I wonder if anyone has done some marketing research on this. Could be interesting. I have a suspicion that lot of the thinking on this is perception and anecdotal. I would think that a relevant question would be what generated the lead in the first place. Was it a TV ad, a print ad, a visit to either a manufacturer or dealer website, referral from another customer, drive by, etc.? No surprise really that closing percentage goes way up once a good salesman is actually talking with a customer.
It would definitely take some work to figure out how to maximize the sales potential from online leads. From what I have seen so far, it doesn't appear that many have put much thought into it yet, I suppose probably because the closing percentage appears low. Were I a sales manager though, I would have to ask my internet folks if they can tell which customers are going to buy and which ones are not based only upon an initial email inquiry. Seems it might be costly to routinely just blow them off or not directly answer their questions simply because the inquiry came from online instead of on the phone.
I work in education, and I try to stay abreast of emerging trends. Education has had an extremely rocky time figuring out how to best utilize newer technologies, and there has been very strong resistance to them as well. This is slowly changing. A web savvy and oriented population is growing. Something we're noticing is that the quality of information on and the quality and ease of use of a website is becoming increasingly important in searches for colleges by prospective students and their parents. No one has quite gotten a good bead on what this really means and how to handle it yet. Certainly a different dynamic is at play than a retail application, but I can see a few similarities.
"...most dealers inventories fluctuate too much for the on-line inventory to be accurate..."
You've got to be kidding! If that's the case why bother even having a web site? That's like a salesman quoting inaccurate prices to all the customers. When they go to sign the paperwork they are going to be upset. That's the same feeling the customers gets when they find something they like on-line only to be told "Oh, that unit was sold weeks ago but trust us enough to come in blind and let us work on you."
If it's impossible to keep track of inventory on a web site how do you keep track of the money people pay you for the cars? I doubt there are piles of checks and wads of cash laying about because it's to difficult to keep track of it all.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
"...I happen to know a local dealer only has 2 on their lot..."
Don't be too sure. I saw 25 of a particular model on a dealer's web site but only 5 on the lot. Then someone told me that the dealer had an overflow lot. Sure enough, out in the middle of a field where the real estate was cheaper were the other 20 cars.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
Let's take this one step at a time from the dealer side. First of all, if a new car is not on stock in most cases it can be obtained in a dealer trade. Why should a web site let you go to a dealer 10 miles away when we could get the car to you in short order at an agreeable price. Secondly, the vast majority of internet leads have not driven the car or been hands on with it and wind up in the showroom as an educated buyer but goes through the demo process to further be informed and see if the car is the right one for him.
Used car inventory is more important and should be kept up on a daily bases. However, our person assigned to keep inventory up does have a day off and inclement weather can postpone pictures. Also, full discription of a car is not available in dealer inventory software and must be entered manually. Although cut and paste helps, it is still a time consuming task.
In the real world most internet leads that are for real (serious buyers) are used to initiate a dialog. The buyer who says give me your best price has a much lower closing ratio.
That is possible. I chose the TX because it is a relatively slow selling model and dealers don't have a bunch of them sitting around. Hard to see needing to store on an overflow lot with only 4 or 5 in stock. More likely with 25 or 30. I did run into that when I stopped by a lot to look at an Acadia. Dealer had 20 or so in stock IIRC, but only five were on the lot by the showroom. The rest were on an overflow lot next door.
The Ford site showed the dealer having 4 available.
That means they have 2 in stock and 2 in route. Meaning the cars are availabe for sale because they are shipped and have a VIN. We sell cars before they hit the asphalt all the time.
I would guess that inventory is tracked and maintained by computer already. Correct me if I am wrong on that.
I can't speak for all dealers but our operating system we use to sell cars, do our accounting, and maintain inventory have nothing to do with the internet. We had this system long before the internet ever came along.
Our web site is on line and maintained by a 3rd party. The only way cars get on and off our site is for us to notify him of a sale/trade and he removes or adds them.
I would not ask any one to call our third party every single time we sell or trade for a car . Every couple off days we let him no what has gone on and he updates the site.
As far as our Ford sponsored site goes (Most Ford Dealers have there own site and there Ford site. The one you end up at if you go to www.ford.com and search for a dealer) that inventory is updated as a car is reported sold or a car is in a shipped status in route to the dealer.
The biggest reason for the two sites is Ford will not host our used car inventory for us.
the vast majority of internet leads have not driven the car or been hands on with it
That I don't understand. I have never asked for pricing without first test driving. Why waste time negotiating price, when you can not even be sure it is a car you will want :confuse: . If you are on line, you should already know invoice and rebates and thus have a pretty good idea of the approximate price range anyway.
Now, without asking about price, I have made initial contact via email to arrange a test drive. In my limited experience, I feel that I am more likely to get the "right" salesperson for me (or it causes them to have the right attitude toward me) that way, rather than just walking in the door.
Let's take this one step at a time from the dealer side. First of all, if a new car is not on stock in most cases it can be obtained in a dealer trade. Why should a web site let you go to a dealer 10 miles away when we could get the car to you in short order at an agreeable price. Secondly, the vast majority of internet leads have not driven the car or been hands on with it and wind up in the showroom as an educated buyer but goes through the demo process to further be informed and see if the car is the right one for him.
I can see the logic here. If every site had complete an up to date info, it would make it easier for a customer to shop competing dealers. From the customer's perspective this is most likely not seen as such a bad thing. The dealer though, certainly doesn't want the customer to just go down the street. That is an interesting dichotomy. Yes, the goal should be, and rightly is, to get the customer on to the lot.
Used car inventory is more important and should be kept up on a daily bases. However, our person assigned to keep inventory up does have a day off and inclement weather can postpone pictures. Also, full discription of a car is not available in dealer inventory software and must be entered manually. Although cut and paste helps, it is still a time consuming task.
This is what baffles me a little. The used inventory would be more time consuming to keep up to date since all the info on a car would have to be entered manually even with the help of C&P. What I have noticed is that used inventory info is usually more up to date and complete, routinely including multiple photos of the car. The Carmax website is quite good in this regard. Maybe they have a full time staff that does nothing but enter this data. Anyway, the objection that we can't because it is too time consuming doesn't make much sense.
In the real world most internet leads that are for real (serious buyers) are used to initiate a dialog. The buyer who says give me your best price has a much lower closing ratio.
I would be happy to continue a dialog if my question were answered directly. I have a feeling that I am being blown off purely because my initial inquiry came via email rather than by phone. I would welcome pricing discussion, but I just want to know if they have a particular model in stock. I would even appreciate a "No, we don't have one in red, but we do have one in blue with the exact options you asked about (or at least close to it). Would you like to take a look at it?" Especially since my original email made it clear that I do not have a strong color preference.
Older legacy systems are probably fairly common in the auto business. Happens in many businesses. More challenging, but not impossible to integrate with the web. Well, sometimes impossible. Time to trade for a newer model.
The thing I like the most with the Ford site is the more complete info approaching what I might see looking at a window sticker. Kudos on that.
