In the Trenches

Archive for the ‘Sales’ Category

Big Rebates - A losing proposition

Friday, November 14th, 2008

“Mr Customer press firmly and sign here your payments are only $538 per month for 6 years, not bad considering we had to give up most of rebate to pay off your negative equity.”

How many times have you heard these words in a dealership?

These types of transactions are not a solution for the customer or the dealer long term and it wont be long before lenders realize this is just bad business for all parties concerned and change their lending guidelines.  A car or truck with a large rebate as a tool to move them and cover negative equity is soon to be part of the “good ole days”.

It is these type of transactions that inflated home values and brought around the inevitable market correction and now is the time for the automotive industry to wake up to the fact that this is not financially sound for any party.

Large rebates on vehicles held by the manufacturer can cripple cash flow for a dealer and cause them to pay interest on their own money.  Basically dealers are giving the manufactures loans and they are paying the interest for them, in their floor plan cost.

A customer who dumps a vehicle they are upside down in by using a large rebate has only gotten a shiny new ride with the same negative equity problem they had before thus removing them from the market for a longer protracted period of time.

The lender who makes a loan structured on invoice price before taking into account a rebate is way under collateralized and is making large personal loans disguised as secured loans.

Not a win for any of the participants.  If the customers and the dealers will not put an end to the madness chances are the lenders will be the first ones to do so, especially now that the federal government is getting into the banking business.

Is this bad for the future of the car business?  Not at all.  It will cause a distress for the short term and stop the shell games and the industry will win when the dust settles.

I may be wrong and would love to hear your opinion.

These are my personal views and are not the opinion of www.drivingsales.com

Technorati Tags: , ,

The Real Online World - How does your dealership’s website stand up?

Friday, October 17th, 2008

I am not a web designer by any means.  I have created a few websites an blogs in the past.  Each one has a different purpose.  Some are to make money by creating high bounce rates others just to get my points and views out there.  None have ever been as important or profitable as a dealership website.

One thing that I am starting to pay a lot more attention to is what is considered best practices in the web design world.  There is plenty of opinion in this regard out there.  Today I stubmled across a blog post titiled 43 Web Design Mistakes You Should Avoid.  There are some things I noticed that just leaped out at me manily is some of the things they talk about are shared by many others.

Most noticably these points:

Make the content scannable: this is the Internet, not a book, so forget large blocks of text. Probably I will be visiting your site while I work on other stuff so make sure that I can scan through the entire content. Bullet points, headers, subheaders, lists. Anything that will help the reader filter what he is looking for.

Do not use fancy fonts that are unreadable: sure there are some fonts that will give a sophisticated look to your website. But are they readable? If your main objective is to deliver a message and get the visitors reading your stuff, then you should make the process comfortable for them.

Do not open new browser windows: I used to do that on my first websites. The logic was simple, if I open new browser windows for external links the user will never leave my site. WRONG! Let the user control where he wants the links to open. There is a reason why browsers have a huge “Back” button. Do not worry about sending the visitor to another website, he will get back if he wants to (even porn sites are starting to get conscious regarding this point lately…).

Do not overuse Flash: apart from increasing the load time of your website, excessive usage of Flash might also annoy the visitors. Use it only if you must offer features that are not supported by static pages.

If you MUST play an audio file let the user start it: some situations might require an audio file. You might need to deliver a speech to the user or your guided tour might have an audio component. That is fine. Just make sure that the user is in control, let him push the “Play” button as opposed to jamming the music on his face right after he enters the website.

Do not break the “Back” button: this is a very basic principle of usability. Do not break the “Back” button under any circumstance. Opening new browser windows will break it, for instance, and some Javascript links might also break them.

Make sure users can search the whole website: there is a reason why search engines revolutionized the Internet. You probably guessed it, because they make it very easy to find the information we are looking for. Do not neglect this on your site.

Avoid “drop down” menus: the user should be able to see all the navigation options straight way. Using “drop down” menus might confuse things and hide the information the reader was actually looking for.

Use text navigation: text navigation is not only faster but it is also more reliable. Some users, for instance, browse the Internet with images turned off.

Make sure to use the ALT and TITLE attributes for images: apart from having SEO benefits the ALT and TITLE attributes for images will play an important role for blind users.

Do not use pop ups: this point refers to pop ups of any kind. Even user requested pop ups are a bad idea given the increasing amount of pop blockers out there.

Include functional links on your footer: people are used to scrolling down to the footer of a website if they are not finding a specific information. At the very least you want to include a link to the Homepage and possibly a link to the “Contact Us” page.

Avoid “intros”: do not force the user to watch or read something before he can access to the real content. This is plain annoying, and he will stay only if what you have to offer is really unique.

Use CSS over HTML tables: HTML tables were used to create page layouts. With the advent of CSS, however, there is no reason to stick to them. CSS is faster, more reliable and it offers many more features.

