Digital Dealer Overview #2 – Filling Customer’s Buckets
Ken Potter of True Car started his presentation with a quick and subtle pitch for his company, the only one he would give for the hour. He suggested that 10% is the average close rate across all leads, while 30% represents the average close rate for “successful” True Car dealers. I will not guess exactly how I should interpret those numbers but it provided a good introduction to his session. Potter questioned what was missing for the 90% of average customers who are not closed with their original lead, and surmised that there was a need for dealerships to focus more on building value (a point that was driven home when he gave all attendees a copy of How Full is Your Bucket, gotta love free stuff). Obviously this is not an especially modern sales technique, but it is worthwhile to examine analyze this when considering the evolution of internet car sales. Here are some of the numbers thrown out in the session:
• Car Dealers represent the 2nd least trusted profession (Congress was first);
• The closest dealer to a customer doesn’t get the sale 52% of the time – this was an interesting point since True Car probably has a lot to do with customers passing their local dealership;
• 36% of leads from CarsDirect.com say they will never do any kind of business with a dealership after the initial lead process;
• Hispanics represent 11% of all auto purchases, a number that is constantly increasing.
Potter provided some dealership best practices as well:
• Give every customer the GM’s business card when they walk in and encourage them to call if they don’t get a chance to meet while in the store;
• Have salespeople fill out an index card with 6 questions (or a needs analysis sheet) and return it to the GM – this must be done before the salesperson takes another up;
• Make your online trade-in process match the in-store process as much as possible;
• Print a check for a customer’s trade-in and give it to them during a TO – the Service Manager can do this as well;
• When a customer calls or visits your website with finance issues, get them in front of the Business Manager rather than trying to start working a deal – work with them to understand their credit and help them fix their credit with sound advice, don’t just sell them a car;
• Offer a needs based test drive rather than your generic one route – for example, ask the mother to bring her kids to test the minivan (and see how quiet they get when you turn on a DVD and give them headphones);
• Have a designated area to park on the lot after a test drive and leave the customer with the car to play with it on their own;
• Send Service offers to customers that you lose – “Sorry we couldn’t do a deal, let us show you how well we do business”.
This was an interesting discussion coming from a True Car representative since their whole business model is based on price (I know they changed their approach, price is still the main driver of their service). Nonetheless, most of what he presented was spot on. In the era of online shopping, dealerships needs to do whatever they can to provide a better shopping experience for their customers. Most of the time that a customer spends online is researching vehicles and dealerships, yet dealer websites push shoppers to pick a vehicle and ask for a quote before starting a discussion. A recurring theme in many of these sessions was the need to understand the customer’s buying experience with your store, starting with your website. As was suggested in a previous post on mystery shopping your stores, it is an eye-opening exercise to try to shop for a vehicle as if you didn’t own a car dealership. Better yet, ask a friend or relative to sit down at a computer and shop for a vehicle and ask for feedback. The best digital dealers out there will be focusing on this more and more, and they will earn a lot of business as a result…