities can help ensure your process is consistently executed. Fair Lending Due to recent political changes and resulting enforcement actions, your dealership may have decided to take actions to address its fair lending obligations under the ECOA by setting a standard dealer participation rate for all of your retail installment contracts. As a result, your credit application system has provided you with the ability to set
a standard dealer participation rate that will be applied to every deal. In the event your standard dealer participation rate is deviated from in a downward manner (only), completing a dealer rate exception form can document the good faith, competitive reason for the downward deviation from that standard. Electronic Document Storage Now that you’ve generated several key compliance documents electronically, it only makes sense to securely store your documents so they can be easily accessed at any time. Credit applications, decision details, credit reports, disclosures, adverse action notices, identity verification documents, privacy policies, eContracts, and ancillary uploaded documents can all be electronically stored to create a complete audit trail for each customer. It can all happen with the click of a button from your credit application system. There is the additional benefit of reducing your dealership’s risk of a security breach due to “physically” stored customer information in and around your dealership. Whether perceived as a burden or not, your dealership’s back office needs to comply with federal and state regulations. Set up and maintain a compliance process that best suits your strategy and make it as easy as possible for your staff to follow. All of the actions listed above have the ability to take place within your credit application system, along with the ability to monitor if the actions were taken, not taken, or not needed. Most of these compliance actions can be set up to automatically run on every deal, by every user in your dealership. Automation is there to assist you and will help you control consistency in the series of actions needed to execute your dealership’s compliance process. Dan Doman is Chief Legal and Privacy Officer for RouteOne, a joint venture between Ally Financial, Ford Motor Credit Company, TD Auto Finance, and Toyota Financial Services. He is responsible for managing all RouteOne’s legal, governmental, privacy, and security affairs.
NOVEMBER 2016 / OIADA DEALER NEWS 3
INSIDE
03..............................................................Tackling Compliance 06..............................................................Tips to Convert a No 07................................................................... Planning for 2017 08...............................................................Dealership Blogging 09.................................................................OIADA Convention 10......................................CRM Technology vs. CRM Mindset 14.................................................................OIADA Convention
WHAT’S NEW
The NIADA National BHPH Summit will be held
Dec. 6-8 in Dallas, Texas. This year’s theme is “Reaching New Levels of Excellence.” The conference features industry leading speakers covering best practices in various BHPH related topics as well as industry updates and strategies for the upcoming year.
For more information contact Diann Flanders at diann@niada.com or (888) 906-8283.
ADVERTISERS INDEX
ADESA Northwest/Portland ................................................ BC AutoTrader............................................................................... 5 AutoZone..................................................................................6 DAA Northwest/Seattle ......................................................IFC Manheim.com..................................................................10, 11 NextGear Capital..................................................................... 8 Spireon..................................................................................... 7 VAuto.................................................................................... IBC
OFFICE
Oregon Independent Auto Dealers Association 1475 Capitol St. NE • Salem, OR 97301 800-447-0302
NIADA HEADQUARTERS NATIONAL INDEPENDENT AUTOMOBILE
DEALERS ASSOCIATION WWW.NIADA.COM • WWW.NIADA.TV 2521 BROWN BLVD. • ARLINGTON, TX 76006-5203 PHONE (817) 640-3838 OIADA Dealer News is published 12 times per year 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 6006-5203. The statements and opinions expressed herein are those of the individual authors and do not necessarily represent the views of OIADA Insider or the National Independent Automobile Dealers Association. Likewise, the appearance of advertisers, or their identification as members of NIADA , does not constitute an endorsement of the products or services featured. Copyright © 2016 by NIADA Services, Inc. Inc. All rights reserved.
