scott pechstein – how to increase your internet lead closing ratio

1. How to Increase your Internet Lead Closing Ratio Presented by Scott Pechstein Vice President of Sales, Autobytel Page: 39

2. Internet Sales 20-group

3. Topics How we gathered our results What is influencing buying behavior

4. Overview Over 5 million Autobytel internet leads sent to Polk annually Polk matches leads to State Registration data for all 50 states This report was from leads submitted in Q1, 2013 Committed = Purchased the brand in the internet requestClose rate by sourceCrossover between New and Used (submitted lead for New and bought Used)Close rate by makeTime between lead submission and purchaseCrossover between makes (submitted lead for Toyota and bought Nissan)Lost sales report by dealer

5. Industry Influences Purchase behaviors have continue to changeBrand ParityProduct ParityImproved on-line contentMerging of Tier One and Tier Two brands Domestic Bankruptcies Recalls TsunamiIncreased Marketing spendMore time spent researching on web sites & inventoryLess loyal generations of consumersIndustry quality awardsConsumer use of ratings & reviews

6. Industry Studies New Vehicle buyers spend 11.5 hours online (Source: R.L.Polk/AutoTrader.com Automotive Buyer Influence Study) 37% of shoppers enter the market without a specific brand in mind (Source: Compete Vehicle Cross Shopping Analysis, July 2012) 59% of consumers dont decide which vehicle to buy until the last week (Source: JDP 2012 New Auto shopper Study) New-vehicle shoppers consider average of 3.3 vehicles up from 2012 (source: JDP 2013 Avoider Study) Baby Boomers only visit 1.9 dealers and overall based on dealership experience all generations express a desire to avoid salespeople in the future ( source: AutoTrader Next Generation Car Buyer Study)

7. Why This Data is critical to dealers Autobytel base line close rate is 16 - 25% If a dealer is closing less than the base line they are losing sales and revenue

8. Buying Funnel The Buying FunnelNot Really Just Different Research Consideration Lead Evaluate Vehicle 1Evaluate Vehicle 2Loyaltyis Dead PurchaseEvaluate Vehicle 3

9. Whats changed? Myth When a consumer submits an internet lead, my competition is my fellow brand dealer in the area . . . Truth The consumer is still shopping brands as the consideration set is being finalized Consumers submit leads as a starting point to begin the discovery and analysis of their consideration set.

11. Brand Defection - Demographics Submitted a New Car Purchase Request Bought a different Make (New or Used) 53.61%Demographics show variance in buying behaviors Based on Household incomeBased on Age Head of HouseholdLess than $15,000 = 60.45%18 to 24 = 68.12%Over $150,000 = 49.85%55 to 64 = 51.28%Based on Gender Male = 51.44% Female = 54.19%

15. Brand Defection Other factors Overall SUV 58.37%Overall Non Luxury Car 54.43%Non Luxury Full Size SUV = 48.93%Non Luxury Compact = 51.92%Non Luxury Mid Size SUV = 58.69%Non Luxury Mid Size = 54.11%Non Luxury Compact SUV = 71.66%Non Luxury Sub Compact = 57.25%%Luxury Mid Size SUV = 80.70%Non Luxury Full Size = 65.99%GeographicNon Minority = 51.71%West = 51.58%Minority = 56.48%Midwest = 52.68%Asian = 47.25%Northeast = 54.61%Hispanic = 56.48%South = 56.03%African American = 59.72%

19. Correlation Committed* / Loyalty Autobytel Committed Brands Bought New SUBARU TOYOTA HONDA CHEVROLET NISSAN JEEP DODGE FORD CADILLAC HYUNDAI Committed = bought the brand that the lead was submitted for.

20. Correlation Committed* / Loyalty Autobytel Committed Brands Bought New SUBARU TOYOTA HONDA CHEVROLET NISSAN JEEP DODGE FORD CADILLAC HYUNDAIPolk Loyalty Ranking Q1 2013 FORD TOYOTA HONDA CHEVROLET NISSAN MERCEDES-BENZ BMW SUBARU LEXUS HYUNDAICommitted = bought the brand that the lead was submitted for.

