A new study reveals a potential starting point for dealers who are just now dipping their toes in the digital waters.

By Gregory Arroyo

I recall a conversation I had with an industry attorney during the early days of digital retailing. Technology vendors believed the Digital Age had arrived, while dealers were saying, “Not so fast.” My question to my attorney friend was, “What’s the holdup?”

He said the problem is dealers aren’t treating digital retailing as an experience — that customers should be rewarded for taking that path to purchase. He suggested that dealerships with separate facilities for fleet sales should consider directing digital buyers there vs. the showroom.

He then relayed his recent experience purchasing his second vehicle from the same dealership. He called the store, explained that he was a willing buyer who simply wanted to update to a newer model, and negotiated the deal over the phone. Expecting the red-carpet treatment for essentially being a rollover, he felt disappointed when he discovered he’d have to wait like the other customers in front of him.

That conversation came to mind when I came across Urban Science’s “Around the Bend: How COVID-19 Impacts the Next Normal for Dealers,” a report based on an online poll of 1,506 adult consumers. It serves as an update to the firm’s August 2019 report, which served as a reality check for digital retailing.

The 2019 study, which included responses from 2,001 consumers, concluded that car buyers weren’t ready to ditch the dealership experience because they still want to kick the tires and take a test-drive. Respondents also said they still needed someone at the dealership to guide them through the process.

I wrote about why I think that represents an opportunity for digital retailing in an April 2020 blog entry, “Digital Retailing’s True Test.” However, I’d like to share an even greater opportunity revealed in this year’s updated study.

See, while the report did show that a majority of consumers still believe buying a car is too big of an investment not to see (81%) or test-drive (79%), it did show that 67% would be more open to buying online if it was a brand or dealership with which they were already familiar.

Again, my convo with my attorney friend came to mind, but so did a discussion I had with a DealerSocket Strategic Growth Manager. He said the main reason some dealers fail to realize the full potential of data mining is because they don’t have a dedicated process. Well, based on that stat from Urban Science, maybe digital retailing represents a missing link.

Take those data-mining campaigns targeting customers approaching the end of their lease or who qualify for smart payment offers. The emails could contain links to a landing page that explains your offer and a link to a streamlined buying process powered by your digital retail tool.

Back in April, another DealerSocket Strategic Growth Manager told me about a Pennsylvania-based dealer group that was rewarded for having a service-drive sales process when the pandemic forced local officials to limit dealers there to appointment-only sales that concluded with service-drive deliveries.

Before the pandemic, the process delivered 100 units a month behind two dedicated salespeople, a sales manager, and an F&I manager, who actually has a dedicated desk (with enough privacy) in the service area. The reason for that is the group wanted that buying experience to feel different and free of pressure.

The group equips the sales team with its inventory management tool’s mobile app (Inventory+) to feed appraisers with scanned VINs and photos of every car that comes into service. The appraisers then prepare a package that includes a vehicle history report, documentation on the vehicle’s going price in the local market, its fair Kelley Blue Book value, a check voucher for an amount over that value, and the salesperson’s business card.

Signage in the service drive lets customers know they can get a free vehicle evaluation by texting a specific number or talking to their service advisor. All customers get an appraisal, but the hand-raisers represent high-value targets the sales team engages.

However, even customers who don’t bite get the appraisal package. They also get enrolled into a CRM-powered campaign that includes email and a phone call — the latter scheduled for the day after the customer’s service visit to ensure satisfaction and to revisit the offer sheet.

I can see three potential opportunities in that process for digital retailing to have an impact. Maybe it’s a kiosk in the service area loaded with a digital retail tool like DealerSocket’s PrecisePrice; perhaps it’s tablets. Whatever the case, digital retail should be a part of those follow-up efforts, whether it’s a link in an email or guiding customers through the process over the phone and emailing a link to their PrecisePrice deal.

And just maybe that buyer’s journey you create in the service drive serves as the entrance for sales opportunities your data-mining efforts generate.

While 93% of respondents to the Urban Science study expressed some concern with an entirely online purchase process, more than two-thirds said they were comfortable shopping online, signing paperwork digitally, and negotiating price and terms via email, chat, or phone.

Recently, the individual leading the digital drive for one of the largest privately-owned dealer groups in the United States addressed DealerSocket employees over a Zoom call. He talked about COVID-19’s impact, inventory shortages, the group’s efforts to build that clicks-to-bricks experience, and how consumers still need to be educated on what digital retailing is. What caught my attention was his response to whether he believed consumers still want the showroom experience.

“Absolutely … Only a small group of individuals want the Carvana model, and we’re going to be there,” he said. “But most customers want to step foot in a brick-and-mortar shop. If they want to get their payment, we’ll do that and meet them in the showroom.

“So, we believe a critical point in that process is that showroom experience,” he added. “You shouldn’t lose a customer who completed things online because you told them it would take 45 minutes, but it takes us three hours.”

A case could be made that the most critical dealer tool throughout COVID-19 has been the CRM. So why isn’t it included in the digital-retailing discussion?

By Gregory Arroyo

It’s interesting how much attention the trade press has paid to digital retailing, especially when most dealers I talked to are quick to credit their CRM for helping them navigate this period of social distancing.