Many dealers are simply too small to have multiple people assigned to keep the web site up to date every minute. Even when changes are made, Autotrader., etc. do uploads at night. Actually, I love serious e-leads. All questions should be answered directly no matter if it via e-mail, phone or in person. If I do not have the specified car in stock, I will say so but inform them that I can most likely obtain the vehicle. I will give "best" price once I have all the info required. However, without a dialog I know that for $50 they will go elsewhere. Most good e-leads visit before starting negotiations.
I do realize there are challenges regarding maintaining websites with accurate up to date info. Legacy software that does not play well with web technologies, lines of communication moving slowly, tedium of the task, integrity and ethics and attention to detail of any third parties or even in house staff, not much to get excited about from the salesperson's perspective, etc.
I am enjoying the discussion though. Hope I am not rubbing anyone the wrong way.
There has been research. I just can't remember the exact stats. I maybe able to find them, but Joe Verde had a ton of statistics.
I agree with you that the trend is moving towards internet. Unfortunately, you still need to go into the dealership to buy a car. That's kind of the trump card.
I would have to ask my internet folks if they can tell which customers are going to buy and which ones are not based only upon an initial email inquiry. Seems it might be costly to routinely just blow them off or not directly answer their questions simply because the inquiry came from online instead of on the phone.
Here's what I did when I first got an e-mail inquiry. I would reply to them to try and get more clear on EXACTLY what they were looking for. This would do two things. First, I could find out if the person on the other computer is actually there and cares. Second, it would nail down a specific vehicle. If I didn't get a response, I wouldn't waste anymore time. The most important thing for me was to start a line of communication so that they could start to get a little bit of the human touch involved in their buying process. If I couldn't open up that line, there was no sense in me spending more time.
I can see how it would seem that we're blowing people off, but the reality is the internet generates a vast amount of junk leads. To use your time wisely, you need to quickly find out which ones are real leads. If there was a phone number included, I would immediately call and try and open up a line of communication there as well. I would confirm the vehicle specs, if they had test driven, when they were looking to purchase and what the best way to communicate in the future with them. The closing ratios on e-mail leads with phone numbers went way up too.
Ok, there's a little glimpse at what's going on in a dealership. (at least the way I work leads)
I do an initial response (goal within 4 hours - usually minutes) and if a phone number is provided I call. If the phone is bogus (and many are) I send about 3 more e-mails over a weeks time and the make them a lost opportunity. 99% of the time if they do not respond to my 1st attempt, they are surfers.
It makes sense to me that up to date used inventory is more important. Every used car is unique. Pictures of used are much more useful than pictures of new.
New cars are a commodity, once I know what I want I can buy it anywhere and get the exact same thing. Dealer also can obtain what I want from another dealer, so it is not necessary for them to have the exact car I want on the lot in order to be able to sell it to me.
I would reply to them to try and get more clear on EXACTLY what they were looking for.
My recent experience with a new Tacoma Prerunner Base cab has been the exact opposite. I would inquire and state specificially what I was looking for and how much flexibility I had with colors, options, etc. What I got back was an email that said the internet price but plus dealer fees which was not listed and nothing specific about a specific vehicle that they may or may not have in stock. When I replied and asked for out the door numbers and a VIN, they said you've got to come in for that.
So here in the Orlando area, internet leads for Toyota dealers are nothing more than a lead and not a way to give the customer a price. It's becoming a snake pit here, more and more like So. Cal. And the dealer fee on some web sites is about $698.50.
The problem is, that you have different systems at different dealers. Some dealers have very advanced computer systems, most don't. Remember, dealers are trying to limit expenses as much as possible. Paying someone to take pictures and keep the database updated is a non starter.
Dealers WANT people to interact with them, not just surf their websites.
I'm sorry,but your analogy is false. There is a big difference between keeping a website updated and actually selling cars. For starters, it is a completely different database. Second, you actually do have people(sales managers) who get paid to make sure that the numbers are right at sale time.
If it's impossible to keep track of inventory on a web site how do you keep track of the money people pay you for the cars? I doubt there are piles of checks and wads of cash laying about because it's to difficult to keep track of it all.
If your cattle on on open range, you may not know where they all are, but if you sell one I bet you know where the money is. :shades:
The objective of almost every salesperson is to get you on the lot to be sized up first then find what you want second. How about using email to size up the salesperson first then looking for the vehicle that suits you (or your wallet if that is the case). I don't want a huge salesman. Forgive me, but taking that commish down to the burger and brew to get even more unhealthy via my $$ just won't do. Nobody over 6-2, nobody under 5-8. No red hair. No flashy jewelry or Armanti suits. The oversize gold watchband that almost falls off with every arm movement is a no sale. After eliminating all but one salesman there will be no split commission so you don't work half as hard. Then we need a verbal contract. If you get fired or quit I want a replacement salesperson of my choice, not the GSMs choice. Then I'll need an overview of your floor plan. Is your employer in good financial standing? Are you about to merge with a megastore where I will become just another number? Email can have its benefits, but not as long as the folks answering have only the goal of getting you in the showroom.
The objective of a salesperson should be to sell you a vehicle. Obviously, having you in person at the showroom is a strong show of commitment to purchase.
I'm not quite sure I understand the other part of your post about finding the right salesman. I assume this was in jest?
Kind of, but what else can customers do when email requests are vaguely answered as to not exclude a potential buyer even though you don't have or may not have the exact car buyer is trying to connect with.
Besides its the salespeople that are largely talking about starting a relationship with a customer for referrals when all the buyer wants is a car.
Customers just want to eliminate 8 of 10 dealers via email so they can concentrate on the car they want. Salespeople don't want to be eliminated. Therefore the games begin.
Customers just want to eliminate 8 of 10 dealers via email so they can concentrate on the car they want. Salespeople don't want to be eliminated. Therefore the games begin.
Maybe you shouldn't contact 10 dealers in the first place? Why would you need more than three?
Several of the recent posts answer your questions - many dealers refuse to embrace the medium. It's not at all unusual to have to query 10 stores to get 3 serious replies.
Buyers seek honesty in narrowing the field to just that one car they want.
Dealers have to weigh the odds...lie and maybe get a switch sale or tell the truth (I have that car without side airbags in blue, still interested?) and begin a truthful exchange. I can tell you what I would prefer, but you may not agree.
(and) No I don't contact anybody except friends/family via email. That 8 of 10 was an example. How bout 2 of 3? After all, shopping is eliminating (to a buyer).
Several of the recent posts answer your questions - many dealers refuse to embrace the medium. It's not at all unusual to have to query 10 stores to get 3 serious replies.
It isn't that dealers don't embrace the medium, it is that what dealers want from the medium is different than what buyers want.
Dealers view the web as advertising, nothing more. The goal of any ad is to get a prospect in front of a salesperson,no matter what is being sold. If a dealer can get a prospect in front of a salesperson, the closing ratio goes way way up. Dealers know this. Anyone who deals in internet sales knows that you have to separate a lot of chaff to get to some wheat. If you get 100 emails, you may only get 5 sales. If 100 people walk through your door, you'll sell 20 to 25 of them. Obviously, you can see what works best for the dealer. I understand what buyers want form the web, and I understand why they don't get it.
Some dealers have their entire inventory on there New and Used with sequenced expirations.
Full pictures, descriptions, shipping, financing (terms,fees), transport, maps to dealer. This is the new dealership online the way I see it. If I want a car I go there first. Then to Edmunds to make sure we're in the ballpark.
