NADA Highlights Best Practice Strategies

Transcription

1 NADA Highlights Best Practice Strategies San Francisco January 2015 Presented by Frank Genobile, David Buckley, Laura Rogers & Neil Cahir March 2015

2 San Francisco NADA 2015 Highlights Overview 1. Introduction NADA Text and Engage with today s changing consumer 3. Fixed Operations 4. Digital Marketing 5. Unleash the Raging Bull in your used car department 6. Winning words for sales and service 7. Create and cultivate a winning culture 8. Emerging trends in leading dealers 9. Wrap up / Questions 2

3 San Francisco NADA 2015 Attendees: More than 23,000 Countries represented: 53 Exhibition space: More than 650,000 square feet Exhibiting companies: 570 Dealer franchise meetings: 26 Workshops: 66 Source: National Automobile Dealers Association 3

4 San Francisco NADA 2015 Themes & Trends NADA 2014 Focused on customer retention strategies New Orleans Sales, Fixed Operations and F&I NADA 2015 Attract Customers and Build Loyalty How? Through service marketing Digital communication; and Better mobile experiences 4

5 5 Trends from NADA i. Attracting prospects and generating sales mobile applications reflects Web Page ii. iii. iv. Changing customer habits mobiles (tablets and computers) have replaced visiting dealership or making a phone call The purchase process less time and less contact between dealer and customer Implement Service Marketing strategies based on better customer experience before and after vehicle purchase v. Use your DMS to track performance indicators what is measured is managed! 5

6 Attracting today s customers Analysis & Opinion There are no Magic Beans. Silver Bullets are just the stuff of legend. And the Easy Button well, it s a lot harder to push than you d hope (Autologica) You have unbelievable tools at your fingertips today. In your pockets right now, tools for/to: Connecting with customers Building relationships Building your brand; and Help you sell more cars and make more money But they re just tools - it s not about the tools. It never has been! 6

7 Attracting today s customers Analysis & Opinion cont. Advertising / Digital Marketing - Relationship Traditional advertising can help you reach out and grab their attention! Advertising is just a bridge Digital marketing can help you Strengthen that relationship Be there for them when they raise their hand and identify themselves as a prospect! What is your Digital Road to a Sale plan? This now begins when a customer or potential customer first walks into your showroom 7

8 Attracting today s customers Analysis & Opinion cont. The new age of ideas! Most new ideas are just a new spin repackaging of the same marketing ideas The digital marketing basics are you ve gotta - Grab their attention Make them an offer they can t refuse Create a sense of urgency; and Have a call to action so that the 1% of the market who are in the market will raise their hands. Do all of that in a way that creates A memorable image; and A distinct brand for your store so you can influence the other 99% when they eventually do get around to raising their hand 8

9 Attracting today s customers Analysis & Opinion The new age of ideas! cont. Don t let the tools become a distraction - it has always been about: sitting across a desk from customers building their trust easing their fears; and helping them make the second-largest financial decision they ll ever make. 9

10 Text & Engage with Today s Changing Consumer Scott Pechstein, Autobytel The Explosive Growth of Texting Call / Text Count Text you pick up right where you left off. Very efficient because you have a trail with you. Source: Experian Marketing Services 10

11 Text & Engage with Today s Changing Consumer cont. Get ready to Text: The statistics are too compelling to ignore! 98% of text messages are read - compared to 22% s, 29% tweets, 12% Facebook posts (Source: Frost & Sullivan 2010) 49% of auto mobile phone users made a purchase related to that interaction (Source: xad/telemetrics) 63% use their mobile device to research and shop while at a dealership (Source: Placed Inc. / Cars.com) 52% visited an additional dealership as a direct result 72% were more likely to visit another dealership than those not using a mobile device on the lot 11

12 Text & Engage with Today s Changing Consumer cont. Mobile Actions while on a Dealers Lot 12

13 Text & Engage with Today s Changing Consumer cont. Explaining Text Gateways (CRM for Text) Step #1: Communication logged and saved Step #2: Hierarchy rules to hide phone numbers Step #3: Opt-in consents and opt-out STOPS managed and stored Step #4: Should be easily integrated into your CRM 13

