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When I read The Zero Moment of Truth (ZMOT) I think back to my early sales days – with more hair and less weight! – standing in the showroom next to a brand spanking new Dodge Aries. From that vantage point, I'd see consumers who would drive from dealership to dealership, gathering information and brochures while adding or removing cars from their consideration list. In-store sales processes back then were constructed around stopping the shopping, and if we failed to do so, our manager's idea of constructive criticism and coaching was to call us "weak." Yikes! What a memorable First Moment of Truth (FMOT) that must have been for the consumer!
We know from ZMOT that seven of the top eight automotive buying influences are online. The "eighth element" is your in-store processes. Sadly though, as I've witnessed in too many dealerships, a winning ZMOT strategy combined with antiquated in-store processes equals a recipe for disaster. Digital processes are improving, but what about the 89% of consumers whose First Moment of Truth takes place over the phone or by walk-in? For many dealerships, the eighth element, phone and in-store processes, is as antiquated as a K-car.
Do we still want to "stop the shopping?" Of course! But today, by the time the consumer has entered the dealership, they have stopped shopping. They have narrowed their consideration list to a small handful of vehicles and dealerships. With seven of the top eight buying influences occurring online, it's up to dealers to deliver that critical eighth element that is going to take shoppers from the floor to over-the-curb.
Written by Steve Hanson, Cobalt Performance Improvement Consultant
Comment
Great philosophy. I especially agree with the early TO. If i transpose this to a restaurant, it is a different experience if I have to address an issue with a manager who has already stopped by to introduce him- or herself, rather than a new face. I am prone to express less frustration because i know they are human. It ALSO gives me a chance to compliment my server if things are going well at that point.
I attended AutoCon and Joe Castle did a fantastic presentation of how he runs his dealerships. Maybe Ralph could invite him to post some information from his presentation. In short, he completely changed the structure of his dealerships from the top down to reflect the current realities of consumer behavior, knowledge and expectations and as an answer to the antiquated methods of the past. They have positioned the BDC between the GM and all Dept managers so that the messaging and pricing that customers are responding to is fed from the top down through the sales managers to the floor so that their is consistency in price, information and process when the customer walks in the door and meets the dealer's representative. Their closing ratios are through the roof and their people are compensated for following the process. Over 85% of their sales are from digital marketing that run through the BDC. It truly is a paradigm shift in how a store is run and the benefits, in his case, definitely outweigh the difficulty of restructuring his stores and the resulting change in culture. I don't feel it appropriate to go into too many details without his permission, suffice to say his unit sales are up 250% per month and his grosses are higher. His forward thinking and conviction to make the necessary changes continues to drive his success. When consumers come into his stores they are buyers that have stopped shopping...
I vividly, remember the Aries K. You had to convince the customer that Chrysler was going to be around longer than the warranty and then provide a world class walk-a-round and demo drive, if you ever expected to sell one. Some of the best salespeople, that I have ever known, came out of those Dodge stores.
Prior to the internet, customers would set out to shop a half dozen stores. That was the only way that they would know what is out there. These were "shoppers". Now, the average customer only visits 1.8 stores. These are "buyers".
Any dealership that isn't focused, like a laser, on closing ratios, is missing business. Improving those closing ratios will require a close examination of your processes. A closing ratio of 20%, that NADA recommended, might have been adequate 20 years ago. It is deplorable, today.
Thanks for posting... All too often the process that is applied when the customer visits the dealership in person after doing "their homework" online is disconnected from the people in a dealership who are assigned responsibility for the web based content, offers, inventory and messaging. This can lead to a failure in the customer experience when they arrive at the dealership. More dealers need to address the disconnect and ensure that every salesperson and desk manager is well versed and aware of all content published online by the dealership.
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