AutoSuccess Magazine Article

This article was written by Lisa Keller and will apear in December 2007 AutoSuccess Magazine

One of the questions I have been asked repeatedly over the years is “Why are dealers so disinterested in on-line leads?” My instinctive, possibly somewhat defensive, response has always simply been “They aren’t disinterested!”

We all know that for a dealer to be successful and reach their financial goals, they have to maximize each and every opportunity. In today’s competitive market, dealers can’t afford to be disinterested in any lead. It doesn’t matter if that lead is on the lot, on the phone or on the internet.

However, with more than 30% of all on-line leads still going unanswered, I will concede (even if somewhat begrudgingly) that dealers become disinterested in on-line leads when they lack the expertise to properly manage them. I visit stores all over the country that are expending a great deal of energy to capture this market. They have dedicated tremendous financial and administrative resources. When these dealers see very little return (if any at all) on their investment they understandably begin to disengage.

So, how can these dealers achieve their desired results? Essentially, how can they sell more cars? There are two fundamental approaches to increasing sales. Dealers can either increase the number of opportunities (on-line leads) they put in front of their sales team or they can simply do a better job managing the opportunities they already have. Without any change in process, increasing leads almost always correlates to increasing expenses. When dealers do a better job managing leads, they increase their closing ratio and almost always increase gross profit.

In order to better manage on-line leads, we must first focus on two of the Key Performance Indicators of On-line Lead Management: Response Time and Quality of Response. These Key Performance Indicators are critical to the success of any Internet Department. They should be used as a performance management tool and as an incentive for behavior; giving everyone in the department a clear picture of what is important, of what they need to make happen. Regardless of the organization of the department, these Key Performance Indicators are constant and equally important. If you want to play in the digital arena, you have to make a commitment to respond quickly and respond well to every lead, every time, without fail.

The minimum standard for Response Time is thirty minutes. Industry statistics suggest that responding to a lead after five hours decreases the chance of closing by 50%. In contrast, a rapid response significantly increases the likelihood of a successful phone contact. A successful phone contact dramatically increases the likelihood of an appointment. And of course, an appointment hugely increases the likelihood of a sale.

Envision the customer as they are submitting their lead. If a dealer responds immediately, where is the customer? Still sitting at their computer…next to a phone! The customer is ready, willing and able to communicate. They are emotionally engaged in the process. Dealers can take full advantage of what triggered the customer to submit the lead. If a dealer responds four, five or six hours later; they lose their captive audience. How engaged will a customer be if a dealer responds to them while they are in a meeting, at a soccer game or in the showroom of the competition?

If we look at the table below, we will see that there is good news. As an industry we have greatly improved the average response time.

Average Response Time

2004* 9.5 Hours
2007** 5.4 Hours*

Unfortunately, there is also some not so good news. The quality of the response dealers are sending back to the customer has actually declined.

Answered/Addressed Customers’ Specific Questions

2004* 38%
2007** 25%

Used Brand or Product Highlights

2005* 30%
2007** 19.5%

Why is the content of the reply so important?

When communicating face-to-face the customer’s perception is influenced 55% by body language, 38% by tone of voice and ONLY 7% by words. When communicating electronically the customer’s perception is influenced 100% by words. Choose them wisely. Every Initial Response should include the following six key elements: Proper Greeting, Alternatives, Qualifying Questions, Value Proposition Statement, Next Step and Complete Signature.

It is impossible NOT to make a first impression. Customers will form an opinion about your dealership from your very first response. This opinion will be favorable or unfavorable and will act as the foundation from which this relationship will grow. It could determine if the customer is going to give you further consideration. First impressions make building a relationship with a customer either an up or downhill battle.

The Initial Response is the salesperson’s opportunity to show they are concerned for the customer’s needs. By asking relevant qualifying questions and offering sensible viable alternatives, you let the customer know you are working hard to customize a solution that will meet their unique needs. The customer will only care how great you are when they understand how great you think they are.

And speaking of how great you are…with the average customer shopping 6 different brands*, promoting your brand or product is imperative. The customer needs to know that you have a great product, you are a great consultant, you work for a great organization and this is a great time to buy! If the only tool you are using to promote your product is price, then the customer has no other option than to base their decision solely on price.
The Initial Response should lead the customer through the process. Set the expectation and execute. Be direct. There is nothing passive about the process. You do not allow the customer to suggest the next step on the phone or on the lot, why would you here?

