Automotive Internet Marketing Insight by DealerDex.com

When I see a dealer showcasing blatantly outdated photos of its pre-owned cars online, I know I’m looking at a store with no serious grasp of Internet Sales. This used to happen all the time years back, but by now I figured that both dealers and the vendors who take photos have realized the importance of taking non-incriminating shots.

Alas, it appears I’m wrong. I came upon this Wrangler just a few days ago while checking out Ramsey Chrysler-Jeep in North Jersey. Note the pile of snow it’s sitting on. Note the fact that the last snowfall in New Jersey was about 4 months ago. So it’s just about time to take this baby to auction I suppose, eh?

Listen, Internet buyers are smarter than ever, and they’ll only get more resourceful as time goes on. It doesn’t take a genius to figure out from this photo that Ramsey Chrysler-Jeep will accept pretty much any offer on this truck… but then, is it even worth the money? If it’s been sitting for that long, perhaps there’s something wrong with it, no? A lot of thoughts go through the consumer’s head when seeing a photo like this, and not a single one of those thoughts is “wow, I want that car and I’ll pay anything for it”.

Here are a few dont’s to take note of when your photos first go up for a pre-owned car; and honestly, I can’t believe I’m writing this in 2008.

- No snow. Shovel out a spot or put the car inside for the photoshoot… no white stuff on camera.
- No people in the background. When the guy in the background is wearing a t-shirt and the consumer is looking at the car online in January, you can kiss your gross goodbye.
- No dashboard pics showing the temperature. You get the idea… 35 degrees on the information display doesn’t hold water in springtime.
- No seasonal crap in the background. Avoid having anything on or around the car that indicates the season, i.e. christmas trees, memorial day/4th of july banners and balloons, etc.
- No visible tailpipe smoke. If you’re shooting the car in the cold, don’t leave it running… the smoke from the tailpipe will be visible and expose the fact that it’s a wintertime shot.

Of course, you could avoid all this and just do a better job of turning over your inventory…

I found out recently that one of my clients was strong-armed into signing a brand new Autotrader contract for the group just 7 months into their current agreement. Now, it does state in the Autotrader contracts that either party may terminate the agreement at any time after the initial 90-day period, but just because it’s legal doesn’t make it right. Or good for business, for that matter.

I’d certainly love to hear Autotrader’s rationale behind forcing clients into new, more expensive contracts before their current ones have expired. And not their rationale to the clients, but rather the rationale to themselves.

It takes some real salesmanship to make this execution come across as anything other than a big fat slap in the face to dealers, and I haven’t met an Autotrader rep in a long time who has that kind of salesmanship. Where is the logic here? Every year, Autotrader pisses off more and more dealers by raising prices and providing less return: their site becomes more saturated with competition every year, they stuff as many third party ad banners as possible into the pages, and other U/C classified listings (many of them free) are making more and more progress all the time. So with all that taken into account, who was the genius at Autotrader who decided, “you know what… let’s not just raise our prices again, but this time, let’s invalidate everyone’s current paperwork and start gouging them right away”?

I heard a lot of the b.s. that corporate shoveled to their reps as canned excuses (fyi, the word “excuses” may have been substituted with the phrase “product enhancements” by your local Autotrader rep), and as usual, none of the excuses justify increasing the price, let alone doing it so abruptly. It’s really come to the point where part of my consulting with dealers involves thinking up solutions to get around using Autotrader. Every few months, those solutions get more and more appealing, and Autotrader edges ever closer to having to take their business model back to the drawing board. I’ve got the champagne on ice for that day.

When Dealer Principals first dip their feet into the world of online lead generation, they all tend to emerge with the same question: how can I bypass these third party lead providers and get an exclusive lead?

While it’s naive thinking, it’s naive for the right reasons. What kind of advantage could you possibly gain from buying a third party lead that gets simultaneously delivered to your competitors? And furthermore, if such a large portion of these leads are created via the third party’s search engine marketing, why pay a middleman for something you can do yourself?

The reason dealers don’t know the answer to these questions has to do with their lack of experience as an Internet consumer. They don’t understand that Internet buyers seek multiple levels of research, and use the anonymity and speed of the Internet to comparison shop. Those two elements - tiered research and comparison shopping - make “exclusive” Internet leads virtually non-existent.

