apr06

a division of Systems Marketing, Inc. www.autosuccessonline.com

3411 Pinnacle Gardens Dr.Louisville, KY 40245

PRSRT STDUS POSTAGE

PAIDLOUISVILLE, KYPERMIT NO 879

April 2006

AutoSuccess Predicts High Profi t Year For New Car Dealerships

8-Step Dealership MakeoverProven Solutions from the Internet’s Master

Automotive Business Builders

Page 24

Pro secrets to build revenue

Nail the one-call close

Power-organize your CRM

©2006 AutoTrader.com is a trademark of TPI Holdings, Inc. and is used under license.

Introducing more buyers to sellers. More sellers to buyers.And the world to the ultimate automotive marketplace.

There’s only one place where 2.7 million vehicles and millions of

serious shoppers a month come together. And it isn’t the newspaper.

It’s the world’s ultimate automotive marketplace. AutoTrader.com.

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866-239-3862The Driving Force Behind

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SALES EVENTS

Experience real case studies and learn best practices that will help your dealership immediately.

Dean EvansVice President of Marketing, Dealix

You will learn:- Internet Marketing that

generates high quality leads

- Maximizing lead generation from your

Web site- Maximizing third party

automotive sites- Metrics that matter

- Focus on return on investment

David KainPresident, Kain Automotive

Inc. Internet & BDC Training Specialist

You will learn:- Mapping out the best Internet sales process

- E-mail templates for the best short and long-term

communication- Phone script elements

that turn leads into appointments

- Recruiting, hiring and compensating for results

SeanWolfi ngton

Owner, BZResults.com

Case Study: How to use BDC/Internet departments to sell 100 - 500 extra cars

a month.

You will learn:- Setup a successful BDC/

Internet department- Use the Web to promote

all your profi t centers- Use the Web to drive

showroom & phone traffi c- Sell old stock, vehicles &

parts inventory- Use e-mail marketing to drive more traffi c for

zero cost

Chip PerryCEO and President,

AutoTrader.com

Internet Advertising Best Practices

You will learn:- How AutoTrader.com’s top performing dealers get their

outstanding results- Take home examples of

effective merchandising you can put toimmediate use

Scott JosephPresident & CEO,

J&L Marketing, Inc.

Case Study: New Variable Data Print Campaign Management System

increases Dealership’s market share from 8% to 20% and grows net profi t

from $170,000 to over $1.6 million in just one year!

You will learn:- Trigger marketing

techniques using customized Web pages and direct mail.- How to increase your fl oor

and phone traffi c during your slowest days of the week.

- A Growth Strategy to grow your gross profi t a minimum

of 33%

Darren HaygoodDirector of CRM & Internet

Sales, Lokey Automotive

You will learn:- Maximize your ROI

- Learn how to increase your Internet dept. gross

profi t - To price or not to price

- Stop giving units away just to gain market share

- How to stop selling price and start maximizing ROI - Redefi ne your used car

Internet strategies - Turn leads into

appointments, appointments into sales

- Conduct monthly phone blitz sessions

JenniferPicheco

Director of e-Commerce, Germain Motor Company

Maximizing Your Internet Department’s Potential

You will learn:

- Core structure: size matters

- Where you are vs. where you’re headed

- Your leads and where they come from

- You heard the customer, now what?

- When follow up is not enough

- Attitude is everything

Al BabbingtonChief Executive Offi cer,

CallCommand

Dealers today run the risk of under-communicating and

also over-communicating to their customer. So what’s

the right mix?

You will learn:- Unlocking the potential in

your database- Understanding the lifetime

value of your customers- Automating professional &

consistent communication- Maximizing owner loyalty

- Increasing repeat & referral business

- Increasing frequency of purchase & spend per visit

Chris HansonAward Winning

DaimlerChrysler Sales PersonYou will learn:

- How to groom your sales people to be 20-plus car

people a month- Proven processes that

work anywhere- Show your sales people

how to make, develop and maintain Raving Fans

- A sales process for today’s sales person and customer- Specifi c follow up process

for sold customers- Specifi c follow up process

for unsold customers- How to close over 35

percent of your Internet leads and increase customer

loyalty

Jesse BiterPresident, HomeNet

Case Study: How proper online vehicle

merchandising can make you stand out

You will learn:- How to work Smarter, not

Harder- How to maximize sales on

the Internet

Dave WhiteGeneral Manager Internet

Operations, DARCARS Automotive Group

Getting the Most Out of Your Internet Department

You will learn:- Effective techniques for

handling the incoming and out-going Internet phone

calls- Creating sure-fi re

processes that will maximize appointments and sales

Rad WeaverRed McCombs

Case Study: “Ford & Toyota Dealer Sells 500 Extra Cars

Online”

You will learn:- How we increased our

Internet sales from 40 to 500 in one year

- How we tripled our Web site traffi c through free

marketing- How we increased out leads from our Web site

- How we staff, train, pay and keep great people

- How we handle pricing to maintain gross profi t

JenniferLampinen

CRC Director, Paragon Acura

Case Study: Key steps to becoming an award

winning CRC department

You will learn:- Develop your people

- Create a process-driven environment

- Do you know what kind of job you are doing?

- Measure your results- Think outside the box:

Look at what other industries are doing that

works- Never stop growing

David ThomasOwner, Subaru of Dallas

You will learn:- How to cut your

advertising expenses- How to get more exposure

for less expense- Gorilla marketing

campaigns that work- How to create free

publicity- How to generate car

reviews in the right publications

- How I grew market share in the world’s worst location

Ashley AntonioCRC Director, Paragon

Honda

Case Study: How to properly train and manage

your CRC staff to ensure the best results possible

You will learn:- Proper hiring practices

- Training methods- How and when to train

- Who to train- Where training should

be done- The importance of mystery

phone shopping the competition

- Constructive Call Monitoring

- Training Incentives

May 18th and 19th, 2006. At the Venetian Resort and Hotel, Las Vegas, NV

Dealers & Managers Only!

Two days of intense learning. Dramatically improve your results.

Limited Seats,Register Today!

Case studies from successful dealerships across the country.

Class room style seating only $595 in advance, $995 after April 18th, 2006.Speakers subject to change

Call today to register. toll free 866.239.3712 web www.autosuccessonline.com

IVSUMMITBEST PRACTICES

LEADERSHIP • INTERNET • CRM • MARKETING • BDC • SALES

After our CFO and I attended our fi rst Summit in Nov. 2004, we used the information to help us form our own Business Development Center. The information provided by the vendors and dealers enabled us to cut out a lot of mistakes that would have been made without the information. In April 2005 our BDC was offi cially launched and is now the hub of our entire dealer group. In Nov. 2005 the BDC manager and I attended our second Summit. My BDC manager was equally impressed with the content of the meeting and walked away with a lot of useful information. I think what makes these two days so informative is the fact that you not only see the applications available in the marketplace but you also see how they are used by real dealers. It would take weeks to research this much information. I would recommend any dealer doing business on the Internet to attend one of these. Thanks again, see you at the Summit!

Gene Leitner,General Manager, Norris Honda

Come see special guest speaker Bill Sattree at

the invitation hors d’oeuvres party, Thursday at 5:30pm at

the AutoSuccess Best Practices Summit IV

AutoSuccess Magazine is published monthly at 3411 Pinnacle Gardens Drive, Louisville, Kentucky, 40245; 502.588.3155, fax 502.588.3170. Direct all subscription and customer service inquiries to 877.818.6620 or [email protected]. Subscription rate is $75 per year. AutoSuccess welcomes unsolicited editorials and graphics (not responsible for their return). All submitted editorials and graphics are subject to editing for grammar, content and page length. AutoSuccess provides its contributing writers latitude in expressing advice and solutions; views expressed are not necessarily those of AutoSuccess and by no means reflect any guarantees. AutoSuccess accepts no liability in respect of the content of any third party material appearing in this magazine or in respect of the content of any other magazine to which this magazine may be linked from time to time. Always confer with legal counsel before implementing changes in procedures.© All contents copyrighted by AutoSuccess Magazine, a Division of Systems Marketing, Inc. All rights reserved. Reproduction inwhole or part is prohibited without express written consent from AutoSuccess. AutoSuccess may occasionally make readers’ names available to other companies whose products and/or services may be of interest; readers may request thatnames be removed by calling 877.818.6620. Printed in the USA. Postmaster: Send address changes to AutoSuccess Magazine, 3411 Pinnacle Gardens Drive, Louisville, Kentucky 40245.

Brian Ankney, Sales-improvement [email protected]

Brian Balash, Sales-improvement [email protected]

Charlie Tierney, Sales-improvement [email protected]

Chris Feck, Sales-improvement [email protected]

3411 Pinnacle Gardens DriveLouisville, Kentucky 40245

toll free: 877.818.6620facsimile: 502.588.3170 web: www.AutoSuccessOnline.com

Patrick Luck, Editor & [email protected] Susan Givens, Vice [email protected] Thomas Williams, Creative [email protected]

Courtney Paris, Sales-improvement [email protected]

helping to promote... monthly verses...

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Leviticus 25:18

“Wherefore ye shall do my statutes, and keep my judgements, and do them; and ye shall dwell in the land in safety.”

Working Well With Others

How to Get Dramatically Higher Response From Your Advertising, Better Quality Ups, Higher Closing Ratios and Increase Sales and Profits

Start Achieving Your Sales Goals Today

Internal Re-con vs. Sublet:The Great Debate

Some of What I’ve Learned About Hiring

Super Bowl Ads: Super Marketing or Super Waste of Money

Taking Photos That Really Work Online

What You Need to Know Right Now About Search Engine Marketing

8-Step Dealership MakeoverProven Solutions from the Internet’s Master Automotive Business Builders

E-mail Address Collection:A Powerful Competitive Weapon

Three Simple Ideas to Improve Your Internet Results

Speaking Up for the Silent Majority

Seven Habits of Highly Successful Dealer-ownedV.S.C. Programs

Winners Are Losers

If You Build It, They Will Come, Part 2

How Are You Attracting Talent to Your Organization

Five Critical Success Factors for Subprime Auto

You Are In Control

Use an Evidence Manual

Internet Marketing Can Be Easy

2424

BrianTracy

JimmyVee & TravisMiller

SeanWolfington

MarkTewart

JimAdams

JeffMorrill

KirkManzo

ChipPerry

RadWeaver

BrianEpro

DavidKain

JesseBiter

EricKauk

ChrisAlford

ChrisHanson

MichaelYork

TimShea

DavidJacobson

EricHinkle

God is the source of all supply

8 www.autosuccessonline.com

Working Well With Others

BrianTracysts fos ls ms sf fi s

sales and training solution

In-Person and InteractiveSolutions for Telephone/Internet

and Business Development.

Alan Ram

How much does it cost every time someone at your dealership talks to a customer and doesn’t

know what to say?

R

Viagra is a Registered Trademark of Pfizer, Inc.R

- Tom Belt, Toyota of Escondido

"Having utilized the services of many top-level automotive sales trainers over the years, absolutely nobody impacts our bottom line while drawing the raves of our sales and management staff like Alan Ram."

- John Chmela, COO, Atlantic Auto Group

“HE’S LIKE VIAGRA FOR YOUR

TRAFFIC COUNT”

toll free: 866.852.0328 e-mail: [email protected]: www.proactivetrainingsolutions.com

A 20-year study at Stanford University examined the career paths of thousands of executives to determine what

qualities they either had or developed that enabled them to move ahead the most

rapidly. Researchers concluded that there were two primary qualities that, more than any others, were indispensable for men and women who were promoted to positions of great responsibility.

The fi rst quality was the ability to function well in a crisis. It was the ability of the

executive to keep his or her cool when the company or the department faced serious challenges or setbacks. It was the ability to calmly analyze the facts, gather information, reach conclusions, make decisions and then mobilize the other people to respond effectively and solve the problem.

The second quality that was identifi ed among the fast-trackers was the ability to function well as a member of a team. This tendency toward cooperation rather than confrontation was evident early in a person’s career. It was the primary quality that senior executives looked for and rewarded the most. The ability to be a good team player inevitably led to greater opportunities to function as a member of more important teams. In fact, teamwork is so important that it is virtually impossible for you to reach the height of your capabilities, or make the money that you want, without becoming very good at it.