14 Text & Engage with Today s Changing Consumer cont. Texting for Sales Ability to communicate more effectively during the shopping / research period 42% influenced by your dealership website SMS can improve this! Mousetraps : Text call to action, when you have a car in a Shopping Centre Put a text contact on your website text us now. E.g. Click on You can drive this for $400 pw text me 14

15 Text & Engage with Today s Changing Consumer cont. Texting for Service (a quicker system of response) Service advisor explains benefit for texting service updates Service advisor gets consumer to sign acknowledgement form for permission to text and dialog is logged like a sales engagement Ability to take a picture of necessary repairs or concerns Customer satisfaction improves 62% say customer service will influence future purchases Do this as soon as you get home Make sure salespeople are not using their personal phone to exchange texts with a customer Implement a texting process that will allow for tracking and follow-up (beware opt-in, opt-out laws) Leverage your current marketing spend by utilizing text-message marketing. It creates customer engagement, and it helps measure the effectiveness of your advertising (minimal cost to implement) 15

16 Text & Engage with Today s Changing Consumer cont. Now we are texting how are we engaging the customer? Baby Boomers only visit 1.9 dealers All generations want to avoid salespeople in the future (Source: AutoTrade Next Generation Car Buyer Study) 80% Traditional Best Sales Practice New Sales Best Practices i. Give them what they want on line ii. Give them options Why buy my brand? What is your USP? E.g. Warranty Why buy from me? Why buy from me? Your message needs to be consistent Vehicle of interest Vehicle of interest Outside of this 15% Alternative vehicle Alternative vehicle(s) You don t go to a restaurant for one 5% (one new, one used) dish All used options Give them a link to all your used car list 16

17 Text & Engage with Today s Changing Consumer cont. Final thoughts engaging customers Consumers more on-line than off-line Dealers need to pave a way for an easy transaction when customer visits 80% the dealership Consumers are coming to the dealership to reaffirm what they saw online 15% 5% 17

18 Simple changes for a Record Year in Fixed Ops Don Reed Facts about the service advisor (US statistics) 86% try to diagnose the customer s concern on the phone 81% quote mechanical repair prices before they know what s really wrong 95% quote higher prices than independent shops, allowing the customer to shop other places 57% do not ask the customer for an appointment Only 29% of customers are offered one additional service to what they ve come in for but up to 46% will buy the additional service from the first person to present it to them!! The independents do just the opposite 18

19 Simple changes for a Record Year in Fixed Ops cont. Change #1 Use Appointment Coordinators NOT Service Advisors Appointment coordinators will SELL the entire day Schedule appointments 15 minutes apart by advisor Schedule appointments per advisor Plant the seed for maintenance requirements and recommendations Contact all no-shows Reduce number of calls put on hold More time for reception walk-around and menu presentations More time for customer communication throughout the day More time for active delivery and setting next appointment 19

20 Simple changes for a Record Year in Fixed Ops cont. Change #2 - Train your Service Team for Growth What is the primary mission of a service department? To ensure every customer leaves your dealership driving a safe and reliable vehicle How? i. 100% maintenance menu presentations for reliability ii. 100% vehicle health checks (MPI) for safety iii. 100% of customers must be trained for retention Who is your #1 Competitor for Service Sales? The independent Need to sell like they do! 20

21 Simple changes for a Record Year in Fixed Ops cont. Answer: Train your Service Team to do what THEY DO! Avoid diagnosing over the phone Do not quote prices for mechanical repairs over the phone Offer a FREE multi-point inspection Offer EVERY customer an appointment for a specific day and time (Always today or tomorrow) Walk-ins-Drop-offs and Waiters Never say No! Can Do versus Can t Do 21

