Category Archives: internet sales

Consumers Want Video Walk-Arounds. Here’s Proof!

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In my days with HomeNet Automotive, a new feature was released that allowed our customers to upload live video into their inventory for distribution to the third-party websites that would allow it.

Being in sales, I wanted to have a real video in which I could show potential clients the possibilities and an actual example of what one would look like so I enlisted help from a friend of mine who’s a GM at a nearby dealer group to allow me to video one of his employees doing a walk-around.
After filming it, I used it here and there when showing a demo of IOL Pro, HomeNet’s core inventory management software. After I left HomeNet Automotive, I promptly forgot about it.
Recently, I came across it in my YouTube video list and was ASTONISHED to see that it had almost 12,000 views in about 21 months! That’s an average of 570 views per month! This is without ANY exposure or publicity whatsoever. It was not on a blog post or anywhere. I can only guess that these 12,000 people came across this video via keyword searches either within YouTube or via a Google search. I did a quick keyword search and was astonished to see that my non-distributed or promoted video ranked 2nd in Google organic search results!
venza

Imagine if this video had actually been a part of that dealer’s actual inventory on their website as well as all the third-party sites. Given that this was a new vehicle, it could have been added to all of the listings for this model and year vehicle in their inventory. They could DOMINATE Google searches for their brands.

The proof is in the pudding. I highly doubt the people watching these videos decided randomly to watch a video walk-around of a Toyota Venza. It’s more likely that these were consumer’s interested in that vehicle.

This is advertising GOLD and cost them absolutely nothing.

If you want to watch it, here’s the video:

Why The First Car Dealership Groupon Failed

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In a first, a dealership in Michigan partnered up with Groupon to offer Groupon’s first car buying groupon. The deal offered was $500 off the purchase of a vehicle for $199. Keep in mind that Groupon typically takes 50% of the price of the offer (in this case about $100) if the Groupon is successful (ie. meets the minimum purchase requirements). So in the event that the minimum of 10 deals were sold, this promotion would have cost the dealer $1,000. Not bad.. IF 10 cars were sold.

The deal failed. Why?

In my opinion, there are several reasons.

First, any kind of “deal” needs to have value to a consumer. This deal didn’t have that because consumers “expect” to negotiate with the dealer and $500 off the purchase of something that could cost $10,000-$40,000+ is just not “enough.” The deal itself cost $199 so, in reality, the consumer is only receiving a $301 discount.

Second, the offer needed a minimum of 10 people buying it for any of the 4 people that DID buy it to be able to use it. Since only 4 people bought it, those 4 people were never charged the $199 and the offer was never “live” for them to use. Obviously, if someone is willing to commit to spend $199 to get $301 off the price of a car, they are not only planning on buying one, but they are planning on buying it from THAT dealership. Seeing as the deal quantity wasn’t satisfied, you now have at least 4 people who think that either A) the deal isn’t a good one; B) something is wrong with the dealership; or C) all of the above. I highly doubt Groupon would provide the dealer with the names & contact information of those 4 people as that would circumvent Groupon getting any of the money.

Third, this Groupon, being the first of its kind, got some great press yet, when contacted, the General Sales Manager didn’t respond to inquiries. Those would have been golden opportunities for some exposure they wouldn’t have been able to buy. Rather than “seize the moment,” if you will, and take advantage of those opportunities, the General Sales Manager chose to engage potential buyers of this deal straight on Groupon in ways that, I feel, would have DETRACTED from the perceived value and may have actually discouraged customers from participating. Here are some of the comments he left:

VALUE GUARANTEE OFFER!!!!
In the unlikely event that we are unable to come to an agreement on a vehicle purchase/lease, for whatever reason, I will honor your voucher toward $199.00 in our service, parts or body shop departments. Purchase accessories, have routine maintenance done or have those annoying dings, dents and scratches repaired. 

So, now the General Sales Manager is saying pay $199 for the coupon and, even if you don’t buy a car, I’ll honor the coupon in our parts, service or body shop… in the amount of $199. Where’s the value there for a customer? That’s just pre-paying for things. Give me $199 and you can have $199 worth of “stuff.”.

William P visited our store yesterday. He selected and test drove the vehicle he was interested in. He worked out all of the pricing details with our sales staff until he was satisfied with the pricing. He THEN AND ONLY THEN explained he had purchased the Groupon voucher but needed a vehicle immediately. We reduced his amount due by $500.00 and honored the voucher in order to accommodate a customer. He took delivery today. We’re still confident that the sales requirement will be met.

This comment was left BEFORE the Groupon was satisfied (ie. 10 deals were sold) which further reinforced the fact that customers really didn’t need to purchase the Groupon to get the $500 discount since the above referenced customer, who may have “committed” to purchasing the Groupon, ultimately was never charged anything for the Groupon since the minimum quantity sold wasn’t met, making the Groupons invalid.

