Facebook just launched "places" which promises to change the way local business interact with their customers. Location based media is not an abstract approach to creating fuzzy dealership ROI, but rather a direct connection between customers interacting in the virtual world and connecting with them directly in the physical world where the cash registers ring. This has huge implications for car dealers. Here is where I think the market is going and where dealers need to be involved.

Dealerships are putting too much emphasis on social media and its not healthy for the stores, the consumers, or the industry. Marketing is not the problem. Despite the fact that most dealerships are still operating on an old marketing paradigm, most dealers are fairly decent marketers. They tend to manage large budgets and get predictable results with acceptable ROI. (The ROI part is semi-debatable, but that’s for another time.) The biggest problem hindering most stores is not the marketing, it’s that they don’t deliver on their marketing promises.  It’s sad, but our industry standard for customer service is doing just enough to get the job done with today’s fresh customers but stops way short of creating an experience that customers can rave about. In other words, the root problem holding dealerships back is not what you are doing in 140 characters on twitter, it’s what you are doing on your showroom and service dr...

Why is President Obama focused on forcing expensive regulation onto dealerships as if they are banks?  President Obama is on a mission to make sure a financial collapse like we recently experienced does not happen again. I think we can all applaud this greater vision. However, he is making a serious miscalculation in executing his reform that could affect us all in the auto industry. We all know that dealerships help customers get financing for their car purchases, but that dealerships themselves are NOT the lenders who underwrite the loans.  Dealerships help consumers by connecting them to banks, credit unions and manufacturer lending sources. Most dealerships simply act is a customer liaison to the loans; the dealers themselves are not banks.   The President's financial reform bill regulates big banks; however the way it is written it also includes dealerships in the regulation. This would be expensive for dealerships to comply with an...

To combat what I feel is a growing problem on Facebook, I’m experimenting in a big way with my strategy. I believe Facebook at its core is a personal tool, not a business one. Like many of you, I joined to connect with personal friends back before it was really the hot marketing play in our industry. I have been watching the company since it was a startup and early on I liked to play with it when it was open just to university students (admittedly I would get in under my brothers account just to understand it.) Today there is so much business talk on facebook I feel its squashing my personal space. I cant help but wonder if potential customers are getting turned off feeling the same way.    As one who likes to share auto industry information this has created somewhat of a personal dilemma. Half of my facebook friends are personal friends from home, people I went to school with or soccer mates who I played ball with for years. These peopl...

Dealerships across the country are jumping into Social Media, and that’s a good thing. However, as I talk dealers around the country many, perhaps even most, are not seeing any ROI from their facebook pages, twitter participation or any other social media assets. Chances are if you are not seeing ROI from social media it is due to one of two reasons:   1. Dealerships are not leveraging their social assets properly   The genesis of social media is user generated content, so naturally to be involved means that you need to join the communities where your customers are, or create your own destinations, and share quality content. This is a problem for dealerships because historically the only content dealerships have created are their marketing collaterals such as TV and Radio spots.    Most dealerships are not geared up to be content producers so they do what comes easy, sharing inventory and sale information. This is bad, in fact...

As most of you know I’m a third generation dealer. My grandfather started his first Lincoln Mercury dealership in the Bay Area in 1964. My father took over the dealership later on and added an independent lot and a Jeep Franchise.   I’ve grown up in the business, mostly working for other dealer groups and have attended NADA’s Dealer Candidate Academy in preparation to buy my own store.  As a child when my friends would say they were going to be policemen or firemen when they grew up, I always answered, “I want to be a car dealer when I grow up.” I’ve been passionate about the business long before I understood it.   Its been almost 2 years since I left the day to day dealership world and have focused on building DrivingSales. My objective is simple: give all dealers 24-7 access to proven best practices and industry innovations. Those on the front lines need better information than they currently get, ...

It's no secret that the core of online marketing is quality content.

Good content increases the time visitors spend on your pages, keeps them returning to your site, and engages your audience with your message.  Good content gets linked to, increasing your authority in the search engines and bringing you more traffic.  Good content gives you the ability to place valuable contextual links on your site, making your property more valuable to those sites you link to.  Consumers are hungry for information and they seek quality content, create quality content and your customers will find you.  Make no mistake; going forward your success online will be directly proportionate to your ability to create good content.