But I get it. The CRM isn’t the new shiny object like digital retailing is, and COVID-19 certainly reignited the digital-retail discussion. However, I challenge anyone to question the importance of appointment-setting during COVID-19, especially for dealerships located in markets where sales were limited to appointment-only. It’s an art that predates the CRM, but, thanks to that critical front-end tool, appointment-setting has become a science for some operations.

 

 

See, what often gets overlooked is just how often CRM providers update this critical tool. In DealerSocket’s case, the cadence is every two weeks. And the focus of late for DealerSocket is appointment-setting, with texting now a key component, thanks to dealer feedback.

Take the California dealership I spoke to in mid-April. Every internet lead received gets an initial opt-in text. If there’s no response within a few minutes, the following text message — one that garners a response 70% of the time — is sent: “We just received your internet request, and we have a few questions. Do you prefer a call or a text?”

By the way, that dealership logged 26,617 sent and received texts in March.

Then there’s Rashad Tillman, who manages a centralized BDC for a two-rooftop independent group in Southern California. With a keep-it-simple approach, he operates under the belief that a successful road to the sale requires five yeses from a customer. The use of DealerSocket’s SocketTalk texting tool usually accounts for two of those yeses, starting with the opt-in text.

“All we’re looking for is a reply. Once we get one, we’re in control,” Tillman says. And once a customer opt-in, the following text is sent: “We received your lead for the [make and model], which we have available. Do you have time today to test-drive the vehicle.”

“That usually results in a reply,” Tillman says. “I’ve been working with DealerSocket’s CRM for seven years now, and I figured out real early that texting is now the primary form of communication. So, we try to eliminate as much conversation as possible.”

In March, Tillman’s 20-member team sent and received 59,402 text messages through the CRM’s SocketTalk texting tool, with two members logging 2,900 sent and received texts for the month. Tillman notes that texting accounts for 80% of his department’s activity when working a lead, which is he says knowing how to configure DealerSocket’s CRM dashboard correctly is critical to making sure no opportunity falls through the cracks.

With DealerSocket’s CRM, managers don’t have to dig into the solution’s reporting tools to keep tabs on their team’s lead-handling activities. Merely creating a dashboard widget for web leads allows managers like Tillman to keep tabs on every opportunity and every text or email exchange. That’s where he says most managers go wrong. They have the talent and skills, but they resist to allow technology to augment their abilities.

In fact, the use of technology is how managers like Tillman are keeping their dealerships in the game when today’s car buyers are shopping more brands, more vehicles, and more dealerships than those car-buyer studies predicted they would four to five years ago. The latest data on that front comes from a study commissioned by Urban Science, which showed that the average car shopper is considering 2.6 brands, visits 2.5 dealerships, and submits, on average, three lead forms.

So, regardless of whether your BDC staffers or sales teams are selling appointments or demonstrating to customers a willingness to be shopped to win their business, converting a lead into an appointment requires a CRM-driven process that doesn’t end once the customer says “Yes.”

The best part of a CRM-driven appointment-setting process is you can automate every step of the way. In the case of DealerSocket, our CRM’s Campaign Manager allows you to assign your operation’s best word-tracks to a BDC staffer’s scheduled response to an inquiry, as well as automate appointment reminders, confirmation communications, and follow-up. Then there’s the CRM’s Business Rules automation tool, which allows managers to initiate activities such as vehicle prep and enrollment of customers into appropriate campaigns.

And that’s why I think the CRM needs to be included in the digital retailing discussion. Think about it: When the customer structures a deal through your website’s digital retail tool and submits the lead, guess where that opportunity lands? The question dealers need to answer is, what does the experience look like when it does.

Gregory Arroyo is the former editor of “F&I and Showroom” and “Auto Dealer Today” magazines. He now serves as senior manager of strategic content for DealerSocket. Email him at garroyo@dealersocket.com.

We continue to think about all of you, our customers and partners, during this difficult time. This pandemic has caused deep challenges across our industry and for all of us, and I hope you know that DealerSocket continues to be here for our dealers. Our goal has been to strike the right balance between being prepared for our dealers and the market when our industry recovers and offering discounts to help our dealers as much as possible during this difficult time. 

We will get through this, and we will get through this together. We are committed to fighting through this with you. We are beginning to see the first signs of positive trends as we climb out of the depths of the COVID-19 pandemic, and this has us all hopeful for the future.

In April, we heavily discounted our software for our dealers. In addition to our discounts in April, we have decided to offer the following DealerSocket billing reductions for May for all of our dealers:

We have already sent out our May invoices, so next week you will receive a credit memo for the above discounts. With that said, similar to our discount package last month, there are some basic qualifying terms listed below.

In addition to these discounts in April and May, DealerSocket continues to offer our customers several promotions and free months of certain software products to help you navigate this crisis. Our offers include promotions for:

Since we are adding promotions and various resources for dealers often, please view DealerSocket’s latest information by clicking here, and, as always, please feel free to reach out to your Customer Success Manager with any questions or if we can help in any way:

If you are not yet an Auto/Mate DMS customer, I hope you know that we can reduce your DMS bill significantly during these challenging times as well as into the future by switching to Auto/Mate DMS. We have several bundled packages that include our Auto/Mate DMS product combined with other DealerSocket products to support you.

Thank you for partnering with DealerSocket. I hope you know how much we value and appreciate your loyalty, partnership, and your business.

I wish you, your families, and your team members health in these unprecedented times.

