We have not had a generation defined by hardship in a long time.  The World War II generation, the generation who survived the Great Depression, the Vietnam generation… For those of us who were born in the 70’s or later, all hard times have been very short.

I’m not saying I want to see us scarred by the current economic predicament, but I do believe it will have a profound affect on how we view the world for the rest of our lives.  That includes what motivates us to spend our money.

I started selling cars 10 years ago; just before CSI became mainstream.  I recall an excellent interest rate being around 8% and the Internet was more of a luxury – nobody was buying anything of significance through it.  Shortly thereafter CSI was enforced by all the major manufacturers and the process of buying a new car instantly became much better for the consumer.  Over time ISP’s lowered their pricing, AOL got huge, and more people were online.  Communicating with customers via email was the new fad!  As sites like Edmunds and CarsDirect surfaced consumers gained the knowledge to negotiate on invoice and a multitude of trade-in values.  Through all this, incentives were high and interest rates were low (due to September 11th).  Consumer confidence was skyrocketing and car sales were never so good!

Then it all came crashing down in 2008.  Banks stopped lending, leasing almost died, floorplans ate dealers alive as unwanted cars piled up, layoffs became motivation, and consumer confidence was wrecked.  As a thrill/speed junky, I wish they made a roller coaster with that kind of drop!

That’s where we were and this is where we are.  The Internet has become as much a part of our existence as the road we drive to work.  The Internet is inexpensive.  It is a place to shop for a deal and a cheap medium to pop an advertisement on.  With traditional medias costing so much more we are all heading online.  However, with consumer confidence low, incentive-based advertising is not working.  Or maybe we all cried wolf so long people stopped listening…

How do we market to consumers today?  How do we define a generation for future marketing?

We all know banner ads are only effective in an incentive-driven world.  There are too many spammy emails to be effective with numerous email blasts.  Google ads will eventually be passed over, by consumers, for more relevant organic results.

Do we make our inventory look so good online that we are basically driving the car out of the monitor and onto their lap?  Do we get on the forums, blogs, FaceBook pages and follow consumers on Twitter?  Do we build relationships instead of being marketers?

What will the next generation respond to?

Great Management and Great Leadership

This coming year will be a sad year for many car dealerships, so I’m writing this article to offer hope and encouragement, and maybe it will help save at least one from despair. But before I continue, let it be known that I am a very optimistic, positive, “glass is half-full” kind of guy. To me, adversity is nothing more than an opportunity for growth, and without challenges no one would develop perseverance. Now, I’m not saying that I like adversity or being challenged all the time, but lately it seems the world I’m living in serves up more and more of it everyday.

Managing The Dealership

Every dealership needs to start by looking at the way they are managed. Thousands of dealers have operated with blinders on for too many years. This mentality avoids true management of people and their processes, and has no chance against the Godzilla-sized problems facing every dealer in the country right now.

First, ask yourself, “Whose hands are on the wheel?” I’ve been in far too many dealerships that have a really great Salesman working as a Manager. NEWS FLASH: An excellent Sales Person does not equal an excellent Manager! The best Manager might not be able to sell their way out of a wet paper bag and that’s ok! Maybe this challenges your way of thinking about management, but that’s ok too…you reserve the right to change your mind when given new ideas.

Consider this. Right now, as you read this article, Managers are making big decisions. Hiring and firing decisions, vendor decisions (who to keep, who to cut, who to add), advertising and marketing decisions, decisions on what to buy at auctions and pricing used inventory, decisions on how to process incoming internet leads, website decisions, decisions on training and education initiatives and so on and so on.

Poor Managers make the above BIG decisions based on instinct alone, which is a display of ignorance. Ignorance is not only unacceptable, it represents a coffin nail that every dealer should avoid at all cost. A bad Manager has no idea what his or her employees are truly capable of and how to motivate them. When a Manager only evaluates sales people based how many vehicles they sell, they fail to identify the reasons why they sold that number of vehicles. If you don’t know why Johnny-Sales-Guy only sold five cars this month, you are a bad Manager.

Bad Managers don’t recognize, or even see the need, for tools that track sales efforts; they don’t know how to determine the value of their vendors; they don’t understand what advertising and marketing choices return the best results; they don’t know what their ratio is between their showroom traffic and their internet traffic; they don’t know what makes a good website (or even know why their website exists); they don’t know when they need training; and they don’t know how to hold trained employees accountable. Managers such as these have no right to be managing in today’s dealership.

