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Ok, here it goes, this is where I try to get some value out of ADM for my employer... Lately I have been on the soap box within ADP trying to get development resources to build an automated software system that would respond to any lead with a VIN or Stock Number associated by sending an email back to the consumer with the price quote based on the rules and parameters set up in the tool, or maybe even the DMS. Anyways, here are my questions... Because i do believe that slogging through multiple leads, doing the same process to send back a proper price quote, and some alternative vehicles is mind numbing and should be streamlined with software! This would free us all up to spend more time on the phone with customers and would prevent late responses when we are tied up on the showroom with customers.

So here are the questions i need answered from people who have done the job of responding to internet Leads:

• Would you be interested in automating lead response emails with a detailed price quote?

• If yes, what level of detail should be included in the quote?
o Local taxes and fees?
o Down payment
o Estimated payments, based on credit score tiers
o Other?

• How accurate does the quote need to be?
o DMS calculated?
o Estimated using local taxes, fees and APR?
o Other?

• What level of interaction would you want to offer your consumer with the quote?
o Customize down payment
o Customize price with trade in
o Select APR \ Credit score
o Offer similar alternative vehicles that are in stock, say 2, 3 or 4 units?
o Other?

Tags: Automated Email, Lead response process, Request For Quote, Response System

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Great topic and one that is obviously near and dear to me. As the founder of RedNumbat, the company that developed and brought to market the first automated pricing software for car dealers I'd say "Yes, this is a great idea!" Having spent 20+ years in the car business from the showroom to the factory I saw a gaping hole in the internet car shopping process. Maybe it's not the right tool for all dealers, but it seems to be right for all car shoppers. We believe that an actual quote on an actual car with a real stock # empowers the shopper and the dealer.

I rolled this out over two years ago and at first was met with resistance from old-school car guys who worried that grosses would drop. But the truth is this isn't about prices or grosses; it's about making contact with internet car shoppers. If you can engage a customer, you can set an appointment and sell a car. It's simple. Make contact, answer questions, and follow up. Make dealer set up simple.

Customers are skeptical when they click the Quick Quote button these days, which is why so few people do it (see the most recent Polk/Cobalt study that was posted on ADM a few months back). We try to reassure the online shopper with our little Numbat, so they'll know a price quote will actually be sent and not just a promise to be contacted later.

Thanks for a great discussion! Joe
no
I think many of the commentators have hit the nail on the head when talking about the personalized communication that is so critical to building rapport with the consumer. The fact is every deal is going to be slightly different based on the customers situation; Trade, Credit, Monthly budget etc. I think that you give up a great opportunity to engage the customer by providing exact information according to their situation. The issue is that once they received the quote (automated or not) 90% of customers are going to want to negotiate the terms and they are going to want to do it on-line. Getting sales still takes work and the sales professionals willing to do that work will be successful. Fortunately with CRM systems and On-line Negotiation Systems, this job can still be done efficiently.
I think this would be a great idea. I would want my stores to send out MSRP, Internet Sales Price, alternet vehicle with the same parameters to include one picture and links to the window stickers on both.
Ralph, are you sure that you are asking the correct question?

Isn't whether and how to automate a dealership's price response, part of a more global Internet execution discussion? Automation can be compared vs. manual processes from a cost standpoint, but is it more effective?

How do you judge effectiveness of the process?

Shouldn't the decision whether to use an automated price response be based on which one sells more cars?

Or why have a manual / automated need to price respond at all? Does the clerical price response process add any value towards the sale? If so what is it?

If you automate the price response, for what reason does the consumer want to further engage with the dealership? What is really happening when an automated price response strategy is implemented?

Is there another way? i.e. With a shopping cart service, it is not necessary, yet the consumer still wants to talk to the dealership (i.e. Will you confirm my credit with your lenders? Will you firm up my quoted trade value? Will you validate the interest rates and rebates that I have selected? Will you hold that car for me for delivery?)