Sejal Pietrzak
CEO and President
DealerSocket
sejal@dealersocket.com

 

Details regarding our COVID-19 relief package:

The car business isn’t the only industry operating outside its comfort zone. That’s why it’s OK that the industry’s at test-drive deliveries and service pickups and drop-offs.

By Gregory Arroyo

Over a two-and-a-half-day period to open the last week of March, the percentage of consumers who said they shopped and purchased online increased from 30% to 47%. However, “things haven’t been easy breezy” for those digital consumers.

According to the article I came across, more than 30% of those shoppers reported an issue with their purchase. They either couldn’t place an order (16%) or had to wait days for their order to be ready (17%).

The data, sourced from CivicScience and its survey-reporting platform, was published in Food Logistics, a magazine for the global food and beverage industries.

Yeah, we’re not the only retail segment operating outside of our comfort zone due to COVID-19. For supermarkets and their customers, that means a few speedbumps on that road to the sale.

For example, what if the brand of product a customer ordered is out of stock? Do you notify the customer of your dilemma, or do you make an executive decision and grab the more expensive brand and eliminate a few items from the customer’s order to make up the difference?

I’m guessing those were the questions swimming through the mind of my in-store shopper during my wife and I’s first online grocery-ordering experience. And he made an executive decision on at least two occasions.

Instead of the two gallons of milk we ordered (Hey, I have a growing boy), we got a gallon of the more expensive brand.

We also didn’t get the 16-pack of fruit roll-ups I wanted. Instead, we got a box of six.

And instead of the two packets of Tollhouse cookie dough I wanted, we got one pack of Simple Truth’s plant-based product.

Understanding the moment, we didn’t get mad, but we did have questions. Unfortunately, our shopper appeared, loaded our groceries, handed us our receipt, and disappeared without saying a word.

That’s the real reason the Food Logistics article caught my eye. The stats it contained reflected my experience. My order took a few days longer to get than initially promised, and the online experience was problematic.

So, yeah, I think a lot of industries are figuring it out, discovering potential speedbumps, and making adjustments along the way. That’s why it’s OK that, when it comes to digital retailing, we’re still at at-home test-drives, and service pickups and drop-offs.

But let’s not be in this situation again.

That was my takeaway after a recent discussion with Darren Militscher, a Dealersocket Strategic Growth Manager operating in the Northeast. He believes COVID-19 moved up our digital timeline by 18 to 24 months.

I believe there are two things in play right now — learning to operate outside of our comfort zone being one of them. The other is equally important to our digital future. And it has to do with the research I wrote about last November in “Why Digital Retail Is Like the Autonomous Vehicle.”

The inspiration for that blog entry was a poll of 2,001 U.S. consumers The Harris Poll conducted in February 2019 on behalf of Urban Science. Seven out of 10 respondents said they would never buy a vehicle without a dealership, which led Urban Science’s analysts to conclude that younger car buyers still desire the knowledge of a well-trained F&I professional.

The reason is finding the lowest price on some third-party lead site is one thing, but how does that price translate into a monthly finance or lease payment? An F&I manager can definitely help, but so can a digital retailing tool.

Folks, that’s what’s in play right now. There are customers right now wondering how General Motors’ recent financing offer — interest-free financing for 84 months and up to 120 days of deferred payments — means to their payments. I’d bet that’s even true in states where showrooms were forced to close.

Like my wife and I during our first online grocery-shopping experience, car buyers need to learn the process. By the way, that plant-based cookie dough wasn’t half bad.

Gregory Arroyo is the former editor of “F&I and Showroom” and “Auto Dealer Today” magazines. He now serves as senior manager of strategic content for DealerSocket. Email him at garroyo@dealersocket.com.

With threat actors working overtime, DealerSocket’s head of information security offers three tips to keep your dealership’s and your customers’ data protected.

By Gregory Arroyo

Greg Tatum has a warning for dealerships everywhere: Cyber threat actors are working overtime. Noting a definite uptick in suspicious activity since COVID-19 hit Europe in late February, he adds:

“Threat actors are actively searching for new targets through a number of different mediums. Things like social media platforms are a very popular target for information gathering that can be used in an attack.”

Tatum serves as DealerSocket’s head of information security. He joined DealerSocket nearly four years ago from a security services firm that works with companies in much more sensitive environments than automotive. I’m talking about healthcare and government contractors, sectors that see billions of attacks each year. So, yeah, we have the right guy on the job.

“DealerSocket spends a considerable amount of effort protecting our customers’ data,” he notes. “It’s part of what we do just to make sure our customers’ customers’ data is protected.”

Tatum isn’t the only one sounding the alarm. The FBI issued its own warning on March 20, noting that scammers are leveraging the COVID-19 pandemic to steal money, personal information, or both.

 

 

Just last week, the National Automobile Dealers Association reported that attackers are now putting up COVID-19-related websites that prompt visitors to download an application to receive COVID-19 updates. But you don’t need to download the app, as the site installs a malicious binary file as you contemplate whether you should.

The attack method uses AZORult, software that originated in Russia approximately four years ago to steal data and infect the breached computer with malware.

Tatum also alerted me to a new phishing campaign that pretends to be from a local hospital notifying recipients that they have been exposed to the Coronavirus and they need to be tested.