Make certain the customer knows who you are, where you are, that you appreciate the opportunity and most importantly, how they can contact you. Never assume the customer is working with you exclusively or has you programmed into their phone.

Right now, you should be asking yourself several questions. Does my Internet Department utilize a sales process or do we simply give out information (a.k.a. price)? Does every initial response include the six key elements? Is my Internet Department’s Response Time Average 30 minutes or less? Do my responses motivate the customer to respond back to me? If your answer to any of these questions is “I don’t know”, find out. Because “I don’t know” is getting too expensive.

When the culture of your Internet Department is to not only meet, but exceed the on-line customer’s expectations by responding quickly and responding well to every lead, you will sell more cars.

*Source: Cobalt 2004/2005 Industry-wide eMystery Shop.
**Source: Cobalt 2007 Industry-wide eMystery Shop.

posted by eValuation @ 10:18 AM  

Wards Dealer Business Article

Mystery Shopping
By Cliff BanksWard's Dealer Business, Apr 1, 2007 12:00 PM
Special Report
Ward’s e-Dealer 100

Is your dealership paying for Internet leads, but not getting them? It happens more than people realize, says Lisa Keller, founder of eValuation Inc., a consulting firm that mystery shops dealerships' Internet departments.

Usually lost leads happen when a shopper sends an e-mail from the dealer's web site but the e-mail disappears into cyber space, never making it into the dealer's Internet lead-management system. Usually, it is a technical snafu.

If a dealer is spending money on search-engine optimization or buying key words on the search engines and advertising to drive traffic to its web site, not getting those leads is wasted money.
“We call it lead evaporation,” Keller says. In February, 11 of her dealership clients experienced some sort of technical problem in which leads disappeared.

A couple of months ago one of her dealer's web site provider's server crashed. When it came back online hours later, it restored an old e-mail address that been used by the dealership's lead-management software years ago.

The result? For days, the dealership was not seeing any leads from its web site. They were being dumped into the defunct e-mail address. Leads from third-party sites were reaching the right address, so nobody noticed the missing web site leads. They still might be missing today if Keller had not been mystery shopping.

Keller mystery shops her clients — many of whom are on the Ward's e-Dealer 100 ranking — four times a month by sending e-mails lead through the dealership's web site. At the end of the month, the dealer principal or general manager gets a report detailing response time and quality of the responses.

Keller discovered the disappearing-lead problem by accident. One report she sent to a dealer last year graded the response time as a zero, meaning she received no response. After investigating, the dealership realized it was not getting any leads from its web site and quickly fixed the problem.

The real value of mystery shopping may be in determining the effectiveness of a dealership's Internet sales people. The measurement is simple. It evaluates timeliness and quality of the response.

“Both are equally important,” Keller says. The longer it takes a dealership to respond to a lead, the lower the score. After six hours, the score goes to zero.
“We see that top performers strive to respond within six minutes,” Keller says. “And auto responders do not count.”

Keller says the reports she provides dealers are simple and lets them see specific areas the Internet sales people need to improve. Besides, just the knowledge they are being mystery shopped and held accountable should be an incentive for most sales people to make sure they are doing it the right way every time.

The quality of the response is where many dealerships falter. Keller says good e-mail responses from dealerships should include the following six things:

1. Greeting. Thank the customer for the opportunity and introduce yourself and the store. Pretend the customer is in front of you.
2. Provide at least one alternative vehicle; two or three are better. Always include a certified pre-owned alternative. A pricing range also should be included. Studies show most customers have not decided on what they want when they contact the store. More information may help in scheduling appointment and closing the sale.
3. Give the customer a reason to buy from you. It's called a value proposition statement. According to a Cobalt Group study last year, more than 90% of online automotive shoppers buy from a dealership other than the first one they contacted.
4. Ask two qualifying questions and then explain why you're asking. For example, determine the trim level of the vehicle they are interested in. Why? Different trim levels can change a vehicle's price by as much as $10,000.
5. Be direct and ask for the appointment. This is important. “We see many responses in which the salesperson says, ‘Let me know if there is anything else I can do,’ and leaves it that,” Keller says. “That's like nails on a chalkboard.”
6. Finally, the signature. Provide your name, e-mail address and phone number along with the web site address and the street address of the dealership.

© 2008 Penton Media, Inc. All rights reserved.



Find this article at: http://www.wardsdealer.com/reports/2007/edealer100/auto_mystery_shopping/index.html

posted by eValuation @ 8:56 AM