Besides its the salespeople that are largely talking about starting a relationship with a customer for referrals when all the buyer wants is a car.
I would disagree with this to a certain extent. The context for that initial human contact is to sell MYSELF to the customer. Otherwards, how am I to separate myself from the other dealers? I don't mind using the customer's preferred medium, but if it's all about price, then someone else is always going to beat me. It could be $2,000 or $50.
The referral and relationship comes after the sale and really works better in highline. Volume stores it's more difficult to keep those same folks coming back regularly.
So, as I mentioned in my previous post. I need to make sure these leads are real. I inquire to exact vehicle, buying timeframe, alternative vehicles if we don't have exacts, etc. All of this to get some feedback from the customer that we can work together. If there is no reply, then I count it as a bogus lead. And there are a lot of them.
I can't vouch for everyone else who works/worked the internet. I know there are some terrible salesmen out there doing a terrible job. This is what worked best for me but in the end I decided to turn in my internet card. It's simply too frustrating of a medium because I could not sell myself. In the end, most people buy from people they like. It's difficult to be loved when typing.
I know of dealers that do put some of their inventory there. Bur, I don't know of any dealer that has their entire inventory there. The average car dealer has well over 100 cars in stock at any given time.
Even so, with ebay a customer has to take a step that is in the dealers interest,they have to bid on the car.
The internet shopper doesn't want a "relationship," s/he wants to buy. THAT's what most stores simply don't get. The internet shopper is NOT like other potential customers. Smart dealers understand that the medium, in fact, delivers precisely what both parties want - a sale.
18 months ago I was shopping for a Mustang. A local store had one that I was interested in but, given the notorious way they treat foot traffic, I wasn't about to walk among the sharks. Sent an email, several actually, but never could get even a hint of an answer to a very simple question: "What's your price on this specific unit?" I bought elsewhere.
A 1% return on direct mail is considered good, 2 or 3 is exceptional. Even accepting your 5% internet sale rate as being true, it puzzles me as to why such additional sales are sneezed at.
We're kind of painting with a broad brush here but maybe it's true. Maybe the majority of internet salesmen aren't trained correctly. Perhaps they aren't motivated. Perhaps they are poor communicators. Perhaps they are all greenpeas at a volume store that turns over salesmen as quick as they turn vehicles.
There are any number of reasons for poor treatment from the dealer. What can you do as a consumer to get what you want?
(I'm working under the assumption that the business won't change.)
If a dealer can get a prospect in front of a salesperson, the closing ratio goes way way up. Dealers know this. Anyone who deals in internet sales knows that you have to separate a lot of chaff to get to some wheat. If you get 100 emails, you may only get 5 sales. If 100 people walk through your door, you'll sell 20 to 25 of them.
I just wanted to make two points about your line of reasoning. First, those 100 people who walk through the door require a lot more time and attention than the 100 emails. I mean, how long does it take to reply to an email versus dealing with a walk-in.
Let's assume that you can burn through 100 emails in the time that it takes to burn through 10 walk-ins. Using your closing figures (25% for walk-ins, 5% for emailers), you will close 5 emailers in the same amount of time that it takes to close 2.5 walk-ins.
Second of all, even if my figures are optimistic (which they might be since I have never been in the biz), it's not like car salespeople are busy every hour of every day. Sure you have a lot of busy times, but you also have a lot of "dead time" as well. Even though I just admitted that I am not in the biz, I have bought cars before. Usually I visit the dealers during off-hours, and what I have seen is that many of the salespeople are not all that busy during these dead times.
It seems like answering email can be used as a way to fill in those dead times. Instead of talking about last night's game, why not respond to an email or two?
Yes, the closing rate for emails is 5%, but on the other hand the closing rate for sitting on your backside is 0%!
I know I promised you two points, but I'll give you a bonus one since I am in a generous mood...
Email, text messaging, and like are only going to grow. The generation that is coming of age today has grown up with myspace, facebook, texting, IMing, and the like. Rather than being some new-fangled thing, these are part of the fabric of their lives. They aren't just using them for keeping in touch with their friends either. They are texting companies to get the latest deals. They are linking to the myspace pages to get product information. They are IMing dinner orders. Some retailers are even picture messaging digital coupons to people's phones which are actually scannable at the point of sale.
The really interesting part is that this generation of young people rivals the baby boomers in terms of size. So whatever you think of all of this electronic communication, you ignore it at your own peril. As that generation gains more and more market power, they will demand more and more on-line communication, and there is a strong possibility that they won't do business with companies that don't handle this communication channel well.
Speaking from personal experience, our last four vehicles have been negotiated through the internet. The last one took all of two emails, and a ten minute phone conversation for a loaded Infiniti G35XS. We do have a cross reference of actually walking into another Infiniti dealer in between sending out emails to roughly five or six dealerships we were willing to travel to. That yielded an MSRP offer plus $299 CT doc fee...um no thanks. After this salesperson spent several days contacting us after we disclosed we reached agreement with another dealership he quickly dropped about $4500 off the vehicle to match the deal we were offered...um no thanks again. Maybe we caught the one bad one, but I can't get that time back, so I'll continue to separate the wheat from the chaff as well.
This very same dealership, has some sort of customer follow up service, where by any person that inquires through email or visits and does not by is contacted. I appreciate these and we do offer our opinions. However, this dealership may be better served using this person on the front end to answer a consumers questions and offer a respectable price relative to what the market dictates.
With all the information sharing available on the Internet, ability to see dealer published invoice prices, holdback, MFG to dealer rebates (trunk money), MFG to consumer rebates, and a general understanding that dealerships still receive rebates/kickbacks/alternate revenue that is unpublished, I question why "old school" sales people refuse to except the increasing move of consumers to the web.
With this said, if I were selling cars (which I'm not), I'd be asking myself the question, "If I service those 100 emails vs. those 100 walk ins what yields me greater returns with my time?"
I'd assume it may take me less than 1/2 to 3/4 of a day to answer those 100 emails (while I sip my latte. How long does it take to service those 100 walk ins, two weeks?
Fascinating discussion. It is very interesting seeing the different perspectives here. There is an odd dynamic at play with the web and the auto business that hasn't quite gelled yet.
Sales folks, I really do understand your desire to qualify the leads you get. More challenging to do that in a text based medium like email. The web makes it much easier to shop and it is much easier for someone to make a bogus inquiry on a car they definitely are not going to buy. Much more difficult to filter through that via email, so the frustration with it and the resulting reluctance to embrace it is quite reasonable actually. I think it can be done, but figuring it out will be challenging. Some just won't be comfortable with the medium in any case.
I also understand you really want to get to talking with a person, hopefully on the lot face to face with the car they are interested in buying. That has worked well for a long time. I see no reason to think that it will not continue to work well.
We live in a time where these newer technologies have changed and are changing so many ways we have done things. Business, education, social relationships, and on and on. It will be a wild ride, I'm sure, to see how the auto business is affected by all this.
I would love to see some research on any of the issues brought up in this thread. Albeit in a different field, this is the kind of thing I do and I am always interested in this stuff.
I appreciate how you describe how you handle the lead.