But it’s not just phishing and ransomware attacks. Business email compromise, or BEC, is also on the rise. That’s when a cyberthief breaks into a legitimate corporate email account and impersonates an employee to get the business, its partners, or other employees to send money or sensitive data to the attacker.

“In this climate we live in today, this is part of business,” Tatum says. “This is part of what we have to deal with as consumers of technology.”

Tatum, by the way, is available to help. He advises DealerSocket customers to contact their Customer Success Managers to get connected. In the meantime, he offers the following four tips to safeguard your organization and your customers’ data:

1. Stay Committed to General Security Awareness

The following is general security etiquette your teams should employ:

2. Separate Work and Personal Data

Use company-issued computers and mobile devices for work purposes only. If you don’t have a company-issued device, be sure to check your company’s policies about using personal devices to access your organization’s data or networks.

Additionally, consider creating separate user accounts. Never use your work email for personal reasons or vice-versa. This segregation helps the company maintain the confidentiality of the data it collects and helps you maintain your privacy.

3. Secure Your Home Network

Update your router’s username and password immediately and use a strong, unique password. And never use the same password for your network and your router. Note that most routers ship with default login credentials that are public knowledge.

4. Don’t Forget About Physical Security

The comfort of your own home is no reason to forget about physical security. Simple acts like keeping doors locked and not leaving mobile devices unattended in a vehicle are non-technical ways to improve security.

Gregory Arroyo is the former editor of “F&I and Showroom” and “Auto Dealer Today” magazines. He now serves as senior manager of strategic content for DealerSocket. Email him at garroyo@dealersocket.com.

In all great moments of history when everything seemed bleak and that the bad times would never end, they did. The question is, will you be prepared?

By Patrick Mendoza

I’m not going to sugarcoat this: The current situation is bad, and it’s going to get worse.

You’ve heard this a hundred times the past couple of weeks, but these truly are unprecedented times. I’ve never seen such a drop in both the stock market and consumer purchasing, and such a rise in unemployment and concern.

The fall due to the pandemic all happened very quickly. Just one month ago, the stock market was at record levels, and analysts were predicting new auto sales to remain around the 17 million mark as it has been for the past several years.

Now, dealerships are closed due to government mandates and have had to furlough large swaths of their sales teams. Sales have fallen off a cliff, and now JP Morgan Chase is predicting auto sales to only reach 10.3 million units this year…10.3 million.

That’s bad. But you know what, this won’t last forever.

In all great moments of history when everything seemed bleak and that the bad times would never end, they did. The title of this post is “Hard Times Come Again No More,” which is the name of a sad song the soldiers used to march to in the Civil War. Think about how bad everything seemed then: brother vs. brother, the United States ripped apart with no hope of reconciliation. But guess what, we did, and we were stronger than ever.

It’s dark now, and, as King George VI said on the eve of World War II, “There may be dark days ahead,” but the industry will be back, and I think it will be back quickly.

Before long, customers will be back. Showrooms will turn their lights on again, and sales will rise.

The question is, will you be ready?

The downtime is your time to make sure you have everything in place for when the good times return. Do you have all of your customers and prospects in your CRM? Are you using a useful data mining tool to help you attract your customers back to your store? After all, it’s cheaper to retain an existing customer than attract a new one. What about your inventory? Are you stocking the most profitable vehicles for your lot?

Now, more than ever, it is your opportunity to be ready for when the people come back.

If you haven’t, or if you’re not sure, operators are standing by. It never hurts to call us and see if you’re ready. We’d love to help you.

Patrick Mendoza serves as director of corp. communications for DealerSocket, Inc. Email him at pmendoza@dealersocket.com.

In uncharted waters, the Indiana dealership is leaning heavily on its virtual presence to navigate it through the COVID-19 pandemic.

By Gregory Arroyo

Emily Spellman serves as director of digital marketing for Circle Buick GMC and has been a driving force in the dealership’s digital push.

This March marked Emily Spellman’s first year as director of digital marketing for Highland, Ind.-based Circle Buick GMC. She’s been a driving force in the 39-year-old dealership’s digital push, but she admits that nothing in her more than 10 years as a marketing professional prepared her for COVID-19.

“We’re all learning as we go,” she says. “The biggest thing I’ve learned is to focus on what I can control and zeroing in on what really matters, which is taking care of the community and our employees and translating that in our messaging in a way that connects with people.”

Deemed an essential business, Circle Buick GMC’s showroom and service department remain open.

Circle Buick GMC’s showroom and service department remain open despite Gov. Eric Holcomb’s March 23 executive order directing all Hoosiers to stay home. Thanks to local officials, who personally requested that Circle remain open, dealerships operating in its Lake County market were deemed essential. Spellman’s challenge is to strike the right balance when it comes to the dealership’s messaging.

“You don’t want to encourage people to leave their home, but, at the same time, you need to show you’re available to people who need us,” she says. “People are still buying and servicing their cars.”

Digital Readiness

Spellman feels fortunate to work for a dealership that has taken several forward-thinking steps that are helping during this uncertain time, such as adopting DealerSocket’s full platform of solutions. They include the software provider’s CRM, RevenueRadar data-mining tool, and the company’s DealerFire website and PrecisePrice digital retail platforms.

For the three months ending on Jan. 16, RevenueRadar generated 33 store visits, 23 open appointments, and 21 sold units, while PrecisePrice created 40 new leads, 33 store visits, and 16 sold vehicles. Total gross on PrecisePrice deals was $684 higher than units sold via internet leads.