You can make the decision to be an excellent team player in everything you do at work and at home. Your aim should be to seek out every opportunity to demonstrate your ability to contribute to the success of a group of people in accomplishing large objectives.

And you can start right where you are.

Let’s start with the defi nition of team. A team is two or more people who combine their talents and abilities to accomplish a specifi c goal or series of goals. A team, by defi nition, is made up largely of equals, men and women who are different only in their areas of skill and who are peers when they sit down together as a work group.

A team is formed to take advantage of the power of synergy. Synergy means the total is greater than the sum of its parts. For example, let’s say that four individuals working alone will produce four units of work; when they are combined as a team, the four individuals may produce fi ve, six, eight or even 10 units of work. One person working alone simply cannot do many jobs, whether it’s carrying a heavy box or carrying out a major corporate project. A team needs to be formed whenever the task at hand is greater than the capacity of any individual working alone.

Over the last few decades, the concept of teamwork has evolved rapidly. We came

9april 2006

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Dustin Zeck - GM - Danny Zeck Ford Lincoln Mercury, Leavenworth, KS

VinStickers.com866.662.1984

[email protected]

continuedout of World War II with a “command and control” mentality. Most of the heads of American corporations, large and small, had been military offi cers of various ranks, during the war. They brought their training into the workplace. Their approach to management was the hierarchy or pyramid style, with the president at the top, the senior executives below him, the junior executives below them, and so on, all the way down to the workers and support staff who made up the base of the pyramid. The orders traveled in one direction: down. Information fi ltered up slowly. People were expected to do their jobs, collect their paychecks and be satisfi ed.

However, two forces have converged to transform this approach to management dramatically. First, is the rapid rate of change and the increasing complexity of even the smallest business operation due to the advent of the computer age. Everyone has critical skills and knowledge that are necessary to many other people if the job is to get done on time and to an acceptable standard of quality.

Your job in your company requires that you know a lot about what is going on everywhere else, as well as be thoroughly conversant with what you do. And the fastest and most accurate way of keeping current with what is going on is to develop and maintain a network of contacts, an informal team of people within your workplace who keep you informed and whom you keep informed.

The old methods of command and control now exist only at the old-line companies, many of which are fi ghting for survival. Today, men and women want a high degree of participation and involvement in their work. They want an opportunity to discuss and thoroughly understand what they are doing and why they are doing it. People are no longer satisfi ed to be cogs in a big machine. They want to have an integral role in achieving goals that they participated in setting in the fi rst place.

Being a team player is no longer something that is optional. Today, it is mandatory. If you want to achieve anything of consequence, you will need the help and cooperation of lots of people. Your main objective is to structure everything you do in such a way that, because you are constantly cooperating and working well with others, they are continually open to helping you achieve your goals as well.

Now, the major reason teams do not function well, and why people end up not making their full contribution to the success of

the teams, is lack of clarity. All the studies of team building and team development focus in on the importance of everyone’s being absolutely clear about what the team is trying to accomplish. This can be in the form of a goal or objective handed down by senior management, or it can be the result of discussion and participation by the various team members. In any case, everyone must know what is to be done, to what standard, by what deadline and what the roles and responsibilities of each team member will be in the achievement of that goal.

One of your key concerns is to be absolutely clear about exactly what is expected of you. If for any reason you are not sure, bring it up and ask about it until you have no doubt. Then get busy, do exactly what is expected of you and do it well.

Remember, in all your interactions with your team, your role is to be supportive and helpful. Your role is not to challenge, criticize or argue, but to look for solutions and for opportunities to help other people make their maximum contribution as well. When you sit in on a team meeting, you are on stage. Everyone is watching you. The best team players I have ever seen are those whose comments to the other members of the team are in the form of suggestions on how things can be done better. The best team members are always offering to help other people after the meetings to get on top of some aspect of their work. This focus on collaboration and cooperation is seen by everybody and marks you as a person to be both liked and respected.

Many men and women have kicked their careers into the stratosphere by taking on a small responsibility and doing such a good job with it that they came to the attention of important people both inside and outside their organizations.

Continually look for opportunities to get onto teams and to make valuable contributions. Volunteer for additional assignments. Focus on high-priority tasks, and fi nish what you start on time. Do excellent work. And remember that, as Confucius said, “He who would be master must be servant of all.”

Brian Tracy is the chairman and CEO of Brian Tracy International. He can be contacted at 866.300.9881, or by e-mail at [email protected].

How to Get Dramatically Higher Response FromYour Advertising, Better Quality Ups, HigherClosing Ratios and Increase Sales and Profi ts

JimmyVee & TravisMiller

Traditional hard-sell advertising doesn’t work in the Internet age. There are other ways to sell

with intelligence, and we’re going to tell you about them.

What you are about to learn doesn’t stop at the end of this article. Once you start digging into this concept you will end up head-over-heels, face down looking into a rabbit hole that goes deep. You have to decide whether to take the leap of faith or stand on the outside while your competition jumps in with both feet and reaps the rewards that come from being on the cutting edge.

Wait, we said “cutting edge.” Oh, this must be another article about the Internet right? Wrong.

This is not about the Internet at all. It’s about what the Internet has caused and why the traditional approach of hard-sell advertising isn’t as powerful as it used to be. For those of you who are doing hard-sell advertising, you are going to be shocked and nervous. For those of you who never embraced a hard-sell marketing approach you’ll be three steps behind and we suggest you pack your parachute and hold on tight.

The Internet has caused a massive change in the dynamic of our customers. They think differently today than they did in the past. They are more educated, and because of that they demand and respond to information-based, value-driven marketing rather than the traditional hard-sell advertising tactics we’re used to using in our dealership marketing programs.

Some of you right now are raising the victory fl ag exclaiming, “Finally the hard-sell days are over,” and others are weeping over its grave while still others are trumpeting the coming of our marketing savior, spending all their time and energy moving their entire operation online, believing that the Internet is the second coming.

First, the Internet is just a tool, just another medium like newspaper, radio or TV. And it’s one where price is king and gross is low unless you really know how to use it.

Second, hard-sell advertising isn’t dead — it has evolved. It’s grown a third leg and wings. That’s what good marketing concepts do.

They are shape-shifters and chameleons. So what’s the reincarnation of hard-sell?

Education-Based MarketingAuthor and expert copywriter Robert Bly said, “Traditional marketing approaches, especially hard-sell, don’t work well on the Internet or with consumers in the information/Internet age. To get readership and response, marketers have to create marketing messages that look, feel and sound like objective, unbiased, useful information.”

So, why does education-based marketing work radically better than traditional marketing? Because traditional automotive marketing is all about the dealership, the vehicles and the features, and no one really gives a rat’s butt about that.

Education-based marketing is about solutions — solutions to problems your customers face right now that they want to alleviate. A well-planned and -executed education-based marketing strategy delivers a much-needed cure to the pain your prospects are suffering.

If you can give your prospects the information they need to eliminate their problems and ultimately provide them with a clearly defi ned set of steps to take you will win their business. You will become the expert in their eyes, they will fl ock to you and price concerns will be secondary to the solution they seek, making your profi ts soar to new heights.

But there is one caveat. You must give your prospects a way to get this information easily and without obligation. You must believe in the concept we call giving value fi rst. We’ve all heard of added value or value after the sale. But that’s easy. That’s for wimps! In today’s competitive marketplace you must deliver value up front, and your marketing — if done properly — should be your fi rst touch-point and should start the cycle.

The value-fi rst concept is nothing new. It’s old and timeless. It’s based in the law of reciprocity that states that others will reciprocate in-kind based upon the way you treat them. The world gives you what you give the world. Ultimately, you are rewarded for the value you bring to the marketplace.

Robert B. Cialdini, author of “The Psychology of Persuasion,” explains, “One of the most potent weapons of infl uence around us is the rule for reciprocation. The rule says that we should try to repay, in-kind, what another person has provided us.”

Many of our hard-sell brethren are probably asking, “Where’s the hard-sell in all this?” The hard-sell sneaks in through the back door, unnoticed, when your prospect’s guard is down.

What could be better than that? When has hard sell ever fl own in under the radar? Maybe in the 1980s, but that was a long time ago.

Imagine a bobcat sneaking into your tent unbeknownst to you, and you only realize it’s sitting there licking its chops and sharpening its claws once you’ve closed up the tent and zipped yourself up in your sleeping bag.

It’s a little too late — you’re getting a butt-whoopin’ no matter what you do. That’s the same way education-based marketing works, except your prospects ask that bobcat to come inside the tent thinking it’s a harmless little kitty cat.

This is cloak-and-dagger marketing, the kind of stuff that affects people emotionally but sneaks up on them logically. We know that all buying decisions are based on emotion and backed up with logic. But the Internet has screwed up peoples’ brains, especially when it comes to car buyers. They are seeking the logic fi rst.

So through education-based marketing we give them the logic and they invite in the emotional pitch and close. It’s really a perfect marriage and a sound system when you think about it.

But it’s not all fun and games. It’s not that easy. There are lots of pitfalls and trip wires that can derail your success and keep you from reaching the goal — more ups, better quality ups, increased sales and profi ts.

That’s why we’ve created the FREE special automotive business advisory for used car dealers and managers, a 32-page industry bulletin, “How To Uncover The Hidden Wealth In Your Used Car Dealership.” This report shows you how to set up an education-based marketing system at your store and helps you avoid the pitfalls. To get your free copy, e-mail us.

Jimmy Vee and Travis Miller are the founders of Used Car MarketingCenter. They can be contacted at 866.852.0145, or by e-mail atJ&[email protected].

sts fos ls ms sf fi s

marketing solution



Start Achieving YourSales Goals Today

SeanWolfi ngton

What’s the difference between a goal and a dream? A goal has a plan and a deadline; a dream does not.

This article will outline 10 tips for setting goals and getting better results, but fi rst we’ll look at the three reasons people fail to achieve their goals: They don’t write them down, they fail to craft a plan or they fall short of the commitments they make.

It may seem simple to overcome these three stumbling blocks, but in the complex and often chaotic dealership environment, that’s not always the case. When a manager or a dealer establishes new goals or launches a new initiative in an attempt to fi nd, sell and keep more customers, there’s bound to be more than one person involved in creating an action plan. Without input and buy-in from every stakeholder, delivering on your commitments may be further from your grasp than you imagined.

Here are 10 best practices for achieving your sales goals.

1. Put it in writingIdentify exactly what you want to achieve in the most specifi c terms possible. Be quantifi able and measurable when appropriate.

2. Date itSet a date and a time limit for starting a goal and determine when you expect to fi nish it. Check it off when you do. Unless you can commit to a start and target an end, it’s unlikely it will happen.

3. Identify obstaclesYou will meet obstacles, and they make you stumble. If you identify them up front, you can build them out and minimize surprises.

4. Assign accountabilityIdentify the people you will contact and work with. If you are planning a big initiative, you will likely need to delegate and assign responsibility.

5. Identify special skills and training neededIf a goal requires special skills, a shift in process, a new technology or new knowledge, you may need to partner with a specialist, hire a training company or invest in internal training. Change does not happen on its own. 6. Document a detailed action planTake a look at where you are, where you want to be and create a plan to get there. Consider what needs to happen, how it needs to happen, who will be involved and when you expect to accomplish each step.

7. Take action every dayProcrastination kills the best goals and the most detailed plans. The more ambitious your goals, the more important it is to chip away at them every day. Here’s where it helps to refer to that detailed action plan every day and continue to work at it. Follow up with the people involved to keep them moving as well. Incentivise them if needed.

8. Measure results It helps to track your performance results and create top-of-mind awareness by posting your results in an area that’s visible to everyone involved.

9. Celebrate successOnce you start chipping away at your action plan you’ll be hitting important milestones eventually. When you do, celebrate your success and spread the word. People like to be involved in success.

10. Revisit your planAs you accomplish tasks and move toward success, you’ll fi nd a need to continually raise the bar.

Sean Wolfi ngton is the owner of BZResults.com. He can be contacted at 866.802.5753, or by e-mail at swolfi [email protected].


leadership solution

Super Bowl Ads:Super Marketing or

Super Waste of Money

MarkTewart

13april 2006

My wife is from Pittsburgh, so you know what I was watching Super Bowl Sunday. Being a life-long Bengals fan,

it was painful for me to watch the game. Although the game wasn’t played well by either team, it was fun to watch the advertisements. I watched the ads not from a football fan or TV viewer’s perspective, but from a marketing perspective. My goal was to fi gure out if each ad was a super ad or a super waste of money.