BTW - I don't think it is so unfortunate that I actually have to go see the car in the flesh and talk with a dealer. Can be fun, ya know. Went to a car show this afternoon. Pushed lots of buttons, kicked lots of tires, and talked to lots of people. :shades:
My opinion is that most internet consumers don't value the "relationship" aspect of car buying some on this forum are speaking to, it's just another purchase. Internet shoppers have already researched the vehicle on sites such as this, consumer reports, etc. and understand how this vehicle compares with competitors. The last factor in this process becomes the selling price.
This conflicts with the salespeople, which believe they offer intangibles in person during the buying process, one of which may actually be the same educating of consumers on the product.
For those that do not research on the web, this works best and I would see how the salesperson wants to be compensated for their time spent.
What ultimately occurs is what you have now, walk into a dealership you get one price, if you inquire over the web, a different and often times lower selling price.
The internet shopper doesn't want a "relationship," s/he wants to buy. THAT's what most stores simply don't get. The internet shopper is NOT like other potential customers. Smart dealers understand that the medium, in fact, delivers precisely what both parties want - a sale.
I understand what you are saying. the buyer wants to buy. But, the dealer wants you to buy from THEM. You see the difference?
I just wanted to make two points about your line of reasoning. First, those 100 people who walk through the door require a lot more time and attention than the 100 emails. I mean, how long does it take to reply to an email versus dealing with a walk-in.
Let's assume that you can burn through 100 emails in the time that it takes to burn through 10 walk-ins. Using your closing figures (25% for walk-ins, 5% for emailers), you will close 5 emailers in the same amount of time that it takes to close 2.5 walk-ins.
Couple of things. 1, it isn't easy to just burn through 100 emails,not if you are going to do it right. If all you are going to say is "please come in for more info" then, by the feedback on this forum you aren't doing what a customer wants anyway. So, no more communication. If you are going to do it right, that takes a lot more time. You need to check inventories, provide payment and price info, answer more questions. It's a lot of work. Then, there is the turnaround time for an answer. It can take several emails just to discuss simple things. If the prospect is in front of you,you can give the info and get instant feedback. 2 Generally speaking, the profit generated from a walk in is greater than the profit generated from the internet. Given that sales volumes will be falling all over this year, a lot more emphasis is going to be placed on profitability.
The internet shopper isn't going away,and does need to be dealt with. Dealers are going to do it in a way that maximizes their potential for success. It's just good business. The customer may not care where they buy,but the dealers do care.Since there isn't really a potential for a "relationship" dealers are simply less inclined to make an extra effort on internet leads. So, as in many things in business you end up at cross purposes. In the end, the market will set the tone. Dealers that handle the internet best will prosper,dealers that don't will fail. Handling it "best" is the rub. Best for who?
No, Max, all I see are a whole bunch of dealers who don't know what they're doing.
As one of the recent posters astutely pointed out, the coming generations live by the internet and they aren't going to change regardless of how many stores want "relationships."
The smart dealers will have user friendly sites with complete (and accurate) inventory information with near instantaneous response time. And they will make lots of money this way.
The dinosaurs will continue to down the old path of shrill advertising and high turn-over staff. And they will meet a dinosaur end.
, it isn't easy to just burn through 100 emails,not if you are going to do it right.
I see your point. I probably shouldn't have used the phrase "burn through", since this implies a certain level of sloppiness. I do, however, believe that you can service 100 email prospects faster than you can service 100 walk-in prospects:
1. With emailers if somebody is obviously wasting your time, it is easier to just ignore them and move on. With a walk-in who is wasting your time, it is harder to get rid of them.
2. With emailers, an immediate response isn't required. You can handle multiple email requests in parallel. Whereas with a walk-in, you are pretty much dedicated to servicing that one customer.
Also, you didn't address my other point, which is that email can be used to fill the slow periods during the day. The closing rate for email might be low, but the closing rate for gossiping about last night's game with your fellow salespeople is even lower!!!
Generally speaking, the profit generated from a walk in is greater than the profit generated from the internet. Given that sales volumes will be falling all over this year, a lot more emphasis is going to be placed on profitability.
You make it sound like it's a tradeoff between handling emails and handling walk-ins. The fact is that profitability comes from selling as many cars as possible. So what if internet leads generate less profitability. As long as you aren't losing money on the deal, why not take on as many leads as possible.
Let's say that your dealer is some mythical super dealership where all of your salespeople are busy with walk-ins 100% of the time (yeah right!). Then the smart business move is to hire more salespeople to handle both the walk-ins and the internet leads. As long as you are making enough money to cover the commissions of the extra salespeople, then this is the smart move.
In the end, the market will set the tone. Dealers that handle the internet best will prosper,dealers that don't will fail. Handling it "best" is the rub. Best for who?
Best for who, you ask? That's a easy one. Best for the customer, of course!
I work for a large company that used to have a virtual monopoly in its particular niche. At that point in time, they pretty much dictated how the customer was going to deal with them. The rationale, of course, was that the customer really didn't have any choice, so the company was going to do what was best for them, and not for the customer.
Fast forward a number of years to today. There is a lot more competition today and customers have a lot more choices. Our company was faced with a decision. The company could continue to dictate how customers did business with it, and watch those customers flock to our competition. Or it could change the way it does business to match the customer's needs, and continue to thrive.
Also, you didn't address my other point, which is that email can be used to fill the slow periods during the day. The closing rate for email might be low, but the closing rate for gossiping about last night's game with your fellow salespeople is even lower!!!
You make it sound like it's a tradeoff between handling emails and handling walk-ins. The fact is that profitability comes from selling as many cars as possible. So what if internet leads generate less profitability. As long as you aren't losing money on the deal, why not take on as many leads as possible.
The reason why most salespeople don'y like handling email leads is that the time/compensation equation is usually out of whack. Esp in a mass market store. If you as a salesperson are going to spend time working,you want to make as much money as possible. Sales people are paid on profit,not units. If it takes you days to close an email lead,and you make a minimal profit, you wouldn't be as happy as the guy who cloed the walk in customer in a couple of hours and made more profit, would you?
Best for who, you ask? That's a easy one. Best for the customer, of course!
From your point of view of course. Remember that the customer isn't the only part of the equation here. It HAS to be best for the dealer also. There are a lot of things in the car business that would be better for the customer, and worse for the dealer,so they simply don't happen.
With all due respect, I know quite a few sales people that receive bonuses monies based on the number of units moved, even separate new vs. pre-owned bonuses. Granted I'm speaking to Infiniti & lexus. Your dealership may not offer this to you and this could be an ownership/management decision regardless of make possibly based on giography.
In an earlier email you stated (and I'm paraphrasing) it would take too much time to review inventories, put together a deal, and ask additional questions. This puzzles me, doesn't the dealership educate the salesperson as to the current buy and lease offers? The "let me see my manager...good cop/bad cop" comments are a little long in the tooth.
If your educated and consistently putting deals together you're simply juggling numbers at a certain point, i.e. details for out of pocket, term, mileage, and for every $1000 down cap cost reduction it lowers your payment by $27......if you financial at our current rate of 2.9% for 60 months each $1000 financed is XX.XX per month.
As I stated in an earlier post I was on the phone during my last deal just three weeks ago, while the internet manager checked inventory for the NY port and detailed three vehicles, their dates of arrival and what else was already on the ground within range, in current dealer inventories.