Emily Spellman says DealerSocket’s PrecisePrice digital retail tool is generating a lot of engagement. She notes the dealership is currently working on new F&I product descriptions, videos, and infographics for the tool’s F&I presentation page, as well as F&I-related SEO content for the website.

Spellman calls that snapshot conservative in terms of PrecisePrice’s true impact, noting a definite uptick in customer interactions with the tool. “People are sending us that info, which comes to the CRM. And we’re pretty proactive about setting those appointments,” she says.

“But really, it’s been a mixed bag in terms of the traffic we’re getting,” she adds. “I was looking over some of the data today, and we’re getting walk-ins, return customers … So, digital retailing is one piece of it. The big difference I’ve noticed is between our current DealerFire website and our previous site. We’re getting more leads overall.”

Stay the Course

Sales for the 130-unit-a-month dealership remained on pace with last year through the first two days of April, but Spellman predicts a slowdown for the month. For now, General Motors’ interest-free financing for 84 months with deferred payments for up to 120 days is what’s influencing buyers, who she believes are taking advantage in case their job situation changes.

Circle Buick GMC is using its Facebook page to collect supplies and donations in support of first responders and the local St. Jude House.

“It’s definitely influencing people,” she says.

It’s why the dealership has adjusted a couple of in-house sales procedures to keep customers and employees safe and to abide by the state’s social distancing mandates. The dealership is also using the moment to collect supplies for first responders and the local St. Jude House domestic violence shelter.

“We’re trying to take advantage of the captive audience we have by sending a positive community message,” Spellman says. “People always remember the businesses that stood up to help, were positive and didn’t feed into the crisis mentality.”

As for the road ahead, Spellman’s advice is don’t panic. “Don’t sacrifice the permanent on the altar of the immediate,” she says. “The dealerships that will survive are the ones that have a cool head and a long-term strategy.”

The Kansas City dealer group is hoping the digital steps it’s taken through the years will sustain demand through the COVID-19 pandemic.

By Gregory Arroyo

Pictured is the showroom of Soave Automotive Group’s Mercedes-Benz of Kansas City, Mo.

Soave Automotive Group, a multi-rooftop operation serving the greater Kansas City area, was off to a solid year, with sales and service profitability outpacing 2019 through February and no sign of that momentum wavering. That was before local health officials delivered two COVID-19-related orders within a period of six days.

The first, which ordered the closure of all social venues like bars and restaurants on March 17, left Kristopher Nielsen unfazed. As Soave’s eCommerce and customer experience manager, he was on the line that day with DealerFire’s design team to get the group’s response to the Coronavirus pandemic online and out to its markets.

“We have no plans to scale back our ad budget,” Nielsen said. “We’re not going to have a knee-jerk reaction. I think there are real opportunities to gain market share in this difficult situation.”

Ready for Anything

The forward-thinking steps the group has taken over the years to button up its operations and virtual presence was the reason for Nielsen’s optimism. He felt especially positive about the integration between the group’s DealerFire websites and DealerSocket’s CRM.

The connection allows him to see how many website visitors a campaign generates, which vehicles they look at, time on site, and then alerts his teams when those customers return — critical capabilities in the weeks ahead.

Nielsen also feels good about the group’s online service scheduling and fully online purchase process, which had generated robust engagement in the 90 days prior to his call with DealerFire. The newest addition to Soave’s websites is DealerFire’s test-drive delivery scheduler, which Nielsen added as part of the provider’s 100-day free use offer.

All three shopper experiences would get calls to action on the landing pages he wanted DealerFire to build to house the group’s COVID-19 response. The main message was that Soave Automotive’s dealerships were open and ready to help.

Promoting those landing pages would be an email campaign, press release, announcement bars on the group’s homepages, and the same SEO content strategy Soave had perfected since partnering with DealerFire in 2010. “The biggest thing for us is checking in on customers and orders coming in,” Nielsen said. “We’re contacting customers reaching the end of their leases. They’re going to need a car regardless of what’s going on in the world.”

Stay the Course

Soave was closing out a lighter than usual but still productive weekend when the second health order was issued. This time, all non-essential businesses were ordered to close on March 24 to stem the spread of the virus, which has infected more than 700 people in the Kansas City area. Dealership service departments could remain open, but sales were limited to appointment-only.

Nielsen said the shoppers who visited his group’s showroom that weekend were especially motivated to buy. Online traffic remained relatively stable, but lead and contact volume declined. Service capacity also declined, as customers opted against non-critical repairs.

Pictured is one of the COVID-19 landing pages DealerFire created for Soave Automotive.

“We’re actually still on track with last year, but January and February were very strong,” Nielsen said. “We’re now going to give back some of those gains.”

As for inventory, Nielsen said the group is keeping in touch with manufacturers as production shuts down. The group wasn’t concerned about being oversupplied, Nielsen noting that Soave has enough vehicles on the ground to get through April.

“A rising tide lifts all boats. Only when the tide goes out do you discover who’s been swimming naked,” Nielsen said. “We recognize that all we can control is how we react. So we’re trying to stay positive and plan as best as we can for where things may go.”

 

DealerSocket’s First Pencil blog offers a peek into discussions taking place in dealer showrooms everywhere. At-home test drives are top of mind, as is digital retailing.