STATE MAGAZINE MGR./SALES
Troy Graff • troy@niada.com EDITORS
Jacinda Timmerman • jacinda@niada.com Andy Friedlander • andy@niada.com MAGAZINE LAYOUT & GRAPHIC ARTIST
Christopher Hanley • chris@niada.com
SENIOR ART DIRECTOR / PRODUCTION MANAGER
Christy Haynes • christy@niada.com PRINTING
Nieman Printing
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
ASSOCIATE MEMBERS ACCOUNTING SERVICES
Delap, CPA Adam Puckett Lake Oswego, OR 97035 503-697-4118
SHOWROOM/ BUSINESS JANITORIAL
Show Room New Mike Barthe 360-882-8162 Commercial Cleaning JaniKing ADVERTISING Morgan Thomas Affiliated Media LLC 541-868-8080 Aaron Jarvis PRIVATE AUCTIONS 503-683-2574 Brasher’s Northwest Carsforsale.com Auto Auction Aaron Oestretch Mark Melton 605-306-3302 541-689-3901 AutoTrader.com Brasher’s Portland Ed Merrick Auto Auction 503-747-9162 Jerry Hinton 503-492-9200 Cars.com James Lynch Crosspoint NW 312-601-5052 Dealer Auction Brian Hardy UsedCars.com 503-594-2800 by Dealix Tamara Garris Manheim Portland 847-397-1700 Auto Auction Ray Priest AUTO SERVICES 503-286-3000 & ACCESSORIES Auto Marketing OUT-OF-STATE Specialist AUCTIONS Gary Palaniuk ADESA Seattle 503-519-7725 Auto Auction Jason Arcaro AUTO DETAILER 253-735-1600 x 213 Show Room New Mike Barthe DAA Northwest P O Box 822073 Mitzi Vanvoorhis Vancouver, 509-244-4500 WA 98682 DAA Seattle 360-882-8162 Dave Blake Northwest Auto Auburn, WA 98002 Accessories 253-737-2200 Craig Lessard Manheim Seattle 503-288-5700 Auto Auction Ray Priest 206-762-1600
BOARD OF DIRECTORS
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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.
PUBLIC AUCTIONS & AUCTIONEERS
Commercial Industrial Auctioneers Ray Beal 503-760-0499 Insurance Auto Auctions, Inc. Ryan Hall 503-253-1500 Petersen Auction Group of Oregon Curt Davis 541-689-6824 Rick Leathers Auctioneers Rick Leathers 503-668-5326 Woodburn Auto Auction Steve Morin 503-981-8185 DEALER SOFTWARE
Frazer Computing Michael Frazer 888-963-5369 FINANCING
Credit Acceptance John Bragg 360-980-2214 Credit Concepts Jason Moon 541-342-8545 JP Morgan Chase Auto Finance Jeff DeGarmo 503-201-4370 Lobel Financial Tom McConkey 503-653-8000 Nationwide Insurance Mark Tischer 503-339-4165
Oregon Auto Finance Gary Veum 541-868-0472 Oregon Community Credit Union Rich Black 541-681-6311 PacWest LLC John Keifer 341-868-2595 Reliable Credit Association David Marx 503-462-3022 Smartway Auto Advisors Sheldon Harris 503-795-7700 The Equitable Finance Co. Brandon Fox 503-808-7939 United Finance Todd May 503-238-6488 FLOORPLAN FINANCING
Lobel Financial Tom McConkey 503-653-8000 Floorplan Xpress Josh Chandler 503-621-9260 NextGear Robert Torbet 503-358-3911 INSURANCE & BONDING
Hecht & Hecht Insurance Agency Evelyn Hecht 503-542-1131
KMI Agency, Inc. Kelly Martin 503-625-2615 Shepard & Shepard Business Solutions Todd Shepard 509-396-0488 The Summit Group of Oregon John Petrie 503-581-2825 LEASING
Oregon Roads, Inc. Joseph McKinney 541-683-2277 SERVICE CONTRACTS
A.U.L./D.P.C. Jim Bangert 360-834-3333 Automotive Business Developers Shannon Meany 541-944-9186 Auto Services Company Susan Williams 800-442-7116 DPC, Inc. Jacob Bangert 360-834-3333 Protective Life Insurance Dylan Doran 818-836-1455 TRAINING
OIADA/NIADA Certified Pauline Sill 503-362-6839
PRESIDENT Tommy Wilson, Jr.