Great Managers, of course, do all of the above well because their experience, knowledge, abilities and talents match the needs of the position. They know the strengths and weaknesses of those he or she manages and they will position their employees to play to their strengths, NOT their weaknesses. A great Manager knows what days showroom traffic is at its peak and cross-trains sales people for traditional showroom sales as well as internet sales. A great Manager tracks sales people’s response times, follow-up discipline, appointment setting ratio, closing ratio and uses metrics to help the dealership thrive not just survive.

Again, good management is a dilemma for many dealerships because so many stores are being managed by people whose greatest strength is not managing.

Helpful Hints and Encouragement

• Choosing to keep an employee should be based on the fact that their abilities, strengths and talents match your needs and that they are well utilized to make your business successful. Establish an employee rating scale (i.e. “Outstanding,” “Exceeds Expectations,” “Meets Expectations” and “Needs Improvement”), then MANAGE your staff toward success or out of your dealership.

• Keep and/or add vendors that increase sales conversion. Now more than ever, vendor choices need to be based on ROI. A good vendor will stand behind their product or service by not forcing long term contracts. Having the best tools available is useless if there is no proven process for them.

• Make cuts in places like newspaper, television and radio. If you spend more than $5k a month in any of these areas, separately or combined, sharpen your axe and start swinging it!

• Manage your processes or you will make bad decisions. If you don’t know how to effectively communicate with your customers (especially online), you will not be able to identify good leads vs. bad leads. You won’t know why one CRM tool fits your business needs vs. another. Solid processes give you critical management tools like visibility, accountability and responsibility.

• If you are the Dealer/Owner/DP, do some self-examination related to your leadership skills and abilities. If you aren’t the one casting the vision for how the business moves forward, who is? A leader must exist. Here’s a video that includes 13 great leadership rules.

Properly managing your people and processes is one of the biggest keys to your dealership’s success. Just signing-up for the latest and greatest product or service will do nothing to help you if the wrong people work for you or if you have the right people in the wrong roles. There will be amazing success stories in 2009, but they will all have two things in common, great management and great leadership.

If there is anything 2008 taught me, it is that America’s memory has shortened even further than it was before.  It is amazing how fast people switched their car-buying habits based on gas prices going up and coming back down.  I can’t get over the speed at which truck sales died and came back.  Do people really believe we’ll never see an increase in gas prices again?  Did the environment take a back seat in our Hummers once again?

The housing market died and interest rates are at their lowest, but even with housing still in the toilet people flocked to new purchases enough to have every mortgage broker and Real Estate agent I know working through Christmas.  All indications show the housing market is going to continue to drop, so why invest now?

Never try to catch a falling knife.

Wall Street is a bloody mess, but I hear more and more people are throwing money at it thinking a big return is going to happen next week.

Wait for the knife to hit the floor first.

Don’t get me wrong, I am super happy to hear people are spending money – we need it to happen more!  I’m ecstatic some faith is being restored to the system.  I’m just intrigued by the month-to-month mentality we seem to have in this country now.  One of my degrees is in History and maybe it is that dorky academic side of me that finds this whole mess fascinating.

One thing these consumer trends are showing me is that we can either get away with more experimental advertising or have to get more long-term with our campaigns.  It is obvious people are not going to remember when you made a mistake.  Sure, a few folks will, but the masses won’t.  At the same time, maybe it means we need to start thinking about spreading our messages farther and longer.  Maybe it means we have to beat people over the head until they say stop.  Maybe we have to get extremely targeted…more-so than before.  Maybe we should concentrate on branding more than ever.  Maybe we should do more guerrilla marketing.

Whatever the marketing tactic is for 2009 it is going to be an interesting year to say the least.  No matter what, it will be tougher and require better strategizing than ever before.  I think it will be a good year for online and anything that is free to consumers (non-subscription based medias).

This email made it into my inbox. Not sure who wrote it but I thought I would share it with everyone. Thanks Todd

——————–

If I hear one more person give another reason why they can’t sell cars I am going to punch someone in the face.

“The banks aren’t buying” – Yes they are idiot, just not like they were, so change what you are doing.

“There are less customers looking” – So get out of your office and work the ones you have harder.

“The deals aren’t as good” – Says who? Cars have always been expensive and they have always cost more than the customer told you they wanted to pay…so now you are going to start believing the customer?

“We cant lease anymore” – yes you can idiots …there just aren’t giveaways that any no talent order-taker could give away, so maybe you should quit and we’ll get a salesperson who can do the job.

Guess what?..We sold cars when interest rates were 18%… We sold cars when they would blow up…we sold cars that flipped over…we sold cars in recessions…we sold cars that were uglier than a monkey’s armpit and broke down on delivery…we sold cars from empty showrooms…we sold Yugo’s, and Daewoos, and Pinto’s, and K-cars for god’s sake, and Suburbans when gas was $4 a gallon.