22 Service Drive: Your other sales floor! Charlie Polston Most dealerships have a new-car sales meeting every single day, but how about a service sales meeting Service Sales Manager Job Description Accountability Conduct weekly service sales meeting with all service personnel (advisors, tech, etc.) Service Sales Advisor Job Description Service Sales Present a service menu of recommended maintenance services to every service customer Conduct a vehicle walk-around using a walk-around form or a wireless tablet at the time of write-up Make a genuine effort to sell the maintenance services recommended by the technician to every service customer 22

23 Service Drive: Your other sales floor! cont. Selling automotive maintenance services The road to a sale Educate the customer Offer maintenance solutions Ask the customer to buy! May we perform this service for you today? The RIM process Related, immediate and maintenance Related needs: Closely related to the primary item Immediate needs: Safety-related, if put off, will result in catastrophic failure Maintenance needs: Lower cost of ownership by preventing major break-downs 23

24 Upselling is not a Dirty Word David Martin Eight ways to increase sales i. The Grandma Rule ii. iii. Treat every customer as though they are your grandma Thorough walk-around on every vehicle 3 out of 4 customers buy tyres from 1 st person recommended from Build value by sharing benefits Sell benefit of the service iv. Improve communication skills Verbal Avoid jargon and technical language Avoid improper questions Non Verbal Good eye contact creates trust 24

25 Upselling is not a Dirty Word cont. Electronic ( s) Be concise; Importance of grammar, punctuation, spelling Write good subject lines Electronic (Texts) Watch abbreviations; Be aware of tone v. Menu presentations Visual affect is more powerful than just the spoken word 46% of customers say yes to services when presented the service vi. Ask every caller for an appointment The customer is calling for a legitimate reason vii. Follow-up on ALL declined services and phone quotes Effective and profitable use of time viii. Professional responses to objections 25

26 What do digitally savvy dealers do? The most profitable item a dealer can sell is an hour of labour tailor your website to focus on your most profitable services Why? Front End Gross Profit as a % of Sales New car GP% has dropped 31% over the last 6 years. Used cars dropped 20% Digitally savvy dealers are rethinking gross profit 26

27 What do digitally savvy dealers do? cont. Re-think gross profit Idea needs to be that we focus on speeding things up-less focus on gross profit per unit Focus is on total gross versus per-unit gross $5,053 Total Dealership Gross PNUR 27

28 What do digitally savvy dealers do? cont. This is the number you want to drive up What do digitally savvy dealers advertise? Extended service, special service offers Work on all makes and models New-owner seminars What is their focus? Retention Speed, not gross Targeted digital advertising What are the outcomes? More efficient inventory Quicker conversion time for customers 28

29 Never before shared strategies to more sales Setting goals do you know where your leads stand in the pipeline? Measure the individual s performance in handling leads If you track each individual s performance you can see strengths and weakness, then you can train effectively 29

30 Never before shared strategies to more sales cont. Website surveys ask questions and learn what is important so you can close the sale A great salesperson will ask a customer questions so they can close the sale why are you not doing the same on your website? i. All dealer websites just list inventory with prices, but it does not have to be that way ii. Shoppers are confused with so many choices, and it is our job to provide clarity i.e. What type of car suits me best? Results lead to vehicle options in your inventory 30

31 Never before shared strategies to more sales cont. Drive leads with digital finding new places to gather leads will lower cost per sale Advertising your dealership on other non-industry websites, i.e. realestate websites, recruitment websites Anytime you put a picture of a person in your ads you can increase your conversion by up to 23% Creates a difference in your ads vs other dealers vehicle ads Get rid of the price points in your ads you don t need them Create engagement programs via social media and increase your dealership s awareness 31

32 Market-Based Pricing Gone Bad The Double Discounting Problem The first discount now happens online, where the dealer prices its cars to market. The second discount happens at the dealership because price-based negotiation is needed to close the deal why? Salespeople are still trained to close by offering discounts Consumers don t trust car salespeople and don t believe they will get a good deal without negotiating a further discount. Secret of selling cars is the ability to tell it s story. Technology can help here. Pre-owned buyers only want to go to one Dealership so if you get the enquiry, you ve already been picked 32