The reason why most salespeople don'y like handling email leads is that the time/compensation equation is usually out of whack. Esp in a mass market store. If you as a salesperson are going to spend time working,you want to make as much money as possible. Sales people are paid on profit,not units. If it takes you days to close an email lead,and you make a minimal profit, you wouldn't be as happy as the guy who cloed the walk in customer in a couple of hours and made more profit, would you?
Again, you keep missing the point here. My point is that, from what I have observed, there is a lot of "down time" at car dealerships. How much profit do you make as a salesperson standing out in front of the dealership like a bunch of school girls smoking and talking about the weather? NONE Why not use that time to work on internet leads?
Also, when you are working that email deal for a couple days or whatever, it's not the only thing that you are working on (I hope). In that couple of day span, you can probably be working dozens of emails deals plus some walk-in deals at the same time. Email doesn't have the immediacy of face-to-face interactions, so you can reply when it is convienent for you, since an immediate reply isn't expected.
From your point of view of course. Remember that the customer isn't the only part of the equation here. It HAS to be best for the dealer also. There are a lot of things in the car business that would be better for the customer, and worse for the dealer,so they simply don't happen.
You talk about building "relationships", but as far as I can tell, this is just lip service. Part of building a relationship is working with people in the manner in which they are comfortable, not in the manner in which the salesperson is comfortable. If a customer wants to deal via the internet rather than face-to-face, you don't build a relationship with them by demanding that they have to deal with you on your terms. People who prefer dealing through email or internet are doing so to save their own time. They don't want to travel back and forth between dealers getting quotes. By refusing to deal with them on their terms, this destroys the relationship that you want to build before it even gets off the ground.
On the other hand, if a customer has a good experience with a dealer via the internet, you can bet that they are going to tell their friends "Hey, so-and-so over at such-and-such a dealer was a pleasure to deal with. We hashed out a deal via email, he faxed me the paperwork, and when I showed up to pick up the car, I was in and out in 30 minutes. If you are looking for an easy deal, be sure to email him first" Why is that sort of relationship not as valid as one built through face-to-face dealings?
You might be cynical and say that this sort of dealing is less personal, which may be true for somebody who is in their 40's or 50's (or even 30's). However, this will become the norm, like it or not.
The other thing to note is that, unless you are in a rural area where you are the only game in town, cars are commodities that can be bought at any dealership. I happen to live in a metro area where there are literally dozens of dealerships of every type within a one hour radius. If your dealership isn't going to adapt to the customer's needs, there are probably five others that will. I'm going to find a dealership that works with me the way that I want to do business.
People can get a car from any of the dozens of dealerships in the area, or if they don't have it, they can all trade or factory order one. So if you aren't going to do business the way that customers want to do business, there is bound to be someone that will.
So yes, it may be a pain to deal with all of thes customer "demands", but the fact is that without customers to sell cars to, then you aren't going to be in business for very long!
Comments
It would definitely take some work to figure out how to maximize the sales potential from online leads. From what I have seen so far, it doesn't appear that many have put much thought into it yet, I suppose probably because the closing percentage appears low. Were I a sales manager though, I would have to ask my internet folks if they can tell which customers are going to buy and which ones are not based only upon an initial email inquiry. Seems it might be costly to routinely just blow them off or not directly answer their questions simply because the inquiry came from online instead of on the phone.
I work in education, and I try to stay abreast of emerging trends. Education has had an extremely rocky time figuring out how to best utilize newer technologies, and there has been very strong resistance to them as well. This is slowly changing. A web savvy and oriented population is growing. Something we're noticing is that the quality of information on and the quality and ease of use of a website is becoming increasingly important in searches for colleges by prospective students and their parents. No one has quite gotten a good bead on what this really means and how to handle it yet. Certainly a different dynamic is at play than a retail application, but I can see a few similarities.
You've got to be kidding! If that's the case why bother even having a web site? That's like a salesman quoting inaccurate prices to all the customers. When they go to sign the paperwork they are going to be upset. That's the same feeling the customers gets when they find something they like on-line only to be told "Oh, that unit was sold weeks ago but trust us enough to come in blind and let us work on you."
If it's impossible to keep track of inventory on a web site how do you keep track of the money people pay you for the cars? I doubt there are piles of checks and wads of cash laying about because it's to difficult to keep track of it all.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
Don't be too sure. I saw 25 of a particular model on a dealer's web site but only 5 on the lot. Then someone told me that the dealer had an overflow lot. Sure enough, out in the middle of a field where the real estate was cheaper were the other 20 cars.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
Used car inventory is more important and should be kept up on a daily bases. However, our person assigned to keep inventory up does have a day off and inclement weather can postpone pictures. Also, full discription of a car is not available in dealer inventory software and must be entered manually. Although cut and paste helps, it is still a time consuming task.
In the real world most internet leads that are for real (serious buyers) are used to initiate a dialog. The buyer who says give me your best price has a much lower closing ratio.
That means they have 2 in stock and 2 in route. Meaning the cars are availabe for sale because they are shipped and have a VIN. We sell cars before they hit the asphalt all the time.
I can't speak for all dealers but our operating system we use to sell cars, do our accounting, and maintain inventory have nothing to do with the internet. We had this system long before the internet ever came along.
Our web site is on line and maintained by a 3rd party. The only way cars get on and off our site is for us to notify him of a sale/trade and he removes or adds them.
I would not ask any one to call our third party every single time we sell or trade for a car . Every couple off days we let him no what has gone on and he updates the site.
As far as our Ford sponsored site goes (Most Ford Dealers have there own site and there Ford site. The one you end up at if you go to www.ford.com and search for a dealer) that inventory is updated as a car is reported sold or a car is in a shipped status in route to the dealer.
The biggest reason for the two sites is Ford will not host our used car inventory for us.
That I don't understand. I have never asked for pricing without first test driving. Why waste time negotiating price, when you can not even be sure it is a car you will want :confuse: . If you are on line, you should already know invoice and rebates and thus have a pretty good idea of the approximate price range anyway.
Now, without asking about price, I have made initial contact via email to arrange a test drive. In my limited experience, I feel that I am more likely to get the "right" salesperson for me (or it causes them to have the right attitude toward me) that way, rather than just walking in the door.
I can see the logic here. If every site had complete an up to date info, it would make it easier for a customer to shop competing dealers. From the customer's perspective this is most likely not seen as such a bad thing. The dealer though, certainly doesn't want the customer to just go down the street. That is an interesting dichotomy. Yes, the goal should be, and rightly is, to get the customer on to the lot.
Used car inventory is more important and should be kept up on a daily bases. However, our person assigned to keep inventory up does have a day off and inclement weather can postpone pictures. Also, full discription of a car is not available in dealer inventory software and must be entered manually. Although cut and paste helps, it is still a time consuming task.
This is what baffles me a little. The used inventory would be more time consuming to keep up to date since all the info on a car would have to be entered manually even with the help of C&P. What I have noticed is that used inventory info is usually more up to date and complete, routinely including multiple photos of the car. The Carmax website is quite good in this regard. Maybe they have a full time staff that does nothing but enter this data. Anyway, the objection that we can't because it is too time consuming doesn't make much sense.