How? Because we SOLD them. We inquired about our customers needs and wants, their budget, their family, their jobs, their travel habits. We made friends and sold the snot out of the right vehicle that met all of their needs. We didn’t sell the deal, we made the deal sell. We didn’t believe them when they told them the car was too much…because we selected a vehicle that wasn’t too much; and, when they chose a more expensive model…we told them it was more expensive and they would pay more. We sold them on the idea of putting money down so they wouldn’t be buried with debt so that cash down wasn’t a burden but a benefit – and they always found more money for the car we made them want…because we made them want it…we made them need it…and they loved us for it.

We didn’t lie or cheat, we didn’t fudge the numbers, and trick them into paying more…we sold the sizzle…and we made money doing it and our customers loved us when we were done. And they told their friends how great we were to do business with.

When I was a salesperson I loved the rain. I loved it because the other salespeople would hide in their office convinced that they were not going to sell anything because nobody was going to come out in the rain. So I stood on the lot under my umbrella and waited, ’cause I knew that if somebody did show up…they were there to buy something.

Today the news media is pumping bad weather into everybody’s living room and it is raining bad news. Today I want to be a salesperson again standing in the showroom waiting for the customer who is going to walk in despite everything they have heard because they are looking for someone to say, “its OK to buy,” and I would be there in my tie with a warm handshake and a smile ready to make it OK to part with a few thousand dollars…and I would make it fun too.

Yes, it is true that dealers will close. Banks will go under. The car business is changing. This is the time when we will undergo an economic housecleaning. We will see the weak salespeople who survived in this business out of sheer dumb luck find their true place in McDonalds dunking fries. We will see the sales managers who forgot how to sell, and who never knew how to motivate and train professionals, move on to telemarketing gig’s or make that career change they have talked about for so long.

Good riddance. This business is not for the weak or feint of heart. Here only the strong survive. When all is said and done only the best will be left standing. We will be sipping our coffee, and cashing our big checks, and rolling steel.

I will be here with my umbrella, my tie, a warm handshake and a smile. I say bring it on.

MAKE IT HAPPEN!!!

-Rob

I’ve been to the remotest place on earth for the last 3 weeks.  It was a complete escape from…well…absolutely everything.  I couldn’t even communicate with Mom.  No news, no phones, no cars, no business, no worries!  You can’t even imagine…

WTF did I just come back to?

I want to sell the house, the car….awwww hell….I’ll just declare bankruptcy and get out of this country as fast as I can.  What a miserable place the United States has become.  I had to fly back into the States through Miami and as soon as I got through customs it was not the America I once knew.  No happy faces, no excitement, no sense of adventure in Miami International.  Yeah, airport security is rough, but this was different.  I was still in vacation mode and didn’t quite put my finger on it.  My layover in Charlotte multiplied these sad things I was noticing.

Then I got home.  I was walking in the clouds from the most amazing experience of my life and discovered all these people who just wanted to grab my feet and pull me into their hell.

For the first time ever I want to move to a different country.

But there is another side of me that wants to see all my friends, family, and colleagues see past this temporary funk we’re in.  You might be cutting back on your spending habits, you might be seeing your net worth drop, or you may even be standing in the unemployment line, but ladies and gentlemen you still have it better than most of the world.  Have we forgotten about the things we take for granted?

1. Were you able to stand up this morning?
2. Were you able to have a meal or three?
3. Does someone else care about you?

If you can check those things off, you’re doing well.

Of course you all knew that.  Motivational things don’t work on you – too many Saturday morning meetings have taken their toll.  Well, here’s some other things:

• The most Generals are made during times of war
• The biggest risk is in not
• You can do anything you want

Okay…nobody is perfect.  Nobody is ever going to list a vehicle 100% right every time.  We all strive to do our best with our online inventory presentations, but we can all do better.  Is our imperfectness creating leads?

If everything is listed as a customer wants, why should he or she ever submit a lead?  If all those consumer questions have been answered, the consumer should just walk right into the store….right?  What’s the purpose of submitting an Internet lead, if there are no questions, other than to expedite the car-buying process?

If your inventory is perfect, and your competitor’s isn’t, are they going to sell more cars because their people are getting more leads?  Is my logic flawed?

If a customer has to submit a lead, or pick-up the phone, because your inventory listing is missing something he/she wants then you win….right?  You and your people have the opportunity to establish rapport, switch the customer to the car that is really wanted, introduce some new purchasing ideas, etc.  The guy with the perfect listing lost out, didn’t he?