1ST VICE PRESIDENT Jim Weaver
TREASURER Salvador Alvarez Herrera Zamora Auto Sales
EXECUTIVE VICE PRESIDENT Siamak Lotfi
SECRETARY Gary Brooks
CHAIRMAN OF THE BOARD Gary Sargent
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NOVEMBER 2016 / OIADA DEALER NEWS 5
ACCELERATE / BY GWC WARRANTY
5 TIPS TO CONVERT A “NO”
>> It Takes Discipline, Patience and
a Calculated Approach
F&I SALES can sometimes feel like a war of attrition. If you just ask the same question enough times, you’ll eventually wear down a customer into buying a product. But is that really the approach you want to take? It’s one that puts pressure on the customer and leaves them unsure whether they truly needed the product they just spent their hard-earned money on. Overcoming a “no” and converting it into the coveted “yes” is a difficult proposition that takes discipline, patience and a calculated approach. Once you have it down, though, you stand to create a more profitable business with happier customers. Find out if it’s really a “no.” Oftentimes, the real objection lies well behind the initial one-word negative response. Don’t be afraid to ask additional questions beyond your initial presentation. Investigate whether the customer had one in the past. Do they know a mechanic and that’s why they’re turning it down? Were they burned by a disreputable company in
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the past? It’s extremely rare one of these examples isn’t the true objection hiding behind those two ugly letters. Be nimble. Once you’ve uncovered the true objection to a vehicle service contract, ask a few more questions about their specific situation. You’re taking on the role of detective in uncovering more information about their individual situation and how the experience and products you offer can change the perception they have of what you’re offering. Be prepared to pivot and address any number of potential true objections. Be ready with evidence. If you’ve gotten to the bottom of why a customer really is declining a service contract and you’ve gotten to know their objections on a more personal level, be ready to pounce with supporting evidence. If it’s someone who was burned in the past, bring up your reputation and show past repair invoices that were covered by a VSC. If they say another VSC didn’t cover anything, know the details of what’s covered with your products – especially non-component items like rental car or lodging reimbursements. Make a U-turn. If a VSC really isn’t hitting the mark with a customer, try talking about other protection options you offer. If they continue to decline, circle back to the VSC and explain why it’s even more valuable than the ancillary products they’ve also declined. Sometimes the comparison in coverage can shed light on the value of VSC protection.
Don’t make it about yourself. It can be difficult to hear “no” from a customer three, four or even five times in the F&I presentation. It’s even more difficult to maintain focus on the customer’s needs while continuing to push a service contract. Be sure your questioning is always focused on the customer and their specific situation. The moment a customer feels you’re pushing products for your financial gain rather than their benefit, you run the risk of losing a sale, referrals and a lifelong customer.
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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 2016 / OIADA DEALER NEWS 7
ONLINE MARKETING / BY CHELSEA MAGEE
>> Does it Really Work?
>>
DEALERSHIP BLOGGING
EVERYONE LOVES FREE INFORMATION. And free information brings in customers. In fact, 90 percent of future car buyers report they search online for answers to their questions about their next vehicle purchase or service. THREE STRATEGIES FOR BLOGGING SUCCESS Because of this push for knowledge, blogs are no longer a luxury. But you have to do it right if you want to get the best results for your dealership. 1. Become an industry expert. Defy the stereotypes! Show future buyers that dealing with car dealers actually can be better than eating worms! Online research can frustrate customers, partly because we often let third-party sites educate them with inaccurate and confusing information. Blogging is one of the best ways for your dealership staff to establish authority and expertise. Once Google realizes you’re an authority on the topic(s) customers are searching for, you’re going to see increased traffic from search engines. And who doesn’t want to drive more traffic to their website? 2. Stick to a schedule. I often see dealerships post a few blogs and end
up quitting. You have to blog regularly and remain 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” questions they answer on a regular basis. You can do this for both sales and service. Make sure to write posts about your local area and events because this will also boost your local relevancy. Another hint? Review everything! Customers often add the word “review” to many of their searches. Keep in mind that you must write fresh content instead of copying and pasting from your manufacturer’s website. Google and your customers know the difference. The icing on the cake? Ongoing communication is like marketing: You have to stay top of mind with your clients. How else are you going to provide customers with a steady stream of information without scaring them away? Customers may ignore your ads, but blogs include content they actually want to read. Supplying this content gets them to your website and helps humanize your dealership. Chelsea Magee has been involved in digital throughout her career. She is the Client Success Director at NCM and oversees their online training website, digital marketing and social media. This article originally appeared on NCM’s Up to Speed blog (http://blog. ncminstitute.com) and is reprinted with permission.