The cost per ad in a Super Bowl time slot is reported to be somewhere between $800,000 and $2.5 million. How could one commercial be worth that much money? Can it possibly pay for itself?

I judged each ad by several criteria to determine if it was worth the money. I also judged the ads from an automobile dealer’s perspective to see if anything could be learned and be used on a smaller scale.

First, I judged whether the ad caught my attention. This can be accomplished through humor and other emotional connections. Some of the commercials grabbed you immediately and compelled you to watch while others almost forced you to lose interest from the beginning. Remember, market share of mind precedes market share.

Next, I judged if the commercials kept my attention and created interest in the product or service. Some of the commercials grabbed your attention and then got lost in their journey to reach their fi nal destination. A simple question of “What are we trying to accomplish?” would have eliminated this problem.

Another important aspect was if the ad created a desire to either fi nd out more about the product or service or to buy it. The biggest lesson to be learned here is that some advertising companies sell a bill of goods to their clients. The ad company gets the client all wrapped up in the creative factors, such as how funny it is or how clever the production is. However, the real reason for the advertisement is to sell something now or in the future.

I remember one funny and clever ad that showed a woman on an airplane getting up to go to the bathroom in the dark and trying to climb over a male passenger who was sleeping. Next the lights came on and the male passenger awoke to the woman straddling him and in an embarrassing position. However, I can’t tell you who the company was, what its product or service was or how the ad related its benefi ts. In my opinion, the company would have been better served to spend the money on a huge party. At least it would have improved company morale. Unfortunately, the ad accomplished nothing.

On the other hand, FedEx had a creative and humorous ad that featured a prehistoric man attaching a large bone that was to be delivered using a large prehistoric bird. The bird was attacked by another animal and the delivery was not successful. When the prehistoric man went back to the cave and told another man what had happened, the man replied, “You should have used FedEx.” The ad was funny, reinforced the brand, the slogan and the overriding benefi t of their service. The ad is memorable and creates emotional anchors of fear and confi dence. The ad created fear of using another service while also creating confi dence in the FedEx brand. Brilliant.

Another good example was Budweiser. Budweiser ran multiple commercials that were effective. The size of the Super Bowl creates a huge reach. However, by running multiple effective ads, Budweiser created frequency as well. Budweiser accomplished in one Super Bowl game what many companies could only dream of accomplishing in the lifetime of a company.

As a dealer principal, most likely you can’t afford an expensive multi-year image campaign. You must bring buyers to your showroom fl oor now. You must use direct-response marketing that gets immediate results. You can’t afford the mistakes made by many of the companies advertising in the Super Bowl. You want, need and deserve super results.

Mark Tewart is the president of Tewart Enterprises. He can be contacted at 866.429.6844, or by e-mail [email protected].

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Internal Re-con vs. Sublet:The Great Debate

JimAdams

Some common arguments:• “How can you expect me to spend all that money in the shop and still make a profi t when I sell it?”

• “We continue to miss business by wholesaling a lot of cars we should keep because we can’t afford to recondition them.”

• “Why can’t I just sublet them to a shop with a lower labor rate to keep my cost down?”

• “I am tired of spending all this money in get-ready and the car is not lot-ready when it comes out of the shop.”

Since the very fi rst used car was traded in, this debate has raged between used car managers and service managers. It is important to remember that a dealership may be four departments, (new, used, parts and service) but it is one business — a business that holds each department 100 percent accountable for the total success of the dealership. The used car manager and the service manager must have a clear understanding of total dealership profi tability and must work together to achieve this common goal.

Let’s take a look at a scenario: A 2003 Kia Optima with 40,000 miles is traded in on Saturday. After it is checked into the shop, the service advisor hands the used car manager an estimate of repairs. The repairs involved include $300 in parts sales, three hours of labor at $70 an hour and a $100 detail and get-ready. Total ticket: $610. Wow, that’s a lot!

The used car manager picks up the phone and calls Joe’s Service Center and Satellite repair. Joe can do the repair for $205 in parts, three hours of labor at $45 and Andy Jr’s Detail shop can get you a wash and vac for $55. Total ticket: $395. Now, that’s more like it!

Now, let’s look at the real numbers. Our shop has not added $610 to the cost of the car, only the difference between the $610 internal rate

and the $395.00 sublet rate: $215. Now what used car manager wants to stand up and say $215 of service work by a Kia factory-trained technician will keep him or her from selling a car for a profi t?

A clear understanding of liabilityI know it’s hard to believe but there are people out there that will sue a car dealership. Remember the golden rule: your car, your liability! If Andy the detail boy has a wreck picking up or delivering your car, you’re liable. If Joe’s Service leaves the lug nuts loose and a wheel comes off at 60 mph, you’re liable. By drastically limiting the amount of sublet you do, you drastically decrease your exposure to lawsuits. Joe and Andy might be good guys but have you seen a MVR on them or all their employees? If you perform the work in your shop and an RO is generated, you will know exactly who worked on the car and what work was performed.

A clear understanding of accountability Service managers must also have a clear understanding that the used car department must be profi table. Pre-owned inventory is not a blank checkbook. Service departments should have a uniform checklist of recon items that should begin with drivability. Nothing makes a used car manager’s head spin faster than a $900 shop bill and a used car with rotor hop and a hard pull to the left at highway speeds. The service manager must remember that he or she is equally responsible for the pre-owned inventory. A unit in inventory is as much a

refl ection of the service manager as it is the used car manager. Service managers must hold their techs and advisors accountable to not recommend even one item that is not

necessary for the proper reconditioning on the used car. Anyone caught stealing from the dealership by performing work that is not necessary for the sake of generating hours should be dealt with.

Building value in your dealershipAsk yourself, would you ask your customer to service his or her vehicle at your shop when you do not even service and repair your own inventory there? It is time to get on the same team. Be proud of your service department and the work it performs. When that customer says, “I can get this same car down the street for $1,000 less,” you can reply, “That sounds about right, but you see every vehicle in our inventory has been serviced and checked over by Kia factory-trained technicians, and any vehicle that does not exceed the high standards that we place on our cars we sell up and down the street to those dealers you are talking about.”

Jim Adams is the general manager at Roper Kia in Joplin, MO. He can be contacted at 800.905.0627, or by e-mail at [email protected].

Internal:

Parts: $300: Gross profi t retention 41 percent = $123 grossLabor: $210: Gross profi t retention 78 percent = $163.80 grossDetail: $100: Gross profi t retention 100 percent = $100 grossTotal: $610 $386.80 gross

Sublet:

Parts: $205: Gross profi t retention 0 percentLabor: $135: Gross profi t retention 0 percentDetail: $55: Gross profi t retention 0 percent


leadership solution


Some of What I’veLearned About Hiring

JeffMorrill

Remember that hiring is the most important thing you do as a manager.Managers accomplish

their goals through their people. A great manager with mediocre people isn’t really a great manager. Hire and retain good people, and your life is worth living. Hire the wrong people, and your life will be fi lled with pain. So make the time to do it well. It’s never something to be rushed. Whatever little time you save now by taking shortcuts will be lost tenfold or more in the subsequent underperformance and rehiring required if you hire the wrong person.

Remember how expensive a hiring mistake is.The cost of hiring one sales person, (including advertising costs, training expenses and screwed-up deals during the learning curve) is easily $10,000 or more. The cost is even more enormous if you add in the lost service and parts business, and lost repeat and referral business from those lost sales over the coming years. With that in mind, spend the time to do it right. Spending your time on other more urgent and pressing tasks instead of hiring is like stepping over dollars to pick up dimes or even pennies.

It’s a lot cheaper to keep the good person you’ve got than to go and get another one.So do what it takes to keep your best performers.

Remember that the person you’re hiring may be a future manager.Among the people you hire for line staff positions, some of your hires need to have management potential. Be on the lookout for it. Promoting from within is a great philosophy only if you’ve laid the groundwork by hiring people worthy of eventual promotion.

There’s never a good time to hire the wrong person, and there’s never a bad time to hire a good person.No matter how desperate you feel to have a person in place, beware of hiring a sub-par person because you’re desperate.

Don’t be afraid of the right person with no experience.Most dealership jobs aren’t so complex that the right person can’t learn the fundamentals and contribute quickly. For certain positions, such as sales, the lack of experience can be positive because you don’t have to break the bad habits they picked up at a lesser dealership.

Remember you can’t fi x stupid.Beware of stupid people and don’t hire them for anything. You can improve someone’s skills but you can’t give them a brain.

Make sure prospects understand just how special your company is by explaining what makes you so.Let’s face it, the best people have the best options, and we need to sell them on why they’ll do better here.

Streamline the interview process.Rather than spending a ton of time explaining the job to everyone who calls, e-mail them a list of frequently asked questions and ask them to contact you if they are interested in learning more. The questions should have rich detail about schedule, pay plan, your mission statement, etc.

At least for sales people, don’t work too hard to track people down after you’ve made an initial contact.Ask them to call you rather than telling them that you’ll contact them. This ensures, if nothing else, a minimum level of interest and professionalism. I want to see that a sales person has the wherewithal to pick up the phone and follow up with people. If they can’t do it with me, they won’t do it with customers. During the interview process, ask the candidate to call you to set up every interview. If they’re not motivated to contact me to set up each interview, then they don’t fi t.

Require three interviews that include multiple team members.This isn’t as tedious as it sounds. I do the fi rst interview. If I like the candidate, I invite the person back to interview with the department

managers and perhaps some line staff (I do not participate in this one). Finally, the third is a shadow day during which the candidate spends the better part of the day observing the rhythm and challenges of the day. Multiple interviews give more opportunities for an unprofessional person to reveal his or her bad work habits or character. Also, they give the candidate a more accurate impression of what the job is and isn’t.

Involve at least one other person in the interviewing process beside yourself.The participation of multiple team members increases team morale that comes from having input on key decisions and increases the odds of someone catching something you missed.

Don’t focus too much on interview skills or a good résumé, look for the skills that the job requires.It’s tempting to hire the person who dresses the best, is the most well spoken, went to a fancy school or happens to “hit it off” with you, but don’t put too much stock in these things unless they are required for the job. Ultimately, you’re hiring someone to perform a job, not to be interviewed. So focus on qualities that are required to do the job.

Make sure your candidates are interviewing you and not just the other way around.This will cut down on the number of people who quit the job after only a short time because they didn’t understand the responsibilities, pace, culture, challenges, etc. It’s my goal to make sure a candidate understands exactly what the job is, warts and all. It doesn’t do me any good to sell someone on the job and then have them discover they don’t like it and then quit.

Jeff Morrill is co-owner of Planet Subaru in Hanover, Mass., and Planet Chrysler Jeep in Franklin, Mass. He can be contacted at 866.872.8699, or by e-mail [email protected].


leadership solution

Use an Evidence Manual

KirkManzo


Customers often believe more of what they see than what they hear. For this reason, today’s sales professional must

create and maintain an evidence manual to show his or her customers proof of why they should do business with your dealership.

Most sales people are attempting to convince a prospect they just met for the fi rst time to buy a product that costs thousands of dollars after only knowing the person for about an hour. This can be a real challenge.

In order to help persuade the customer to do business with your dealership now, use an evidence manual to reinforce your strengths.

The book itself should be constructed from a large photo album. The best type to use has a three-ring binder with full-size pages. The pages should have a hard backing with a plastic sheet you can pull up and place documents and photographs of various sizes and shapes underneath. Your local discount department store should have a photo album for about $10 to $15, a small amount to pay for your success.

The book should be formatted into four different and distinct chapters, each designed to help infl uence your customer to action now.

Chapter one is all about you. This section is a collection of photographs of you outside your work environment. This collection of photos should show you involved in the activities and interests you participate in outside of

work. Perhaps you enjoy fi shing, hunting, coaching a little league team or traveling to a variety of destinations. Showing these photos allows your customer to realize that you are just like him or her, a human being, not some big, bad car sales man. Include photos of you and your family, your dog and the people that are important in your life. This section should take up a few pages in your book, not one photo.