33 Market-Based Pricing Gone Bad cont. Pre-Owned Gross Margin Trends There has been a fundamental change to the way we price, but haven t adapted the way we market cars online, and they way we train staff to close the deal. 65% of Gen Y would prefer to purchase without negotiating with a salesperson. Only 22% of Buyers consider only price Most people want to love the car and know they are getting a fair deal Need to reset your Digital Road to a Sale to start online. 33

34 Market-Based Pricing Gone Bad cont. Digital vehicle must sell itself Do your vehicle pages answer these 5 questions? i. Is this a fair price? ii. iii. iv. Am I buying a lemon? Is this car right for me? Why is this car better than all the others I ve seen? v. Why should I buy from this dealer? Website must be better at converting, once you ve sold the vehicle s story Average customer spends 90 seconds on Dealer website. For a website built for conversion, average is 4 minutes. 34

35 Market-Based Pricing Gone Bad cont. Ways to proactively build value in every car Share concrete evidence with the consumer instead of speaking at a high level Sell the specific unit, not the model Most people know the model, need to focus on the unit Point out differentiators proactively instead of waiting to be asked by the customer Expand the set of cars on your lot that might meet the customer s needs by recommending additional vehicles. 35

36 Market-Based Pricing Gone Bad cont. Ways to proactively build trust in the Sales Process Share evidence / information proactively instead of waiting to be asked by the customer. Creates a sense of transparency Show proof points for every differentiator you talk about (CarFacts information, how the price compares to Redbook, etc.) Offer to information to the customer that includes concrete evidence. Don t be overeager to get customer contact information let the customer learn about the car first. Once the customer arrives at your dealership they re more ready to buy than ever! 36

37 Market-Based Pricing Gone Bad cont. Top Reasons Mobile Customers Leave Your Lot Are you prepared for Sunday shoppers? QR codes on cars Access the relevant story on your website Notes to the story in the car window follow the 5 question philosophy Everybody at the dealership needs to actively work on creating knowledge of all cars on the lot Makes you the Product Expert on that car! 37

38 Unleash the Raging Bull in your Used Car dept Strategy #1 Roll money roll Short-term stocks - Every car is a short-term stock and you (Dealer) are a day trader 2015 Hot Sheet Strategy #2 Get on Down Every day you need to know the average unit value of used car stock. If you are at $17.5k aim for $17k Strategy #3 The Attack mode Attack the 10 most expensive cars in stock If they are in Service, Service Manager prioritises RECO asap We price these 10 cars to ensure they move/sell asap!!! NB: Do not change your commission plan to compensate for your poor inventory management!! 38

39 Unleash the Raging Bull in your Used Car dept cont. Strategy #4 Getting after the internet Tracking GAP (Give Away Profit) Differentiate between Internet price; and Your transaction price Principle The more you can reduce the GAP, the more money you make!!! A must do report in your business! 39

40 Unleash the Raging Bull in your Used Car dept cont. Strategy #5 The Winning Bull Life Cycle Management There are 20 day cars (identified by Trade Walk) with EWR Sticker EWR 20 days Purchase cars 30 days Trade is 45 days 40

41 Unleash the Raging Bull in your Used Car dept cont. Life Cycle Management 41

42 Winning words: Language pathways for sales & service Paul Cummings Need enthusiasm Excitement is your sustainable / controllable attribute you can build a long term team with The power has transferred from the dealership to consumers This is a good thing, it forces us to be better The consumer arrives at your dealership closer to a buying decision than ever before When the customer arrives it is all about how to service them, not sell to them You have already been selected for the sale!! The key is to be authentic Service-centric language is your new tool! 42

43 Winning words: Language pathways for sales & service cont. Our belief is Can you see some value in that? How we build value is by creating momentum I have an opportunity with you today I might not get one tomorrow Service-centric language rules Stay in service mode Absorb never deflect Restate never assume Confirm and clarify Bridge tool to keep control of the conversation Question out and up Every customer you have wants you to think they re special 43