In the real world most internet leads that are for real (serious buyers) are used to initiate a dialog. The buyer who says give me your best price has a much lower closing ratio.
I would be happy to continue a dialog if my question were answered directly. I have a feeling that I am being blown off purely because my initial inquiry came via email rather than by phone. I would welcome pricing discussion, but I just want to know if they have a particular model in stock. I would even appreciate a "No, we don't have one in red, but we do have one in blue with the exact options you asked about (or at least close to it). Would you like to take a look at it?" Especially since my original email made it clear that I do not have a strong color preference.
The thing I like the most with the Ford site is the more complete info approaching what I might see looking at a window sticker. Kudos on that.
I am enjoying the discussion though. Hope I am not rubbing anyone the wrong way.
That's the problem.....your guns are out of alignment. It's supposed to be a green screen!!
I agree with you that the trend is moving towards internet. Unfortunately, you still need to go into the dealership to buy a car. That's kind of the trump card.
I would have to ask my internet folks if they can tell which customers are going to buy and which ones are not based only upon an initial email inquiry. Seems it might be costly to routinely just blow them off or not directly answer their questions simply because the inquiry came from online instead of on the phone.
Here's what I did when I first got an e-mail inquiry. I would reply to them to try and get more clear on EXACTLY what they were looking for. This would do two things. First, I could find out if the person on the other computer is actually there and cares. Second, it would nail down a specific vehicle. If I didn't get a response, I wouldn't waste anymore time. The most important thing for me was to start a line of communication so that they could start to get a little bit of the human touch involved in their buying process. If I couldn't open up that line, there was no sense in me spending more time.
I can see how it would seem that we're blowing people off, but the reality is the internet generates a vast amount of junk leads. To use your time wisely, you need to quickly find out which ones are real leads. If there was a phone number included, I would immediately call and try and open up a line of communication there as well. I would confirm the vehicle specs, if they had test driven, when they were looking to purchase and what the best way to communicate in the future with them. The closing ratios on e-mail leads with phone numbers went way up too.
Ok, there's a little glimpse at what's going on in a dealership. (at least the way I work leads)
Does that help a little?
-moo
New cars are a commodity, once I know what I want I can buy it anywhere and get the exact same thing. Dealer also can obtain what I want from another dealer, so it is not necessary for them to have the exact car I want on the lot in order to be able to sell it to me.
My recent experience with a new Tacoma Prerunner Base cab has been the exact opposite. I would inquire and state specificially what I was looking for and how much flexibility I had with colors, options, etc. What I got back was an email that said the internet price but plus dealer fees which was not listed and nothing specific about a specific vehicle that they may or may not have in stock. When I replied and asked for out the door numbers and a VIN, they said you've got to come in for that.
So here in the Orlando area, internet leads for Toyota dealers are nothing more than a lead and not a way to give the customer a price. It's becoming a snake pit here, more and more like So. Cal. And the dealer fee on some web sites is about $698.50.
Some dealers have very advanced computer systems, most don't.
Remember, dealers are trying to limit expenses as much as possible.
Paying someone to take pictures and keep the database updated is a non starter.
Dealers WANT people to interact with them, not just surf their websites.
There is a big difference between keeping a website updated and actually selling cars.
For starters, it is a completely different database.
Second, you actually do have people(sales managers) who get paid to make sure that the numbers are right at sale time.
If your cattle on on open range, you may not know where they all are, but if you sell one I bet you know where the money is. :shades:
I don't want a huge salesman. Forgive me, but taking that commish down to the burger and brew to get even more unhealthy via my $$ just won't do. Nobody over 6-2, nobody under 5-8. No red hair. No flashy jewelry or Armanti suits. The oversize gold watchband that almost falls off with every arm movement is a no sale. After eliminating all but one salesman there will be no split commission so you don't work half as hard. Then we need a verbal contract. If you get fired or quit I want a replacement salesperson of my choice, not the GSMs choice. Then I'll need an overview of your floor plan. Is your employer in good financial standing? Are you about to merge with a megastore where I will become just another number? Email can have its benefits, but not as long as the folks answering have only the goal of getting you in the showroom.
2013 Mustang GT, 2001 GMC Yukon Denali
The objective of a salesperson should be to sell you a vehicle. Obviously, having you in person at the showroom is a strong show of commitment to purchase.
I'm not quite sure I understand the other part of your post about finding the right salesman. I assume this was in jest?
-moo
Kind of, but what else can customers do when email requests are vaguely answered as to not exclude a potential buyer even though you don't have or may not have the exact car buyer is trying to connect with.
Besides its the salespeople that are largely talking about starting a relationship with a customer for referrals when all the buyer wants is a car.
Customers just want to eliminate 8 of 10 dealers via email so they can concentrate on the car they want. Salespeople don't want to be eliminated. Therefore the games begin.
2013 Mustang GT, 2001 GMC Yukon Denali
Maybe you shouldn't contact 10 dealers in the first place? Why would you need more than three?
Buyers seek honesty in narrowing the field to just that one car they want.
Dealers have to weigh the odds...lie and maybe get a switch sale or tell the truth (I have that car without side airbags in blue, still interested?) and begin a truthful exchange.
I can tell you what I would prefer, but you may not agree.
(and) No I don't contact anybody except friends/family via email. That 8 of 10 was an example. How bout 2 of 3? After all, shopping is eliminating (to a buyer).
2013 Mustang GT, 2001 GMC Yukon Denali
It isn't that dealers don't embrace the medium, it is that what dealers want from the medium is different than what buyers want.
Dealers view the web as advertising, nothing more.
The goal of any ad is to get a prospect in front of a salesperson,no matter what is being sold.
If a dealer can get a prospect in front of a salesperson, the closing ratio goes way way up.
Dealers know this. Anyone who deals in internet sales knows that you have to separate a lot of chaff to get to some wheat. If you get 100 emails, you may only get 5 sales. If 100 people walk through your door, you'll sell 20 to 25 of them.
Obviously, you can see what works best for the dealer.
I understand what buyers want form the web, and I understand why they don't get it.
Some dealers have their entire inventory on there New and Used with sequenced expirations.
Full pictures, descriptions, shipping, financing (terms,fees), transport, maps to dealer. This is the new dealership online the way I see it. If I want a car I go there first. Then to Edmunds to make sure we're in the ballpark.
2013 Mustang GT, 2001 GMC Yukon Denali
I would disagree with this to a certain extent. The context for that initial human contact is to sell MYSELF to the customer. Otherwards, how am I to separate myself from the other dealers? I don't mind using the customer's preferred medium, but if it's all about price, then someone else is always going to beat me. It could be $2,000 or $50.
The referral and relationship comes after the sale and really works better in highline. Volume stores it's more difficult to keep those same folks coming back regularly.
So, as I mentioned in my previous post. I need to make sure these leads are real. I inquire to exact vehicle, buying timeframe, alternative vehicles if we don't have exacts, etc. All of this to get some feedback from the customer that we can work together. If there is no reply, then I count it as a bogus lead. And there are a lot of them.
I can't vouch for everyone else who works/worked the internet. I know there are some terrible salesmen out there doing a terrible job. This is what worked best for me but in the end I decided to turn in my internet card. It's simply too frustrating of a medium because I could not sell myself. In the end, most people buy from people they like. It's difficult to be loved when typing.
