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Too many dealerships seem to practice as “faith-based” businesses—not faith in a higher religious power (which might actually help!), but faith that their GM, GSMs, salespeople, marketing, etc. will work as they always have.  That they can somehow resist modern business changes from sales to processes because they have magical faith both in people who don’t even know that they need modernized thinking and in processes that are breaking every day.  The Internet is relentless now, and there’s no going back to the Stone Age of Car Sales where people waited for the UP Bus and dealers only had to have good ad-cars in the local newspaper.  If you maintain operating under that history today, you will soon be history

And the processes in place to convert visitors into sales, from the showroom to the service drive, are more important than ever.  I’m reminded of what my friend, Scott Falcone of World Hyundai and Presto Reviews, says about reputation:  Fundamentally, you have to consistently deliver great sales and service or no one can help you with it.  I’ll add that excellent sales results still ultimately come from people and processes that deliver excellence to the customer.

I only have my own observations, but it seems to be 10% of the dealer body “gets it”, and about 40% of the remaining dealer body will follow as much of what the top 10% are doing as they can afford.  Or stand, really, as oftentimes it’s a “fear factor” that holds them back, not really understanding what they are doing and not wanting to change.  And do their processes still stand in the way of their success, even with all the help from the modern marketing items?

Yes!  Internet marketing efforts, social media, reputation management, QR codes, data mining, email blasts, targeted direct mail—dealerships must modernize around these items, but none of them will overcome the losses from bad processes.  That is the challenge, to modernize and then meet the success of modern marketing with modern sales processes.

Faith will always have its place in human culture, but at dealerships it is no replacement for actions that are necessary for good business.

So, which will really make you successful:  Chanting over a newspaper ad in the service drive at midnight, or embracing and implementing modern marketing combined with modern sales processes?

If your answer involved a stone altar, you probably need to change.  And soon.

 

By Keith Shetterly, keithshetterly@gmail.com
www.keithshetterly.com
Copyright 2011 All Rights Reserved

 

P.S. If you are looking for help, consider attending Brian Pasch's Bootcamp just before Digital Dealer 10.  I'll be there, as will other great folks.  Come learn!  www.automotivemarketingbootcamp.com.

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Comment by Keith Shetterly on March 24, 2011 at 10:06am

Jae, I may have to use that point in a blog...I just read someone's blog on another site that was calling Social Media BS. I know that vendors push the "new", but the real sea change in how people shop is really just beginning.

I'm often reminded of several discussions I've had about measuring the Internet Department. As in hearing a complaint such as "You had xx leads and you only sold yy!". And yy might be a good closing ratio! However, my reply was not just that, it was "The Internet Department is not only the most measured department because of the nature of a lead, it is really the ONLY measured department! Can you honestly tell me how many ups were dropped on your lot and never put into your CRM? Do you know how many sales calls people fumbled? NO. Don't confuse the great ability to measure with the ability to judge success/failure: Our Internet Department is succeeding in both sales AND measurement. No other department can tell you exactly how many folks tried to buy a car. What the Internet is showing us is not that our Internet Department sucks, because it doesn't, but instead that we don't know what the other departments are really doing!"

 

P.S. I *love* the QR-coded Blue Gorilla, not on the building but out by the road. 

Comment by Jae Chang on March 24, 2011 at 9:09am

Open THEIR EYES Keith !! 

I've been trying, still trying, and will keep trying.  I used an analogy to the recent changes in the Middle East (use of technology and social media and its immediate effects) and it opened some conversation.

 

No one hates the gorilla? do they?  Just paste it with an oversized QR code!

Comment by Keith Shetterly on March 22, 2011 at 8:15am

Aj, yep!  Didn't you see my other article on the extinction of the blue gorilla??  :)

 

Everybody needs to wake up!!

Comment by Aj Maida on March 22, 2011 at 8:11am
What...you mean my blow up Gorilla is obsolete????
Comment by Keith Shetterly on March 21, 2011 at 5:45pm

Ed,

 

The market will eventually kill price negotiation on new cars, and I believe that the OEMs know this.  And I know that is a controversial position, but just a few years ago nobody big was doing things like putting pricing directly on the web, either.  Reputation Management was in it's infancy.  Social Media Marketing was even more confusing that it is today, even for those promoting it.  And internet leads were being answered at averages that came in days, not minutes.

 

And so I agree with you that faith in the old-school working today will doom any dealership.  I've had to talk to some folks lately who were so old school that in order to say "Internet" I had to get stone, chisel, and a hammer.  For one guy, I think a burning bush wouldn't have helped me!

 

Thanks for the reply.

Comment by Ed Brooks on March 21, 2011 at 1:20pm

Keith, We can count on hitting very few 'Home Runs' in this business today, but you just hit one. I started a discussion over on the DR Forums last week titled "What does your PRICING have to do with your REVIEWS?". I quoted from a recent press release and asked the question: Do you think reducing the old-school "Price High - Negotiate Down" approach in favor of a Market Priced, reduced negotiation environment has an effect on dealer ratings and reviews?

 

It engendered lots of discussion, much of it like this "Lots of upside to those that dare to move away from negotiation. FEW DO IT. Why? Management that dares to sell without negotiation are brave souls because it completely changes everything. No negotiations means that business operations now drive financial performance."

 

Here was my response "There certainly does need to be culture change to make this successful. But it doesn't need to be a move to NO negotiation, simply LESS negotiation. In effect, giving away the discount in the Ad, not in the negotiation. The obvious benefit is greatly increased traffic.

A great example is featured in one of our new Print Ads, your neighbor in Buffalo, the West-Herr Group. They made the move to reduced negotiation by implementing RealDeal. The numbers speak pretty clearly for themselves; 311% increase in used inventory retail turns while holding negotiated discount to a impressively low average of $170.

To top it all off, they are showing outstanding ratings on a Google search I just did. The only problem I see is that need to be asking more customers to rate them because, while they don't have a ton of reviews, the ones they have are raves".

 

I don't know that this is the ONLY answer for real success in today's market, but I do know it is ONE answer. My feeling is every answer will involve throwing out many of the precepts we hold dear and a full realization that FAITH in what worked before the internet might possibly doom a dealership in the age of transparency.

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