21. Brand Defection Buying Patterns Buying Pattern after New Car Lead Submission2012 Polk sales results

22. Brand Defection Buying Patterns Buying Pattern after New Car Lead Submission2012 Polk sales results

23. New to Used Defection Submitted a New Car Purchase Request Bought Used any make 40.23%Demographics show variance in buying behaviorsBased on Household incomeBased on Age of Head of HouseholdLess than $15,000 = 55.81%18 to 24 = 67.59%Over $150,000 = 28.52%55 to 64 = 33.74%

24. New to Used Defection Submitted a New Car Purchase Request Bought Used any make 40.23%Demographics show variance in buying behaviorsBased on Household incomeBased on Age of Head of HouseholdLess than $15,000 = 55.81%18 to 24 = 67.59%Over $150,000 = 28.52%55 to 64 = 33.74%

25. New to Used Buying Pattern Buying Pattern after New Car Lead Submission

26. New to Used Buying Pattern Buying Pattern after New Car Lead Submission

27. Off-line Experience Baby Boomers visit 1.9 dealerships Gen X visit 2.5 dealerships Gen Y visit 3.1 dealershipsBased on their dealership experience, in the future they will avoid salespeople: 56% Gen Y 49% Gen X 37% Baby BoomersLess visits = more burden on the internet lead process to drive visits (AutoTrader.com Next Generation Car Buyer Study Sept 2013)

28. Off-line Opportunities Dealership Brand is featured Ability to test drive and explore vehicle features and benefitsAbility for a professional walk around of the vehicleSales Consultant can be a vehicle consultant: Who will be driving the car?How will the car be used?What features are important in a vehicle?Ability to profile the consumer to lead them down a personalized vehicle presentation New/Used/CPO Model Trim Colors Optional Equipment

29. Joe Verde An excerpt from the second edition of the Autobytel Dealer Insight series How to determine the proper vehicle for the consumer off-line (at the dealership)

30. On-line ExperienceWhat demographics and buying behavior trends do we know about this consumer? How committed are they to my brand? How can we give them the off-line dealership visit experience? How do we create a need for them to visit my dealership?

31. On-line Sales Consultant can be pigeon holed into being an information provider: 1) Do you have the car I want? 2) What is the price?When a consumer submits a lead WE MAKE THEM PICK A YEAR/MAKE/MODEL. Is that the vehicle that really meets their needs? November 21, 2013 Copyright (c) 2013 Autobytel Inc.

32. Traditional Best Practice Quick Response Time and Continuous Follow up Why buy from me1Vehicle of interestAlternative vehicle(s)23

33. Internet Process Needs to Change Why Buy BrandWhy buy from meVehicle of interest123Alternativ e vehicle(s)4All used options5One size fits all does not work emphasis needs to vary for each deal

34. Joe Verde An excerpt from the second edition of the Autobytel Dealer Insight series 86% of consumers drive off with a different model, trim, color or options than they intended to buy when they walked on the lot

35. Lead Submission vs. Purchase Variable factors Local Market conditions and competition Demographics age, income, gender, ethnicity, geography Brand being considered & Segment of vehicle of interest What is in the garage Dealership salesperson experience will cause less dealership visits in the future NEED TO FOCUS ON BASIC GOAL OF GETTING THE CONSUMER TO VISIT THE DEALERSHIP

36. What can you do? If Real Estate is about location, location, location Internet Sales is about vehicle choices, vehicle choices, vehicle choices Off-line you can see the customer and easily probe for clues to buying behaviors that create a custom vehicle presentation On-line you a professional, repeatable process with phone scripts and e-mail templates that create a need for the consumer to visit the dealership

scott pechstein – how to increase your internet lead closing ratio

Automotive

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