So, while customers are bantering within the comments of the deal over the true value of the Groupon, the General Sales Manager chose to try and convince everyone it was a really good deal and that they should buy it by making statements that detracted from the value of the offer and, at the same time, failed to take advantage of the free exposure. There were almost 50 articles written about this offer. All of which could have been turned into golden PR and marketing opportunities for the dealer – if the dealer had responded.

This is a perfect example of why you should carefully analyze any deals/social media offered on such a large scale. Many dealers have website pop-up coupons that have the same offer “$500 off a car.” In fact, this particular dealer has a STILL LIVE “special offer” pop-up which features the Groupon offer (even though it’s now expired), even further detracting from the value of the Groupon.

I’m not surprised that this offer failed. Groupon is ultimately in the business of making money. Since the deal r
equirements weren’t met (meaning nothing was sold), Groupon didn’t make any money further reducing the chance that they will participate in any future similar Groupon offers by dealers.

If you’re considering trying to run a deal via social media or bulk offer sites (ie. Groupon, Living Social, etc.), you need to make sure that the deal is truly a good value for the consumer and only offered via that promotion. The dealer could have leveraged this deal in many ways even if they didn’t sell any cars from it. As you can see, while this deal is not available to buy anymore, it still exists in internet-land both on their website and via search engines and it’s even on the first page of a Google search for “Lafontaine Auto”. This is almost as bad as having a negative review because it plants the seed to a prospective buyer that $500 off a car at your dealership isn’t worth $199, which, by extension implies that a $301 discount isn’t valuable.

Don’t jump into social media unless you know what you’re doing. If you do, your promotion can backfire, just as this one did.

Your Virtual Lot Needs Attention, Too!

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[This post is also a reprint of an article written for an industry publication in May 2008 saved here for future reference. That doesn't make it any less true. In fact, I would say it is even more important now than it was 2 years ago.]

In this digital marketing age with more and more consumers choosing to utilize the Internet to assist in making their automobile purchasing decisions, it is increasingly important to monitor the activity within your Internet departments.

Judging the effectiveness of your Internet traffic cannot be done solely by valuating its production. Whether you are using third-party lead providers or driving traffic to your own website or a combination of the two, you need to be aware of what’s going on with the leads. Just like you look at how your ups are being worked by your salespeople, closers, or sales managers; you should know what’s going on with your Internet ups.

What most dealers forget to include in evaluating their Internet departments and/or where the budget is being spent to provide leads are the most basic factors imaginable:

1. Are my Internet managers working the leads properly?

2. Do I have a process in place that I can use to hold them accountable?

It’s important to have processes just like any sales force has. Would you expect your salespeople to take a customer on a test drive before writing them up? Of course you would.

Internet leads are ups in the same way as someone that walked onto your lot. In fact, you may get more ups through your virtual lot than you do on your physical one. There are many dealerships that have Internet departments that account for 30-40 percent (or more) of their business but this is the department that is typically the most neglected and least monitored of all departments by sales managers. Dealers pay a lot of money for these ups yet fail to work them as hard as they would any customer that had walked on the lot because they don’t see the potential of turning these ups into sales today. The mentality that exists, and has existed, is that this is a today business.

While we would all prefer to sell a car today (anybody waiting for the be-back bus?),I think everyone would agree that selling a car eventually is better than  never.

Through my experience and observations, I’ve noticed that unsuccessful Internet departments tend to have Internet Managers that don’t continually work a lead. Maybe they call a few times over a week or so but then they just give up and restart the process on fresh leads. This circular pattern neglects the customer that’s not ready to buy today, but is a buyer. With most Internet customers being seven weeks out from initial contact to sale, no wonder you are losing business. I understand how frustrating it is for an Internet manager to call someone 18 times and never get a hold of anyone and never have any calls returned. That doesn’t mean these aren’t buyers, only that they’re not ready to buy or not enough of an impression has been made to earn their response. Just like any salesperson knows, you can give a customer every way to contact you imaginable: the dealership’s phone number, your home and cell phone numbers,your work and personal e-mails, etc., build great rapport and ask the customer in every way possible to call you when they want to come in and that you will be there to assist them and, despite all of this, the customer will still show up when they are ready to purchase without calling the salespeople. Knowing this, why is it hard to believe that a customer who nobody at your dealership has ever even met in person would do the same thing?

I’m a firm advocate of utilizing a business development center (BDC) to followup with your customers whether they are prospects or previous customers rather than entrusting your customers to salespeople who may or may not follow up with them. At least with a BDC, you can create a consistent process with dedicated people that follow up with your customers and prospect for your dealership.This simple addition to your business will increase your sales immediately and create greater customer satisfaction and a great first impression. Have you ever heard a customer say that nobody ever contacted after requesting information? How about feedback from a customer saying a salesperson never called them back after promising to?

