Buy a Car or Get a Root Canal?

Buy a Car or Get a Root Canal?

What a question you say? Not really! I have been in the automobile business for over 30 years and my brother-in-law is a dentist. Even though both of us know that both are painless, most of the time, there are dealers and dentists that can turn a simple procedure into a nightmare.

Let’s try and look at this through the eyes of the buyer. I’m talking about really breaking down the buying process from their point of view.

Buying a new car should be a simple and gratifying experience. What’s not to like…the gleaming paint, the soft and supple leather, the “new car smell?” Unfortunately, my customers tell me dealing with a TV-cable company is easier.

We already know that over 80% of the people in the market for a new car already know what they want to purchase and, in most cases, have done extensive research on the Internet. They know everything there is to know, including knowing how much the dealer paid for the new car they want to purchase. Simply put…there are no secrets in the automobile business anymore. Here’s the embarrassing part, when they walk into your dealership they may just know more about the specific model they are interested in purchasing than your best salesperson!

Everything is ‘on the Web’ to see and print out for future reference. The people making this information available are “arming” the potential buyer’s with ammunition for the ‘fight’ ahead. It bothers me to think that the buyer today really believes they have to prepare for a battle. I’ve had some very close friends tell me their wives didn’t want to go to the dealership and be put through the embarrassing negotiation process.

Many dealers actually believe they have trained their staff to handle the ‘ups’ with more TLC. That’s great! The problem is that statistics do not support this.

At NADA this year there were over 150 companies touting the “best leads” for your dealership. 150 companies with the best leads…how can that be? Well, it’s simple.

Consider this…many people have described to me how they configured (built) their dream car on the web, and, there are many sites that offer this, including manufacturer’s websites. There are literally scores of them offering this feature. The next step in the process requires inputting the potential buyer’s personal info which was then passed on to multiple dealers in their area. That’s when it becomes frustrating. They either never got a call back, or the contact came days later and, if they were contacted at all, what occurred were dealers working hard to get the buyer into the store.

One person explained to me how they were told the requested car was waiting for them and when they got to the dealership – well you guessed it…no car! These “leads” cost the dealership much more than the fee charged by the lead generating company; they result in low closing ratios which leads to low morale which leads to low production by the sales staff..

Why is it so difficult for those of us in the automobile industry to change?

I am reminded of an article I read many years ago in the Wall Street Journal in June of 1967. Mr. King Whitney Jr., President Personnel Laboratory, Inc, was quoted as saying, “Change has a considerable psychological impact on the human mind. To the fearful it is threatening because it means that things may get worse. To the hopeful it is encouraging because things may get better. To the confident it is inspiring because the challenge exists to make things better. Obviously, then, one’s character and frame of mind determine how readily he brings about change and how he reacts to change that is imposed on him.” Unfortunately I believe most automobile dealers and general managers are the former!

I’ve been in the automobile business for over 30 years as an owner/operator, GM, GSM, salesperson, etc. and I consider myself to be open-minded and an innovator when it comes to adapting to the ever-changing facets of our business. That is why I find the new and very innovative, totally anonymous, buying process to be on the cutting edge of what the customer wants.

Here is where it differs from all of the others…there are no introductions…no contacts from the dealership…requests for personal information are keep private …none of what has formerly been the “norm” in handling website leads.Strange? Not really! The buyer “builds” the car just as always, but now the entire process changes. This request is then submitted to a network of dealerships with just the buyer zip-code. The dealer network sees the configured car and the zip-code and merely supplies the price for which they will sell the vehicle. The buyer has no clue who or where the dealer is, and the dealership has no idea who the customer is.

After 5 days, or even sooner, the buyer can accept the bid and only then does the winning dealership get the contact info. The thought is simple, if the buyer is sold on the car, they already know exactly what they want, color, options, etc. and the only factors are where is the car and what is the price – delivered to my driveway! Very simple and very cost-effective for both the buyer and the dealer.

The buyer is not chasing around hundreds of miles, burning today’s expensive gasoline, only to go thru 20-year old sales gimmicks, trying to get the exact car…AND, for the dealership…well they are just 6 clicks of the mouse to get a bid to a qualified, fee-paying buyer. The real beauty is that this is a process that requires nothing more than having the sales manager enter a bid. The dealership’s cost of sale just went down and the monthly fee to be part of the network is the price of a great dinner for 2 with a bottle of wine.

I liked the process so much that I became a partner in the business and I would invite everyone to become a subscriber.

Danny Mayer has been the automobile business since 1969. It has been his entire career and remains his passion today. He has sat in the chair of virtually every executive position in the industry, from single point franchises to the largest publicly owed automobile corporations. He has proven time and time again that “…creative, at the edge thinking drives success…” That is probably why General Motors of Canada tapped Danny to assist them in developing and introducing a new Customer Satisfaction program for that nation’s dealers and why Nissan Corporation asked him to participate, as 1 of 3 dealers nationally, in developing the Internet process for all Infiniti dealers. He knows the automobile business…he knows the Internet…and he cares about customers. He can be reached at danny@sdmautomotive.com..

Additional articles may be viewed via Danny’s “Street Talk” main page.