The Ultimate Dealers Guide for Customer Communication to Maximize Profits
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1 The Ultimate Dealers Guide for Customer Communication to Maximize Profits
2 The Ultimate Dealers Guide for Customer Communication to Maximize Profits CONTENTS TABLE of 3 INCREASE PROFITS NEW AND RETURNING 4 CUSTOMERS 6 MISSED CALLS of calls into automotive dealerships are from 45% new customers LOGGING LEADS MOBILITY Sales satisfaction among new-vehicle buyers is 52 points higher when their Salesperson uses a tablet device 13 PAGING 15 CLOUD BASED 16 SOLUTIONS 18 NETWORKING 19 WIRELESS WHO S CALLING? Phone calls into your dealership can provide intelligence on the health of your business. 22 SECURITY 23 CONCLUSION 24 REFERENCE
3 Three Ways You Can Increase Your Profits: Number of customers you have Add-on sales Frequency of your customers purchases Interestingly enough, the common theme throughout these is not cutting expenses or having the perfect process it is communication. It is easy to see that without communication you cannot grow. This white paper is packed full of statistical data to help you realize areas of communication growth as well as the latest trends in automotive dealerships. 3
4 The Phone s Ringing Who is Calling and Why? According to a Marchex, Inc. study, about 45% of calls into automotive dealerships are from new customers. 1 When the phone rings, someone needs to be there to answer it.? Potential new customers are calling: With questions about new vehicles or price quotes 4% of the time To get directions and find out your hours of operation 23% About services or vehicles not offered by your dealership19% of the time of the time Calls into dealerships To make an appointment or purchase over the phone 4% of the time New customers 45% When the phone rings, someone needs to be there to answer it. 55% Existing customers 4
5 You re Not the Only One They Want In a Service 360 study, they interviewed over 1,000 new car buyers and found that the majority of them (58.2%) visited 2-4 dealerships before they purchased their vehicle. Consumers today are more savvy and money conscious than in years past. They can shop around and narrow their choices much easier. Loyalty is not always a part of the equation. 71% of the people surveyed purchased their vehicle from a new dealership. 2 Previously purchased vehicle from same dealership? Number of dealerships visited before vehicle purchase 29% Yes 71% No 31.4% 58.2% 10.4% Only 1 2 to
6 Do You Know What You re Missing? What is really scary for dealerships, according to a Marchex, Inc. study, is that 20% of all dealership calls go unanswered. 1 That means 1 in 5 calls are missed, each of which could be a new lead. 20% of calls go unanswered Do you know which 20% you are missing? And what is worse, according to a CDK study, is that many dealerships (45%) do not even know how many calls they missed. The number of missed calls for these dealerships could be even higher. 6
7 Missed Calls = Missed Opportunities Each call your dealership misses could be a revenue-generating opportunity. Access to call reporting numbers can reveal some insightful, yet shocking numbers. A CDK study looked at six different dealerships of various OEMs and found the following departmental breakdown: Sales 4% of calls were missed and 10.4% went to voic Service 1.6% of calls were missed and 20.7% went to voic Parts 1.1% of calls were missed and 6.4% went to voic 3 SALES SERVICE PARTS Lost or Missed Calls (during a month) Average Profit $1500 $300 $50 Total Loss Loss Opportunity (assuming 15% close ratio) $47,475 $1,620 $172 $49,267 $591,204 month year Dealerships are passing up huge profits when they miss calls. Also, it is not hard to infer a direct correlation between CSI scores and calls going to voic no one likes to leave voic s. 7
8 Logging the Lead is not as Easy as it Sounds You use your phone system every day to help generate thousands of dollars of revenue, yet often times it is not integrated with any or all of your valuable software applications. Integration is a key aspect to effective communications. In a CDK study, we surveyed Sales Representatives and asked how often they logged phone leads: 9% said they NEVER log the leads 39% said only SOMETIMES they log the leads 3 This means that out of every 30 leads your dealership receives, you may retain data on only 15 of them. According to a Cobalt study, the average Sales cycle can range from days. 4 So, Salespeople are likely to enter leads into the CRM system only if they believe they will close the deal and only if it will happen in the next 10 days or less. 8
9 The Foundation of Communication is Integration Did you know that, according to a CDK study, 52% of dealerships enter the same customer data three or more times during a single deal process? 3 A simple feature like Screen Pop can help your employees view full customer information before they even pick up the phone. For example, Service can receive a call and create a repair order simply by clicking SERVICE REPAIR PARTS ORDERS the screen pop, and the customer s information will automatically be populated. Screen Pop DMS DESKING CRM We found that it typically takes 45 seconds for a dealership to access one customer s information. 3 But, with integration between your phone and software applications, information is available in less than 5 seconds. Time taken to access customer information 3, Average # of calls to Service x 45 seconds = 42 HOURS per month 3 9
10 When Mobility Gets Personal You see it every day: Salespeople using their personal smartphones for business. Being accessible 24/7 is essential for the old Sales axiom, ABC (Always Be Closing). In fact, a recent CDK survey uncovered that Salespeople give their cell phone numbers to customers 86% of the time. 3 Seems harmless enough. But, combine that with the 2013 NADA Workforce Industry report that says annual dealership Sales turnover is 62%. 5 This means that if you have 15 Salespeople on staff, 10 of them will leave your dealership this year, taking their personal smartphones containing many of your leads with them. LEADS! 15 salespeople on staff 10 will leave your dealership this year taking their personal smartphones AND YOUR LEADS with them 10