By Gregory Arroyo

It hit me like a ton of bricks. I drove to my son’s school this morning to pick up his tablet for virtual learning. I was excited to get out of the house, but the reality of today’s situation hit me when I saw masked and gloved teachers approach my vehicle to hand me his tablet.

Great leaders always seem to rise to the occasion, and those teachers were doing just that.

I’ve also witnessed great leaders emerging in dealer showrooms. We’ll be featuring them in our new “Inside the Dealership” series, but I’d like to share some tidbits from those interviews as well as notes I’ve jotted down from the social media groups to which I belong.

No Plans to Scale Back

You got to love car people. No matter the situation, you’ll never hear fear in their voice. I say that after listening in to a call between DealerFire’s design and content team and Kristopher Nielsen, who serves as eCommerce and guest experience manager for Kansas City’s Aristocrat Motors.

“We have no plans to scale back our ad budget,” he said firmly. “A rising tide lifts all boats. Only when the tide goes out do you discover who’s been swimming naked.

“We’re not going to have any knee-jerk reactions,” he continued, “because I think there are real opportunities to gain market share in a difficult situation.”

What he was referring to is the shopper conveniences his group offers, including the group’s fully online purchase process, online service scheduling, and at-home test-drives. All three of those offerings got calls to action in the group’s email, landing page, and other marketing pieces detailing the operation’s response to the coronavirus pandemic.

Top-Down Leadership

Then there’s Honda of Cleveland, Tenn., which had an action plan in place the day before Tennessee Gov. Brad Lee declared a state of emergency. That plan was delivered by Brad Cobb, president of Bowers Automotive and owner of Honda of Cleveland. He first shared it with the dealership’s general manager, who shared it with his managers, who shared it with their teams.

“The key has been the communication from the top,” Hailey says. “We’re respecting what’s going on, but we’re not fearing it. We just want to keep things positive.”

Mixed Reports

Overall, it seems at-home test-drives are top of mind, at least on social media. While I try not to plug my company’s products, I feel compelled to share that DealerFire will offer free use of its test-driver delivery scheduler for 100 days to owners of a DealerFire website who also use DealerSocket’s CRM. Click here for details.

News regarding showroom traffic seemed mixed. Some car people reported a business-as-usual sales weekend, while others reported cancellations and empty showrooms. Things seemed to turn a bit as the week progressed, as I began seeing posts about dealers adjusting employee schedules. One post indicated that the dealer was letting employees walk with the promise that the dealership would hire them back once the crisis subsides.

It’s only been Week One of this social distancing, and I can’t fathom what’s to come. My heart and thoughts go out to my commission-based friends manning showrooms and F&I offices. Hey, we got this.

As my friend “Mad” Marv Eleazer likes to say, good luck and keep closing.

Gregory Arroyo is the former editor of “F&I and Showroom” and “Auto Dealer Today” magazines. He now serves as senior manager of strategic content for DealerSocket. Email him at garroyo@dealersocket.com.

The business has navigated unprecedented hardships before, and DealerSocket’s First Pencil blog believes there’s no reason it won’t do it again.

By Gregory Arroyo

Remember the period between late 2007 and 2009, when the housing crash that caused the credit crisis led to the Great Recession? The market was tough to read, and the used-car guides were all over the map.

Dealers that bulked up on big trucks and SUVs were stuck with a lot full of them, as gas prices reached $4 a gallon and finance sources tightened up. Any car buyer with below-prime credit couldn’t get approved, as banks weren’t sure where car buyers — particularly those with investment properties — would land and finance companies were dead in the water.

The good news right now is we’re not experiencing any of those market dynamics. But news surrounding COVID-19 (a.k.a. the Coronavirus) has certainly heated up in recent days.

Hearing about Tom Hanks was disconcerting. So was hearing about the National Basketball Association’s decision to suspend the season, after Utah Jazz center Rudy Gobert became the first major professional athlete to test positive for the virus. Now his teammate, star Donovan Mitchell, has tested positive.

As of March 10, there have been at least 116,000 coronavirus cases worldwide. About 64,000 people have recovered, and 4,000 have died. Here in the United States, multiple states are under a state of emergency.

With all that said, the one thing I love about this business is how opposed it is to doom-and-gloom talk. In fact, just yesterday, the founder of a car dealer Facebook group I belong to urged all admins not to allow panic to take over the group.

“I don’t want negative talk about this affecting us,” he wrote.

It made me think of this great line from the first Avengers movie: “Until such time as the world ends, we will act as though it intends to spin on.”

Hey, consumers who need a new car (or used) today will still need it tomorrow. Still, it’s not business as usual, so preparation is vital.

So, if you’ve loaded up with inventory the past couple of months to take advantage of tax season, monitoring aging will be key. And if you’re part of a group that engages in group trading, it’s time to dig into your inventory management systems to ensure vehicles are on the right lots. It’s not time to panic, but you should have exit plans in place.

I recall a story told to me back in 2009. A dealer in the Northeast took on a bulk of pickups in trades just before things got bad. Having dumped $5,000 to $7,000 into the vehicles, he refused to take a loss at auction when things did — even though he was losing money each day those vehicles sat on his lot. His patience was rewarded, however, as he ended up grossing $2,000 to $5,000 by waiting out the storm for a couple of months. Americans do love their trucks and SUVs.