Chapter two will also contain photographs, however, these pictures will show you standing next to people with large smiles on their faces standing in front of the new vehicle you just sold them. These pictures provide you with a very powerful tool of infl uence to persuade your customer to buy from you now. There is an unconscious message that your customer will be receiving as he or she views page after page of photos of people standing next to you smiling next to a new car: “Buying a car from you will make me smile, too.”

In smaller communities this section can be even more powerful. As your potential new customer is fl ipping through the pages of your evidence manual, whom might he or she see? That’s right, people they already know and trust. “Look honey, Bill and Terry bought a car from this young fellow.” What just happened to your credibility? Exactly. It just shot through the roof. Due to current privacy laws you may want to have a standard advertising disclaimer form signed in F&I during delivery giving you permission to use the photos.

Chapter three is focused on written evidence to support your case for why the customer

should buy from you. This section will contain copies of favorable CSI and SSI surveys showing positive comments from previously sold customers. Any thank you notes or letters should also be included in this section.

A good strategy to help increase the number of thank you notes you have available to place in your evidence manual is to make it easy for customers to provide their comments in writing. Go to the local offi ce supply or stationery store and pick up a small 5x7-inch note pad with a generic beach or mountain scene in the background. Keep this in your desk so that when you are fi nishing the sale and your customer comments how pleased he or she is about everything, you can then make a small request of him or her. “I really appreciate you saying that Mr./Mrs. Customer. Would you be so kind as to take a moment and jot down what you just said so that I could add that to my book?” Then simply hand him or her a pen and your stationery to get your written testimonial for your evidence manual.

The last chapter will focus on your product. This section will contain articles written about the various models of cars, trucks and SUVs you sell. The good news is that going to Yahoo or Google should provide you with plenty of content for this section. In addition, you should subscribe to “Motor Trend,” “Road and Track,” “Automobile,” and other magazines to both stay current on competitive new models as well as collect articles on your product. Make it a point to pick up the Friday edition of USA Today because it reviews new vehicles each week.

The use of an evidence manual shows your customer you are a professional. It provides him or her with proof that you are someone he or she should feel good about spending his or her hard earned money with today.

Go make something happen.

Kirk Manzo is the general manager at Ziegler Supersystems. He can be contacted at 800.858.6903, or by e-mail at [email protected].



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Taking Photos ThatReally Work Online

ChipPerrysts fos ls ms sf fi s

marketing solution

The key to building an effective online advertisement is real-time, detailed information. With online advertising, the

more information you provide, the better the response. And providing visuals is an essential component of merchandising vehicles and telling the car’s story, which is why the fi rst training module covers photographs. Great photos are key to advertising online, in order to reach the information-seeking consumer and illustrate what you have in your “virtual showroom.” Dealerships need to understand what makes a photograph most effective.

The fi rst step in taking good photographs is having a good camera. Use a high-quality digital camera with a large lens opening to take sharp, close and professional-looking images of the car. Be sure the photos you

are posting are consistent with the comments in the ad. If you highlight that a vehicle has low mileage, you can take a picture of the odometer; if you advertise the car has large trunk space, open the trunk and take a picture looking in. These types of photographs reassure consumers they are seeing pictures of the actual vehicle of interest, making it worth their while to visit the dealership for a test drive. With recent improvements and drastic price reductions in digital cameras, it is a solid, low-cost investment.

Even better than low-cost, location is a no-cost investment. Choosing the right location to showcase vehicles can make all the difference in vehicle sales. You should avoid taking pictures in the inventory line. This can make your dealership appear cluttered and can distract consumers from the vehicle on which you are trying to focus. Instead, fi nd a showcase space with minimal distractions,

a neutral background and good lighting. Do you have woods behind your dealership or a solid wall on one of your buildings? A showroom with high ceilings? These are all good examples of locations that will help the focus remain solely on the vehicle for sale.

As mentioned, lighting is important in photography — too much light produces glares and dark shadows, whereas too little light produces darkness and makes it diffi cult to see vehicle details. The best online photographs have diffuse lighting, which produces no glare, harsh shadows or color distortions. Therefore, take photographs in a well-lit, indoor location or on an overcast day. The right amount of light will allow consumers to clearly see the vehicle and every little detail.

Photos help sell cars. To show off all the features of the car, it’s important to include multiple photos. It’s statistically proven that ads with photos sell better than those without, and ads with multiple photos sell three to four times better than those with a single photo. Post photos showing off every important aspect of the car from every angle. Show off any special features, such as specialty or new tires, good condition leather interior, folding seats or a spoiler. Include a picture that makes the consumer feel like they’re “in the driver’s seat,” but don’t be repetitive and post similar photos. Whether your dealership is large or small, franchise or independent, the way vehicles are merchandised online is what ultimately makes a difference in car sales. When in-market shoppers are scanning for vehicles that meet their needs, the main driver of consumer response to online advertisements, aside from price, is the way dealerships present their inventory. Take good photographs, invest in a digital camera, choose good locations, use diffuse lighting and provide multiple photos. Successful online advertisements provide consumers with mental ownership of vehicles.

Chip Perry is the president and CEO of AutoTrader.com. He can be contacted at 866.853.0234, or by e-mail [email protected].

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What You Need to Know Right Now About Search Engine Marketing

RadWeaver

At this point, you’ve probably heard the saying that you need to fi sh where the fi sh are. You may also know

that the fi sh (our new- and used-car buyers) today have migrated from the traditional advertising pond into the fast running river we all know as the Internet.

If you’ve ever waded into a river, you may have noticed that a river is never the same twice. It’s always changing. For those of us who actually fi sh in a river, we also know that the bait that works one day, may not work the next — same thing with the Internet.

So when looking at the rapidly growing market space for search engine marketing (SEM), we can learn from our fi shing analogy. In such an emerging space, companies specializing in search are almost as common as bars advertising the coldest beer in town. Now that top dealers across the country see the enormous, untapped potential of aggressive search marketing in their areas, there is a glut of wild claims about which bait does and does not work. With such a crowded space, how can today’s dealers fi nd a qualifi ed partner capable of getting results we all know are possible?

Here are a few questions to ask when searching for the right vendor that can deliver SEM strategies that can catch you fi sh.

1. Where are the results?Any conversation with an SEM vendor needs to begin with results. Ultimately, the only results that matter are sales, CSI and profi ts. A credible vendor should be able to provide testimonials and referrals from its dealers. A more granular look at SEM results looks for rankings in the top 10; savvy dealers ask for the phrases that they use. Look at any phrase over three words with suspicion and always ask what research techniques your potential vendor uses to identify the valuable phrases. A keyword phrase like “Anchorage, Alaska car dealers” may sound like one the American car buyer would use, but real data proves otherwise. Real research delivers real results.

2. Does it come with cruise control?This information superhighway has two speed limits: fast and faster. It is helpful to ask how a potential vendor keeps up with the rapidly changing landscape of search engine marketing. Ask about conference attendance, community participation and daily time investment in research. A successful vendor can show how it stays ahead of the game.

3. How often do you switch the bait?Six months is an eternity in the search business. Ask your potential partners how often they alter their techniques and average turnaround times. The successful search teams can research, identify, test and implement signifi cant changes in their projects in 30 days at most. The search corral is loaded with one-trick ponies; your dealership’s search marketing should be handled by a deep bench with an extensive

playbook, and don’t be shy about asking to see it.

Search engine marketing, like channel cat fi shing, is conducted with respect to an impossibly large array of variables. Temperature, lunar cycle, wind speed, season, species and more will determine what’s on the end of your pole before you cast. Fish aren’t going to catch themselves, and only the well-prepared anglers are going to be well fed at the fi sh fry of search.

Rad Weaver is the director of eCommerce for RedMcCombs.com. He can be contacted at 866.210.2838, or by e-mail at [email protected].

23april 2006


marketing solution


fs feature solution

Cover image from left to right: Marvin Grimm - Senior Director of Sales and Operations, RPM; Stephen Lind - Senior Vice President and General Manager, RPM; Dennis Colome - Director of Training; Mark Garms - Senior Vice President, Dealer Operations; and Tim Rogers - Vice President, Dealer Sales.

8-Step Dealership MakeoverProven Solutions from the Internet’s Master Automotive Business Builders

Dealerships can often profi t from objective advice that helps them re-build their processes to manage, convert and retain more customers. We invited Autobytel’s Performance Coaching Team, which has helped thousands of dealerships across the country “make over” their systems, to provide hands-on instructions that will help you knock down costs and build up new revenues — in just 8 simple steps. While the focus is on Internet business, you’ll see that this “dealership makeover” ultimately applies to all customers and most dealership departments.

What You’ll Need: • High-quality customer leads — Get them from a proven mix of providers including dependable third-party lead providers, your dealership Web site and other reliable sources.• A heavy-duty customer management system — This is to automate the heavy lifting required to provide a quality response to every prospect.• Industrial-strength service CRM — This is to keep customers fi rmly attached to the dealership service center.

Getting Started Internet customers generally just want to know two things: Do you have the car and how much does it cost? The cornerstone of online success is the ability to provide a response to these dead-end questions that exceeds customers’ expectations so you can begin to draw them in and build a relationship. For that to happen, you need to lay a foundation of solid processes to ensure an effective response to every lead. That may

sound like a big project, but you can do it, and we’re here to help.

Step 1: Remove the Internet department from its boxRather than routing leads through an ISM or HUB, train your sales team to respond to all dealership customers. Sales people generally provide a better customer experience (that’s why they’re in sales), and the new opportunities also make them feel more self-reliant and professional, cutting down on turnover. There’s a more subtle benefi t as well, which is that they become more attuned to customers who’ve researched online before coming into the store, which is most of their customers.

Helpful tip: Train them like you always have. The same accountability measures should apply online and in person. If sales people are trained to convert 100 ups into 50 demos, 25 write-ups and 20 sales — that translates to 100 online purchase requests, 50 showroom appointments, 25 shows and 20 sales for Internet customers.

Step 2: Assemble a rapid responseOur data indicates that dealers who respond to leads within 30 minutes not only close more sales, but also generate higher gross profi ts. So it’s critical for managers to invest in monitoring the electronic lot as closely as the physical lot — and respond just as quickly when somebody enters it.

Helpful tips: • Provide wireless Internet hubs for sales

people so they can stay on top of incoming leads even if they’re on the lot. • Hire an appointment setter to help handle follow-up calls (keeping in mind that the best time to contact a prospect is early evening, when the sales team is usually dealing with live customers). Based on our experience, it generally only costs $8 to $12 per hour to hire a caller, plus $5 for each appointment, $10 if it leads to a sale. And the ROI is usually in the 8:1 range. (Of course, costs vary by market and region.)

Step 3: Drill your team to nail proven phone processesIt can take eight to nine calls to establish phone contact these days, so don’t stop calling until you’ve tried nine times over the fi rst three weeks (only leaving messages every third attempt). Once contact is made, it’s probably the only opportunity to schedule an appointment, so don’t leave it to chance. Provide your sales team with relationship-building talking points and questions to open a dialogue about the prospect’s transportation needs and how your dealership can help solve them, rather than talking about availability and price. (A reasonably fi rm price quote should already have been received via e-mail.) The goal should be to sell the dealership — not the car — and schedule a showroom appointment.

Helpful tip:Online buyers tend to have champagne tastes on beer budgets. Offer some options slightly below the price point of the vehicle he or she requested.

Step 4: Re-build the dealership experience online E-mail is how most Internet customers prefer to communicate, so you should translate the traditional dealership experience to e-mail. Think of it this way:

Auto-response “welcome” message = Meet & GreetQuestions about transportation needs, budget, etc. = Fact FindingMultiple price options based on needs = Inventory WalkPhotos and accessories = Product Presentation

Step 5: Mix in broadcast e-mails to stay in touch You should also broadcast a series of more

25feature solution

On the Road Again. Mark Pantages, Autobytel’s East Coast Training Director, traveled 40 weeks last year and worked with over 400 dealerships, helping them improve their sales and customer retention.

In Control. Ed Braunbeck, Vice President and General Manager of AVV, demonstrates best practices on the Web Control customer management system, which tracks and organizes all customer contact to automate follow-up schedules and e-mail communications.

