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The Big Missed Opportunity: Never neglect to log an up

There’s an elephant in the room. This particular elephant is eating your sales career lunch!


You know about the elephant, that “topic” nobody seems to want to recognize and talk about. There’s a big elephant in the middle of most sales floors. This elephant is called missed sales opportunities.


These missed opportunities are ups that flow in and out of our showrooms:

  • These are ups we sell and then fail to follow up with throughout the months or years they own that vehicle.
  • These are the ups who don’t buy and for whatever reason we fail to capture their information in an up log of some type so we can pursue them later.


Sales people thirst for the fresh up, but their opportunity is the elephant. This elephant is made up of be-back, repeat and referral ups that statistically are the big missed opportunities in car sales. Here’s what I mean. CAR-Research statistics tell us something very different from the industry rule-of-thumb rate of 18 percent fresh up closing rates. In fact, of 100 fresh ups who come into your store, just nine will buy -- just 9 percent of fresh ups buy!


This is the opportunity we chase in closing percentages and gross; when the elephant is easier to catch and more profitable. Our research also shows:

  • Be-back customers, those who return after some level of negotiation, close at 67 percent rate.
  • Repeat customers, those who bought service or vehicles from us before, close at 60 percent rate.
  • Referral customers, those whom our friends and families refer to us, close at 55 percent rate.


Yet we so often fail to follow up with customers:

  • Who leave without buying.
  • Who did buy but we’re too busy chasing the next fresh up to call them and ask how their vehicle’s operating, to wish them a happy holiday, happy birthday or simply stay in touch.
  • Who have friends and families who need vehicles and vehicle services but we neglect to ask them for their names so we can build a base of referral business.


Our elephant of missed opportunity is a big one – closing rates with five to six times greater closing opportunity than the daily up that crosses our curbs every day.


Think about this math for a minute... If you have 100 fresh ups:

  • 9% close. That leaves 91 missed opportunities.
  • 33% of those are willing to come back in if proper follow up is performed.
  • That’s 30 be-back’s who will close at 67% according to NADA.
  • That’s 20 car deals.  You just doubled your sales!


We must work daily ups to keep the customer base fresh. But we do more damage to the long-term health of the dealership and to individual sales careers when we neglect to continue important relationships with customers and fail to ask them for referral business.


Is the elephant eating your sales career one bite at a time?


Let me know if you have any questions.  Thanks!

Views: 949

Tags: AutoCon2012, CAR, CRM, Customer, Kelly, Patrick, Research, XRM, car, management, More…motivational, rally, relationship, sales, speaker, up


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Comment by Doug Davis on September 6, 2012 at 10:35am

Keith, As a consultant, I deal with processes and marketing, not sales training.

This is a discussion that I have brought up on here and other sites like DealerRefresh. It isn't something that gains traction. In fact, it is usually a thread stopper.

We use these statistics because we don't have newer ones to use. The statistic that buyers shopped an average of 1.8 stores, suggests that they all actually had to visit stores. The point of my posts is that we need more focus on closing ratios. Today, we have more buyers and much less tire kickers. I don't think there has ever been a time where having highly trained professional salespeople has been more important. I can't think of anything more detrimental, to a dealership, than flooding the floor with green peas salespeople.

Comment by Keith Shetterly on September 6, 2012 at 10:01am

Also, to the ".8" math, what that also means is that no more than 4 out of ten buyers visit three dealerships.  And it can actually be NONE out of ten visit three dealerships.  Just because they considered 3 online doesn't mean they actually visited 3 at all.

Comment by Keith Shetterly on September 6, 2012 at 9:53am

I think there's still value in the old averages because they get the attention of folks who have been doing this for decades--and then it's also even more valuable to "adjust" the stats to reflect the Internet.  I find that follows along like an up-sell strategy, rising from the comfort to the next step.  It's still a very hard conversation.

Comment by Doug Davis on September 6, 2012 at 9:20am

Keith, I really appreciate your comments.  It is like the dirty little secret that dealerships don't want to address.  With dealerships still not fully embracing the internet, this is something that the majority don't want to hear.

We are dealing with sales averages, statistics and ratios, many are decades old.  They don't consider the influence of the internet.

Comment by Keith Shetterly on September 6, 2012 at 8:30am

Doug is correct.  The most telling stat is the 1.8 dealers visited.

Understand what this does to the be-back, because a shopper cannot visit ".8" dealers.  Using Doug's stat of three dealers researched to visit, which is also accurate, mathematically this means that at LEAST 3 out of ten buyers are visiting only ONE dealership.

Back in the 80's, this average was 4.3.  Starting to get the picture?