You also need to fire up that CRM. Hey, you know you have customers reaching the end of their finance, lease, or warranty term. Vehicles also need to be serviced. Maybe it’s an excellent time to offer free service pickup and return.

And if you’re a dealer that dipped your toe in the digital retail waters — or maybe offer test-drive deliveries — today’s uncertainty represents an opportunity to really test those strategies.

So, start promoting those customer conveniences, and make sure your digital retail button stands out. In other words, remove any conflicting calls to action on your vehicle details and dedicated landing pages. Banner promotions on your search results pages and VDPs are a must.

Now, when it comes to your employees, I suggest not sticking your head in the sand. Management teams need to get educated on this virus, and communication will be critical. Care also needs to be taken when it comes to the cleanliness of your showroom, employee offices, and common areas.

With all that said, here’s what I do know in all this uncertainty: Every time this business faces a severe hardship, it always seems to come out the other side a better industry. I’m sure that will be the case once again.

Gregory Arroyo is the former editor of “F&I and Showroom” and “Auto Dealer Today” magazines. He now serves as senior manager of strategic content for DealerSocket. Email him at garroyo@dealersocket.com.

Through new integrations with DealerSocket, Facebook believes its platform can help auto dealers turn car buyers into customers for life.

By Gregory Arroyo

Remember when the prevailing wisdom when it came to your dealership’s interactions on social media was to treat it like a cocktail party? Join the conversation and don’t sell, they said. Dealers haven’t lived by that standard for years, and now Facebook wants to make it even easier for you to market your inventory and post-purchase services.

In fact, the social media giant believes its family of apps can act as an extension of your CRM and turn car buyers into customers for life. Brent Parres, partner manager for Facebook’s automotive vertical, talked about Facebook’s new play during a recent webinar in which three new integrations with DealerSocket were revealed. He also shared the following stats to prove the platform is worth your attention and a bigger slice of your marketing budget:

The timing of Facebook’s push is interesting. Currently, approximately 34 states are considering changes to their privacy laws. Speaking at the Vehicle Finance Conference this past February, Mark Templin, president and CEO of Toyota Financial Services, said there is a real possibility the industry could be looking at “51 different standards” when it comes to protecting consumer data.

As I noted back in January, data remains our industry’s best opportunity as well as its greatest threat. Facebook knows all too well what I mean.

Remember all the scrutiny Facebook came under after the exposure of the Cambridge Analytica data scandal in March 2018. Well, it forced two significant shifts in how the social media giant manages its platform:

Shift No. 1: Facebook now views its family of apps as a single, privacy-focused messaging and social networking platform. For users, that means easily and securely communicating across Facebook, Messenger, Instagram, and WhatsApp. For dealer marketers, that means you can use the same budget to target car buyers across Facebook’s platform.

Shift No. 2: Facebook no longer allows marketers to use natively integrated data from third-party firms like Nielsen Data and Polk for custom audience targeting. That doesn’t mean you can’t take advantage of third-party data targeting outside of Facebook. The social network simply wants dealers to rely on their data (whether scrubbed by a third party or not) when operating on its platform, which brings me to the first of three key integrations between Facebook and DealerSocket:

Integration No. 1: Facebook Audience Integration with DealerSocket’s CRM

The new connection, a pilot of which was recently completed, will allow Facebook campaigns to sync with customer lists inside DealerSocket’s CRM. Parres said that translates into limitless audience segmentation. Think about what that means in terms of your operation’s post-purchase, customer-for-life efforts.

“Those systems will match data back and forth and update back and forth, so you don’t have to constantly update your audience lists,” Parres explained. “The fact that DealerSocket is going to set this up for you and refresh the data automatically … You can’t get any better than first-party data.”

Integration No. 2: Automotive Inventory Ads

DealerSocket will soon roll out an inventory export that automatically uploads a dealer’s entire inventory to Facebook to populate the social network’s Automotive Inventory Ads. Facebook serves up these ads based on availability, pricing, and intent. That means consumers looking for Volkswagen are shown models with the body styles that mean the most to them.

“It’s our best-performing product when trying to drive leads or sales on a specific piece of inventory, so this integration would put you at a unique advantage,” Parres said of the integration, which will be available to users of DealerSocket’s CRM, Inventory+, and DealerFire websites. The connection also means no more switching out creative, because the creative is the inventory out on the lot.

Integration No. 3: Facebook Direct Lead Post

Facebook Lead Ads, which take advantage of the social network’s audience selection and optimization products, allow dealers to customize lead forms that auto-populate based on a Facebook user’s profile data. Soon, through a new integration, the information collected from those lead ads will automatically post into DealerSocket’s CRM so the sales team can take immediate action.

“We know the longer a lead sits, the worst the potential outcome will be,” Parres said. “So, this would be a huge convenience for [dealers].”

What’s also interesting about Facebook’s timing is many dealers are reconsidering their investments in third-party lead sites. Maybe a little competition is what’s needed.

Gregory Arroyo is the former editor of “F&I and Showroom” and “Auto Dealer Today” magazines. He now serves as senior manager of strategic content for DealerSocket. Email him at garroyo@dealersocket.com.

Thirty is the new 60 when it comes to a profitable turn of your inventory. The following best practices are designed to get your inventory merchandised faster and more efficiently.