44 Winning words: Language pathways for sales & service cont. This is a service-based language pathway Applies to all service scenarios It matters because salespeople can get stuck Once you master service-centric language You will never be stuck in sales conversations You will always have a language pathway to choose The sales process ends only when you lose interest If you out-serve, you will always outsell Some other Truths: Reputation will build you a successful business Marketing gives you a temporary return Training is the gift that keeps on giving 44

45 Winning words: Language pathways for sales & service cont. How can I master service-centric language? Practice to win! Master with practice It takes 20 minutes a day every day! Only practice on the days you want to win: which is every day! Never say I can t Need to always show the 4 E s 45

46 Winning words: Language pathways for sales & service cont. Can you see some value in that? That simple question builds Yes momentum Get customers to say as many little Yes s as they can before you ask for the big yes Sticky rules Leader own the process Need a postage-stamp mentality - Stick to it until you get somewhere You can only soar as high as the standards you ve set Do we really need to practice every day? We tried it, it worked, so we quit Looking for the exit ramp to mediocrity 46

47 Create and Cultivate a Winning Culture Heather MacKinnon Jeff King, General Manager/VP Bozard Ford Step 1: Define your dealership s core values create an intentional culture Does your dealership have defined core values? Allow employees to give input and help in the creation of your core values Step 2: Employee-engagement survey Perform yearly employee engagement surveys Step 3: Recognise employee strengths and share successes internally and externally Step 4: Build a return on engagement by integrating your culture and success into all forms of advertising 47

48 Create and Cultivate a Winning Culture cont. Step 5: Celebrate your Rock Stars Design a monthly recognition program for employees Step 6: Create a sense of purpose and loyalty through community events Step 7: Dealership employee-wellness programs healthier employees = happier employees Program designed to cover 75 to 100 percent of employee-health costs if wellness incentives are met Step 8: Encourage employee mental health to decrease stress and increase productivity Key Take Out The only way to have emotionally engaged customers, is to firstly have emotionally engaged employees!! 48

49 Emerging trends in leading dealers New car department Next car now programme finance payment driven sale generated, based on payment for new model being equal to < current payment Next up floor management system (80% TD, 60% conversion thereof) Fletcher Jones Benz pioneered system (US Dealer), 2 Fordham clients currently using Used car department Used car ROI 200%+ i.e. $1 mill of stock equals $2 mill + annual gross 200% ROI model, average unit retail COS should be $12k-$14k Wholesale tender (properly run) = average wholesale gross of $200 - $500 per unit 49

50 Emerging trends in leading dealers cont. F&I / Aftermarket departments F&I early intro equals quick capacity assessment Group BM role re: recommended insurances for next day deliveries (GSM can cover) 30% of Sales Manager income should be dependent on F&I / Aftermarket results Service Department Free 6 month inspection (to combat 12 month visits) New owner nights within 6 months (owner engagement and retention focus) 40%+ wait jobs (focus on school mums 10:00am 2:30pm timeslots = massive efficiency gains! 50

51 Emerging trends in leading dealers cont. Service department cont. Focus on preventative maintenance, preventative maintenance, preventative maintenance! Menu options: 40% minimum benchmark (70% = best practice) Cooling system service (features, benefits, consequences) Brake fluid service (features, benefits, consequences) Fuel and air induction fluid service (features, benefits, consequences) Tyre tread measured (and recorded) Tyres and platetronic (equals value based wheel alignment upsells) Battery test Alloy wheel repairs; and Etc.. 51

52 Question time and wrap up Feedback forms 52

53 Thank you for attending today s presentation Fordham advice and services are provided by Perpetual Trustee Company Limited (PTCo) ABN , AFSL This presentation has been prepared by PTCo. It contains general information only and is not intended to provide you with advice or take into account your objectives, financial situation or needs. You should consider whether the information is suitable for your circumstances and we recommend that you seek professional advice. The information is believed to be accurate at the time of compilation and is provided in good faith. To the extent permitted by law, no liability is accepted for any loss or damage as a result of any reliance on this information. 53