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Sunday, May 06, 2007

Improving Dealership Sales by Treating All Customers Differently

A lot of car dealers operate on the philosophy of treating all customers the same. Of course this is a good principle if you're referring to the general sense of respect and courteous service. I believe that treating each customer differently will generate more sales for your dealership.

When dealing with our website customers there are dealers from all walks of life. Some are large franchise groups that keep 600 vehicles in stock in metropolitan areas, while others are small independents with only a dozen cars. The thing that makes us successful is how we work with our customers on the level they need. Many customers are in rural areas and have extremely limited computer knowledge. These customers require a higher level of training and explanation of why things are done a certain way. They need us to hold their hand through the early stages of the internet marketing process. It's not uncommon for me to get 4 or 5 calls in the same day from some of these dealers when they're starting out. The larger dealers we work with often have internet managers who have been hired specifically for working with us, therefore they have a better understanding at first and don't need as much of the attention we offer. I only speak with some of these dealers as infrequently as once every 6 months, because they prefer not to be bothered.

Knowing your customers needs is key to closing more deals and selling more cars. Take the sub-prime market for example. A lot of bad credit customers shop for cars based on two things: (1) if they can get financed, and (2) how much their weekly payment will be. The actual vehicle is surprisingly not at the top of the list of the most important needs. Someone with perfect credit is apt to be more interested in the vehicle instead of weekly payments.

Two of my family members are purchasing new vehicles this month. One (my mother) is 65 years old and the other (her uncle) is 85 years old. Of course the salespeople saw them coming and probably figured on high-gross deals right away. I'm sure they changed their opinions pretty quickly, not to mention they probably needed a bottle of Advil when they left. They both drive a hard bargain, but it sounds like before that point they didn't take the time to establish buying needs. My mother's car was her first car ever, so rather than pushing her toward the typical "old people" cars, she was actually looking for something small, safe, economical, and easy to drive. A salesman figuring this out at the first dealership probably would have resulted in a sale. Instead she went to another dealer where they figured out her motivation for buying a car, and more importantly what type of car she wanted.

Imagine you sell scuba gear. You've got the best scuba gear available on the market, and it's at a great price. You push your gear on someone and tell them how much they need it. Now imagine what the customer is thinking right up to the point they tell you that they don't swim. It starts things off on the wrong foot, and the customer quickly develops the feeling that the dealer doesn't care about anything other than a deal.

Get to know your customers before you start pushing them into a particular car. It sounds like common sense, but a lot of dealers just don't do it. If you can do this, you're sure to see higher revenue in your dealership.

So how does this relate to your dealership website? Simple - make sure your site maintains this same philosophy. Don't assume that everyone visiting your site is there for the same reason. Some people want to shop by price. Others want to shop by make/model. All customers want to be able to do this on their own time, but make sure you have different solutions for when they're ready to pull the trigger and do something. Contact forms or credit apps should be readily available, phone numbers/addresses should be prominent on all pages, and that way they'll have options for the manner in which they're most comfortable contacting you. More ways to contact you means a way that appeals to everyone, and increasing the number of contacts will ultimately increase your revenue as well.

Thursday, May 03, 2007

Pricing for a Dealership Website

Take a look around the web and you'll see an unbelievable range of pricing for auto dealer websites. It's no surprise - you get hundreds or thousands of companies and you're bound to be all over the map. Of course a small company who builds websites in their spare time is going to charge less than another company who focuses strictly on car dealers. Why? I believe the answer is a simple concept. For some reason a lot of auto dealers we talk to don't seem to get it right off.

The reason is a matter of simple economics. I see a lot of web design "companies" that are nothing more than one person building and promoting all sorts of site design in their spare time. The usual situation is one in which a person has a full time job and relies almost exclusively on referrals from existing customers and also the "friend of a friend" scenario. In this situation there is no real need to grow the business; it's merely a hobby. This means no money needed for marketing, development, a sales force, an office, etc. When these typical business needs aren't present, of course the profit margins increase and voila, you have an inexpensive website product to offer. This isn't always a bad thing, but we see a lot of these providers who just don't care about having a good product. Of course there are larger companies that produce good looking sites but lack the essential features to make your internet marketing a success. I'd say the majority of car dealers still haven't been educated on what makes a good site vs. a bad site.

It all boils down to value. Suppose I go to a car dealer and ask how much his BMW costs. Let's say they quote me $25,000. If I tell the dealer that another dealer down the street has "a car" for $5000, we all know what the first question would be from them: "Well is it the same BMW?" This example sounds absurd, but we run into the same thing with a lot of dealers who call in. "Company X only charges this amount and you want to charge your amount." Car dealer websites probably have as much variety as the vehicles on the road, so we constantly have the apples to oranges discussion with dealers. We choose to work in this industry where price is everything in the mind of most customers, so taking on the value-building educational role doesn't bother us. When it comes time to make a decision on what provider you want to develop your dealership website, I recommend shopping around, determining what features you need and what features you could care less about, and then make a true apples to apples comparison between the providers who offer the features you need. Your choice is eventually going to impact your return on investment, so it's well worth your while to do the homework.