By paying more attention to your Internet departments, Internet Managers and leads, you will be able to increase your sales within that department immediately, without any additional expense to you.

If your salesperson were burning ups, you’d stop the behavior. Why allow your Internet managers to do the same thing?

If you don’t pay attention, you only have yourself to blame.

E-Mail Strategies in Internet Sales (Revised)

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[Note: My original intent on posting this blog post was to preserve this article. It was originally published in June of 2008 in an industry publication. They restructured their website so that the URL to this article no longer works so I wanted to have an easy place to find it. While reading it again, keeping in mind that this article is 2 years old, the only piece of advice contained within this article that should be changed is that providing a quote to the customer is imperative. I've edited the article in bold with updates.]

Every Internet sales department involves e-mails either to the customer or from the customer. Having a strategy in place for the e-mails you send to customers is necessary. Many of your customers will be receiving automated e-mails from your CRM but do you have a strategy in place to maximize the results from those e-mails? You cannot sell a car without establishing a dialogue with the customer first, whether through a phone contact or an e-mail response. Reality is that you’ll have many customers who choose not to respond to you and/or respond at their leisure. The lack of response and inability to get a hold of customers is frustrating to many Internet managers and many choose to stop following up with these leads. A well thought out e-mail strategy can increase your responses, thus creating more dialogue with customers, which will translate into more sales.

Many Internet CRMs come with “canned” auto-responders and e-mail templates that most Internet departments alter with bare minimum changes (typically the addition of the customer’s name and contact information). You should scrutinize these e-mails and tailor them to your dealership’s Internet sales strategies whether you are focusing on price or value. These are really the only two things you have to sell at this point. You can sell customers on the fact that they should buy from you because you have the lowest price. Or you can sell customers on why they should do business with your dealership (value) avoiding price as much as possible. If you can get customers into your dealership without quoting them a price, you will increase your grosses in your Internet department. There are conflicting mindsets towards the best sales strategy to use with an Internet customer – quoting versus not quoting – and the research shows that neither method works better than another. Of course, this is a generalized statement and depending on what your competition is doing, you maybe forced to use one strategy over the other.

[In today's market, providing a quote to your customer is mandatory. If you're not providing quotes, you are losing business. The information available to consumers today is such that they can get pretty much any information they want, if they look. By not "helping" them, you are only alienating them from your dealership. They will get the information. Do you want to be the dealership they remember as "helpful" or the one they remember as "typical"?]

Most Internet managers are concentrating on selling a car way too early in the process. You cannot sell a car to someone you have no dialogue with. What Internet managers need to realize is that your first goal in your process should be to sell the customer on an appointment, not a car. Without contact with the customer and/or getting the customer to come into your store, you’ll be hard pressed to sell them anything.

Internet customers tend to be more educated and less spontaneous. Some of them go on the Internet because they are intimidated by the typical sales process and/or have had a bad experience in the past. Some simply don’t have the time to shop several dealers looking for the best deal. Internet customers should be treated with a soft approach at first. Once contact is established, you can tailor future follow-up and/or your approach on an individual basis, but until you figure out why your customer went on the Internet in the first place, why do anything that would hurt your prospects of establishing contact?

An effective e-mail strategy will include some, if not all, of the following elements:

• Always be polite and courteous in your e-mail’s tone.

• Make sure your e-mails look professional and do not have grammar or structural errors.

• Always give more to the customer than they’ve asked for. If you’re a quoting store,give them quotes on more than just the vehicle they’ve asked for a quote on. Show them a model up and, perhaps, a similar pre-owned vehicle with low mileage.

• Ask how you can be of service in every e-mail. Always over-deliver. You need to stand out from your competition.

• Never be aggressive in your e-mails! You’ll turn off your customers, reinforce that you are no different than any other salesperson and you’ll only hurt your chances of getting a response from an uncontacted customer.

• Do not bombard your customers with e-mails. The more and more frequently you send e-mails, the more likely your e-mails will end up in trash folders unread and/or get tagged as spam.

• Use standard e-mail etiquette in all your emails (no all caps, etc.).

In my opinion, an effective e-mail campaign strategy should look like this:

1. You should have an auto-responder acknowledging your receipt of their information request that promises only what you can deliver. If you can respond within five minutes consistently, then tell the customer that. If you cannot, do not promise them that, as you’ll only accomplish instilling a first impression that you cannot deliver on your promises.

2. Your second e-mail to a customer should be personalized and sell your Internet department and why they should do business with you. Why should the customer come and see you and/or the Internet department versus the normal sales department. You should be selling an experience at this point and be telling the customers how doing business with the Internet department will make their buying experience hassle-free and convenient.

