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Taking Control of your Dealership - is outsourcing ok?

I wanted to share this blog with the ADM community.

Taking Control of your Dealership - is outsourcing ok?
By Len Critcher - President of ecarlist
Originally Posted on August 10, 2008 at 10:43 am on http://www.ecarlist.com/blog/

When ecarlist begins the integration/training process with many of our larger dealerships, the number one issue we almost always encounter is the clutter of companies that seem to have their hands on so many pieces of the dealerships activities and wallet. One company manages photos, one company manages the website, another might manage feeds and inventory distribution to 3rd party sites, another handles market pricing/analytics, and so it goes…

It’s harder being a dealership today, there are many more details to tackle - so where do you begin? In this post, I want to address the need for a dealership to embrace all aspects of online marketing. Specifically, I want to address online inventory management.

The Dealership should control it’s inventory, where it goes, the quality and content of their ads, and oversee photography – stop “farming out” control.

I think the biggest issue hampering the success of the franchise dealers’ exploits online today is the fact that they don’t know what they are selling. Most franchise dealers have fallen prey to outsourcing almost every step of the listing process. Dealerships are paying anywhere from $17 to well over $20 (per vehicle) to have their vehicles pictured, tagged with a window sticker and sometimes even listed on the dealer’s behalf. There are a couple of glaring problems inherent with this approach, which really makes it difficult to justify the cost-benefit equation of not internalizing these functions at the dealership.

1) Picture Quality and Quantity

Now I’m not saying hiring a third party vendor to take photos is necessarily a bad thing as ecarlist has great relationships with several of these companies that can perform well, however, if you are selling the car - wouldn’t you have the most to gain from at least monitoring quality? Usually the company this task is outsourced to is only taking 7-10 pictures and has no real incentive to ensure the right pictures are taken, if you sell the car for a higher price, or move the car faster off your floor plan - does the photographer care? The answer is no. The company you are paying to take pictures is paying their employee by the car pictured—that employee’s only incentive is to picture as many cars as possible and get on to the next dealership so they can get their day over with!

If you do have a great vendor taking pictures and it works - keep ‘em! Take more pictures period.

take as many pics as you can - pics SELL CARS

2) The Ad

In most instances the company loading the vehicle for the dealership does not put the correct optional equipment in the ads. In many cases, the company does not bother putting any of the optional equipment. One of the most important details that a buyer will use to distinguish your vehicle from others during their search/selection process (other than price) is what optional equipment the car has. It’s pretty easy to look at a car and tell whether or not it has navigation, leather or a sunroof—these are not necessarily the “options” I am referring to. Let’s talk about specific options and option packages. If the car has heated seats, does it just have heated seats or is it part of a Heated Accessories Package? If the car has optional sport wheels, is this upgrade part of a more expensive and desirable Sport Package that includes other trim and suspension upgrades? It is important to list the optional equipment and their packages, particularly with the higher-line vehicles whose price could be substantially impacted by optional equipment packages. Buyers know what they want and if you don’t want 50 e-mails or phone calls (this wastes your time and time is money!) asking if the car has the “Comfort Access Package”, put it in your eBay, Auto Trader, Cars.com, and Dealer Website ad! Or, if you don’t want 50 e-mails or phone calls asking why your price is higher than another car with the same mileage, color and production year, then justify your price with the vehicle’s optional equipment. Writing that your car has a steering wheel and a sunroof just doesn’t cut it with todays savvy online buyer!

3) Take Back Control

A fundamental problem with farming out these services is lack of control and misalignment of interests. However, both of these problems can be solved if the dealership cares enough to internalize these procedures. If you look at the full spectrum of independent dealerships – from the smallest, to the largest— almost all take their own pictures and write their own ads. For someone at a franchise dealership to say that they can’t rationalize hiring someone full-time to take pictures, load cars and write ads, is a little worrisome. First of all, who said that person had to be full-time? Second, who said even if that person were a full-time employee they would have to spend 100% of their time performing just these tasks? Why not hire someone in college or high school to work part time/contract? Why not grab one of your porters or detailers and train that person to do some of these tasks. The fact of the matter is that whether you are paying someone that is working as an employee of your dealership, or paying another company to do these tasks, you’re still paying (and probably a lot more). However, if you internalize your process you will have more control over your product, and you will probably find that you will have more pictures, better pictures, quicker turnaround time when uploading your cars and more accurate descriptions of the optional equipment on the various vehicles you are listing.

Lastly, why think of this function as just an extra expense? Think of the incremental revenues you could generate if you sold 1 or 2 extra vehicles per month just because your pictures looked better and the information in your ads was a little more comprehensive.

The point is control, period - part of running a successful dealership today IS selling online - the dealerships of today MUST embrace these new initiatives, they MUST embrace technology, they MUST work smarter and more efficiently than ever. Find a software partner that understands your needs and can offer technology as well as process ideas.

The automotive customer is continually becoming more discriminating and educated - show them you value their intellect and time - give them what they need by taking control!

===================================================================

Len Critcher is a dealer principal of eCarLink.com, a leading Internet dealership and CEO of ecarlist.com, a dealership software company in Dallas, TX. For five years, eCarLink.com has consistently sold over 1,000 vehicles per year exclusively through online marketing.

Critcher has been profiled in Forbes Magazine, CBS News, American Way, and the Dallas Business Journal for his work. He is often asked to consult dealerships on best practices in selling/marketing online. Critcher’s dealership is currently ranked #8 nationally of ‘pre-owned retailers’ by Auto Dealer Monthly

If you would like to read more of Len's blogs please visit http://www.ecarlist.com/blog/.

Views: 34

Tags: Analytics, Cars, Dealership, Demos, Development, Digital, Email, Free, Lead, Listing, More…Management, Market, Paperwork, Pre-Owned, Pricing, Website

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