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 Jack Nerad. of a small SUV (and don’t need all-wheel drive), “For those who feel a keen ache in their the 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
8 OIADA DEALER NEWS / NOVEMBER 2016
>>
Good Affordable Used Cars
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ASSOCIATION NEWS /
GENERAL BUSINESS FROM THE 2016 OIADA CONVENTION
>>
>> Convention Highlights
OIADA Congratulates the 2016 Scholarship Winner Jose Francisco Pinomesa, son of long time member and past president Jose Pinomesa, was this year’s scholarship winner. OIADA relies on the expert review of non-independent dealer educators to review and score the applicants in many areas, such as academic achievement, SAT scores, extracurricular activities and involvement in community programs, offices held and other distinctions. Jose is a freshman at Loyola Marymount University majoring in Mechanical Engineering. Legislation At the general membership meeting, OIADA voted to take a stand with a “no” vote on Measure 97. The OIADA executive board encourages you as a small business owner to vote no and to strongly promote a “no” vote. Here are some of the reasons: • Measure 97 is a tax on total sales – not profits – that would increase consumer costs for all types of products and services.
George VerKamp from AutoZone getting ready to make a presentation.
Chairman of the Board Gary Sargent visiting with members.
• Measure 97 would be the biggest tax increase in Oregon history – $6 billion. • Measure 97 is a deceptive, hidden sales tax. • Measure 97 would especially hurt Oregon families, farmers and small businesses who can least afford higher costs. • Measure 97’s badly-designed tax on sales would result in taxes on top of taxes. • Measure 97 would damage Oregon’s economy and cause the loss of thousands of local jobs. • There’s no guarantee the money would go to education or anything else. The legislature could spend it “any way it chooses.” Board Nominations It’s election time for OIADA Executive
Board as well as board members. Nomination forms are available by contacting OIADA. This is a year by year commitment, with a minimum of quarterly meetings. Help drive OIADA to be the only Oregon independent dealer association, with quality programs serving the dealerships. Applications for 2018 Quality Dealer of the Year You too can be an Oregon Quality Dealer of the Year! Applications are available by contacting OIADA. Now is the time to start reviewing your dealership for the 2018 award that will be awarded Fall 2017.
ASSOCIATION NEWS /
>>
CONVENTION HIGHLIGHTS
>> Thank You Sponsors and Vendors
Thank you to our great sponsors and vendors, who made this year’s convention/conference a huge success. We could not have provided the outstanding programs without you. Associates are the heart of OIADA and their support is invaluable. Thank you for everything you do for OIADA! DAA Seattle DAA Spokane AutoZone Hecht & Hecht Insurance Nationwide NW Crosspoint NW Auto Auction Benchmark Dealer Services KMI Agency Elite Warranty Lobel Financial Podium Auto Cap Services Shepard & Shepard Insurance VITU
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NOVEMBER 2016 / OIADA DEALER NEWS 9
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 OIADA DEALER NEWS / NOVEMBER 2016
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RM
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.
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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NOVEMBER 2016 / OIADA DEALER NEWS 11
ASSOCIATION NEWS / /
OREGON INDEPENDENT OIADA ~ Oregon Independent Auto Dealers Association AUTO DEALERS ASSOCIATION
Your only nationally recognized association since 1948. OIADA, here to help, support, educate and promote quality dealers in Oregon.