You get the idea. Me, I like consumer self-serve that requires them to identify themselves in order to use it and which leaves them wanting to speak to the dealership.
Brian,

You describe a lot of issues that need to be considered or addressed... But, what about the dealers who do not want transactional website capabilities?
My experience is that dealers care about what sells more cars more profitably. Few care about the "how" just so long as it works, is legal, and they can make money at it.

But let's set aside the implications and dynamics of self-serve, shopping cart ecommerce (structured to get the consumer to identify themselves) for now and explore your initial question regarding the need for an automated price responder. They are out there. Skoots has one. Rednumbat has one and ResponseLogix has one as part of their CRM program. I'm sure there may be others.

Set aside "how" for a moment. We are discussing "should you."

You've sold a lot of cars online. Do you find that most consumers have a sufficient understanding of the model, trim, options and colors that you can effectively quote a price automatically? That doing so without any engagement from the consumer is a best practice (sells more cars, more profitably)?

Does a vehicle consultation no longer play a role in effective internet sales? Is it the current best practice to just respond clerically to the vehicle inquired upon + 1 with more, 1 with less equipment and the nearest used vehicle? To guess at credit and add payments, incentives?

Is that listening?

Do dealer websites and 3rd party lead programs have the consumer on just the right vehicle they want? Do they provide info on the range of vehicles the consumer would consider if they were in the showroom?

I agree with you that responding to Internet leads with prices, payments on 3-4 vehicles is a lot of work. I really do. I've seen it. It is a lot of work.

However I also believe that from a profitability standpoint that a lot of what dealers currently do is broken. Their Internet sales funnel is too wide at the top and too narrow at the bottom. Most have more staff and more technology today than they had 15 years ago, yet sell the same or fewer vehicles at lower gross profits. How does that work?

And their consumers are usually barely engaged with them. That's why the funnel is too narrow at the bottom. This is 2009. How engaged as a consumer would you be in the shopping process with the dealership if you knew what you wanted, you went to their website, and then were presented with "send us an email."

Come on. Seriously?

Oh, but wait there's more? You want me to chat, push a $500 coupon at me and have videos? Pleeeeaaaasssseeee..... I want to shop. 1 in 5 would buy online if you let them (CapGemini). Why would you get in the way of that? Because you want them in your showroom? Is that really what you want, or do you just want to profitably sell cars?

"A "lead" is a superficial expression of interest. Very few are serious buyers who know in detail exactly what they want, yet that is how an automated price response tool is going to respond to them all.

Ralph, I get that I am opinionated. It is one of the perks of being an entreprenuer.

I'll say this unequivocably... "If I was a car dealer I would not under any circumstances have an automated price response tool in my dealership."

I also would fundamentally rethink the strategic purpose of my website from having a goal of "Call or Email Me".... to one of "Shop and Buy Online," design it in such a way that I can attract consumers too it as a competitive adantage, structure it in such a way that they have to tell me are in order to shop online, earn their trust and let them realize (which they do) that they want to talk to me....but that is another topic for another day.

Ralph, I will see you soon my friend. I have a new service Ai-Dealer will be offering that I'd like to show you when we are together again. Part car dealer shopping cart network, part research portal, part dealer ecommerce portal, part wiki.

FROM A POST BY MATT KOENIG AT DEALERREFRESH.COM:

I read an article on another automotive website regarding a tool for responding to RQF (Request for quote) consumers. It would be a type of auto-responder affording the consumer the opportunity to work their own payments, etc. to find out if the car is truly right for them.

I have to say at first glance I got excited about the possibilities of what could be done with this automated system like this and how great it could potentially be for me as a consumer. Then, after stepping back I realized that that this system could possibly perpetuate some of the perceived problems that dealers have with the internet. Allow me to explain what I mean.

As I travel the country talking to dealers I have heard, on many occasions, phrases like: “consumers aren’t loyal anymore”, “the internet has made my business harder”, “customers just shop everybody and use me to keep their local dealer honest”.

As someone who works for a large online classified company I’m going to say this: all of those statements are true. However, the reason they are true isn’t because consumers have the internet as a vehicle for communicating. It’s our fault as dealers.