-moo
Bur, I don't know of any dealer that has their entire inventory there.
The average car dealer has well over 100 cars in stock at any given time.
Even so, with ebay a customer has to take a step that is in the dealers interest,they have to bid on the car.
The internet shopper doesn't want a "relationship," s/he wants to buy. THAT's what most stores simply don't get. The internet shopper is NOT like other potential customers. Smart dealers understand that the medium, in fact, delivers precisely what both parties want - a sale.
18 months ago I was shopping for a Mustang. A local store had one that I was interested in but, given the notorious way they treat foot traffic, I wasn't about to walk among the sharks. Sent an email, several actually, but never could get even a hint of an answer to a very simple question: "What's your price on this specific unit?" I bought elsewhere.
A 1% return on direct mail is considered good, 2 or 3 is exceptional. Even accepting your 5% internet sale rate as being true, it puzzles me as to why such additional sales are sneezed at.
There are any number of reasons for poor treatment from the dealer. What can you do as a consumer to get what you want?
(I'm working under the assumption that the business won't change.)
-moo
Dealers know this. Anyone who deals in internet sales knows that you have to separate a lot of chaff to get to some wheat. If you get 100 emails, you may only get 5 sales. If 100 people walk through your door, you'll sell 20 to 25 of them.
I just wanted to make two points about your line of reasoning. First, those 100 people who walk through the door require a lot more time and attention than the 100 emails. I mean, how long does it take to reply to an email versus dealing with a walk-in.
Let's assume that you can burn through 100 emails in the time that it takes to burn through 10 walk-ins. Using your closing figures (25% for walk-ins, 5% for emailers), you will close 5 emailers in the same amount of time that it takes to close 2.5 walk-ins.
Second of all, even if my figures are optimistic (which they might be since I have never been in the biz), it's not like car salespeople are busy every hour of every day. Sure you have a lot of busy times, but you also have a lot of "dead time" as well. Even though I just admitted that I am not in the biz, I have bought cars before. Usually I visit the dealers during off-hours, and what I have seen is that many of the salespeople are not all that busy during these dead times.
It seems like answering email can be used as a way to fill in those dead times. Instead of talking about last night's game, why not respond to an email or two?
Yes, the closing rate for emails is 5%, but on the other hand the closing rate for sitting on your backside is 0%!
I know I promised you two points, but I'll give you a bonus one since I am in a generous mood...
Email, text messaging, and like are only going to grow. The generation that is coming of age today has grown up with myspace, facebook, texting, IMing, and the like. Rather than being some new-fangled thing, these are part of the fabric of their lives. They aren't just using them for keeping in touch with their friends either. They are texting companies to get the latest deals. They are linking to the myspace pages to get product information. They are IMing dinner orders. Some retailers are even picture messaging digital coupons to people's phones which are actually scannable at the point of sale.
The really interesting part is that this generation of young people rivals the baby boomers in terms of size. So whatever you think of all of this electronic communication, you ignore it at your own peril. As that generation gains more and more market power, they will demand more and more on-line communication, and there is a strong possibility that they won't do business with companies that don't handle this communication channel well.
This very same dealership, has some sort of customer follow up service, where by any person that inquires through email or visits and does not by is contacted. I appreciate these and we do offer our opinions. However, this dealership may be better served using this person on the front end to answer a consumers questions and offer a respectable price relative to what the market dictates.
With all the information sharing available on the Internet, ability to see dealer published invoice prices, holdback, MFG to dealer rebates (trunk money), MFG to consumer rebates, and a general understanding that dealerships still receive rebates/kickbacks/alternate revenue that is unpublished, I question why "old school" sales people refuse to except the increasing move of consumers to the web.
With this said, if I were selling cars (which I'm not), I'd be asking myself the question, "If I service those 100 emails vs. those 100 walk ins what yields me greater returns with my time?"
I'd assume it may take me less than 1/2 to 3/4 of a day to answer those 100 emails (while I sip my latte. How long does it take to service those 100 walk ins, two weeks?
Sales folks, I really do understand your desire to qualify the leads you get. More challenging to do that in a text based medium like email. The web makes it much easier to shop and it is much easier for someone to make a bogus inquiry on a car they definitely are not going to buy. Much more difficult to filter through that via email, so the frustration with it and the resulting reluctance to embrace it is quite reasonable actually. I think it can be done, but figuring it out will be challenging. Some just won't be comfortable with the medium in any case.
I also understand you really want to get to talking with a person, hopefully on the lot face to face with the car they are interested in buying. That has worked well for a long time. I see no reason to think that it will not continue to work well.
We live in a time where these newer technologies have changed and are changing so many ways we have done things. Business, education, social relationships, and on and on. It will be a wild ride, I'm sure, to see how the auto business is affected by all this.
Classic dilemma.
I appreciate how you describe how you handle the lead.
BTW - I don't think it is so unfortunate that I actually have to go see the car in the flesh and talk with a dealer. Can be fun, ya know. Went to a car show this afternoon. Pushed lots of buttons, kicked lots of tires, and talked to lots of people. :shades:
My opinion is that most internet consumers don't value the "relationship" aspect of car buying some on this forum are speaking to, it's just another purchase. Internet shoppers have already researched the vehicle on sites such as this, consumer reports, etc. and understand how this vehicle compares with competitors. The last factor in this process becomes the selling price.
This conflicts with the salespeople, which believe they offer intangibles in person during the buying process, one of which may actually be the same educating of consumers on the product.
For those that do not research on the web, this works best and I would see how the salesperson wants to be compensated for their time spent.
What ultimately occurs is what you have now, walk into a dealership you get one price, if you inquire over the web, a different and often times lower selling price.
I understand what you are saying.
the buyer wants to buy. But, the dealer wants you to buy from THEM.
You see the difference?
Let's assume that you can burn through 100 emails in the time that it takes to burn through 10 walk-ins. Using your closing figures (25% for walk-ins, 5% for emailers), you will close 5 emailers in the same amount of time that it takes to close 2.5 walk-ins.
Couple of things.
1, it isn't easy to just burn through 100 emails,not if you are going to do it right.
If all you are going to say is "please come in for more info" then, by the feedback on this forum you aren't doing what a customer wants anyway. So, no more communication. If you are going to do it right, that takes a lot more time. You need to check inventories, provide payment and price info, answer more questions. It's a lot of work. Then, there is the turnaround time for an answer. It can take several emails just to discuss simple things. If the prospect is in front of you,you can give the info and get instant feedback.
2 Generally speaking, the profit generated from a walk in is greater than the profit generated from the internet. Given that sales volumes will be falling all over this year, a lot more emphasis is going to be placed on profitability.
The internet shopper isn't going away,and does need to be dealt with.
Dealers are going to do it in a way that maximizes their potential for success.
It's just good business. The customer may not care where they buy,but the dealers do care.Since there isn't really a potential for a "relationship" dealers are simply less inclined to make an extra effort on internet leads. So, as in many things in business you end up at cross purposes.
In the end, the market will set the tone. Dealers that handle the internet best will prosper,dealers that don't will fail. Handling it "best" is the rub. Best for who?