By Judy Greeby

Merchandising is about getting as many eyeballs as possible on your inventory as quickly and for as long as possible. Smart digital tactics — such as great photos, robust descriptions, and rave customer reviews that help drive showroom traffic — are imperative. So is getting vehicles frontline ready as quickly and as efficiently as possible. These seven merchandising best practices can help:

1. Fast and Efficient Reconditioning

Unless a vehicle needs bodywork, get it through the reconditioning process within three days or less. In reality, reconditioning often takes a back seat to customer-pay work in many dealership service departments. To speed up the process, try the following:

  • Devote one or two full-time service technicians to reconditioning vehicles for the used-vehicle department.
  • Offer incentives to your service departments to get vehicles reconditioned quickly and without comebacks. Do this with outsourced vendors, too.

2. Do-it-Yourself Photos

An array of high-quality photos are essential to attract interest in listed vehicles. If your lot service company isn’t due back for a couple of days or your service department is tied up, do the following to get a non-frontline-ready vehicle listed online today:

  • Use a mobile app to take four to six photos that can be posted online before reconditioning. Take shots of the vehicle’s left front quarter and rear right quarter. If the interior or tires are in good shape, get photos of them, too, and highlight features such as sunroofs and custom wheels.
  • Take photos from farther away to minimize imperfections, such as a nicked windshield your service department can repair later.
  • No photography booth? No problem. A clean, clutter-free area with the dealership’s name in the background works well.

3. Create SEO-Rich Descriptions

The quickest way to create a description is to use an automated description writer equipped on leading inventory-management tools. They simply require a VIN to pull vehicle details, such as make, model, model year, trim level, engine type. But manually written or manually enhanced descriptions are best.

  • Over the past several years, Google has made adjustments to its search algorithm to put a little more emphasis on relevant content and a little less emphasis on keywords. Geographic references — for example, the vehicle was purchased and serviced at the dealership that is now offering it for sale — work well for SEO.
  • Vehicle history matters to consumers. So, for example, if a vehicle was previously owned by a family who outgrew it, say so. Have salespeople and receptionists listen for and jot down such details to include in a vehicle’s description.
  • Include features, technology advances, and a call to action. Awards, ratings, special offers, and whether the owner’s manual is available should be included, too.

4. Price Strategically

You don’t have to have the lowest prices in your market, but you do need a customized pricing strategy to boost overall gross income per vehicle retailed and reinterest customers tracking your listed inventory.

  • Retail 70% or more of your inventory within the first 30 days, starting from the day a vehicle enters your dealership management system.
  • Avoid profit erosion by keeping in mind that a vehicle’s market price could become outdated if it takes 10 or more days to get it frontline ready. The reason is dealers with similar models may lower their prices.
  • DealerSocket’s Inventory+ offers a Health Report you can use to create customized price strategies that increase your dealership’s overall gross income per vehicle retailed. Complied daily, the report tracks inventory age, prices, third-party websites on which the inventory is posted, and the photos and descriptions accompanying those listings. Have the report emailed to you each morning.
  • The Health Report also provides profit-per-day information for each parking space on your lot. Shoot for a minimum profit per day of $40 for each spot. Meet that milestone and then work to increase it.

5. Keep Tabs on Listed Vehicles

Vehicles are “marketed” when they’re offered for sale online with pricing and good photography — though descriptions are important, too.

  • Make sure these elements accompany all inventory offered for sale on your dealership’s website and third-party sites. Check the websites once a week or more.
  • As previously mentioned, third-party posting information is available in DealerSocket’s Inventory+ Health Report.

6. Drive Rave Reviews

You strive to satisfy your customers. So, strive to get great customer reviews by asking your customers to write them. Reviews help attract internet leads. The facts speak for themselves:

  • Research indicates that more than 90% of shoppers read reviews. And of those who do, more than 90% use that information to make purchase decisions.
  • Studies also show that most consumers trust reviews as much as they trust a personal recommendation from a friend, and they are willing to pay around 15% more for a vehicle purchased at a dealership in which they have confidence.

7. Leads Matter

The ultimate goal of effective merchandising is turning SRP/VDP views and internet leads into fresh “ups.” The more fresh ups you drive, the more chances you have to sell a customer your vehicle.

  • Use your inventory management tool to keep tabs on the leads your listings generate is crucial.
  • Keeping an eye on leads provides direction and opportunity. For example, if your dealership has a vehicle that isn’t attracting leads, try raising the price for a few days. This old tactic will usually draw out a customer who might be following it online in hopes of a price cut. However, if you don't get a bite after a day or two, you might have a vehicle with the wrong color, price, or equipment. Maybe the vehicle is just wrong for your market.

Bottom line, a vehicle doesn’t have to be frontline ready to be merchandised online. In fact, DealerSocket is partnered with very successful dealers who can have a vehicle they just took in as a trade merchandised on their site within two to three days. What they’re doing is giving themselves an extra week or two to sell the car. It may not be frontline ready, but it’s available virtually to everybody in their market.

Judy Greeby has been with DealerSocket for 13 years and currently serves as a Strategic Growth Manager. With an extensive experience in automotive industry, she partners with dealerships to make sure they get the most out of their inventory system. To connect with a Performance Advisor like Judy and learn more about Inventory+’s merchandising capabilities, call (888) 655-1435.