Essentially, getting the be-back for your dealership is more important than ever.  And your marketing, which had the luxury of sucking for decades, is now your #1 draw.  Say, how's your Internet site doing?  Inventory right?  Pricing?

Comment by Doug Davis on September 6, 2012 at 7:42am

Beth, I'm afraid that my statistics are accurate and yes, there is more accountability in the internet department because of the electronic paper trail.

The internet has completely changed our business and we are using decades old ratios to measure it.  Not only has logging customers been a problem, Managers will remove customers to improve their closing percentage.  That is truly sad, when I say that the 20% is far too low to begin with.  

A client took me to lunch, yesterday.  He was really excited that his internet department delivered over 22% of their leads.  I went over the same information that I discussed on this thread and the importance of focusing on overall closing ratios.  I'm certain that his GSM will not appreciate my input but you are not going to develop excellence from low expectations.

Too often, I see Sales Managers sitting at the desk waiting for a salesperson to bring them a deal.  A twenty minute meeting, to open the day, is the extent of their training program.  They are quick to complain when a customer isn't handled properly.  These people do not want to hear that a 20% closing ratio is not acceptable.

Comment by Mel Bayo on September 5, 2012 at 11:04am

Thanks Patrick! I too have seen similar statistics over the years and work with sales teams to help them realize the benefits that accurate data collection provides.

Two benefits (among many) we talk about are:

  • It enables individuals and entire teams to Build More Accurate Business Plans and…
  • It also enables individuals and entire teams to Identify Skill Building Opportunities.

Accurate tracking can provide sales teams with a guide as to how many opportunities, demos and write ups they need to reach their goals AND they can get an idea of what part of the sales process the team needs to work on in order to improve their results.

Yet as you state so succinctly, they must have accurate data first and here is where it gets interesting. That's because you get a chance to find out who, from the DP on down wants to grow by pressing the reset button and getting an accurate look at where they currently are. 

Thanks again for the post!

Comment by Beth Hoover on September 5, 2012 at 10:07am

CRMs are there for a reason and if the salesperson brooms a customer at the door, the loss is more than just revenue.  Not only do people share negative experiences with one another, but they also use networking and review sites to air their grievances.  Log the customer and always TO. 

Doug, those numbers, if accurate, are shocking.  I took a break from advertising and ran a BDC recently and truly believe there is more accountability in the internet department because the calls/emails and appointments are all funneling through it.  Everything has to get logged and is naturally very organized.  The salespeople are on the floor as fresh ups or appointments arrive, and if the salesperson doesn't feel like there will be a lot of profit or they cannot give the customer what they want, it's easy to pretend they never existed... It's not until the BDC does follow up and finds out the customer had indeed arrived.  Unfortunately, that "paper" trail does not exist for fresh ups.  :-(

Comment by Doug Davis on August 30, 2012 at 9:16am

Logging customers has been an issue for the more than 30 years that I have been in the business. It will continue to be a problem after I am gone.

These closing percentages are a product of NADA and date back decades. What has changed? Before the internet, customers set out to shop a half dozen stores. These were shoppers. They had very little idea of what they wanted or what was out there. Today, 92% of our customers spend an average of 17 hours doing research, online. They eliminate all but three dealerships. On average they only visit 1.8 stores. Traffic is down because there are fewer shoppers but mostly buyers. NADA has held that we should close 20% of our fresh ups. I believe that would be a disaster.

When I was an Internet Director, we closed over 80% of our appointments. This was a large metro import store. Those deliveries were put on the sales log. Consider that the internet department was responsible for 70% of sales, what should that closing percentage be? While 92% of customers do their research, online, 60% never email or phone a dealership before they arrive. Dealerships need to be aware of the amount of influence their internet marketing has on consumers. This makes qualifying the customers extremely important.

I don't know what that closing ratio should be. I do know that if we consider 20% acceptable, we are losing money. If you have low percentage salespeople, that is costing you money.

Comment by Robert Weare on August 30, 2012 at 8:08am

I remember going to a seminar where the speaker stated that the average sales person actually worked less than an hour everyday.  And this was before the internet!  That they did little to no prospecting and very little follow-up. The right way is to put a process in place, and work the process everyday.  When I started, I had a mentor who wrote everything in his diary, everyday!  Time, date, weather, "ups" with numbers and what they bought or were looking to buy.  When business was slow, he was busy.  If his sales were slow, he would go back and start calling those folks in his diary just to say "Hi!"  I only beat his sales one time, and he never took his eye off the ball while I was around him again.  I followed his lead.  And he is the gent that taught me that we were not in competition for the "ups."  If I sold everyone that I touched, how could we be in competition?

My point, get a process in place and work the process.

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