Without fail, something that is consistent across all car dealerships is the cascading desire of leadership to move more units and increase gross profit per vehicle sold. This starts at the top, with ownership. Do not think just because I am calling attention to this fact that I am unfairly critical of it. As you may have ascertained (depending on your station in life and your current views), almost everyone involved in entrepreneurship is deeply concerned about the profitability of the business they are in. In fact, I have a certain respect for ownership and upper management at the dealership. There is absolutely no mistake why they do what they do and I find them to generally be honest about the fact.
This page was not created with the intention of being a moral or philosophical commentary on the automotive sales world so I will move on to the point of this article. I would like to focus in on the "volume," portion of the the answer to the question owners and managers never stop asking "How can we make more money?" Hint: the answer is "sell more cars and hold more gross [profit]," in case you did not know. I have frequently observed vendors (usually pitching an additional lead-source or sales training) promise they have a way to increase volume. In my opinion, this is a nearly-solved problem. A wise man once told me most problems a person has with completing a task can be divided into a "doing problem," or, a "not knowing what to do problem." The knowing what to do part is relatively simple, and can be summarized fairly easily:
Now this is a gross oversimplification, but for our purposes will be fine. I want to talk about internet leads in particular. If you have ever bought a used car from me, you have heard me say "Great question, the internet has really leveled the playing field and dealers can't get away with marking inventory up to mark it down later," when you ask for a discount. Its true, most shoppers begin their search for a new car online, and, even when they see something they like on their local lot they research it online before setting foot in the store (or calling, or inquiring online). These are actual internet leads, and the path to closing a deal with them is not much different than with a walk-in or any other shopper. The overwhelming majority of these folks will use the dealership website to inquire if they do so online. Now, the vendors I previously mentioned will claim the lead source they want the owner to pay for will increase volume dramatically. In almost all instances I think that claim is a huge exaggeration. How many people, if you trace their journey through the dealer CRM, originated on a third-party website, and, would not have bought the car they did if the third-party website did not capture their information and send it to the dealer? The answer to that (way too convoluted) question is almost none.
One of the major issues when discussing best practices in the digital retail environment for automotive is the statistics that training providers and lead sources use to justify buying their products. These are like almost all statistics, in that they can be manipulated to support the narrative of whomever is providing them. This seems like it is especially bad in the auto sales world, although I suspect it happens everywhere. If someone is selling training to help dealer employees sell more cars on the internet, they will focus on how extensive the training is, and, all the scenarios it covers. These training packages can cost hundreds, or even thousands of dollars. The truth is, there is no secret sauce when it comes to closing car deals on the internet. It doesn't take hours (or days) to learn how to do it. If you are engaging with a shopper online, whether through chat, email, or via some other method, you should:
That's it. It is possible to expand on this and make it more complicated than it needs to be. Sales training often does that, and you can distill their material into the above three points for the most part. One thing that is often added to this list is "Follow up relentlessly." I left that out because for the most part I disagree. It is car business tradition to encourage sales people to make lots and lots of phone calls. As someone on the receiving end of that instruction, I promise I am not just being lazy. My opinion on this practice is not because I am afraid of bothering people (I typically just do follow up anyway, in most cases I do not think it is very effective but I also do not think it is going to hurt your chances to make a deal.) The reason I think follow up is overstated in its importance is as follows: Consumers do most things with intention. Even if their cause and effect reasoning is flawed, there is almost always a reason they submit their information online (or call the dealership, or walk through the door.) It is possible this reason can be "to buy X car quickly and efficiently." Shoppers with that intention will typically inquire on a specific vehicle through the dealership website. These buyers set an appointment at a very high rate, show up to their appointment at a high rate, and, ultimately buy a car at a high rate. If you call/text/email them, they will answer you. Although I doubt contacting them too much would dissuade them from buying a car from you, it is not necessary. I think the idea that the sales consultant or BDC (business development center) representative has more influence than they really do is a popular one among lead sources and sales trainers.
Now we know how sales trainers can sometimes overstate the effectiveness of their product, what about lead sources? As I previously mentioned, most buyers with intent inquire online through the contact form on the dealer website, or call the dealership directly (or just show up). But ask a lead source who is trying to sign a dealer up for their service and their website will increase sales dramatically. What gives? Most dealers could do without third-party internet leads and I doubt their sales would be affected very much. It is true that shoppers will often visit one of these third parties before eventually purchasing. So knowing this, the lead source collects the consumer's information and sends it to the dealer. At some point, the shopper buys a car. Since the lead source sent the information to multiple dealers, they likely sent it to the particular dealer the customer bought from. So now its a win for the lead-source, they can add another notch in their belt and pat themselves on the back. What about the dealer who is paying for these leads? Well if you happen to be the one who sold the car, it was money well spent. Everyone else, try again next time. If you ask the lead source why their leads are closing at such a low rate, they will likely reply your internet team needs more training.
In conclusion, if you are in charge of this type of thing at the dealership, you should:
If you are a sales person or a BDC rep, just do whatever your boss says. Keep your eye on the prize, I found success comes with experience and a good attitude.