Consumers aren’t loyal because many of us, as dealers (myself included after spending 12 years on that side of the desk) have forgotten about the importance of follow up and prospecting - how many years has Joe Verde said to ask “how many, how many, who’s next?” My sales team in a little Nissan Dealership went from last to 1st in our region by making sure our 3 simple salespeople did that prospecting script 5 times a day before 11 A.M.

We made phone calls to our customers every 90 days to say hello and catch up on a personal level. Our customer were loyal. As a dealer can you say that you do that type of follow up? Do you know how little Jimmy’s baseball season went or are you just relying on your CRM to fire of a form letter a few times a year?

If you aren’t following up to that level, why would your customers be loyal?

The internet has made business harder because we don’t use it for what it is: one more way to connect us with a consumer that will eventually buy from the dealer that treats them the best and gives them the options that are closest to what they want and need. Instead, many of us look at consumers who use the internet as a bunch of ’strokes’ and we don’t treat every one of them them like buyers.

Last I checked, if people aren’t too old to drive, they are a buyer. If people aren’t too young to drive, they’re a buyer. To quote Joe Verde again, doesn’t that mean everyone is a buyer eventually? If that is true wouldn’t it mean that the only questions are when will they buy and who will get the commission?

If you aren’t treating internet consumers as well as your walk in customer (who also went online but didn’t tell you), is it the internet that made your job harder or is your lack of professionalism making your job harder?

Finally, as far as consumers using the internet to keep their local dealer honest all I can say is “duh”.

Everyone wants to make sure the dealer is honest. Let’s face it gang, we aren’t ranked very high on the ethics surveys no matter how hard we try.

This isn’t new though is it? Before the internet was the primary vehicle for information people used to use the little gas station rags like AutoTrader Magazine and AutoMart Magazine or they would get the paper from the next town over to do the same thing; keep us ‘honest’.

If we as dealers would build relationships better couldn’t we have more repeat & referral business that pays higher profit anyway?

If we would just focus on learning how to use a phone better when that customer calls couldn’t we set more appointments when the shoppers from the town over do call?

If we’d just sharpen our sales skills by practicing every now and then instead of complaining about the economy and the internet, couldn’t we possibly convince a customer that we’re worth the drive to do business with?

What does this have to do with an automated RFQ program. I’d say everything.

I think the idea would be fantastic if as dealers we were prepared to pay attention to the consumer requests, if we cared enough to follow up and if our sales skills were sharp enough to give the consumer the experience that comes with a true sales professional; the experience that they deserve.

Unfortunately, as it sits with far too many of us I believe this tool could just add to a lazy entitlement mentality and further worsen the consumer experience lending to even less consumer loyalty and more excuses.

About the Aurthor: Mat Koenig is a 12 year veteran in the Automotive industry and is currently serving as a Sales Training Manager for Cars.com.

RALPH PAGLIA'S RESPONSE TO ABOVE POSTED ON DEALERREFRESH.COM:


Matt,

Your article certainly got my attention! And, although you have clearly identified the nature of a HUGE problem we have as an industry in how mix customers, dealership sales professionals and web based information and communication systems… You made me have a flashback to 1999 when I was in the owner’s office at a small 5 rooftop dealer group in Western NY. Your words echo what the owner said when I showed him how customers could go into KBB.com, go through a Virtual Walk Around process on their trade-in and then get a Kelley Blue Book supplied Trade-In value… He was freaked out, but NOT because the customer had access to this information, he was upset because his perception was that many of the inbound sales calls his sales departments received each day were from people who wanted to find out the “book value” on their current vehicle. And, he probably had a valid point… Luckily, we were able to come up with a plan, and then implement it in a manner that leveraged the emerging information technology (at that time) into creating more sales opportunities. The details are still valid, but that is off-topic.