Special Finance Specialist. Car.com Vice President and General Manager Mike Gargano and his team of special fi nance experts are the architects of Autobytel’s Special Finance Leads Program powered by Car.com, which recently delivered its two-millionth fi nance lead.

general e-mails (including messages from management) to establish regular touch points during the fi rst month, e.g., asking them if they need more information, etc. At 30 days, send a “keep us in mind” e-mail that also requests permission to broadcast weekly messages with relevant vehicle and dealership information. This is important because a large share of Internet buyers make their purchases more than 30 days after the purchase request, so cutting off communication after a month means you’re walking away from a signifi cant portion of your potential online business.

Step 6: Use a heavy-duty tool to power customer management and communicationsAll of this obviously takes a lot of organization, which is why we recommend our dealers use a fl exible customer management tool to automatically capture customer contact, schedule follow-up, create tracking reports and broadcast personalized communications based on each customer’s dealership interaction and stage in the selling process. By automating the heavy lifting it takes to manage and communicate with customers during the weeks and often months between purchase request and purchase, dealers can keep the dealership on more customers’ buying radars and close more sales. For example, some dealers who use the Web Control customer management system have been able to increase the number of prospects they manage by more than 50 percent, and others have quadrupled their closing ratios within months.

Step 7: Prime your dealership for subprime businessToday, roughly one-third of the entire fi nancing market is subprime. Yet only 15 percent of the nation’s dealerships specialize in the non-prime or sub-prime market. This represents a huge opportunity for dealers, especially considering the generally high margins on subprime customers and the exceptional loyalty they tend to display if you get them into a car.

Many subprime shoppers are now opting for the anonymity of the Internet to fi nd fi nancing. Innovative online services, including Autobytel’s Special Finance Leads Program (powered by Car.com), are channeling these fi nance-focused Internet prospects to local dealers. This is a great way to bring in incremental business for a fraction of traditional marketing costs. But fi rst you have to gear up to effectively serve subprime customers, and that means dedicating at least one manager to focus on special fi nance buyers, while developing relationships with experienced subprime lenders.

Helpful tips: • Treat your subprime buyers with empathy and respect (inspiring loyalty).

Also let them know that the sale represents a chance to repair their credit (motivating them to meet their payments).• Department integrity is key: It’s not how many deals you book in a day, it’s the quality of the work and meeting lenders’ requirements that will pay off in the long run.

Step 8: Drive customers into your service center with precision CRMA mere 5 percent improvement in service customer retention can increase a dealer’s operating profi t by 25 percent. So dealers need to invest in service retention marketing accordingly.

Many of the dealers we work with use Autobytel’s RPM program to effi ciently draw in customers for ongoing maintenance. This outsourced program lets them target customers via e-mail, direct mail and phone based not only on their ownership profi les (vehicle model, mileage, etc.) but also specifi c buying behaviors and patterns, making it easy to reward loyal customers, for example, or attract less frequent spenders. The payoff is often dramatic. In fact, while the industry average response to communications campaigns is 5 percent, RPM users achieve response rates at an average of 29 percent. And ROI, for some users, can be as high as $50 for every dollar spent.

Clean up:Once we help dealers put together these building blocks to success, they usually begin to clean up with better closing ratios, costs per sale, sales volumes and service revenues. Even if you don’t follow every step of our blueprint for success, we hope you’ll take away some nuts-and-bolts advice that inspires some successful business-building projects at your dealership.

Enter to Win a Free Performance Coaching Makeover at Your Dealership!If you think your dealership needs a process makeover, we want you to tell us why. We’ll review all submitted descriptions and give what we think is the most deserving dealership a free one-day Performance Coaching makeover. In your e-mail, feel free to include anecdotes, descriptions of your processes or relevant performance statistics.

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E-mail Address Collection:A Powerful Competitive Weapon

BrianEprosts fos ls ms sf fi s

marketing solution

Most auto dealerships are making e-mail collection a top priority. E-mail marketing has come of age, and those dealers who have built

huge e-mail databases are already reaping the benefi ts. Armed with an extensive list of e-mail contacts, these dealers are sending extremely inexpensive, yet highly targeted e-mail communications at a surprisingly low cost of 10 cents to 30 cents per touch. From a cost perspective alone, these dealers are at a huge advantage. Plus, those dealers leveraging the power of e-mail are able to communicate in a far more targeted manner with the fi nite pool of automobile shoppers in their region, grabbing their attention, luring them into the dealership and selling more vehicles and service. Step one is collecting e-mail addresses to build a strong database for online communication. At the beginning, collecting addresses may seem diffi cult, but it soon becomes second nature. In fact, the best dealers have mastered it to the point where they routinely collect e-mail addresses for 75 percent to 85 percent of the folks who contact the dealership. How? These dealers have developed a comprehensive plan for e-mail collection, have communicated it clearly to their personnel and customers, and as a result, have seen steady growth in their e-mail databases month after month. To make e-mail address collection a routine part of doing business, you must create a culture in which e-mail addresses are expected for every customer or prospect who comes in contact with your dealership. Without a clear understanding of why collecting e-mail addresses is so important, your sales and service people simply won’t bother to do it. All dealership personnel must be fully aware of e-mail’s cost benefi ts and

marketing potential, and that communication must come from the top. As part of this communication process, you need to educate employees on how to identify opportunities for requesting a customer’s or a prospect’s e-mail address. Adopt the mantra, “ask early, and ask often.” When a prospect walks into the dealership and is greeted by the receptionist, ask him or her to sign in and specifi cally request an e-mail address on the sign-in sheet. Sales people should be asking for the e-mail address when they are collecting a prospect’s phone number. When your soon-to-be-customer is preparing to sign on the dotted line, your F&I manager should ask him or her for an e-mail address. The service manager should be requesting an e-mail address every time the customer brings a vehicle in for service. Consider hiring an intern to call every customer in your database and ask for their e-mail addresses to ensure that you’re communicating with all your contacts in the most targeted and cost-effective way possible. The next step is to determine the appropriate way to ask for an e-mail address. Frequently the most basic of benefi ts will be enough to convince customers and prospects to give you their e-mail addresses. Let prospects know you’d like to stay in touch with them via e-mail to ensure they have the latest information on the vehicle they’re considering. Mention to customers that providing an e-mail address will make it easy to receive recall notices or service specials from your dealership. Be upfront and let people know that you’re requesting their e-mail addresses as a way to keep their costs down and reduce the environmental impact of relying exclusively on snail mail for communication. Signage throughout your dealership should underscore these benefi ts as well. Once you’ve built a robust database of e-mail addresses, don’t abuse it. Your e-mail

database is an extremely valuable resource, so think carefully about how and when you use those addresses. If you send out untargeted mass e-mails to your database at too-frequent intervals, customers and prospects will start opting out left and right.

If you’re growing your list by 10 percent per month, but 10 percent of your e-mail contacts opt out each month, you’re really not growing your list at all. To avoid burning out your e-mail list, consider sending e-newsletters, recurring communications that supplement product articles with engaging lifestyle content to deliver high open rates and low opt-out rates. You can even track how readers interact with an e-newsletter to identify areas of interest and follow up with targeted communications that push prospects further along in the sales cycle. The truth behind e-mail collection at your dealership is that it’s not an exact science. Although there are many companies — like e-mail append services — that will happily take your money to provide questionable e-mail addresses, your resources are probably far better spent by hiring a consultant to come in and work with your dealership to implement a top-down process for e-mail collection that identifi es your customer and prospect touch points; defi nes what message should be delivered at each of those touch points to request an e-mail address; and clearly communicates the benefi ts of the e-mail collection process to your employees. Finally, once you’ve implemented this process, you need to give careful thought to the best ways to communicate with that treasure trove of e-mail addresses your dealership has worked so hard to collect.

Brian Epro is the director of the Automotive Services Group of IMN. He can be contacted at 866.393.3919, or by e-mail at [email protected].

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Three Simple Ideas to ImproveYour Internet Results

DavidKain


Simple ideas are often overlooked when dealers are trying to improve Internet sales. I’ll present three ideas that you can put to

work right away to get more appointments and sales.

1. Get the best leads You will dramatically enhance your Internet sales results when you improve the quality of your leads.

Increase your Web site leadsThe best quality leads come from your own dealership Web site, so it is important to increase your site traffi c and then motivate your site visitors to submit their contact information.

SEO/SEMYou can spend a lot of money using traditional advertising to encourage prospects to visit your Web site or you can lower your cost by optimizing your Web site

and using search-engine marketing. Search-engine optimization makes your site easier to fi nd by search engines, and search-engine marketing promotes your dealership to prospects who use search while shopping for a vehicle online. Leading Internet dealerships have found these tools to be cost-effective at increasing traffi c to their sites or to landing pages that convert at high rates. The Web site or landing page must convert at a good rate in order for you to increase leads, so it is not a sure-fi re lead generator if your conversion is not good.

Pop-ups A simple method is to create a pop-up coupon that encourages a customer to provide his or her information. Some dealerships shy away from this because they feel it detracts from the overall visitor experience or they feel pop-up blockers will prevent it from generating many leads. The volume of leads generated for my clients who use pop-ups convinces me that customers fi ll out the forms at a high rate, so many people don’t use blockers, and those that do are not exposed to your pop-

ups so you don’t frustrate them. I think it is worth the investment. One dealership I work with averages more than 200 leads a month from their pop-up coupon and averages a 10 percent closing rate. That’s well worth it!

SpecialsDealerships have special deals most of the time, and yet you can visit their Web sites and the specials section is not up to date. It’s a shame because the specials link is normally the most clicked link on a Web site. Keep your specials up to date and watch how many leads you will get on the vehicles you need to sell the most.

Used vehicle photos and descriptions Dealerships who invest the time and energy to post clear used vehicle photos and write engaging descriptions get a solid payoff in more phone calls and e-mails. Chip Perry, CEO of AutoTrader.com, said online shoppers are information seekers, and I agree. If you want to generate more leads on your used vehicles, write them up as though you were selling them in your own driveway.


marketing solution

Live chatOnline shoppers are more likely to give you information when you are assisting them in person. A close substitute is live chat. Dealerships that host live chat on their Web sites are increasing their leads by simply meeting the customer where they shop. It is equivalent to greeting the customer when he or she walks onto the lot. You can host live chat in your dealership or outsource it through a call center, depending on your set-up. Since the Internet is the closest most shoppers will get to your dealership, I think live chat is essential.

Make your lead provider a business partnerInternet managers that communicate with their lead providers on a monthly or more frequent basis tend to get the best quality leads. Some companies provide tools that let you control leads while others need to hear from your dealership to make adjustments. Either way, let them know when you need more leads or fewer leads so they can work with you to adjust the fl ow. No matter what, it is best to make them a partner in your marketing — not just a lead provider.

2. Work faster and harder than the other guyAs with most things in life, if you are quick to respond and you work harder than the next

person, you will reap the rewards. There are few places where this is more apparent than the automotive Internet.

Be fi rstDealerships that respond within minutes to their leads have been able to demonstrate much higher close rates than those who wait an hour or more. If you contact the customer fi rst and provide compelling information, you have an advantage over the next dealership.

Make more calls and always leave a voicemailSome Internet sales teams are concerned that they are making too many calls to their customers. I consider two calls a day for the fi rst three days to be the right volume. Just enough to make a name for yourself and not too many to be overwhelming. You are trying to make an impression on the customer, and the best way to do that is to advertise who you are and how you are trying to help them. Be kind and courteous in your message, and you will get the desired response.

3. Make your communications personalOnline shoppers are sometimes thought of as impersonal and private but this is the wrong assumption. Internet users are very comfortable with exchanging information about the most personal details of their lives

but they have to feel confi dent the person they are confi ding in has their best interests in mind.

Personal e-mail responsesWhen you respond to your Internet leads make sure you express interest in the product they are considering. Another good strategy is to ask questions about their current vehicle or to respond to any comments they submitted with their request. When the prospect sees the e-mail is custom to their request, you are well ahead of your competitors.

Brief, personal voicemailsThe best voicemails are 30 seconds or less, talk specifi cally about the customer’s request and have a persuasive call to action. Spend the time to script your voicemails and gauge whether you would respond if you heard the message, and I believe you’ll get more call-backs.

David Kain is the automotive Internet training specialist at Kain Automotive Inc. He can be contacted at 800.385.0095, or by e-mail at [email protected], or visit www.kainautomotive.com.

