Three Ways You Can Get More Referral Business

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1 Three Ways You Can Get More Referral Business Jeff Hartman Product Manager

2 One of the best parts of having loyal, long-term customers is, of course, referral business, but getting more referral business isn t always easy. In fact, a recent study of 1,000 car buyers found that 71% of participants purchased or leased their most recent vehicles from a new dealership one they hadn t bought from before 5. Making your existing customers advocates of your dealership will take a focus on every customer interaction. Mishandled Communication Hurts Customer Satisfaction Virtually everyone alive today has had access to a telephone since birth, but that doesn t mean that everyone who uses a phone uses it well. In a dealership, employees can mishandle phone calls in a variety of ways not answering calls, putting callers on hold for too long, misdirecting calls, and simply having poor conversational skills. All of these can lead to a damaged dealership reputation, 1 which is a true drain on profitability, customer satisfaction, and referral business. Although the phone is the most important sales tool available to your dealership, it s not your only sales tool. We are surrounded by communication tools, from traditional telephones to smart phones, from desktop computers to tablets. Mobile marketing and advertising, video, and instant messaging are all vital communication tools that help you find, attract, and keep more customers. The Right System Delivers a Total Communication Package Every day, your dealership receives phone calls from existing customers and potential new customers, most of whom are looking to buy something from you. In data analysis released by Marchex, Inc., in April 2013, researchers found that 79% of mobile calls answered by auto dealers led to a sale. 2 That means your employees must not only answer the phone, but they must also handle those phone calls correctly, getting those potential buyers to the right department, even the right person, the first time. A comprehensive communication package gives you all the tools you need to manage communication as it flows through your dealership: Incoming calls present a screen pop on your employee s computer, providing one-click access to full customer details. Now you can tell whether this customer is ready for a Service appointment or Parts pickup or something else. Before transferring callers to the Service, Parts, or Sales manager, you can use Presence to determine whether the manager is available to take the call, so your customers aren t falling into the voic trap. 3 If you re working with a customer at your desk, instant messaging allows you to ask your coworker or manager a question without leaving a customer alone during the Sales or Financing process. Video lets you and your customers communicate with dealership employees who work in other locations or are simply offsite for the day. In all of these situations, effectively handling the communication flow through your dealership has a positive impact on customer satisfaction, retention, and referrals. 71% of buyers had not purchased or leased a new or used vehicle from this same dealership before 79% of mobile calls answered by auto dealers lead to a sale Nearly half of calls into your dealership come from potential new customers. But letting calls go to voic is almost like throwing those potential customers into a black hole. We all know how easy it is to forget to return a voic because you ve been distracted by other items in front of your. The implication is clear miss a call, lose a customer.

3 Get More Referral Business by 1. Choosing the Phone System That s Right for Your Dealership The market today offers dealerships a wide variety of commercial-grade phone systems, all of which work well but in varying capacities: Traditional PBX The most basic business phone system available is called private branch exchange, or PBX. A PBX is a phone switch that s usually located on your dealership s property, typically in the wiring or phone closet. The PBX provides basic phone services like internal calling and access to local and long distance public telephone networks. Typically, a PBX lets a company share a small number of outside lines among all employees. It is private in that the company owns it. Dealerships with this type of phone system can certainly answer incoming calls and make phone calls as needed. But in a traditional PBX, each telephone is hard-wired to a port on the phone system and each requires a dedicated cable, and often its own power source. Typically, dealerships cannot move, add, or change handset locations without the intervention of their PBX provider, which carries associated service costs. IP Telephony About a decade ago, Cisco Systems pioneered a new technology called VoIP. Although VoIP uses the word Internet in its name, the system does not use the Internet to connect or transfer calls. Instead, Internet Protocol (IP) refers to a formatting standard that underlies the Internet. VoIP solutions work differently and more effectively than traditional PBX systems. The building block of VoIP technology is the ability to run voice, data, and video traffic across a single network, a practice often known as convergence. For most businesses, this convergence occurs at the PC. Some VoIP solutions can connect voice traffic with data applications to perform tasks normally handled by your employees. And to further enhance the functionality, both hard-wired and wireless technologies can use this infrastructure. Even though VoIP has existed for more than ten years, it may appear new to many dealers. Many PBX systems have performed acceptably since VoIP s emergence, which has prevented many dealers from considering the upgrade. VoIP phones are available today in two configurations onsite and cloud-based. An onsite VoIP phone system means that the servers and technologies required to run the phones and data are located onsite, within the dealership. These systems come with all the benefits of VoIP technology including, in specific cases, integration with the dealership s DMS, CRM, and other installed solutions but requires dealership IT departments to invest in, as well as manage and maintain, onsite hardware and servers.