Here are the great benefits of OIADA membership: • Oregon Dealer News is delivered to our dealers monthly, filled with quality up to date business articles. • Included in each Dealer News Magazine is 30 minutes towards continued education, free to OIADA members, which now means returning eight answer sheets a year. This is a savings of $75 annually. • OIADA Auction Punch Card: Our valued auction houses in Oregon, Washington and California are offering $50 savings on your buy and sell fees, a value of $1,100. • OIADA offers members discounts on all meetings, educational programs and conventions, with an annual savings of over $200. • OIADA members receive a discount on most forms, a savings of up to $100 or more annually. • Quarterly regional dinner meetings, an outreach to bring programs, education and conversation to all areas within Oregon. • Annual convention will host a variety of programs including eight or more hours of continued education. Quality Dealer of the Year Awards and Banquet. At a savings of $100 for OIADA members. • Opportunities for OIADA members to be awarded Oregon’s Quality Dealer of the Year and to compete for the National Quality Dealer of the Year at our national convention. • National education opportunities, becoming a Certified Master Dealer and more. • National access to Dealers 20 Groups . • OIADA has on contract a lobbyist to bring forth interests and to protect our dealers at the state level. • OIADA hosts a required certified 8-hour Pre-License Class. Upon completion dealers will receive the DMV required 8-hour certificate. • Title and registration classes, savings of $35 for OIADA members. • Help and support with your issues is just a phone call away. • Automatic membership with NIADA and the NIADA Used Car Dealer Magazine. • Access to NIADA’s annual convention. • Opportunities for scholarships, both state and national. • NIADA offers OIADA members a wide variety of discounts to members, from education to everyday business expenses.
ontact OIADA at 503-362-6839 to start your enrollment for all these great opportunities as a ember of OIADA. Annual Savings $1100 Auction Punch Card $ 100 Forms $ 75 Education $ 100 OIADA Convention $ 50 Driven to Learn & Regional Meetings $ 1425 Bottom Line Savings
25 Cost of Membership ~ OIADA helping you succeed.
12 OIADA DEALER NEWS / NOVEMBER 2016
OIADA FORMS STORE
YOU CAN EASILY ATTAIN FORMS NEEDED FOR EVERYDAY BUSINESS Don’t let yourself run out of the forms you need to do business every day. OIADA has four ways for you to get forms:
1. 2. 3. 4.
You can order forms any time of the day online at OIADA.com. All you need is an email address.
You can stop by one of three locations within the Oregon auction houses during auction day.
You can pick up forms at the OIADA office, located at 1475 Capitol Street NE in Salem.
You can call the OIADA Office Monday-Friday. We will ship your order that day. In most cases, it will be delivered to you overnight by UPS.
Don’t be caught without a Secure Odometer Form or Secure Power of Attorney. These forms are DMV forms and each has a registered number assigned to the dealer who purchased them, so don’t lend yours out and do not borrow from your neighboring dealer. When you purchase these forms, it’s a good idea to pull them out of the packet and slip a reminder near the bottom to call OIADA and order more. You can even add the phone number (503-362-6839) on the note. Did you know that our members get a discount on most state forms? OIADA members save an average of $100 or more every year.
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AUCTION NEWS /
Auctions to Work For
>>
>> 2016 Auto Remarketing Best Auto
DAA NORTHWEST AND DAA SEATTLE have been named as two of the 2016 Auto Remarketing’s Best Auto Auctions to Work For. Auto Remarketing partnered with Best Companies Group to identify auctions that have excelled in creating quality workplaces for employees. This survey and awards program is designed to identify, recognize and honor the best employers in the wholesale auction industry, benefiting the industry’s economy, workforce and businesses. The list is made up of just 25 auctions nationwide. To be considered for participation, auctions had to fulfill the following eligibility requirements: • Must have been in business at least one year at time of entry. • Must have a minimum of 15 employees working in the U.S. • Must be a for-profit business. • Must be a publicly or privately held business. • Must be primarily run as a dealer-only auction.
OI A DA C ON T INUING EDUC AT ION P ROG R A M
OIADA CONTINUING E D U C AT I O N P R O G R A M
READ & RESPOND AND CERTIFY BELOW
>>
DAA NORTHWEST & DAA SEATTLE AWARDED
COMPL E T E T HIS T ES T A ND CER T IF Y BELOW T H AT YOU H AV E RE A D T HE A R T ICL ES F OR NOV EMBER 2016.
