Voyages of the How They Did It – February 2007
By Patrick Luck
Their Mission: To seek out new leads; To explore innovative new marketing worlds; To boldly go where no dealer has gone before.
Last month we announced the Top 10 eCRM Dealers of the Year for 2007. In reviewing the data from the recipients of the award, I reflected on the tremendous phenomenon the Internet has become as a marketing medium. I was reminded of the science-fiction-based series Star Trek which debuted in the 1960s. In its fictional universe, humans were able to overcome many boundaries and limitations to improve the quality of life. This fictional vision of the future had a huge impact on our culture, most notably on the development of technology. The series is believed to have motivated the design of many current gizmos including the mobile phone, Tablet PC, and other personal digital devices, and set the bar for developing technology such as “virtual reality.” An entire subculture has grown up around the show. Trek fan or not, we find ourselves – 40 years later – utilizing similar, previously unfathomable, concepts to break through marketing barriers and improve the quality of customer service available to the new-frontier, generation-tech auto consumers.
In this issue, we will share with you how the award-winning eCRM Dealers of the Year achieved their phenomenal results, selling from 70 to 700 additional units per month, through exploration of the innovative technology of eCommerce. By unleashing the potential of the Internet, these dealers have discovered an ingenious solution to promote all profit centers within their dealership (New, Used, F&I, Subprime, Service, Parts) while improving customer satisfaction. Success like theirs is possible for all dealers who have the desire to implement it; however, as with any industry, new technology always presents challenges within the dealership. In an effort to share the knowledge gained and lessons learned, we’re publishing a compilation of the top 10 pitfalls commonly hindering today’s eDealers. By avoiding and correcting these common pitfalls, your dealership will save valuable time and money while improving results and sales.
Charting New Territory
Our industry has successfully navigated into new territory by leveraging the power and technology of the Internet. In an effort to share best practices with our readers, we have compiled a consensus of various best practices and strategies from this year’s award-winning dealers:
• Consult a Professional
Nine of the 10 top eCRM dealers agreed that the constantly evolving technology of the Internet requires the knowledge and experience of professionals who constantly monitor state-of-the-art technology and, most importantly, know the auto industry. Many have been exposed to companies that offer marketing tools and CRM technology, but are unable to provide valuable expertise on industry trends. Gloria Williams at Harvey Autos adds this for consideration, “Because our site was created by experts who understand the car business, it builds value in our dealership. As a result, our Web site has consistently converted five to six times more visitors into leads over our previous site.” When seeking a consultant, ask for references and referrals of current clients to find out about their satisfaction and results.
• Build a Detailed Strategy
All of the top eCRM dealers shared the belief that a good Web site is important, but won’t generate extra sales without a detailed, innovative marketing strategy, detailed processes to turn leads into appointments, well-trained people to turn appointments into sales, and a solid pricing policy to protect a fair profit to hold it all together. Dave Smith, founder of Dave Smith Motors, developed a one-price system in the early 1980s and successfully continues today to offer this “hassle-free” buying philosophy.
• Implement Processes
Top eCRM dealers tell us that having the dealer and general manager heavily involved in initial planning, strategy sessions, and decision making process is crucial to successful implementation. Continued support and involvement determines the success or failure of any eCRM initiative. Andrew Walser, owner of Walser Auto Group sums it up: “We understand the importance of process and execution. We have centralized a consistent process in all of our 12 franchises, and as a result have built a great foundation in terms of percentages and closing ratios. Currently we are setting appointments on 32 percent of our leads with an 80 percent show up rate.”
• Automate Processes
The top eCRM dealers agree that with the right technology, you can handle more leads with fewer people. Brian Benstock, of ParagonHonda.com explains, “Automation makes it easier to follow our process, allows us to handle more leads with fewer people and allows our sales specialists to focus on what they do best: sell cars. It’s a big part of why we’re selling an additional 200 cars a month. Today we have more than 80,000 email addresses and if we were attempting to manage that database without automation, it would be overwhelming.”
Tony Rimas, from RedMcCombs.com echoes the sentiment that automation allows you to do more with less, “Our CRM tool automates so many of our phone and e-mail processes that we can manage thousands of additional leads without adding staff.”
• Generate Traffic
All of the top eCRM dealers define a great Web site as one that generates leads. They are reducing their dependency on hard-to-close third party leads and costly traditional advertising and are relying on their state-of-the-art Web sites as their lead generator. Dealers know that a Web site will get results if it is simple, easy to use, quick to load, and has highly engaging content that can work fast even on a low-speed connection. Dealers with award-winning sites offer innovative features like Virtual Test Drives, Online Auctions, Online Credit Applications, Trade Appraisals and more.