Here’s my point, for 2 years I managed a team where one of our biggest daily challenges was simply executing the tasks prescribed by our lead management response process. There were over 25 people on my team and we were handling over 5,000 leads from hundreds of sources, but all of them related to either a new Chevy or a used vehicle. The time that was required to respond to an RFQ was always a problem… Looking up the car they asked about in our DMS, calculating the price we wanted to quote, copy and pasting numbers, vehicle descriptions, etc. into the email templates. Then, doing that 3 more times to offer each customer additional vehicles in stock that were similar to the one they selected, so we were providing alternatives for the consumer to consider. Heck, we had NO PROBLEM SELLING CARS when we were able to execute 100% of the process steps! Our problem wasn’t defining the process, our challenges EVERY SINGLE DAY was executing those process steps. The solution you referenced in your post is pure and simple in its objective… MAKE IT EASIER TO EXECUTE LEAD RESPONSE PROCESS ACTIONS. I find it amazing that my query has triggered speculation that the product exists, because the discussion topic I posted was done so that I would have other people’s opinions to consider when drafting a Solution Requirements document. In other words, don’t complain about something that hasn’t yet happened! Your post makes me think of that science fiction movie starring Tom Cruise where people get arrested for crimes they are highly likely to commit in the future… The ultimate in crime prevention. I often wondered, after watching that movie, if we know something in advance, then why wouldn’t we solve the root source of that problem, so it never materializes.

If you use a PC and multiple software programs to execute a series of clicks, copies and pastes that retrieve, transfer and format information into an email… And you do this process repetitiously every day, then why wouldn’t it make sense to build a program to make you more efficient. I mean, let’s really think about this… If you need to follow-up, make phone calls and meet with people in-person, and doing something on your work station PC uses up your time, then freeing up your time by automating that something inevitably means you now have more time to do follow-up and phone calls!!!

There is a Toyota dealership in Sunnyvale, CA and the owner of that dealership is a personal friend of mine who saw the same thing I saw… He invested in a business that hired programmers and created software to automate the lead response processes for his Toyota dealership. His store gets anywhere from 1,200 to 2,000 leads each month. He implemented one additional piece of automation… Sending a response to a RFQ lead with a valid price quote. His closing ratios went up by 4 percentage points in the first month the software system was implemented. The small fortune he invested to create this custom software was fully recovered via incremental sales within 6 months.

If we do something over and over again, every day, repetitiously like a machine, and that simple, mind-numbing task doesn’t require the intricacies of face to face, or voice to voice human engagement, then why would we NOT build a machine to do it?

Matt, here is where I believe you have not yet seen the vision… In order to do all those follow-up and CRM processes that you describe, automotive sales professionals need time, training and motivation. If a software company provides a program that frees up additional time, then you are able to execute those processes more frequently, and sell more cars. You would also be able to have more time for training… In my opinion, the greatest challenges we face in dealership sales departments today is NOT discovering or defining what needs to be done, it is simply executing those things, and finding the time to do them!!!

Now, you are right about something you pointed out… If your team is playing Solitaire on their PC’s while they are waiting for their next lead to come in, then software that uses automation to streamline what they do after a lead arrives is only going to enable them to play more solitaire… Or, go have more smoke breaks outside and bitch about business, or pay plans, or butthead sales managers… I had some of those people on my team, with the key word being “had”. For those really great Internet Sales Professionals out there, providing them with a tool that streamlines the clickety-clack portions of that process, will make that process more accurate and allow them to execute it faster and more consistently. More time to speak with prospects on the phone, and more prospects that are thrilled and delighted with the response they received from their online inquiry will result in more sales to the same number of leads.

EDITOR'S NOTE:
I found the above interesting enough that I wanted to share it within the ADM community... RP
Ralph,

I agree with you. I have seen the system at the Toyota Dealer in Sunnyvale, and I think their automated solution and with other re-activation trigger points help create a positive investment for any dealer using that tool, or similar.

The overall issue at the retail level is having processes in the dealership that "stick". I beleive auto retailers overall have been negligent on training on their products, and more importantly successful processes.