29april 2006

continued


Speaking Up forthe Silent Majority

JesseBiter

It’s not easy to reconcile what we see in this world with the directives we read in the Bible. With war, famine, disease,

natural disasters, people continue to struggle with the harsh realities of the world and faith is tested every step of the way.

The business world is no different. I think we can all agree that faith in the American economy has been put to the test in recent years. Illegal bookkeeping practices by mega-corporations such as Enron, Worldcom and Tyco exemplify the mentality of greed that has shaped much of the business landscape. Even America’s favorite pastime isn’t immune. As the steroid controversy continues to plague some of Major League Baseball’s most feared home-run hitters, it appears that cheating and unethical business practices have permeated nearly every aspect of our society.

So who’s to blame for the lack or morality that grips our nation? Secular politics that attempt to take God out of the government? Mainstream media that has all but eliminated faith from the public discourse? How about the American pop culture that promotes morally bankrupt ideals? The easy answer would be to blame all of the above. The more diffi cult answer lies within all of us.

According to a 2004 Newsweek poll, 82 percent of Americans believe Jesus Christ is the son of God. A FOX News/Opinion Dynamics Poll in 2005 found that nearly eight in 10 Americans believe the courts have overreached in driving religion out of the public. Clearly, the vast majority of Americans at least identify themselves as Christians. Yet the overwhelming majority continues to placate the vocal minority. If the majority of Americans are Christian and we live in a nation rooted in religious freedom, why have Christians become the silent majority?

It all starts with the individual. Christians need to stand up for what they believe and not let those who are angry with God dictate the freedoms of the majority. A secular society is not what our founding fathers envisioned for our country’s future. More important, a secular society is not in line with God’s vision for our country’s future. Not only is it my right as an American citizen but my duty as a Christian to put the love of Christ into everything I do. That includes my business.

He said to them, “Go into all the world and preach the good news to all creation.”(Mark 16.15)

The fi rst step in bringing your faith to work is to believe that is what Jesus wants you to do. Think about the aforementioned companies. Would things have turned out different for those poor Enron shareholders who lost everything if the company’s executives had chosen to guide the company by Christian principles? Sure there may have been fi nancial hardships. There may have been layoffs and restructuring. But in the end, it was the corruption fueled by greed that led to the company’s demise. Running a Christian company doesn’t mean that you don’t also care about profi ts. Every business needs to make money in order to survive, and nowhere in the Bible does it condemn us for achieving fi nancial success. But putting profi ts before people is not how God wants us to run our business or our lives.

I know it may sound strange to some, but it is possible to run a prosperous business and serve the Lord at the same time. You may be surprised to learn that strong faith and good business sense are more prevalent than you may think. From Fortune 500 corporations to small mom and pop operations, Christian business leaders are everywhere. In fact, a recent Fortune Small Business article estimated that more than 30 Christian networks for business leaders are thriving in the United States today. Half were launched in the past fi ve years.

“Do nothing out of selfi sh ambition or vain conceit, but in humility consider others better than yourselves. Each of you should look not only to your own interests, but also to the interests of others.” Philippians 2:3-4 By no means do I wish to preach a gospel of prosperity but I do think it’s worth noting that many of the top companies in the United States have been led by Christian executives. One company, in particular, that serves as a model for other Christian business leaders is Chick-fi l-A.

With more than 1,200 restaurants and annual sales approaching $2 billion, Chick-fi l-A is one of the largest privately owned restaurant chains in the nation. Despite such tremendous success, the company has always made its fi rst priority to serve a higher calling. According to the company’s Web site, the offi cial statement of corporate purpose is that the company exists “to glorify God by being a faithful steward of all that is entrusted to us and to have a positive infl uence on all who come in contact with Chick-fi l-A.” Chick-fi l-A founder Truett Cathy said, “I see no confl ict between good business practice and solid biblical principles.” Cathy puts his money where his mouth is. The company invests in a variety of charitable organizations and Cathy closes his restaurants on Sundays, traditionally one of the busiest days of the week in the restaurant business.

Next month we’ll discuss what you can do at your workplace to change the order of business. There is a revitalization taking place in the business world, and I hope you will be a part of it. May God bless you, your family and your business. See you next month.

Jesse Biter is the president and CEO of HomeNet, Inc. He can be contacted at 866.239.4049 or by e-mail [email protected].


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Seven Habits of Highly Successful Dealer-owned V.S.C. Programs

EricKauk

There is no magic in maintaining a highly profi table vehicle service contract program.

Lowering loss ratios is the key to lowering rates, and lower rates make vehicle service agreements more affordable for the consumer and more profi table for the dealer. Controlling and lowering loss ratios requires everyone to be on the same page. Everyone, in this case, means: the dealer principal, your program administrator and every employee in your dealership.

Loss RatiosBy defi nition, a loss ratio is calculated by dividing the incurred losses (the amount of total claims paid) by the earned core reserve.

The obligor collects a single, one-time fee to

pay for all the claims over the entire term of the vehicle service contract. This fee is called the core reserve. As each month goes by, a small portion of the core reserve gets earned. The amount that gets earned is pre-determined by the administrator based on historical claims data that parallels the expected occurrence of claims. So, if historically the Toyota Camry has a low occurrence of claims, the core reserve would earn out faster than a vehicle that had a higher occurrence of claims.

Here are some examples of loss ratio calculations.1. $250 in incurred claims and $400 in earned core reserveLoss Ratio = $250 to $400 or 62.5 percent (acceptable)2. $500 in incurred claims and $400 in earned core reserveLoss Ratio = $500 to $400 or 125 percent (not acceptable)

Earnings PatternsPeople called actuaries determine service contract earnings patterns. Actuarial data is considered the backbone of the entire program. There are several items that are considered by the actuaries when they are determining earnings patterns, for example: specifi c make, model, mileage, term of manufacturer’s warranty and terms of the service agreement. It is also important to remember that the earnings patterns are set up to ensure the strength of the program’s entire book of business, based on the most accurate historical claims data available.

Here is an example (for illustrative purposes only) of an earnings chart:

Core reserve = $60060-Month service contract36-Month manufacturer’s warranty

In this example, notice that most of the earnings come during years three and four

of the service contract, and that a very small amount is earned in the fi rst two years. This is typical of most new vehicle earnings patterns, but as your entire book of business matures, these earnings should even out. There are several different methods of establishing earnings patterns: pro-rata (unusual in automotive but seen more often in the marine industry), rule of 78s, reverse rule of 78s and actuarial-basis patterns. There are also many proprietary variations from insurance company to insurance company.

The earnings pattern and the method used to establish it, are crucial elements of the service contract program. If the earnings pattern is a rule of 78s-type earnings pattern, then more of the core reserve will earn-out later in the service contract term. This is a common practice on new vehicle service contract programs, as the manufacturer’s warranty often picks up most of the claims in the early part of the service contract term, leaving less exposure to the service contract early on. However, if you have a reverse rule of 78s-type earnings pattern (common on used vehicle service contract programs), then you will realize more earned core reserve in the early part of the service contract term as a result of greater loss exposure early on, for example on a used vehicle which has no remaining manufacturer’s warranty coverage.

Keys to success:1. Strive to sell Service Contracts on ALL vehicles.Be sure that your F & I manager is presenting the VSC to every customer and that he or she knows at least two good transition statements and two good ways to overcome customer objections to purchasing service contracts. Some vehicles produce better loss ratios than others, and the good loss-ratio vehicles will offset those who don’t perform

as well. VSC programs are set up using actuarial data from a good mix of vehicles,

Earning Chart

Year 1 2 3 4 5 TotalPercent of fee earned 1% 13% 29% 34% 23% 100%Amount earned $6 $78 $174 $204 $138 $600 Cumulative earning $6 $84 $258 $462 $600


fi xed operations solution

so make sure that your F & I managers are truly pursuing VSCs on all of the vehicles all of the time. When evaluating this as a dealer principal or general manager, you should use a very simple formula: Number of service contracts sold, divided by number of retail units delivered. You should be above 40 percent penetration, regardless of your store’s number of cash deals, leases or new car sales.

2. Thoroughly inspect and repair all used vehicles on your lot.Implement an inspection checklist for every used vehicle, and strictly enforce its use. Not only will this cut your loss ratios, but it will also improve customer satisfaction and sales force confi dence in your inventory.

3. Don’t reward service writers for up-selling.In other words, do not encourage the repair of items that have not failed. Vehicle Service Contracts are designed to repair items that have failed, they are not intended to cover recommended repairs and they are not to cover preventative repairs. Overzealous service writers can sink your VSC profi ts.

In general there is merit to the concept of moving dollars toward fi xed ops, but not in this case because doing so will move non-commissionable dollars out of your pocket.

4. Strongly encourage having scheduled maintenance done at your facility.Lack of routine maintenance could lead to more claims and may affect coverage of the service agreement and therefore customer satisfaction. Also, performing repairs at your facility will give you greater infl uence over repair expenses and greater control over your loss ratios.

5. Sell higher deductible plans.Higher deductible plans, for a number of reasons, generally have lower loss ratios. Customers will think twice about fi ling questionable claims if they have to pay the $100 deductible. Historically higher deductibles mean lower loss ratios.

6. Sell shorter-term plans.Shorter vehicle service agreements will earn out faster and will have less exposure to loss. Selling shorter-term service contracts will also lead to a shorter trade cycle.

7. Use factory/aftermarket remanufactured and LKQ parts when possible.It is completely reasonable to think that a failed part should be replaced with a part that is of like kind and quality. If you have a claim on a vehicle that is over the half-life of the warranty miles, use remanufactured parts.

These seven habits are powerful tools in your quest for VSC profi t. Regardless of your franchise brand, you can maintain a highly profi table VSC program by using these techniques.

Eric Kauk is the vice president ofIndustry Relations at PrimeSource Solutions Inc. He can be contacted at 866.853.0108, or by e-mail [email protected].

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continued


Winners Are Losers

ChrisAlford

“Our strength grows out of our weakness.” -Ralph Waldo Emerson

Some read it and see danger. Others read it and see opportunity. Regardless of how it is interpreted, it is written, “The only way to avoid mistakes is to gain experience, and the only way to gain experience is to make mistakes.”

But does society teach mistakes as good or bad? Have we been taught that it’s wrong to fail or that it’s good to fail? Do mistakes help us or hurt us? Modern science teaches us one thing for sure: Humans are born with only the fear of falling and the fear of loud noises. All other fear is assembled through learned behavior.

Early in life, failure is frequently assembled as a negative experience. In school, for example, a scarlet letter F on a report card means certain death to many students. Even in class discussions, making the mistake of saying the wrong thing at the wrong time or challenging an idea means ridicule from peers. Eventually, a safe shut-up and lock-down strategy prevails. By third grade, a take-no-risk philosophy paints a permanent mark on the mindscapes of young champions with fear of failure: Bad things happen when you fail. Unless you want to be a loser, don’t stretch, don’t push, don’t test and don’t experiment. Soon, many young minds assemble a PhD in avoidance.

Later in life, even in today’s modern workplace, failure can continue as a negative experience. Too frequently we hear, “Failure is not an option.” Culture calls, “If you mess up, you’re fi red!” Powers preach, “Don’t reinvent the wheel, and don’t give me your excuses, just do what I tell you!” Authority screams, “I can’t believe you lost another sale!” The lesson is rekindled, and the negative emotions resurface. Self-esteem takes a nose dive. Self-belief evaporates. Soon, creativity dries up, and feedback eventually stops. The failure brush paints yet another mind with avoidance.

While mistakes will forever pepper the pathways of life, it’s important that we understand a simple concept. You always pass failure on the way to success. Great coaches become great coaches by using past player mistakes to refi ne current player skill. Great coaches encourage players to make mistakes as they watch for them on game fi lms and correct them on the fi eld. Mistakes allow the best opportunity to learn.

Michael Jordan walked the peppered path. “I’ve missed more than 9,000 shots in my career. I’ve lost almost 300 games. Twenty-six times, I’ve been trusted to take the game-winning shot and missed. I’ve failed over and over and over again in my life. And that’s why I succeed.” His message is clear. Develop a highly sustained determination to achieve what you set out to do despite all adversity that may confront you.

Physiologists report that muscles grow stronger only when they are subjected to stress. Stress causes muscles to feel sore, but champions see the stress not as pain and failure, they choose to see the pain as an indicator showing nothing less than weakness leaving the body.