Effective Web sites entice the customer to submit a lead, pick up the phone, or drive straight to the dealership. Rick Case offers information on their site, “RickCase.com is more than just a web site; it’s a Virtual Dealership which serves as our own regional buying service. Our site, along with innovative Search Engine Marketing (SEM) strategies, drives more quality traffic to the dealership which increases leads, reduces reliance on third-party lead providers, and lowers costs.”
E-mail marketing is the most cost-effective, measurable method of advertising. Brian Benstock, of ParagonCars. com explains, “We sold 36 vehicles in three days with one of our campaigns and it didn’t cost me a dime. We have collected over 100,000 e-mail addresses and we send out a minimum of one multi-media email campaign a month. We’ve had a lot of success with our e-mail marketing campaigns, so we focus on gathering e-mails from our parts, service and sales customers to fuel the e-mail database for future digital marketing.” Bob Tasca III of Tasca.com gives another powerful example, “If Ford comes out with an Explorer incentive, I can send an e-mail to everyone who has been in on an Explorer, and I can select just our lease renewal customers who are currently in an Explorer or even customers who were in to service their current Explorer. There’s no limit to how I can target my campaigns.” Search Engine
Search Engine Optimization (SEO), also known as “organic,” is fundamental to any digital marketing strategy. Through a process of including key words and phrases, dealers are able to better position their Web site ahead of the competition. Roy Reutter, from Sheehy. com tells us, “Search Engine Optimization combined with our multimedia e-mail campaigns has enabled us to increase traffic and sales at a lower cost than ever.” Search
Most dealers with eCommerce Departments have marketing strategies that encompass the art of Search Engine Optimization; however, we have found that award-winning dealers are also capitalizing on the more immediate and measurable benefits of Search Engine Marketing to maximize placement in search engine results. As Tony Rimas of RedMcCombs.com tells us, “Our Digital Marketing System, complete with an advanced Search Engine Marketing strategy, allows us to dominate search engine results in our region, continuing to provide us with consistent results, increased sales, and customer satisfaction at a lower cost per sale.”
Many of the top eCRM dealers concur that Search Engine Marketing generates a higher return on investment by boosting traffic and increasing sales. These dealers are doing a great job integrating their online and offline marketing strategies to maximize the return on all their advertising.
• Prepare and Train
Even though the Web and CRM have made an incredible impact on the automotive industry, this still is – and always will be – a people business, so nothing is more important than quality people who are well-trained. All dealers express the importance of having a well-trained, dedicated staff to handle incoming leads. Bob Tasca III is passionate about people, “We have a recruiting, hiring and training process that we use whenever we’re hiring for any position in the dealership and we like to say that we hire out of inspiration, not desperation. That means that we’re always on the lookout for energetic, talented people with a good work ethic and an eagerness to learn. A new candidate doesn’t necessarily need to have automotive experience because our new hire training program and on-going training are so extensive. We have a training company that we bring in for two days every month to help with our training needs.”
• Track & Measure
To truly maximize the profitability of every customer relationship, you need a marketing automation solution that supports your entire marketing team and provides management with crucial metrics to improve efficiency and effectiveness at every stage of the marketing process. Jay Gubala of HerbChambers.com asserts, “Our Virtual BDC Manager is fully automated. We measure everything and hold regular meetings to discuss our progress and to find ways to fine-tune our processes. The customized reports give us the information we need, the number of leads by source, response rates, appointment percentages, show percentages, closing percentages and cost per sale.”
The Internet will shortly be under the care of another generation. To them and their posterity will we commit the future of our digital marketing. They will continue the voyages we have begun, and journey through all the previously unexplored lead generating possibilities; boldly going where no man – where no dealer – has gone before. Congratulations to the Top 10 eCRM Dealers of 2007, and thank you for sharing your insight on what it takes to effectively leverage the technology of the Internet and CRM to increase profits and create loyal customers in the process. As Mr. Spock would put it: With results like these, to not continue to explore the limitless opportunities of eCommerce would be…illogical.
If you have any questions regarding any of the best practices discussed in this article, please feel free to visit the dealers’ Web sites or send me an e-mail.
Patrick Luck is the publisher and editor for SellingSuccess Magazines. He can be contacted at 866.239.3698, or by e-mail firstname.lastname@example.org.