I have brought up these issues with friends that work for website companies and I get the same answer from them all.  They say they design sites according to the customers specifications.  The auto started audio, pop ups and blinking headlights on flash images is what helps them sell their products and dealers think it is so cool.

Maybe if dealers and website vendors would concentrate on what give the website visitor the best experience onsite conversions would rise.  Car dealers train their employees to help misguided consumers in making the right decision or to show them why the customers is wrong without blowing the sale. Are industry website vendors doing the same thing? 

Dealers and dealership employees do you think you website vendor is helping you get the most bang for your buck?  If so give them a thumbs up at our automotive website review section, if not you know what to do.

Paul Rushing
Community Development
912-266-1629
www.drivingsales.com
paulr@drivingsales.com

Contact Me: LinkedinTwitter

Technorati Tags: ,

Hit a “Honey Hole” Lately?

Tuesday, October 7th, 2008

Owning your own business is the dream of many, while many are in business for themselves and do not even realize it.  When I first entered the car business in 1990 I had an awesome sales manager that took the time to really ingrain in me that I was in business for myself.  The dealership provided me with free inventory, a free office, a free phone line and even a few potential customers.  He also reminded the entire staff daily that if you are just waiting for ups to walk through the door we were never going to be very successful.

We all know that people that have already done business with us are the best people to market too, especially if their purchase and service experiences were extraordinary, not a new concept.  One of the things that was taught to me way back then was a dedicated follow up process to follow.  To bad we did not have the technology then that is available to us now.

Today while unpacking my office, I just moved, I found that old follow up routine in my treasure trove cabinet.

Follow up on sold customers:

Day 1 or Day after - Congratulations call and thank you for your business.  Maye sure there are no unanswered questions.  Mail thank you card.

Day 3 - Follow up/Fact Finding - How are you enjoying your new ride, what other kind of vehicles are in the household, Which of those will be replaced next.

Day 5 - Recent nice trade.  Mr and Mrs Jones we just traded for _______ . This would be a great vehicle for ________.  Who do you know that may be looking for something like this?

Day 7 - Are you tired of me calling you yet?  Let them know that you just want to make sure that they are enjoying their new car and you are available if they ever have any questions.

Day 15 - Hey I got something for you.  Give a free first service.  Ask questions about neighbors cars from criss cross directory.  (Note to self: Not even sure it this is still around, need to find online resource)

Day 30 - Referred lead talk.  Mr Customer who do you know.

Follow up every thirty days for the first year. 

Follow up every sixty day for the second and third year.

Fourth year start 30 day follow ups again.

These were just the notes from my initial training almost two decades ago.  Of course as you progress documenting your customer contacts some will leave your list, others will refer you a tremendous amount of business and you will earn repeat business.

Aggressive follow up like this is how you hit “honey holes” where you wind up selling everyone in the family, office, church, neighborhood cars in a 30 -60 day period.  One of my favorite types of customers were young soldiers and sailors.  If you treated them right and followed up aggressively it always meant additional sales.

Now technology has made this type of constant contact easier and faster and a heck of a lot easier to manage.  Index card boxes and tickler files are a thing of the past, for some, but for sure the techniques will still apply today. 

Chances are if you are In the Trenches and following up properly you probably have some other good tips to give yourself, as this was just an over view.  Please fire away in the comments below.

 

Technorati Tags: , ,

People love to buy

Friday, September 12th, 2008

As worn out as this statement is it is worth being reminded every now and then. “People don’t like to be sold, but they love to buy.” Right now I am personally involved with buying a townhouse in St Augustine, FL and am very excited about this purchase. I feel like I received a good deal, easy to do in today real estate climate, love the location and best of all my whole family is excited.

Of course I am a salesman so I am an easy deal when I am ready to buy something. I just don’t think my Realtor realized that when I told him that he could stop selling me. It took the wind completely out of his sails until I made the offer. Nothing he said or did was going to close me I had to close myself first.

Would I have made the offer if tried bear trap closes, used intimidation to extract an offer or tried to take it away by telling me how many other people had looked at the property or how many other people were coming to look at it? Nope, I had buy it first mentally and would have seen through that. As a matter of fact I would of probably just went to another Realtor and made the offer if I really wanted the property, just so I would not have had to interact with him anymore.

Car customers can and will do the same thing. If they don’t like they how they were handled or feel like you do not have their best interest in mind they can easily find someone who does. The web has made it easy for someone to find another dealer that has a Natural Khaki Hyundai Sonata Limited 4 cyl with a navigation package. Just because you helped confirm their desire to buy on does not mean they have to buy it from you and they will not buy from you if you don’t make it easy for them.

Just like when we left our current home to view the townhouse we had already bought it before we got there and no one wakes up and says I think I am want to go be sold a car. They are thinking hey it might be time to buy one.

Sure you can motivate people to take action, that is our job. You just can’t motivate them to take an action that they do not want to take and build a long term relationship which brings in repeat and referral business. That is like Devo’s “Whip It”, a one hit wonder, that they will replay the next time they go buy a car.

