How can I convert my new vehicle leads to appointments if my pricing is not competitive?

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Permalink Reply by Philip Zelinger on March 19, 2010 at 5:08pm

You can't. Next question!

Understand that conventional conversion tools require an online shopper to visit your site vs. others with an expectation that they will get the best deal possible and unfortunately price is often the first filter that they apply. I suggest that you review the dozens of comments posted on ADM to my post -- To Price Or Not To Price, That Is The Question -- to get the variations on this reality.

That said, your best shot would be to shift your message to branding and long term positioning on social networking where C2C conversations might place you on the preferred list for dealers when online consumers are in their buying cycle but frankly you will probably be working somewhere else by then since that will take some time to mature!

One option might be to place your inventory on third party sites that will attract onlne shoppers with the hope that they will select your vehicle even though your prices aren't competitive, but again -- that will require a social networking message earned over time to validate your dealer's other attributes. Right now the only marketing / search portal out there with a built in social networking element is ronsmap.com but fortunately they offer free listings and free leads so I suggest that you extend your online exposure through them until your management accepts the fact that today's Internet customers are in charge and they need to change from their push/pull marketing concepts to the current pull/push messages that drive today's retail auto industry.

Good luck and don't give up! Stupid is as stupid does and any dealer that survives in today's consolidating auto industry can't be stupid for too much longer!

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Permalink Reply by Matt Watson on March 21, 2010 at 1:59pm

One way would be to quote MSRP and list the incentives. A lot of dealers don't do a very good job of quoting MSRP less rebates. So even MSRP less rebates might make it look like your prices are lower than other dealers only showing MSRP.

I would make sure you always show incentives on your website and in the quotes you send from your CRM so you always look as competitive as possible.

Here is an example emailed new car quote with MSRP less rebates showing incentives.

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Permalink Reply by Philip Zelinger on March 21, 2010 at 2:45pm

As always, Matt has provided a real world example of a possible solution short of changing jobs so, I agree -- listen to him!

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Permalink Reply by David T. Gould on March 22, 2010 at 9:21pm

Might I suggest not using "Final Price"... my only "Final Price" is when their nose to nose, in the store, on a specific vehicle... Up to that point I'm always working for them to reach the best "Final Price". Good Selling! DTG

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Permalink Reply by Philip Zelinger on March 23, 2010 at 7:58am

Ooops, I agree with David about the "Final Price" thing. I thought that Matt and VinSolutions was perfect so I missed that little detail but other than that ---- listen to Matt!

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Permalink Reply by Michael Cotter on March 25, 2010 at 8:16am

We currently use Matt's system of pricing on our website. We go a little further and discount to invoice minus rebates on our site. I still lose deals by sometimes up to $1500 because every competitor (not every dealer, but true competitor) is using all of the holdback plus stairstep to price the new cars. I might just be stuck with a NCM that would rather have gross over quantity. I believe that taking 10 deals at $1500 net is not as good as taking 50 deals at say $389 net (our doc fee). However it would take time for them to see the benefit and they are not ready to make the leap.

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Permalink Reply by Ron Morrison on March 29, 2010 at 1:57pm

Another option to communicate a VALUE differentiation is to use something more powerful then price comparisons: "Word-of-Mouth" from existing customers!

Follow me on this for a moment. Your lead/customer has found your price online, which makes them an online buyer, which tells us that there's a 57% chance that they're a social network user (facebook, myspace, linked, in etc).
So, if your dealership has a facebook or twitter page - hopefully you have customers/references there. If that's true... then your response to leads could include something along these lines... "Thanks for the inquiry... yada yada yada, we'd love to ... yada yada yada" but BEFORE you do anything don't take our word for it - check with your community. Check with the people like you, who had similar questions and concerns - you can find them on our facebook fan page here ______! Let us know what you find from them... etc.
Encouraging people to crowdsource tells them that you think they're smart and it demonstrates high confidence in your VALUE!

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Permalink Reply by Matt Watson on March 29, 2010 at 8:20pm

We offer our dealers the ability to customize those pricing options. The example I provided probably wasn't the best.

Here is another example. System automatically picks all the different trim levels from vehicles in stock and builds a quote

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Permalink Reply by Eddie Coleman on March 29, 2010 at 8:10pm

Forget your pricing... That's a jack... You can drag these people in by the wheel barrel loads with a landline a rotary phone in a toll booth located on a country road and do it without over promising, under delivering or ticking them off...

Oh Brother....


E

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Permalink Reply by Mikhail Melomed on April 5, 2010 at 8:01am

This is the right statement Big E.

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Permalink Reply by Stan Sher on April 2, 2010 at 10:14pm

Let me go back to saying that it depends on many things. In some cases you can't. In other cases you can. Think about your location, your product, your demographics, the attitude of the average customer, the average credit score in your dealership. Work in the store 30-60 days you will know all of those things. Try out different ways, you will eventually find out what works in which situation. You need to look at the big picture of lead and qualify. I get calls from people on ads that advertise aggressive lease deals constantly. I listen to what the customer tells me, a lot of them tell me they have a trade or they have a credit score of 510 (sometimes lower). I get the same with internet leads too. I find out in a conversation about the customer. How do we get them in? We find out about them. We ask questions (qualify). Now I take their situation and use their situation as the selling point as to why they need to be here right now. We have a special finance department. We have a mega used car operation. We are the most reputable dealer in the area. We have this, we have that. You need to see the big picture. You cannot just make assumptions. Price in not competitive, no problem. "We can make our price competitive mr. customer. I understand that you got a better offer. However, we need to look at the big picture. What is the doc fee the other dealer is charging? (can be $200 more sometimes). How large is their used car lot? (We sell over 100 used cars per month, we need your trade!). Based on your credit needs, we have a department that caters to your needs especially for you. Let us help you. The only guarantee that I can give you is that we will work with you to get you the best possible deal and the right approval. Let us go to work for you." These are some great lines. Look at the big picture. Look at the big picture. My buddy, Joe Webb once wrote about deconstructing a lead. Well, deconstruct the lead, build the rapport, gain confidence and trust. In many ways, getting the lead to come in is like negotiating a car deal. Think about it.

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Permalink Reply by Eddie Coleman on April 4, 2010 at 10:48pm

(please take this with a grain of salt)

Eddie Rule Number One: Look for a cure not a treatment…

Reasons to buy, if I could ya would ya wouldn't ya agree now come on ya said ya would now why don't ya, we got these, them, this that and baby fat or pimpin price will not change a thing at the end of the month. It's like teaching someone front kick, jab, jump spinning hook kick without teaching them to read where their opponent’s mental state is at and where the critical distance line is at so they know when to move and when to get out of the way.

You don’t need techniques or clever ways to drop numbers. You need to know how to find out where their head is at (which is completely different skill set than qualifying) so you know what to say prior to saying it or emailing it.

As you progress know that if you’re not getting at least 85% of your leads on the phone and 80-95% of those people to commit to come see you without making false claims, then you may be practicing kung-fu in front of a Jet-Li movie and you need to find someone who can successfully move the dryer out of the way and plug you into the 220 outlet.

E

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