Does Anybody Have a Plug?

by : Richard Griskie

http://www.dealer-magazine.com/index.asp?article=1845

Lost opportunities have plagued dealerships across the United States since we began selling cars over 100 years ago. An average dealership selling 150 cars per month has approximately 1,000 lost opportunities in that same time period. Envision a bucket full of water with four holes in it representing your showroom, Internet, phone and service departments. Naturally the water (representing leads) will pour out of the bucket through the holes unless you plug them. The challenge is making those holes smaller so you lessen those opportunities that are lost and keep more water (representing sold customers) in your dealership bucket.

As CRM has evolved in the automotive industry, I feel we have become too focused on the features of systems and not focused enough on building processes to prevent leads from leaking out of the dealership. Get your processes under control and you can stop the leaks and capture more sales.

The simple goal of CRM is to convert leads into appointments, appointments into sales, and sales into satisfied, loyal customers. To accomplish this you must understand who your prospects and customers are, why they didnít buy, and influence when they come back.

The question is how to get more out of what you already have without spending additional advertising or technology dollars. There are four distinct areas I would like to review and share tips and strategies to help you improve each one.

Four areas to maximize your current opportunities
The first is the walk-in traffic. A defined process should be in place whether you use a closed or open floor selling system. The keys to making CRM work for showroom measurement is tracking and accountability. The most important items that should be measured are making sure as close to 100 percent of customers are logged into a CRM tool, not just the ones that touch the desk. That includes lot drops, just looking prospects, service customers who wandered into the showroom, and any other person of age to buy a vehicle that steps foot onto your lot.

†Both salespeople and managers donít like to log everyone because then they are responsible for following up. Create an incentive for the salesperson with the most logged customers for the month. You could also try to tackle the issue by using a greeter whose sole purpose is to meet and engage everyone.

To successfully make this happen month after month you must create a system that all salespeople and managers adhere to in regard to logging people, with necessary discipline for failing to adhere to the system. I have seen closing ratios drop from 18 to 20 percent down to 6 to 8 percent once everyone is logged correctly. It must be noted that while closing ratios dropped, total units sold increased. Remember real numbers mean real results.

The second area to improve is your phones and making sure they are answered promptly and correctly every time by someone who can sell the appointment. Whether your calls are logged by a BDC rep or your showroom sales staff, it is imperative that each call is logged and labeled within your CRM tool - enabling you to obtain an accurate count of phone calls and what happened with each one. Use technology to record both your incoming and outgoing calls and make sure everyone knows that every time they are on the phone someone might be listening. Remember to train your people to sell the appointment because cars are not sold over the phone - appointments are.

Third is the Internet, which is the easiest to track since leads usually automatically go into the CRM. But here is where a lot of people are missing the connection. Your showroom log and your Internet log must be connected to uncover crossover shoppers and to make sure you are not losing gross because customers are shopping both sides of your store. Also make sure to check your Internet follow up and how long you are making constant contact with a lead. We recommend that you have consistent communication with prospects for the first 74 days, and then put them into a monthly communication cycle. Remember with Internet customers to get them on the phone and sell the appointment. I will take an OK phone call versus the best e-mail any day of the week.

Finally, I feel one of the most overlooked areas of your store for sales opportunities is the fixed operations department. Having a system in place to identify potential deals and communicate them from the service or body shop manager to the showroom sales manager seems to be one of those areas that have inherently never been truly maximized. This is usually because it comes down to ownership of the customers and the struggle between the front and back. Come up with an incentive for both departments to work more closely and you will see a consistent stream of customers come from the back to buy a vehicle. Just think about customers who have totaled vehicles, or vehicle repairs over $3,000. These could be triggers to soft offer those customers a new vehicle or at least show them more options, which would include a new or pre-owned vehicle offer. Remember, your service department generates three to six times more traffic than your showroom, so start to use it more effectively.

The key to keeping CRM processes working effectively is ongoing measurement with active management using an accountability system which includes: prospect/customer follow up schedules, daily work plans, performance reporting, and one-on-one coaching.

In conclusion, over the next couple of months try to look inward to capture and maximize the opportunities that you already have, versus spending more money on generating additional showroom traffic. The average dealership can increase its business by 15 to 30 units per month just by logging and managing its current lost opportunities.

Richard Griskie is the assistant vice president and general manager of JMsolutionsí CMX Customer Management Solutions. With over 18 years of automotive retail experience, Griskieís expertise resides in leveraging process and technology to enable dealerships to sell more vehicles and service ROs at a higher gross profit with lower cost.