4 Cloud-based, or hosted, systems are the latest iteration of VoIP systems that transfer responsibility of the servers and technologies to a third party provider. With this configuration, dealerships have the IP phones on their desks, but servers, and the responsibility of them, reside in a remote, secure location. A cloud-based phone implementation will allow dealers to avoid periodic upgrade decisions and to have a single point of accountability for all of their phone system requirements. When carefully selected and constructed, both onsite and cloudbased solutions enable dealership-wide collaboration, whether that dealership has a single storefront or multiple locations across the country. Unified communications allow for integrated voice, voic , and instant messaging with presence; mobile applications; and conferencing via the web or video. As just one example, before your dealership receptionist transfers a caller to a particular salesperson, the receptionist can use presence to make sure the sales rep is available to take the call. If not, a different rep can answer the customer s question, avoiding the voic trap and speeding up the customer satisfaction process. Dealerships that do not have the in-house IT resources to support onsite configurations tend to select cloud-based solutions. By taking the hardware equipment and system responsibility out of the dealership, dealerships are not only saving time and money, they re taking advantage of the latest technologies that help build strong, long-term customer relationships. Cloud-based solutions are expected to reduce costs. In a study presented by CFO Researchiv, the majority of finance executives stated that they expect cloud-based solutions to reduce costs for their companies. How significantly? To what extent could cloud computing reduce each of the following over a 12-month period at your company? Operational costs 22% 15% 64% IT spending 24% 17% 64% IT maintenance costs 18% 36% 21% 13% 62% M&A integration costs 51% 2. Integrating Your Phone System with Your Dealership Technology Solutions Because it stands on its own, a traditional PBX phone system is not capable of integration. Phone calls come in often from people who are ready to buy from you and employees must take notes, enter caller information into the system, then transfer calls manually throughout the dealership, not knowing whether the desired employee is available or not. VoIP phones, on the other hand, will talk to other dealership technology solutions. This communication, called call-telephony integration (CTI) links the data in your DMs, CRM, and other dealership technologies with the phones. And whether you select an onsite or a cloud-based VoIP phone system for your dealership, the greatest improvement to your communication, retention, and referral efforts lies in integrating your phone system with your dealership technology solutions. For example, when a customer calls into your dealership, the receptionist would know before answering the phone the status of the customer s vehicle the Service department. He or she could greet the customer by name and have answers readily available. n More than 20% reduction n Up to 20% reduction n No reduction Percentage of respondents excluding Don t know/does not apply responses. Note: Percentages may not total 100% due to rounding.

5 Many IP phone providers today assert that they can integrate their phone with the DMS, CRM, and coordinating dealership technology solutions. Take care to investigate these claims fully. True integration goes well beyond a screen pop that shows up on your computer when you receive a phone call over the VoIP system. Seeing the name and phone number pop up on screen similar to caller ID is certainly handy, but when the phone system if fully integrated with the dealership technology solutions, employees will be able to: Access full customer records with one click on the screen pop Click to call contacts in your DMS and CRM databases Use phone notifications to remind customers when Service is due, repairs are completed, Parts are ready to pick up, and the like Log incoming leads to your CRM directly from the phone Create repair orders right from the phone call If the VoIP system you re considering can t fully integrate with your other dealership technologies, then it may not be worth the investment in the phones, servers, and other hardware because it won t be capable of helping your employees improve customer service and retention over the phone. Comprehensive solutions not only help improve employee communication with existing and potential customers, they also facilitate seamless communication between your dealership staff. Consider another example: While looking at the inventory in the lot, sales reps could use their phones to look up customer information from the DMS or CRM. From there, the sales reps could start a video call with the inventory manager to see if s/he would appraise the customer s trade-in during the new vehicle test drive. Presence, instant messaging, video conferencing, and smart phone integration are all critical factors when considering an integrated communication solution. 3. Deploying Dealership Technologies with Predictable Costs, Services, and Support In a recent survey of 310 senior finance executives from a range of U.S.-based companies, CFO Research determined that the majority of finance executives see cloud-based solutions as important factors in their companies success over the coming years 4 if they re not already relying on the cloud. In that same study, flexibility and improved productivity were cited most often as the reason companies moved technologies to the cloud, but those same executives have also stated that moving to the cloud yields cost savings. Cloud-based solutions contribute to corporate strategy. The same CFO research 4 study found that finance executives see cloudbased solutions as an integral part of corporate strategies. Executives answered the following questions with these responses: Would widespread adoption of cloudbased systems at your company... meaningfully improve your IT function s ability to focus on high-value activities? 68% Yes meaningfully improve your IT function s ability to innovate? 67% Yes meaningfully reduce IT s budget? $ 45% Yes Percentage of respondents excluding Don t know/does not apply responses and We have not implemented cloud computing to any extent responses. Note: Percentages may not total 100% due to rounding.

6 Combining the cost-effective, flexible, and productivity-enhancing nature of a cloud-based solution with an integrated communication package means minimizing dealership expenses; maximizing technological value; adapting to the increasinglymobile workforce; and finding new and unique ways to advance customer satisfaction, retention, and referral efforts. Cloud-based VoIP technologies also allow dealerships to scale their business communication needs as they change. A dealership with one location and 30 employees may acquire the dealership down the street or across town; only with a cloud-based solution is it really possible to scale up and down quickly as needs change and without the capital outlay required to purchase, install, and configure new servers and other hardware. It s More Than Just a Phone System Some dealership executives may be (rightfully) concerned about the security and reliability of cloud-based solutions, these concerns can often be allayed by finding the right communication solution partner. That is, when selecting the phones and communication technologies that are right for your dealership, you ll want to find a partner who: Understands how business flows through a dealership Relies on proven, commercial-grade hardware and applications with secure, Tier IV data centers Provides network solution support to a vast, growing number of dealerships around the world Proves uptime capabilities with greater than 99.5% uptime Focusing on communication means getting your employees the training they need to be effective while communicating with customers and prospects, but it also means arming those employees with a total solution that lets them handle calls effectively while collaborating across the dealership. 1 Finlay, Steve. Bobbled Phone Calls Hurt Dealership Business. WardsAuto, 24 Feb Marchex, Inc. Marchex Finds 4 out of 5 Mobile Calls Answered by Auto Dealers and Repair Shops Lead to Sales. Marchex Investors, 2 Apr Marchex, Inc. Study: Auto Dealers Pay Big for Letting Calls Go to Voic . Marchex Investors, 24 Oct CFO Publishing, LLC. The Business Value of Cloud Computing: A Survey of Senior Finance Executives. June Service 360 Partners. Helping Dealerships Improve the Vehicle Buying Process. July 2013.

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