Automotive Digital Marketing

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We’ve heard the complaints about salespeople for years—if not for decades, if you’ve been around long enough in the car business—concerning how they mishandle the phone, the floor ups, the follow-up, the sale, the close, etc. And more how, nowadays, they mishandle the Internet leads, the emails, and so forth. Even though we “train, train, train!” Right? The truth: The “Elephant in the Showroom” is that, for salespeople, we get exactly what we pay for. Especially now, we’re losing sales because of this.

Today, we place our salespeople across the phone, the Internet, and the desk from the most educated car shoppers in history. And we know that over ninety percent—so we may as well say “all”!—of these shoppers have been to the Internet for product knowledge, inventory, and even (as much as they can) negotiation. The buyer has been modernized, but the salesperson . . . has not. And, frankly whether the “old school” managers agree with it or not, it is not the salespeople’s fault that they fail so much. It's ours.

We wouldn’t put a cave man (sorry GEICO!) into the Space Shuttle to land it, which is what the typical current car sales pay plan can provide for. And we wouldn’t put a modern pilot into it and pay him/her only on the landing, which is the typical current Internet pay plan, too.

The facts are that no other large sales force is paid commission-only. And we pay thinner and thinner commissions, and we know we do. And, by the way, if finance blows out a customer that’s been landed on a car, the dealership loses a sale . . . but the salesperson loses the entire commission. Not a new situation? True. Except that information on this type of situation is readily available to potential car sales candidates to read about on the Internet. And that is just another example of what we face: Because, just like the shoppers read about cars and car buying strategies online, your potential staff is reading about how car salespeople get “screwed” and work ridiculously long hours. And that’s out there on the Internet whether you agree that happens to them or not. And it certainly affects the type of candidates we get applying.

We all know that our “Internet staff” are our most modern and adept sellers, or they should be. Except that what we actually need aren’t “Internet Departments”, but really ALL the sales staff to be equally adept on the phone, email, Internet leads, floor-ups, etc. And, say, about that Internet Pay Plan that you know your Internet sales staff really likes: I bet it’s getting expensive. And maybe you want to cut it. Maybe you think if you can make the floor folks smarter, or get smarter folks to come to the business, you can take it all back to the floor sales pay plan. Yeah! That’ll work!

No, it will not. We will spend money and time training, only to compensate sales staff to a point where the sales folks we get and can motivate are still far behind their current shoppers in knowledge and motivation! Reducing pay certainly won’t correct that. Our shoppers are more educated than ever in History? Absolutely. And folks considering car sales careers are also the most educated on car sales realities in history, as well.

If you don’t think this is true, take a good, long look at your Internet Department. I bet it’s full of people who can show us all that the way is to improve compensation and treatment of staff, not to go backwards but to go forwards and improve sales. And, after that, if you still want to accept that you “get what you pay for”, then get your sales staff out of the phone & Internet business. And then staff an appointment-setting BDC that can turn customers to the sales staff that you want to pay at the “sell dresses from the rack mentality” level of ability.

Regardless, this Elephant in the Showroom isn’t going away until we fix it. And, until then, sales ARE going away, right out of that same showroom.

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Comment by Keith Shetterly on June 15, 2010 at 6:46am
Tom, thanks, and the full article that the video references is here: http://www.autonews.com/apps/pbcs.dll/article?AID=/20100614/RETAIL0...
Comment by Tom Gorham on June 14, 2010 at 4:48pm
Hmmm check out this video on Automotive.com http://www.autonews.com/article/20100613/VIDEO/306139999/1414. It mentions changing pay plans for salespeople in the auto dealership.
Comment by Tom Gorham on June 14, 2010 at 4:29pm
Thanks Keith, I agree. I remember when a manager once told me, "hire them and if they don't produce, fire them". So simple. His reasoning was that there was very little up-front investment in a salesperson. But the car business has become much more sophisticated. To build a true professional today requires training that is sometimes lacking in some of the management staff themselves. Training takes time, effort, and money. And a well-trained staff requires compensation equivalent with their training and experience. If you're looking for change, you may have to challenge some sacred cows. Has anyone ever given a valid reason for 12 hour days except to say it's always been that way? Change takes time and is often a surprise to those too absorbed in their daily activities to notice. Anyway, thanks for the article.
Comment by John Zarlino on March 13, 2010 at 10:20am
Too funny. Have you been reading my white paper? John

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Comment by Jerry Thibeau on March 12, 2010 at 3:23pm
Very well delivered message Keith.

I find that in different parts of the country the caliber of salespeople can vary from one end of the spectrum to the other. The stores that are open 7 days a week and 16 hours a day seem to attract the low end of the spectrum when it comes to salespeople. And the opposite for stores that have a more civilized schedule.

Manufacturers can also help attract better people buy offering incentives to work in the industry. Here are a few thoughts:

1. Lease specials on vehicles for dealership employees. There's no better testament than a sales person driving the product they sell. Lexus and BMW have nice programs for salespeople if the dealer agrees to participate.
2. I like what Honda and Hyundai have done with spiffs and spins.
3. Training and more training. Do we practice until we get it right, or until we can't get it wrong?

In the end, dealers have to do a better job when it comes to selection, hiring, training and career path planning.

Thanks for the good read.

Jerry

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