You can buy leads from a provider who only sells a lead once over. You can take it upon yourself to run PPC campaigns to snatch up leads before they hit a third party site. But you’ll never stop a consumer from submitting one lead and moving on to their next bit of research, wherever that may be. In fact, this is often why exclusive leads from smaller vendors are worse than those coming from the big third parties… you may be the only one getting the lead from that website, but that could be hours or days or weeks after the consumer submitted their information to a top-tier site like Edmunds, which is what the big third parties are selling to you.

Point is, the nature of the Internet consumer makes lead exclusivity nearly impossible. They don’t want to be stuck talking to just one dealer, and they don’t want to limit their research to what a dealer’s web site can provide. You’d have an easier time generating exclusive Internet leads by trying to direct non-Internet shoppers to your corner of the web. Take your radio, print and other advertising mediums and use them as a means to promote your website. Of course, there’s nothing to say you won’t be shooting yourself in the foot by pointing inexperienced shoppers to the mecca of consumer buying power, but hey, if you’ve got a thing for exclusive leads, that’s your best bet.

Let me save you some time right from the start: if you came here looking for an article that discusses specific CRM vendors and provides some insight into who you should go with, my advice is two-fold: a) iMagicLab, and b) who cares.

The latter part of my answer is in fact what this article is about. When the phrase “CRM” started popping up in this industry (twenty years after it did in the Telecommunications & Financial industries), dealers had an opportunity to revolutionize their business models and bring about a new dawn in the infamous dealer-to-customer relationship. But the combination of dealers’ “I only understand results I can see today” mentality and the willingness of CRM vendors to belittle their tools as plug-n-play business boosters created a perfect storm of squandered opportunity, resulting in the half-assed execution of CRM we typically see today at dealerships.

Here’s the thing: when you decide that your dealership needs a CRM tool, the very last thing you should do is shop CRM vendors for the best deal or the coolest tool. Deciding to create a Customer Relationship Management discipline in your store is just that - a discipline, not a solution in a box. You’ve got a long way to go before you’re ready to sit in on a sales pitch from a CRM vendor if you want to get this right the first time… and trust me, you do.

Granted, if you’re clueless about CRM, it would help to talk to a vendor and get an idea of what such tools can do. But a better idea would be to hire a consultant (even if it’s a consultant from a CRM company) to assist you in developing a new business model that integrates departments, increases productivity, and keeps your customers in constant revenue rotation. The integration of a CRM tool is the most opportune time you will ever have to change the way your store does business for the better… don’t screw it up.

The most important thing to understand about CRM in the automotive industry is that a CRM tool is like an engine, with your staff being the cylinders. In order to get some results out of this engine, your cylinders have to make a revolution… and it’s the Owner or GM’s job to make sure the engine is tuned before starting it up. What you see in many dealerships is an Owner who bought the engine and turned the key right away… and he’s got a cylinder whose timing is off (the Sales Manager doesn’t appreciate the value of the tool and undermines it), as well as a cylinder that’s totally frozen (Fixed Ops doesn’t even know the CRM tool exists).

Fact is, the CRM revolution doesn’t start with a product pitch. It starts with you, the dealer, asking questions and envisioning your future. Some of the issues you’ll need to address include:

• Understanding where your processes are at now, where you think they could be realistically in a year, and where you’d want them to be if you had all the resources you need. Build out a plan of action to get to both of those goals.
• Ensuring that every single member of your staff is ready and able to do their part in the new process. If they don’t understand the agenda - or don’t want to make the effort - get them on your side or marginalize them before CRM implementation.
• Envisioning a customer record that stays in one system and can be touched by everyone at the dealership, from sales to service to administration. Think of the perfect customer: they buy a car, they come for service, they recommend others, and they come back to buy again. Now think about who needs to be involved and how they need to collaborate to make that the case for every customer.
• Recognizing the value of Internet Sales & Service as an integral part of your business, and not a mysterious sideshow. The Internet will eventually be the future or the end of your business, depending on how much perceived value you can build through your dealer website and CRM practices.

Build your business plan first, get everyone on-board to the point that they’re salivating over the opportunities they’re about to receive, and then go shopping.