11 Don t Ignore it! Embrace Smartphones that Protect the Dealership One effective way to protect your dealership s leads is by using a feature that integrates a desk phone and a cell phone, called Simultaneous Ring. This allows a customer to call a single phone number one owned by your dealership to ring an employee s desk and cell phone, simultaneously. That means a dealership employee can effectively bring their desk phone with them, anywhere they go, to: Transfer calls between the two phones Dial internal extensions from their mobile device Tag and enter leads directly into the dealership s CRM system Look up vehicle and customer information on the lot Incoming Call
12 Smartphone Apps Further Increase Productivity With easy-to-use, free mobile applications, employees smartphones can be fully utilized without additional cost to the dealership because they are connected using Wi-Fi. Many dealerships now provide a free mobile application that gives Sales Representatives the ability to: See which employees are available for a call Dial out using the dealership s phone number Instant message (IM) with co-workers and customers Make video calls between all of your departments Service will not need to walk back and forth to the Parts counter Your F&I Manager can easily communicate with Sales when closing a deal 12
13 James Smith, Line One James Smith. You have a call on line one. James Smith, line one. Pages like these are often heard throughout the dealership however, James Smith is not always there to hear them. Paging is an inefficient way to locate employees. Productivity apps and unified communications can tell you if employees are available and where they are, when used properly. Here are a few examples of the newest dealership communication technologies: Presence Chat Voice Desktop sharing Video According to a CDK study, 43% of participants reported that their CSI score stayed the same or decreased over the last 6 months. 3 Better collaboration within your dealership can help. In Out James Smith Frank Jones Sally McNally 13
14 Wasted Time With unified communications, your dealership employees are empowered to route calls not only to the right person, but to the right person who is available to take your customer s call. According to a CDK survey, 90% of dealership employees said that at least one Technician per hour walks over to them to ask a question. And 93% said that it takes at least 1-2 minutes to walk from a Service bay, to the employee s desk, and back technicians 1.5 x minutes x 8 hours = minutes wasted per day Using unified communications, employees can see if someone is available and ask them a question via chat, video or desktop sharing. How much time do your employees waste walking throughout your dealership? 14
15 Do You Know Who s Calling? Phone calls into your dealership can provide intelligence on the health of your business. With an easy-to-use tracking solution, you can monitor: Missed calls Customer data from phone calls through the lead-logging process with the click of a mouse Call volumes throughout the day The effectiveness of Sales follow-up calls Calls that go to voic No shows for Sales and Service Knowing this information in real time can alert you to when there are not enough employees to answer the volume of incoming calls. It also gives you the ability to return a customer s missed call. Additionally, dealerships that want insights into Marketing ROI can use separate phone numbers to track the true effectiveness of every Marketing promotion. Missed Calls Customer Data Call Volumes Calls to Voic 4 Service No-shows 15
16 Cloud-based Solutions Make it all Possible Now you need to know how you can build a foundation to put all of this in place. Cloud-based, or hosted, solutions are the latest innovation of today s phone technologies. They can free your dealership from the hands-on, day-to-day management of your phone system. With a cloud-based phone system, your dealership can: Be flexible Purchase only what you need by expanding or decreasing the number of users you have when changes arise Stay current Receive updated software releases at no cost, so every one of your stores is on the same software version Improve efficiency Reduce repetitive IT maintenance Save money Incur no upfront capital costs for call servers and enjoy not having to upgrade, maintain or back up servers ever again 16
17 More Benefits of Putting Your Business in the Cloud When your phone service is delivered through the cloud, your employees can be walking the lot, on a test drive, or in their kitchens. Suddenly, you are far better equipped to deliver the level of service your customers need and expect the level of service that keeps them coming back to your dealership, time and time again. 99.5% uptime (and business continuity) with secure hosting from Tier IV Data Centers that can withstand most natural disasters (CDK) 3 Freedom to turn over all of your phone responsibilities to a single point of accountability Reliability of affordable communication technologies with predictable costs 17
18 The Backbone of Your Phone System DMS A network consisting of routers and switches make up the backbone of any connected business. In a nutshell, the router finds the best path for traffic in and out of your network and the switch sends it where it needs to go inside the dealership. That brings us to the needed shock to your system. Every phone or wireless access point needs electricity to function. By combining your network and electrical together (commonly called a powered network), your devices only need one cable verses two separate ones for cable and electricity for everything. For real estate success, it s all about Location, Location, Location. For dealership success, it s all about Network, Network, NETWORK. Investing in the right network that is supported 24/7 is critical for your phone system, dealership applications and your wireless network. CRM 18