3. Your third e-mail should be selling the customer on why they should do business with your dealership. What benefit would the customer get from buying from your dealership rather then your competition?

4. The preceding three e-mails should be within the first 48 hours of the receipt of the lead. After that, you should have different e-mails being sent on days four and six, with follow-up e-mails twice on week two and once per week every week thereafter.

Keep in mind – your dealership can tailor the messages in each of these e-mails. Just like you have a consistent sales process for your salespeople (meet, greet, needs/wants, etc), you should have a consistent process within your Internet departments.

Keep in mind that I’m mainly talking about uncontacted leads although I feel that the elements I mentioned above should always be used. These e-mails are the only impression an uncontacted customer has of your dealership. You wouldn’t want a dirty car on your showroom floor so why have a “dirty” e-mail?

Perception is reality. What perception are you giving your customers?

The Right Stuff (Identifying Great Internet Sales Managers)

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What skill set makes a great Internet Sales Manager?

It’s not as easy of a question to answer as you may think regardless of where in your organization’s hierarchy you have this position. I’ve seen so many types of people in the Internet Sales Manager position and many that have failed. I’ve seen excellent salespeople “promoted” to the ISM position just to see them fall on their face and have that confidence and cockiness they had shattered and I’ve seen that person who couldn’t“close” a door, succeed beyond everyone’s expectations.

So, how exactly do you decide who the “right” person is to make your department successful?

Some dealerships choose their top salesperson with the thought that he/she can pump out even more units given more people.Some will actually put the person who’s NOT selling cars in there with the hopes of a turn-around. Some go the “experienced fleet manager”route. Some put their new (or green-pea) salesperson in there. For the most part, NONE of these are the “right” person for the job.

Am I a mystical guru that can foresee the future? No, of course not and my forthcoming opinions will certainly have exceptions. (Keep in mind that the ability to communicate and use a computer is assumed.)

The top five personality traits of successful Internet Sales Managers are as follows:

  • Excellent phone skills
  • Persistent
  • Customer-Service Oriented
  • Aggressive
  • Organized

You notice I didn’t include “good sales talent”. There’s a reason for that. In this industry, everyone’s used to looking for that person who has sales talent – whether it’s as a liner or a closer. When looking for a good Internet Sales Manager, sales talent is certainly important but it’s not in my top 5.

Why?

What qualities does it take to get a person from an e-mail or phone call into your store?

Phone skills are a MUST. If they cannot talk on the phone, they should not be in your Internet Department. I would consider this to be THE most important attribute that an excellent ISM can have. If you have any call-monitoring services, you know who those people are. They’re the ones you are consistently letting your OTHER salespeople listen to as examples of how to properly make/receive a phone call.

You need someone who’s persistent and doesn’t give up on that lead that they’ve called 6 times and emailed 4 times who’s never responded. This happens way too much. Persistent is definitely a key to success. Do you have someone who always makes their phone calls and follow-up to the point that customers are calling you asking you to please have “Joe”stop calling me? That would be someone to start looking at.

You need a customer-service oriented person. You can’t stick your closer in there and label it as a promotion because they inevitably try to“close” the person over the phone and that will only alienate the customer. Remember,many customers have chosen to shop for a vehicle and/or gather information via the internet because they are intimidated by the retail sales process. By mimicking the retail sales process within your internet sales department, you will reinforce the experience that the customer is trying to avoid in the first place. You need someone with a pleasant phone voice that can transmit through phone lines sincerity and genuineness.

Of course you need an aggressive person. One of my “strategies” if you will (and I’m sure many salespeople also do this)is that I start making calls until I get that person whom I get a feeling I can sell a car to“soon”. I liken this to the fish nibbling at the bait. Once I get that nibble, I’ll work all day to “reel” in the fish,focusing on that one nibble to create a sense of urgency (“Hey fish, I have more worms in the boat.”). The “aggressiveness” that I am talking about here is the ability to know when there is genuine interest and being able to identify and cultivate a sense of urgency within a particular customer, not the ability to be pushy.

You definitely need someone organized, as they need to keep up with every lead and know what’s going on as they juggle replies and phone calls. It doesn’t matter how good your CRM is (assuming you have one), if your Internet Sales Manager cannot sound like they know that EXACT customer’s needs and wants when they do make contact, it will be that much harder to build rapport.

Sales skills are secondary to all of this because getting the customer into your store is their primary job.

Once the customer is in your store, you have a whole sales staff that can make sure they leave in a vehicle if your Internet Sales Manager cannot accomplish that. 

Sales skills and processes can be trained, personality traits cannot.

Find that “eagle” with the above abilities and you have the makings of an excellent Internet Sales Manager.