I saw a hot-dog vendor on the street once. He had the same problem with tourists taking up his time asking directions but not buying anything.
He had a sign on his cart: DIRECTIONS--FREE CORRECT DIRECTIONS--$5.
Maybe dealers should charge for their time and if the person buys, deduct it from the price.
2019 Kia Soul+, 2015 Mustang GT, 2013 Ford F-150, 2000 Chrysler Sebring convertible
As one of the recent posters astutely pointed out, the coming generations live by the internet and they aren't going to change regardless of how many stores want "relationships."
The smart dealers will have user friendly sites with complete (and accurate) inventory information with near instantaneous response time. And they will make lots of money this way.
The dinosaurs will continue to down the old path of shrill advertising and high turn-over staff. And they will meet a dinosaur end.
I see your point. I probably shouldn't have used the phrase "burn through", since this implies a certain level of sloppiness. I do, however, believe that you can service 100 email prospects faster than you can service 100 walk-in prospects:
1. With emailers if somebody is obviously wasting your time, it is easier to just ignore them and move on. With a walk-in who is wasting your time, it is harder to get rid of them.
2. With emailers, an immediate response isn't required. You can handle multiple email requests in parallel. Whereas with a walk-in, you are pretty much dedicated to servicing that one customer.
Also, you didn't address my other point, which is that email can be used to fill the slow periods during the day. The closing rate for email might be low, but the closing rate for gossiping about last night's game with your fellow salespeople is even lower!!!
Generally speaking, the profit generated from a walk in is greater than the profit generated from the internet. Given that sales volumes will be falling all over this year, a lot more emphasis is going to be placed on profitability.
You make it sound like it's a tradeoff between handling emails and handling walk-ins. The fact is that profitability comes from selling as many cars as possible. So what if internet leads generate less profitability. As long as you aren't losing money on the deal, why not take on as many leads as possible.
Let's say that your dealer is some mythical super dealership where all of your salespeople are busy with walk-ins 100% of the time (yeah right!). Then the smart business move is to hire more salespeople to handle both the walk-ins and the internet leads. As long as you are making enough money to cover the commissions of the extra salespeople, then this is the smart move.
In the end, the market will set the tone. Dealers that handle the internet best will prosper,dealers that don't will fail. Handling it "best" is the rub. Best for who?
Best for who, you ask? That's a easy one. Best for the customer, of course!
I work for a large company that used to have a virtual monopoly in its particular niche. At that point in time, they pretty much dictated how the customer was going to deal with them. The rationale, of course, was that the customer really didn't have any choice, so the company was going to do what was best for them, and not for the customer.
Fast forward a number of years to today. There is a lot more competition today and customers have a lot more choices. Our company was faced with a decision. The company could continue to dictate how customers did business with it, and watch those customers flock to our competition. Or it could change the way it does business to match the customer's needs, and continue to thrive.
You make it sound like it's a tradeoff between handling emails and handling walk-ins. The fact is that profitability comes from selling as many cars as possible. So what if internet leads generate less profitability. As long as you aren't losing money on the deal, why not take on as many leads as possible.
The reason why most salespeople don'y like handling email leads is that the time/compensation equation is usually out of whack.
Esp in a mass market store.
If you as a salesperson are going to spend time working,you want to make as much money as possible.
Sales people are paid on profit,not units.
If it takes you days to close an email lead,and you make a minimal profit, you wouldn't be as happy as the guy who cloed the walk in customer in a couple of hours and made more profit, would you?
Best for who, you ask? That's a easy one. Best for the customer, of course!
From your point of view of course.
Remember that the customer isn't the only part of the equation here.
It HAS to be best for the dealer also.
There are a lot of things in the car business that would be better for the customer, and worse for the dealer,so they simply don't happen.
In an earlier email you stated (and I'm paraphrasing) it would take too much time to review inventories, put together a deal, and ask additional questions. This puzzles me, doesn't the dealership educate the salesperson as to the current buy and lease offers? The "let me see my manager...good cop/bad cop" comments are a little long in the tooth.
If your educated and consistently putting deals together you're simply juggling numbers at a certain point, i.e. details for out of pocket, term, mileage, and for every $1000 down cap cost reduction it lowers your payment by $27......if you financial at our current rate of 2.9% for 60 months each $1000 financed is XX.XX per month.
As I stated in an earlier post I was on the phone during my last deal just three weeks ago, while the internet manager checked inventory for the NY port and detailed three vehicles, their dates of arrival and what else was already on the ground within range, in current dealer inventories.
Esp in a mass market store.
If you as a salesperson are going to spend time working,you want to make as much money as possible.
Sales people are paid on profit,not units.
If it takes you days to close an email lead,and you make a minimal profit, you wouldn't be as happy as the guy who cloed the walk in customer in a couple of hours and made more profit, would you?
Again, you keep missing the point here. My point is that, from what I have observed, there is a lot of "down time" at car dealerships. How much profit do you make as a salesperson standing out in front of the dealership like a bunch of school girls smoking and talking about the weather? NONE Why not use that time to work on internet leads?
Also, when you are working that email deal for a couple days or whatever, it's not the only thing that you are working on (I hope). In that couple of day span, you can probably be working dozens of emails deals plus some walk-in deals at the same time. Email doesn't have the immediacy of face-to-face interactions, so you can reply when it is convienent for you, since an immediate reply isn't expected.
From your point of view of course.
Remember that the customer isn't the only part of the equation here.
It HAS to be best for the dealer also.
There are a lot of things in the car business that would be better for the customer, and worse for the dealer,so they simply don't happen.
You talk about building "relationships", but as far as I can tell, this is just lip service. Part of building a relationship is working with people in the manner in which they are comfortable, not in the manner in which the salesperson is comfortable. If a customer wants to deal via the internet rather than face-to-face, you don't build a relationship with them by demanding that they have to deal with you on your terms. People who prefer dealing through email or internet are doing so to save their own time. They don't want to travel back and forth between dealers getting quotes. By refusing to deal with them on their terms, this destroys the relationship that you want to build before it even gets off the ground.
On the other hand, if a customer has a good experience with a dealer via the internet, you can bet that they are going to tell their friends "Hey, so-and-so over at such-and-such a dealer was a pleasure to deal with. We hashed out a deal via email, he faxed me the paperwork, and when I showed up to pick up the car, I was in and out in 30 minutes. If you are looking for an easy deal, be sure to email him first" Why is that sort of relationship not as valid as one built through face-to-face dealings?
You might be cynical and say that this sort of dealing is less personal, which may be true for somebody who is in their 40's or 50's (or even 30's). However, this will become the norm, like it or not.
The other thing to note is that, unless you are in a rural area where you are the only game in town, cars are commodities that can be bought at any dealership. I happen to live in a metro area where there are literally dozens of dealerships of every type within a one hour radius. If your dealership isn't going to adapt to the customer's needs, there are probably five others that will. I'm going to find a dealership that works with me the way that I want to do business.
People can get a car from any of the dozens of dealerships in the area, or if they don't have it, they can all trade or factory order one. So if you aren't going to do business the way that customers want to do business, there is bound to be someone that will.
So yes, it may be a pain to deal with all of thes customer "demands", but the fact is that without customers to sell cars to, then you aren't going to be in business for very long!