“TACKLING COMPLIANCE” TRUE/FALSE: You can help reduce your dealership’s risk by validating every consumer’s identity. TRUE/FALSE: When using a consumer credit report to make a credit decision, you have legal obligations under the FCRA and Equal Credit Opportunity Act. Which of the following is “personal information”? A) Name. B) Address. C) Phone number. D) All of the above. “5 TIPS TO CONVERT A ‘NO’” TRUE/FALSE: A “no” is always a “no.” Which of the following should you not do with F&I sales? A) Be nimble. B) Be ready with evidence. C) Promote products for your own financial gain. “CRM TECHNOLOGY VS. CRM MINDSET” TRUE/FALSE: CRM technology alone makes sure everyone gets touched, whether they’re Internet leads or face-to-face prospects. TRUE/FALSE: 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.
• Must have a physical location in which the business conducts sales. • Must be whole-car auctions. Auctions from across the United States entered the two-part survey process to determine Auto Remarketing’s Best Auto Auctions to Work For. The first part consisted of evaluating each nominated company’s workplace policies, practices, philosophy, systems and demographics. This part of the process was worth approximately 25 percent of the total evaluation. The second part consisted of an anonymous employee survey to measure the employee experience. This part of the process was worth approximately 75 percent of the total evaluation. The combined scores determined the top companies and the final ranking. Best Companies Group managed the overall registration and survey process, analyzed the data and determined the final ranking. A digital news article featuring the 2016 Best Auto Auctions to Work For can be found here: http://browndigital.bpc.com/publication/ frame.php?i=337645&p=5&pn=&ver=flex&pre=1. For more information on Auto Remarketing’s Best Auto Auctions to Work For program, visit www.BestAutoAuctionsToWorkFor.com.
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I certify to OIADA that I have personally read these articles in The Oregon Dealer News Magazine for November 2016.
STOP!! Before you sign and send this form, make sure you have answered
and completed all the quiz questions to receive Continued Education Credits. My Name ____________________________________________________________ ____________________________________________________________________ Dealership Name ______________________________________________________ Dealership # __________________________________________________________ Dealer License Expiration Date: (Month)_____________________________________ (Year)________________ Signed: _________________________________________ Date _________________________________________________________________
FAX TO: 503-364-7331 MAIL TO OIADA, 1475 Capitol St NE, Salem, Oregon 97301
NOVEMBER 2016 / OIADA DEALER NEWS 13
ASSOCIATION NEWS /
>>
CONVENTION HIGHLIGHTS >> Education and Classes
Education is the key to a dealer’s success, not only through the classroom but with vendors teaching them how to improve their business. This year we were privileged to have Joe Lescota as our keynote speaker. His understanding of how to create the vision through hard work, follow through and commitment was well received by the great number of dealers attending this year. These dealers recognized the value and came not only from the Portland Metro Area. Several traveled over five hours to attend. Joe Lescota and OIADA will be hosting a Certified Master Dealer class in February 2017. To find out more on attending the three day CMD class, contact OIADA or go to www.niada. com.
Keynote Speaker, Joe Lescota
President Tommy Wilson, Jr
ASSOCIATION NEWS /
OIADA 2017 QUALITY DEALER OF THE YEAR
>>
>> Congratulations to Eric Freeman
and Marshall Zoerner
The Freeman Motor Company began in the 90’s when Eric Freeman was just out of high school. It has grown to over 55 in staff with a top rated service center. The partnership with Marshall Zoerner began when Marshall too was just out of high school in 2000. Fifteen years later, after holding many titles within the dealership, from Sales Manager to GM, Marshall became Eric’s partner. Vision, leadership, drive and passion for the industry are qualities that describe Freeman Motor Company. The empowerment of staff, providing them with access to education, and the building of community involvement through their generous gifts of time, talent and financial support , both locally and abroad, makes this dealership truly an OIADA Quality Dealer of the Year. Eric and Marshall will travel to the 2017 NIADA Convention in June to compete for the coveted award of National Quality Dealer of the Year. OIADA is proud to have these great dealers represent us at the national level.
14 OIADA DEALER NEWS / NOVEMBER 2016
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