19 Wireless According to a JD Power Study, sales satisfaction among new-vehicle buyers is 52 points higher when their Salesperson uses a tablet device versus not using one during the Sales process. 6 A few progressive dealerships have already started transitioning to using tablets to empower their Salespeople with mobile technologies that can help them find the information they need, when they need it. But, what happens if wireless access is spotty or unavailable at times? Suddenly, the tablet and the investment in it is almost useless. According to an CDK study, almost 59% of dealership employees said that their wireless access does not work all of the time. 3 No Wi-Fi?! A properly installed, commercial-grade wireless network that rides on top of your core powered network is essential to enhancing the way your dealership operates. 19
20 Six Mistakes Dealers Make when Implementing Wireless Networks Here are a few considerations when implementing or upgrading your wireless network: 1 Powered network Without having power 2 in your wired network, you will have to run electric to each one of your wireless access points, which can cost as much as $1,200 per outlet. Access point placement Where you position your access points is critical: if they are too far from where dealership employees use the Internet, the connection will be weak, and if they are too close to your devices, they will drain the batteries. Every dealership 3 is unique, so a comprehensive site survey pays off. Configuration OEMs are building wireless solutions to make your business better, and to run those solutions effectively, you should follow their recommended wireless configurations. 20
21 Six Mistakes Dealers Make when Implementing Wireless Networks (continued) Access point type 4 Many dealerships wrongly believe that a consumer-grade wireless access point is good enough for business. These devices are designed to support about four wireless devices, so once your employees and customers join your wireless network, they will absorb tons of bandwidth, decreasing the coverage area as well as slowing down the entire network. 5 A single wireless network Make sure you link your wireless access points together so users can move throughout your dealership, and like a cell phone connection seamlessly flow from access point to access point, maintaining a strong wireless connection. Wireless controllers can also mitigate signal interference as well as maintain a separate guest network for your customers. 6 Tablet management Purchasing, fixing, configuring and managing tablets can become overwhelming. Select a vendor that supplies, configures, supports and replaces tablets, saving you the trouble of running around to fix tablets, day in and day out. 21
22 Don t Forget About Security Dealerships are becoming one of the most regulated businesses in the country. According to NADA, dealerships are subjected to nearly 100 federal regulations as well as additional state laws, depending where you reside. The FTC has even gone as far as considering dealerships to be financial institutions basically the same as banks. It then goes without saying that your dealership is a target for cyberthieves. According to a Verizon report, in 2011, the second-highest data loss total was reported since they began keeping track in % of attacks were from outsiders, organized crime and activist groups 81% of attacks used some form of hacking 79% of dealerships were targets of opportunity targets with known weaknesses Breaches resulting from privilege misuse were only 5% of the total As you can see, the data your dealership holds is extremely important, so you want to do everything you can to protect it. 22
23 Conclusion Collaboration is King The way you collaborate with your customers and your employees says a lot about your dealership. Having the right solutions that will help productivity, clarity and speed is what will separate you from your competition. CDK has been providing INTEGRATED phone systems to dealerships for the past eight years. In conjunction with Cisco, who specializes in networking, cloud computing and phone systems, CDK is the industry s authority on dealership communications. Currently, CDK: Has sold over 100,000 phones Supports over 3,000 dealership sites Manages almost 80 million calls per month To learn how you can advance your communication processes, contact your local CDK Sales Representative or call CDK Global is a Cisco Gold Certified partner in the USA, allowing us to incorporate the deepest level of Cisco Lifecycle Services expertise into our offerings and demonstrate a measurably high level of customer satisfaction. Listed below are the architectural specializations that helped us obtain our certification: Advanced Data Center Advanced Collaboration Advanced Borderless Networks Master Unified Communications Additionally, CDK Global is a worldwide Cisco Cloud and Managed Services Partner with the following Powered Managed Services specializations: Managed Security Business Communications Application Performance Management cdkglobal.com Follow us for more insights 23
24 Reference 1 Marchex, Inc. Study: Auto Dealers Pay Big for Letting Calls go to Voic . Marchex Investors, 24 Oct irol-newsarticle&id= &highlight 2 Service 360 Report 3 CDK Business Intelligence 4 Cobalt ebook. A Guide to the Modern Car-Shopper Journey NADA Dealership Workforce Study Industry Report. 6 J.D. Power 2013 U.S. Sales Satisfaction Index (SSI) StudySM. Released November 14, Based on responses from 29,040 buyers who purchased or leased their new vehicle in April or May e0bad968f014.pdf 24
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