Technorati Tags: , ,

People or Process Who Wins?

Friday, August 22nd, 2008

Is process a way to manage people or do people manage processes?

With all of the technology that dealerships have at their disposal one would think that there would be a perfect process that is duplicable, transferable and easy to manage. In my experience I did not find that to be the case. The automotive vendors that I used had very rudimentary training for using their applications. Sure they were easy to use but the implementation was a nightmare.

It was mostly due to a lack of time. Perfect world there would have been cookie cutter processes in place that could be adapted and managed to maximize ROI. I would cringe when I would get the call from the ILM vendor to know why I did not have the work flows set up beyond a certain time period. They were worried about losing the account, but did not make it easy for people to get started with their product. (No I am not going to name them)

Granted I was in a situation where there was no established processes in place. Had I had some benchmarks to work from it would have been better. While at the same time it would of been impossible to work under an unchangeable process for me.

When I first started in the business in 1990 the process was mandated to the point of being authoritarian and inflexible with no deviation. In today’s world where I feel that is an outdated management style, as that encourages the high turnover the industry has. However I see where consultants still preach this management style. Does this still work?

Back to the main question though.

Do you use process as an inflexible management tool or are people allowed to take ownership of a process to manage it and adapt it to help acheive the goal of moving more product?

Technorati Tags: , , ,

Are you Pushing or Pulling?

Thursday, July 24th, 2008

I can remember back in the early 90’s I was working with a couple on a program Sedan Deville. They were in their late forties their last child had just graduated college.  The Mrs. wanted to start to experience some of the finer things in life as their obligations had diminished drastically with this event.  I had done a million dollar presentation and she was in love with the car.  I knew I had a deal but the husband was still very luke warm at best.  I had an objection that had not been uncovered yet.

Me: "Mr. X, you and your wife obviously like the car but I notice some hesitation on your part.  Have I done something wrong?" ( Thanks Jackie B. Cooper for that one)

Mr X : "No, Paul, you have been great.  I really like the car too but I am just not sure."

Me: "You’re not sure about what?"

Mr X: "This car is a front wheel drive and I have always said I will never own a front wheel drive.  People have problems with them."

Me: "May I ask you a very serious question?" (Zig) (smiling and almost laughing as I asked for permission to close him)

Mr X: "Sure Paul, I love the car but just am not sure about front wheel drive.  We probably need to look at something different."  ( he noticed my glee and was smiling and felt the close coming)

Me: "If you had a wagon at the bottom of a hill loaded with rocks.  Would you push it or pull it?"

Mr. X : (Embarrassed look on his face with no reply.  Feeling very uncomfortable at this point.)

Mrs X : "Answer the man, Honey!!"

Mr X: "That is a silly question Paul.  Of course I would want to pull.  It makes sense now."

This was just an effort to get them to the table to to finalize the transaction.  They bought the car and have been loyal customers ever since.  We now we joke about pushing and pulling. 

Thinks about how this applies to our business today.  I am not talking about bear trap closes to overcome objections.  It is much deeper than that. 

Traditional advertising incorporates push and pull marketing.  We concentrate a huge effort to reach a small percentage of people who are in the market today utilizing radio blast and ad slicks of a current sale.  This is push marketing.  While any branding message we deliver is pull marketing.  Letting people know we are there for them and we have what they want when they are ready.  It causes people to seek us out.

Online advertising is pull marketing, if done properly.  Customers only find us when they are searching for us or the products we sell.  This is the best form of permission based marketing.  Our message is only delivered to those that request it.  However dealers spend money trying to encourage people that are not in the market for what we sell to jump in prematurely.

The results of push marketing are partially to blame for the down turn we are in now.  After 9-11 the manufacturers pulled out all the stops to encourage people to jump into the market faster than they planned to.  We are feeling the effects today. - Gilbert Chavez

If your best customers are the ones searching for what you have to offer or you directly, why do we spend the majority of our advertising dollars on push marketing.  When we can receive a greater ROI marketing to those that want what we have.  One of the old paradigms in marketing is "Encourage the customer that does not want what you have to buy your product".  That is the largest base of customers out there and most expensive ones to move into action.

Spaghetti marketing, slinging stuff against the wall and see what sticks,  is a  waste of time and money.  Why participate in it?

Why not make it easier for customers to find us an our offers?

When customers find us online they have already given us permission to sell them on contacting us.  Otherwise they would not be looking at our offers.  Our job at that point is to convince them to take action.  We can accomplish this by using effective copy writing, online merchandising and building trust with our audience.

The Internet has made it easier and cheaper to reach the best customers out there, the ones who want what we sell.  Concentrate on solving your customers problems and it will solve most of yours, become visible and transparent at the same time and stay in the game!!

Stop pushing those rocks, pull them and enjoy the ride.

 

Technorati Tags: , ,