There is definitely room for improvement, either in process training at the retail level, and/or investment into outsourced processes that drives sales!
Bob,

One of the biggest contributors to process execution deterioration in dealerships, is the sheer redundancy and time consuming task repetition required to consistently answer Request For Quote (RFQ) leads days in and day out... I tried many different ways to streamline the process, because we were getting well over 5,000 leads a month in a single roof-top dealership. One of the best results I saw over time was identifying which of the "clickety clack" keyboard intensive tasks could be automated so that the ISS's could spend more quality time either on the phone, in person or writing personally relevant emails to that single customer. When Adam Simms from Toyota of Sunnyvale first showed me the ResponseLogix and LeadLogix systems, I immediately saw software that would streamline the initial lead response process, requiring less ISS/ISM time looking up inventory and calculating price quotes, allowing MORE HUMAN CONTACT... In my not so humble opinion, that is the primary function of software automation, to free up PEOPLE so they spend less time in front of their PC monitor and more time talking to, or meeting with the customers.

I do not like looking up 4 different vehicles for each of 18 leads sitting in the ILM application on a Monday morning, feeling like I will never get caught up as more come pouring in... The other aspect is accuracy and ensuring that vehicles quoted are still in stock... I have seen too many times when an ISS/ISM find a could of new vehicles that came in with value discount packages that make them attractive from a features and price point perspective (even with the rubber floor mats). They keep quoting that vehicle as one of the alternatives to each lead on that model type, only to find that when a customer shows up for it, the truck was sold 2 weeks ago! This is the reality of having sales professionals manually calculate price quotes over, and over and over again... It is only natural that mistakes are eventually made.

Again, the idea behind more automation from an ILM/CRM application is to eliminate the redundant, non-value added time consuming tasks that take sales professionals away from dealing directly with the customer. After all, if you do something with a calculator, keyboard and an ILM tool that is repetitious and follows a consistent formula, step 1, tsep 2, step 3 and so on, then shouldn't we use technology to automate that brain numbing non-customer facing task and free us to spend more time doing what we know sells more cars... Talking to customers?
Ralph,
I agree with the main point of freeing up time for the "human touch"! Automating is the way to go in the sense of freeing up time. I beleive technology like ResponseLogix makes all the sense in the world if a dealer is looking free up time due to being overloaded and spending too much time on manual taskes for RFQ's that don't lead to anything. Having said that, freeing up time is not the total answer, as many times when time is freed up, an investment needs to be made to know what to do with the free time.
Ralph / Bob,
ResponseLogix, the Toyota Sunnyvale soution you have been referencing, is about to open its 40th market in April. The lessons we learned being imbedded in Toyota Sunnyvale for a year and a half have provided great dividends for the dealers across the country that started using ResponseLogix's SmartQuote and SmartFollow products for lead quoting and follow-up. The success Toyota Sunnyvale experienced is being replicated by dealers in markets like Cleveland, Houston, Philadelphia, and LA. The theory and research saying a dealer can be more successful by being the first one to reply to a customer lead with new and pre-owned vehicle options has been proven over and over again.

During these difficlut times, the ability to cut 25 hours a month from an ISM's time for every 100 leads she would have to quote results in a more efficient and productive Internet sales function. Now the ISM has more time for phone calls and emails. and when she does connect with the customer, the conversation changes from price to options. This kind of tool gives dealers more time to do what they do best: sell.

One of the benefits we've seen for dealers is that their margins are positively impacted when using ResponseLogix. This goes back to the change in conversation from price to options. It is also reflected in the sale of pre-owned vehicles to new car leads. Many of our dealers are seeing 40% of those new car leads convert to pre-owned sales.

So Ralph, if I can go back to yout original question that started this conversation: "Would you be interested in automating lead response emails with a detailed price quote?", and amend it slightly to: "Would you be interested in automating lead response emails with deatiled price quotes for both new and pre-owned vehicles, that would save you 25 hours per month for every 100 leads you receive, improve your close ratio, and increase your margins?", I can point to dealers in almost 40 markets that would say YES!

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