Professional Community for Automotive Marketers, Car Dealers, OEM and Suppliers
Click on the link below to see the article on Automotive News
When the add-ons are seen on-screen, accessory sales rise
Automotive News | May 31, 2010 - 12:01 am EST
Thanks to an in-store Web tool and some extra sales training, accessory sales at Bob Moran's Acton Toyota in Littleton, Mass., have doubled to about $110,000 a month since September, said Shawnee Wandless, the store's sales manager.
He said the tool, AddOnAuto by izmocar, allows the store to market accessories to car buyers in an easy-to-use, visual way. "We've put accessories in the forefront of vehicle sales, not as an afterthought," Wandless said.
With a couple of mouse clicks, customers can see online how specific wheels, electronics, leather, chrome trim and other accessories will look on the exact vehicles that they intend to purchase.
The program also lists prices and calculates how much the monthly payment will rise if the accessories are wrapped into the vehicle financing.
It's a big leap forward from print or online catalogs that simply show the products alone without showing the parts on a specific vehicle, Wandless said.
As margins shrink on car sales, dealers are trying to find new ways to generate revenue, said David Stringer, president and founder of Insignia Group. Accessory sales are fertile ground, he said. Vendors selling tools similar to Add-OnAuto include Insignia and DealerTrack Chrome Systems.
The auto accessories market has ballooned to about $32 billion annually, and industry data show that 60 percent of vehicle buyers will customize after leaving the showroom, said Mike Martinez, chief marketing officer of izmocars, of San Francisco. But dealers historically have grabbed just 10 to 17 percent of that market, he said.
Getting buyers to consider accessories before signing the paperwork is crucial to upping dealers' take, Martinez said.
All 28 salespeople at Bob Moran's Acton Toyota are trained on the izmocar system, Wandless said. With monthly training and weekly encouragement, each is expected to engage customers in accessory buying throughout the vehicle-selling process, he said.
"The old wisdom is that you never negotiated accessories until the sale was closed," Wandless said. "We don't negotiate the online price, but we do show items to them, and they can pick and choose if they want them."
Acton Toyota sells about 400 new and used vehicles per month, Wandless said. Salespeople are compensated for accessory sales at 10 percent of list price, up to $100, he said. The store pays $1,400 a month for AddOnAuto.
Fitzgerald Auto Malls has put its 13 stores, including 10 in Maryland, on the Insignia system over the past six months, said Larry Branche, director of aftermarket and factory accessories.
The Fitzgerald approach is to present accessories online to vehicle buyers in the several minutes between the time customers agree to a purchase and when they close the deal in finance, he said.
Before Insignia, Fitzgerald Auto Malls saw an average accessory sale of $55 per vehicle, Branche said. With Insignia, the average is $65. Insignia charges $199 per month for the system and up to $899 per day for training on it, Stringer said.
DealerTrack makes ample use of 3D in the electronic catalog it sells to dealers so customers can accessorize vehicles, said R. Philip Fallis, director of operations for emerging solutions at DealerTrack's Chrome Systems division.
Fallis said more than 2,500 General Motors Co. dealers use the product, known as DealerTrack Accessories Solution. The automaker can feed DealerTrack updated factory accessories or prices daily.
The AddOnAuto system by izmocar enables a customer to see how an accessory will look on a vehicle and also computes how the purchase will affect monthly payments