In the same way, failure also makes us stronger when we choose to see it as a positive experience. Even a bone becomes stronger after it is broken. Does this mean we need to go out and jump off the top of a building? For some, perhaps. But for the rest of us, choosing a good, old fashioned perspective shift works just fi ne.

We can always learn lessons from medicine and science. We can also learn from a 3-year-old playing in the living room. A 3-year-old reminds us that anything that has been assembled can be disassembled. Disassemble your negative life lessons of failure and reassemble them for confi dence, value and success. Glue it all together with choice.

Choose to make a personal perspective shift check-up from the neck up. Mistakes are not indicators of character fl aw. They are

indicators of humanness. Author Jeffrey Gitomer wrote, “Make mistakes. The best teacher is failure. It’s the rudest of awakenings, and the breeding ground for self-determination. Don’t think of them as mistakes — think of them as learning experiences not to be repeated. How willing are you to make mistakes?”

Mistakes highlight areas needing improvement just like pain highlights an area needing medical attention. Remember that everything in life is a lesson from which you can learn. What can you learn from your failures? What do you want to believe? You can never manifest the greatness inside of you by allowing fear, worry and despair to occupy your mind.

Sales people that get stumped by the same objection over and over also have choices. They can either become bogged down in feelings of frustration, or they can consider the event an opportunity for improvement. A recurring objection that shuts you down is nothing more than an indicator of a tool missing from a tool kit. The quickest way to learn is to spend time with a more experienced sales person or manager, learning the ways in which he or she handles such objections. Once three or four ideas have been gathered, incorporate them into your presentations. Start with the most exciting one fi rst. Tweak your skills, and kill your fears.

As this author experiences failure, he is encouraged by John F. Kennedy’s timeless statement. “When written in Chinese, the word ‘Crisis’ is comprised of two characters. One represents danger. The other opportunity.”

Chris Alford is the president of Motivate America and Chris Alford Concepts. He can be contacted at 866.881.9315, or by e-mail at [email protected].



Last month I sent out an email to my list of subscribers with the controversial headline titled, “Does your traffi c suck?” It created a couple of negative responses from people who said that the title was offensive. My reply was then and is now – “Get a life.” All of us have heard the term “Sucking wind.” What’s offensive about that?

I want to make two points. The fi rst point is that the worst thing you can ever be in marketing is boring. That title that was considered offensive by two people out of the 60,000 it was sent to. The other part of the story is that title and that email wound up making me, my company, my employees and some our clients a small fortune. You may be asking yourself how.

In that email, I told the truth. The truth was that traffi c did suck for many dealers as it still does for many now. The domestic manufacturers cleared their inventories and pulled the market ahead by several months and created a lot of low gross deals for many dealers. If you think the title of these emails have been offensive, you should consider how offensive it is to sit there with no

Does Your Traffi c Suck?

MARK TEWARTTewart Enterprises

traffi c day after day. Now that’s offensive.

In my previous email, I mentioned that for years, several of my clients have asked me to provide staffed event sales. I have always declined because I had seen mostly drunks, drug addicts and rogues who did those events. My apologies go to those who don’t fi t into that category. But even those people would have to admit what I’m saying is true. Some of my clients wanted the huge boost in sales and gross profi t but didn’t want to have to deal with the mess afterwards.

Finally, I relented. I recruited an awesome staff of people and we began to make things happen. Just recently, a dealer client of mine has experienced $200,000+ in gross profi t in fi ve days. The dealer is right now almost doing cartwheels because of the success of the event and how it is being handled and he has rebooked us for another event in the future. The list of these types of results is long.

The question is, do you want to do something about your weak traffi c? If these types of events are not for you, I certainly understand. If you want those types of results for your store or you are at least curious to know how it works, call 888.2TEWART (888.283.9278) to fi nd out how it works.

Once again, call 888.283.9278Or

Email us at [email protected] Or

Fax us at 513.934.4588 with the word ‘sales event’ written on

your business card.

Visit www.tewart.com toreceive your free newsletter

If You Build It,They Will Come, Part 2

ChrisHansonsts fos ls ms sf fi s


Let’s spend some time talking about, “If you build it.”

You need to come to a point in your career

when you say, “I don’t want to live on ups. I don’t want to wing it everyday waiting for business to happen. I know my career will be determined by how I follow up with my customers, so I need to build it. Not the dealer, me. I work at a great dealership, I need their support but I need to take my career into my own hands. I have to be committed. I really want it, and, more important, I am going to do it. No excuses; just action.”

I just heard about a guy who sells more than 700 cars a year. Do you think it was 700 ups? Do you think he just winged it and waited for something to happen? Of course not — he has a system. It’s mostly repeats, referrals and maybe a handful of ups.

And you know what the crazy thing is? He does it with index cards. It’s a paper system. Do you think this guy is committed to his system? He decided, at all costs, he would do it. A paper system is not the easiest or most

effi cient way to do it, either. But he built it and therefore they come.

He knows what his customers drive, what they do and who they are, their likes and dislikes. It’s all in his index system. He is building relationships. That’s what it’s all about. He is organized — big time. Not some of the time; all of the time. He does mail pieces and phone calls all year long to all of his customers, all of the time. He is committed. If he has time, you have time. I can guarantee this guy has a lot of raving fans. No one does it like he does, and his customers know it.

It’s not about making a few calls and sending out a few notes. To create raving fans, you need to have a process when you’re with a customer and a detailed follow-up system that every sold and unsold customer goes through, without exception. The reason you create raving fans is because everything you do is over the top. Everything you do is for the customer. You are a professional, not a “used car sales man.”

Vince Lombardi said it best: “Winning is not a sometime thing: It’s an all-the-time thing.

You don’t win once in a while; you don’t do the right thing once in a while; you do them right all the time. Winning is a habit. Unfortunately, so is losing.”

Do you really want to sell more than 20 cars a month and create raving fans? Then your process and follow-up system has to be an all-the-time thing. Every customer; every time. Remember, winning is a habit but, unfortunately, so is losing.

If you really want to create raving fans, if you really want to put in place a system that is second to none, e-mail me. What I’ll show you, you can do. But what I’ll show you isn’t for part-timers. It isn’t for someone that wants to do it some of the time because it won’t work. It’s all or none. If you’re ready, then I’m willing to get you started, and I look forward to hearing from you.

Chris Hanson is the president of Follow Up For Success Inc. He can be contacted at 800.901.2862, or by e-mail at [email protected].


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Five Critical SuccessFactors for Subprime Auto

TimSheasts fos ls ms sfs fi s

special fi nance solution

37april 2006

Excellent subprime sales teams perfect the fundamentals. These fundamentals provide a foundation for growing success in sub prime. I

like to call those fundamentals the fi ve criti-cal success factors for Subprime Auto.

1. Dedicated subprime department / personnel• Properly sold – subprime business is han-dled completely backwards from your prime business and should be separated from it.• This staff “owns” subprime and “smells the money”. They are trained for it and paid solely off the sales from subprime, which brings accountability. • They know your lender’s programs and niches and how to control the customer to maximize gross profi t.

2. Proper lender relationships• Proper mix of sub-prime lenders that purchase contracts covering the full spectrum of “B through D” paper. Typically dealerships should be working with 6 to 10 lenders, including some “deep” lenders with higher discount fees. • No one lender will buy it “all”, but securing every possible approval is necessary to maximize profi t for the department.• Your staff must properly manage lender relationships including Look to Book (submissions cost lenders money), Time to Fund, CITs, Bank Fees and more.

3. Appropriate inventory• Driven by the average income in your market. Vehicles should be inventoried to match not only your customer’s income and budgetary constraints, but also your lender’s underwriting guidelines.• The majority of marginal credit customers need to purchase used vehicles due to budget limitations. Vehicles need to be purchased far enough “behind book” to afford discount fees and yet still enjoy signifi cant profi t. • Typically, they are program or auction vehicles, not retail trade-ins. Current year model program cars (“like new” invoice) create some of your best opportunities. Some new vehicles with factory rebates also structure well.

4. Effi cient business systems - Managing a subprime department requires administrative work.• A central log to track the dealership’s

subprime traffi c separate from your prime traffi c.• Ability to capture and keep customers involved solely in a credit decision until you are ready to move them to a product decision. • Processes and systems to work the customer: Initial Callbacks, Setting Appointments, Prioritizing Workfl ow, Interviews, Stip Collection, Income Verifi cation and more• 100/50/25/10 rule – also referred to as subprime metrics - For every 100 workable leads, you should be presenting ~ 50 percent of them to your lenders. Of the 50 percent presented to lenders, you should be seeing an approval rate of ~ 50 percent. Of the net 25 percent approved, you should deliver between 40-60 percent resulting in a net 10-15 percent delivery ratio.• Desking software - very helpful for structuring deals and maximizing profi t.

5. Marketing - A system to consistently generate and capture a high quality of lead and measure results.• “John Q Public” - Television, Print, Inserts, Radio, Billboard –advertising reaches the whole market and follows the 100/50/25/10 rule. • “Targeted” Direct Mail advertising pre-screens prospects based on actual credit fi lters and improves your subprime metrics• Both work well. Lead quality and quantity are variables that need to be balanced to match your dealership’s capacity and optimize your ROI.• Goal is to gain market share, and where and when possible, to sell across franchise lines to do so.

Managing these fundamentals will position your dealership to have growing success in subprime. To the degree your dealership is weak in any of these areas, that success will be hampered. In the months ahead, I look forward to investigating with you each of these fundamentals in depth. In the mean time, let’s chase perfection and catch excellence.

Tim Shea is the president of Great Direct Concepts. He can be contacted at866.853.0223, or by e-mail [email protected].

How Are You Attracting Talent to Your Organization

MichaelYork

What magnet are you using to attract talent? Recruiting? Blah, blah, blah. “We do this and that and the other thing …”.

Uncommon companies have always known it’s easier to attract talent to the organization than to continually seek and search for talent and then have to sell them on your position or opportunity.

When talent is attracted to Disney or Southwest Airlines or other uncommon organizations, the individual has already decided, in many cases, that this is a team of which they’d love to be a part.

So how can you do it? When faced with that very challenge a consulting client of mine asked me to create a document and a process that would change the way he hired sales people and change the caliber of individuals applying for the positions. In the process, we changed the results his business was getting and the amount of new customers as well.

What I came up with was a document that we could point to that was more about the individual than a job description and something that said a lot to that individual about the kind of organization he or she was considering.

It was a document that spoke to the qualities of the individual and on the quality of life he or she could enjoy with this organization. When was the last time you talked about quality of life to one of your job applicants? Why should you care? Lots of reasons. Too many for me to go into in this limited space. Life is bigger than work, and when you understand that and the effect it can have on

someone, it changes how you do business and how you do life.

Here’s how that document began.

I am an aspiring professional, with the passion, heart, and determination of a Top Performer.

It is my goal to work in a professional environment.To have fun with and respect those around me.To attack my work with a passion that will prove to others that I am an uncommon individual.

Selling positions vary greatly in independence and compensation, but most every sales person (I think) would benefi t from the slogan, “independently owned and operated.” That means taking a personal responsibility for how things work out and thinking like an owner. That led to our next paragraph in the document.

I do not belong with the masses, for I have chosen a business of independence.I am a captain of enterprise in a nation of opportunity.

I will be a continuous learner and not depend on the crutch of experience nor rest on the successes of the past, for my greatest achievements are ahead.I will strive daily to do professional work in a professional way, producing dynamic results that will transform my life in the process.

I will strive to consistently be INSPIRED about my life and my work. I will be strong and courageous, LOVE PEOPLE, and lead by EXAMPLE.I will take RESPONSIBILITY for how things

work out and will accept neither PRAISE nor MONEY that is not DESERVED.

Everyone wants to be inspired about his or her work. Too many individuals are worried about too many things that don’t really matter, when what they should be concerned about is being uninspired. Encourage yourself and you’ll encourage others in the process. And just how will you go about your business? That’s the big fi nish on our document.

I will create value, educate business leaders, and build CONFIDENCE in those around me.I will BE HONEST with others and with myself. I will RISK NEW IDEAS and build a foundation of IDEALS and FUNDAMENTALS that are UNSHAKEABLE!

I will share this opportunity with others, in appreciation for those who once shared it with me.