Is it really better to strive for building the imperfect inventory listing?

FOODFIGHT!!!

Alright, we’ve had our fun. I was up late last night deleting the swarm of comments that had come in attacking individuals, including myself (which is ok). This post has gotten out of hand and that was not it’s intent. This isn’t Hollywood and it’s not what our industry is about.

I know some will be pissed at me and say I was weak for un-publishing this post and others will say it was the right thing to do. In one of my comments, I wrote “Is this history in the making for our industry or will this blow over and will no one think about it 2 months from now? ” I don’t think it’s history in the making and I hope for Paul and Jim’s sake they figure this out and it does blow over.

If we get anything out of this, I hope every one of us; dealers, vendors, sales people and myself,  think twice before hitting the SEND button and ask ourselves a few questions.

• Am I CAN-SPAM
  Compliant?
• Did I legally obtain everyone’s email address?
• Does my marketing email provide a way for recipients to unsubscribe? (Opt-Out)
• Am I using good emailing practices? Have I been honest and truthful?

Humans learns from their mistakes or by the example of others mistakes. My advise to Jim Ziegler; be sure you know the game before you step on the field, especially if you’re viewed as a coach. What you did was wrong and you got caught. Just because “everyone does it” doesn’t make it right!

I should have stuck with my gut instinct when I said “It’s disturbing to see something like this happen and maybe I shouldn’t be posting about it and possibly bringing to more to light to an awful situation”. My mistake!

This is an awful situation and could have been solved with a simple phone call. When something like this happens, PICK UP THE PHONE and talk about it. You’ll often be surprised with the outcome.

I hope we can all agree that nothing positive was coming out of this post and after time we might have looked back and said..”maybe I shouldn’t have been a part of this discussion”.

So lets call it a day and move on. I’ll get to crunching on some “informative” posts.

And NO I was not contacted my Jim or Paul to remove this post. I made my own decision.

The comments are open.

If you have ever worked with dealer advertising and marketing, you will enjoy this video!

For anyone that has ever had to deal with Honda DMA compliance. You’ll love this little cartoon put together by an anonymous cartoonist.

I came across this report and didn’t know what to think.  It wasn’t sent to me by BZ, so I’ve covered over the URL’s used for this report.  You can click on the image to see a larger version.

This report was sent by BZ to solicit business from a non-BZ customer.  That dealership is denoted as “DEALER A” and one of their competitors is “DEALER B”.  The funny part is the third competitor’s URL is very similar to a national furniture store, so the person who created the report used the furniture store’s URL.

The second mistake is the use of Compete.com.  Don’t get me wrong, Compete.com is an awesome resource – I use it all the time, but I would never use it like this.  I understand web-hosting competition is fierce, but this just seems like a way to sucker someone who isn’t that educated on the Internet.  It is under-handed in my opinion, but I’ve been wrong in the past.

What do you all think?  Under-handed?  Fine piece of salesmanship?  Preying on the uneducated?  At least you laughed when I told you they’re comparing two car dealerships to a national furniture store!

Let’s all gather ‘round for a nice Internet Sales version of the game, “Would You Rather”.

It’s easy to do… just pick one situation (or all of them), and tell us which outcome you’d go for, and why. And remember folks, this is all hypothetical, so don’t go getting your britches in a bunch about having to choose one or the other. I don’t want to see any “well I’d do something entirely different” or “I have a solution for both”… just put on your crisis management hats and pick a side, okay?

Trust me, it’s good for the brain.

Would you rather…

A. Get three third party email leads
Or
B. Get one phone lead

A. Spend $2,000 on PPC
Or
B. Spend $2,000 on high-level SEO

A. Get an email from a customer saying “your price is too high”
Or
B. Get an email saying “you don’t have what I want”

A. Have a Service Appointment form on your site that never gets responded to
Or
B. Have no form at all

A. Have a competitor directly under you in the SERPs
Or
B. Have a negative consumer review directly under you

A. Have a payplan that pays out for previous Internet customers
Or
B. Have one that pays out for Internet-based Service revenue

A. Remove all the phone numbers from your site and rely only on the email forms
Or
B. Remove all the email forms from your site and rely only on the phone numbers

A. Lose your domain name
Or
B. Have your mail server blacklisted

Remember…it’s either one or the other. None of this.. "I’d do something entirely different". You have to choose form the given situations. Give each "Would You Rather" some deep thought and share your feedback. Have FUN!!

Guest posting by Mitchell Turck
Internet Consultant with
WebNet Services