This is the future and I will help make it great for me, my family, my company and my customers.

The end? Nah, it’s really just the beginning.The entire story of how we did it and the results we achieved are documented in a book. If you’d like to read more about top performers, how to attract one or even become one, get my book “Becoming Uncommon: Developing Your Success at the Speed of Life.” It’s available at Amazon.com or you can get your signed copy at www.MichaelYork.com.

Michael York is an author and professional speaker. He can be contacted at 800.668.5015, or by e-mail [email protected], or visit www.MichaelYork.com.



leadership solution

You Are In Control

DavidJacobson

The guest sheet offers you the opportunity to continue building a relationship with the customer or prospect. After all, people love

talking about themselves, and if you’re sincere and show a genuine interest, this will go a long way.

The guest sheet enables you to learn what customers do for a living, whether they are married, have children, what they like about the vehicle they drive, as well as what they may be seeking in a new vehicle. The key is to keep the customer talking.

Many dealerships require that sales people ask for a prospect’s work number. While many sales people cringe at the thought of interrogating the customer by asking personal questions, others use the question to open doors to discover valuable information and build a relationship with the prospect. Turn the simple task of asking for a work number into an interesting and informative conversation about what your customer does for a living, which then allows you to ask further if he or she enjoys what they do.

Open-ended questions are used throughout the sales process. For example, when presenting a vehicle to a customer, try this:

“How does this vehicle fi t your needs?”

Using this expression will help you fi nd out the true needs of the customer while maintaining comfort.

Consider these non-confrontational, open-ended questions:

“What are some of the most important features your next car will have?”

“Who will be doing most of the driving?”

Open-ended questions are another great way to fi nd out valuable information about your prospective customer. Most sales people would love to know how long their prospective customer has been shopping for a car. Many customers are uncomfortable with this question because they more than

likely have been asked this same question at each dealership. When used correctly, open-ended questions can engage your customer and provide more useful information than ever expected.

Here’s an example:

“How long have you been considering a new vehicle?”

Regardless of the answer, your response should be:

“What brought it to a head; why now?”

In addition to the time he or she has been considering a new vehicle, this will engage the customer to share with you why the time to buy is now. It could be mechanical problems or perhaps he or she will be giving the vehicle to a child who just started driving. In addition to providing you with priceless information, your customer will begin to realize he or she is in a safe place.

Hearing the answers enables you to discover the true purposes and not just the reason. At the same time, you will learn if the customer has shopped at other stores. Moreover, the information will assist you later in the sale when you present the features and the strong points of your product as they relate to the customer’s needs.

Every customer has a reason for buying a new car, and a sales person will fi nd this out. But there is something far more important — the customer’s purpose for buying the car.

Consider the parents of a young daughter starting college and in need of a car. Their reason, plain and simple, is transportation. But what is the real purpose of buying the car? Most likely, they love their child and want her to have a safe, reliable car that can be serviced locally where she will be attending school. As a result, her parents will feel at ease.

How many sales people actually tap into the emotional part of the experience?

Customers will talk about these things if you engage them, and if you do this, you become

a friend and an advocate. You are then seen as a problem solver, not the problem.

Confi rm, confi rm and confi rm

OK, you’ve found out what you need to know. Always confi rm that you understand what’s important to them.

1. Your customer will agree with the facts they already told you about themselves and will respond positively.

2. Since you understand their needs, their comfort level with you will increase.

3. You will know your customer is in stride with you.

Many sales people err in going through their pitch without knowing if the customer is in sync mentally until the end, which may be too late.

Consider that many customers will “yes” you and nod their heads, causing you to think they are interested and in agreement, which may be the total opposite. All the more reason to interject confi rming phrases such as:

“If I understand you correctly …”

“So, what you are saying is …”

“It sounds like you …”

Using these phrases will enable you to ferret out the accurate answers to the important questions posed about features, price, timetable, etc. It helps you show the right car with the precise benefi ts and features that fi ts the customer’s needs.

Most important, if you can secure this information up front, then you are in control and well on the way to making the sale.

David Jacobson is the founder and president of GrooveCar Inc. He can be contacted at 866.663.9038, or by e-mail at [email protected].




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Internet Marketing Can Be Easy

EricHinkle

Success depends a great deal on having your inventory with photos on each site on which you market. Web site vendors

will drive customers to your site. Without compelling vehicle photos, you’re not going to be successful.

One solution is to hire a service company that can help take the pain out of the process. To remain competitive, dealerships will either spend more dollars per vehicle for a professional to show up, or fi nd an alternative resource for this process.

If you are not concerned with price or time to market for your incoming inventory, then service companies are a good choice. Their popularity is because more dealerships are discovering the magic of the Internet. Whether or not to use a service company

will depend greatly on the capacity of both the dealership and the rep placed to provide these services. Sometimes bad data and poor photos are better than nothing.

When it comes to the diffi cult task of deciding what to outsource, realizing that your dealership does not have to have a hand in every part of the marketing process may actually save money in the long run. Outsourcing these tasks to a service company gives you time to focus on your core business — selling cars. If your dealership is in a less-populated area, deciding on a service company may not be an option.

But there are other choices. In-house solutions have made the Internet marketing process simple and seamless. Choosing the right solution can save your dealership thousands of dollars, however trying to go too cheap may have a negative effect. The data and information for each vehicle should be rich and accurate, rather than coded or picked. The software or company you choose for this process needs to supply this rich data instead of relying on a walk-around inventory of options. This will help avoid those anomalies that show up on your stickers that end up costing your dealership a six-disc CD changer after the vehicle has been retailed.

Another thing to consider with an in-house solution is your ability to streamline photo work and uploading. Using a standard digital camera can make this task tedious and time consuming. You are better off fi nding a solution that integrates a camera to the Internet and your DMS system for easy and smooth uploading. The time savings are valuable and make the in-house solution worth the money.

To bring your Internet marketing efforts in-house, several other things must be in place. Having a dedicated person or Internet manager that will devote the necessary time to take photos and sticker the inventory is paramount. This may not be as easy as it sounds; taking photos takes time away from phone calls and selling. Using a software solution that makes this process simple and seamless will alleviate some of the time concerns and make your dealership more effi cient. The biggest

benefi t in bringing the photo work in-house should be the cost savings. Your dealership will need to gauge whether the perceived savings are really savings at all. The upside is there are products out there that provide real turnkey solutions. Look for the ones that are fully integrated with DMS systems. Find a company that will not limit your photos or provide inferior data.

Another positive benefi t of bringing Internet marketing in-house is time to market. Recently acquired vehicles can make the Web sites for the weekend. Some do-it-yourself software solutions offer real-time photo uploads that will streamline your photo efforts. Posting in real time takes away the mystery of whether your inventory will be seen. Your dealership can certainly benefi t from real-time inventory marketing; however this still depends on whether your dedicated person has the time to process your vehicles in a timely manner.

Provided the proper equipment and software, your dealership can easily gain market share on the Internet. With a quality service company you can accomplish the same thing. What your dealership must decide is whether the cost of a service company negates the time to market disadvantages.

You should also review whether bringing the process in-house is really saving money. Depending on the monthly fees required by the software company, you may be facing a higher cost per vehicle. It may be worth the extra money if your dealership values time to market per vehicle.

Regardless of how your dealership handles Internet marketing, the ultimate goal is to gain the lead and sell the vehicle. A dealership Web site is very important but it’s useless without vehicle photos. Choose a provider that has real-time photo solutions, excellent data, easy to read reporting and eBay loading tools. Internet marketing can be simple if you fi nd the right product or service to assist you.

Eric Hinkle is the chief operating offi cer of ESP Data Solutions. He can be contacted at 866.663.9037, or by e-mail [email protected].


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DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-

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*

IMPORTANT:

OF VEHICLES!HUNDREDSHUNDREDS

BANK REPO FLEA MARKETTHE BANK REPO FLEA MARKET HAS BEEN CONTRACTED BY USA MOTORS TO CONDUCT THISINCREDIBLE EVENT. THIS IS THE REAL DEAL... IF IT DOESN'T SAY BANK REPO FLEA MARKET YOU

WILL HAVE PAID TOO MUCH! THE BANK REPO FLEA MARKET TRAVELS FROM STATE TOSTATE...CITY TO CITY...TOWN TO TOWN...ALL ACROSS AMERICA OFFERING THE LARGEST

DISCOUNTS...50-70 % OFF ON THE FRESHEST PREMIUM INVENTORY AVAILABLE...WITH ONLY $19DOWN AND PAYMENTS AS LOW AS $29 PER MONTH ON ‘05, ‘04, ‘03, ‘’02, ‘01, ‘00 AND ‘99 MODELS!

BANK REPOS...AUCTION CARS...LEASE RETURNS...ONE OWNER TRADES...ALL IN PREMIUMCONDITION! THE BANK REPO FLEA MARKET WILL GUARANTEE THAT THERE IS ONLY ONE EVENT

IN YOUR AREA AT A TIME. THERE ARE NO AUTHORIZED DUPLICATIONS OF THIS EVENT.ANYTHING ELSE IS AN IMITATION.. THE BANK REPO FLEA MARKET CHOOSES ONLY ONE DEALERIN YOUR AREA... AND THAT IS IT!

DRIVE AWAY IN ANY VEHICLE FORONLY $19 DOWN!DRIVE AWAY IN ANY VEHICLE FOR

ONLY $29 A MONTH!

100%GUARANTEEDCREDIT APPROVALFOR EVERYONE!

WE CHANGE LIVES!

100%GUARANTEEDCREDIT APPROVAL

WE CHANGE LIVES!

DRIVE AWAY IN ANY VEHICLE FORONLY $19 DOWN!DRIVE AWAY IN ANY VEHICLE FOR

ONLY $29 A MONTH!

SALE DATES:THURS•FRI•SAT•SUNMAY 26•27•28•29

EVERYONE IS APPROVED

GUARANTEED

GREAT INTERSTATEGREAT INTERSTATE

100% APPROVAL100% APPROVAL100% APPROVAL100% APPROVALEVERYONE IS APPROVED

GUARANTEEDEVEN IN CASES OF

•BANKRUPTCY•FORECLOSURE•REPOSSESSION•BAD DIVORCE•INSURMOUNTABLEMEDICAL BILLS

•LOSS OF JOB•RECENTLY MOVED•NO CREDIT AT ALL

100% APPROVAL

EVEN IN CASES OF•BANKRUPTCY•FORECLOSURE•REPOSSESSION•BAD DIVORCE•INSURMOUNTABLEMEDICAL BILLS

•LOSS OF JOB•RECENTLY MOVED•NO CREDIT AT ALL

100% APPROVAL

THE BIG ONE IS HERE...WHERE PEOPLE LIKE YOU...FROM ALL OVER THE ANYTOWN AREA WILL GET 100% GUARANTEEDCREDIT DURING THIS SPECIAL 5 DAY...CREDIT EXPO 2006! IF YOU’VE BEEN TURNED DOWN...FOR ANY REASON...YOU

WILL GET 100% GUARANTEED CREDIT NOW THROUGH SUNDAY NIGHT! HURRY FOR BEST SELECTION!

$4000 GUARANTEED

FOR ANY TRADENO MATTER WHAT CONDITION YOUR TRADE IS IN...

JUST GET TO THIS EVENT AND IT’S GUARANTEED $4000 WHEN YOUPURCHASE ANY USED CAR $7995 OR HIGHER. IF THAT’S THE MINIMUM

JUST IMAGINE HOW MUCH YOUR GOOD TRADE IS WORTH

PERMONTH

DELIVERS ANYVEHICLE!

ONCE WE MAKE A DEAL WE CAN PAYOFF YOUR ENTIRE OLD BALANCE

NO MATTER HOW MUCHYOU OWE.

VEHICLESIN ALL!

1234 USA DRIVE • ANYTOWN, USA1234 USA DRIVE • ANYTOWN, USADISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-

DISCLAIMER-DISCLAIMER-DISCLAIMER-DISCLAIMER-

WE

WILLDOUBLEDOUBLE

YOUR TAX REFUND AMOUNT

OR REIMBURSE YOUR

TAX BILL UP TO

$2000!

WHEN YOU PURCHASE

ANY SELECT VEHICLE

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DON’T PAY HIGH AGENCY COMMISSIONS!

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