In the world of the social web (which is the world we live in if you haven't noticed) you don't have to work hard to find the best content.  You simply login to your favorite community and it finds you.  In the social web your job is to share the content that you like wi...

I wanted to extend a special invitation to all DrivingSales community members to come join us in Orlando for an action packed advanced marketing workshop. Our NADA Conference workshop is about the "Proper model for advanced dealership marketing."  This workshop is geared for Dealer Principles and GM's who are looking to really understand trends in the online market place and translate that knowledge into a working strategy for their dealership to get to the next level.

Inside the workshop we will cover:

How the web has evolved into a social ecosystem and the power (and pitfalls) that come with it.
We will discuss the business case for increasing traffic at your dealership while reducing your spend and lowering your ad costs PVR.
We will outline the strategies and tactics your dealership should be using to drive and measure online business in both Variable and Fixed ops.

Each participant should expect to leave pumped up but most importantly with a higher level of underst...

WOW! The video below is a sad but somewhat familiar occurrence in the auto industry.  It's video of a real sales meeting where the manager is insulting his people into motivation.  He tells his people they suck, failure is their fault and that he, the manager, refuses to be part of the problem.

Unknown to the manager, one of the sales people whips out his phone and records the incident, then posts it to YouTube for all to see. No doubt we will write about the social media implications to the dealership's brand, but for now I want to talk about the huge gap in management skills that are demonstrated in the video.



What do you expect?
We have all been in meetings similar to this.  Most of us promised that when we became managers we would do a better job.  Sadly, without being taught the skills of proper management many in the industry become a product of the environment and poor management perpetuates itself.

I will be the first to say a manager's job is to hold his/her...

Five Strategies for Social Media ROI
Social media is relatively new and critics often state it does not produce concrete measurable results and thus is not worth your time.  This is false.  Here are five concrete, value-boosting strategies that your store can use to benefit from social media.

Social CRM
Your dealership should already have a storewide Customer Relation Management system to help you track and transact with your customers.  Social CRM has a parallel goal to your CRM system, to maintain and strengthen ongoing relations with your customers.  However, Social CRM is much less focused on creating transactions, and much more focused on creating strengthening relationships.  These relationships are built and maintained through efficient conversations on social media sites.

High quality content that engages customers and creates ongoing dialogue is the key to social CRM.  When your customer has a question about a 60k mile service, the answer should be found on your ...

Why your Internet Sales Process matters more now than it ever has, and the 7 Process Points you must execute to be successful:

Advanced marketing tactics like SEO and Social Media Marketing are a big focus in the industry right now. These marketing tools are very successful at moving the bar forward and YES your dealership needs to be involved.  However, if you are growing your arsenal of marketing tools you are also being more wasteful if your process is not nailed down.  Your store should not be investing more marketing dollars unless your customer funnel is proven to convert the customers into deals.  As the economy rebounds and you look to grow your marketing it's a perfect time to do a dealership process check up.  How does your store stack up?

The Correct Internet Sales Process
A successful Internet sales process is not rocket science.  There are 7 things every process should accomplish.  By executing these seven points consistently and with your dealerships brand, y...

At about 5:30 am yesterday morning I was woken up by a twitter text from Jeff Kershner at DealerRefresh.  He told me about a contest he was running to help get dealers involved in using social media and asked if DrivingSales would participate.

Naturally we are game to support anything that helps the dealers get involved in social media.  (Plus I was half asleep and would have said yes to just about anything.  Looking back, buying two flip cams is a commitment I can handle!).   So here it is, DrivingSales is donating a couple extra flip cams to the cause so your chances of winning just doubled!

If you want one of the sickest ISM tools on the market, the Flip Cam MinoHD, here is what you have to do:

1.     Sign up on twitter and follow @dealerrefresh (jeff) and @drivingsales (me)

2.     At four random times during the digital dealer event we will Tweet our location.

3.     First person to come to us from the tweet gets the Flip Cam.
*fine print at the bot...

DrivingSales has been re engineered from the ground up to be faster, offer more features and help you easily find the profit building information you need to maximize your success.  I wanted to offer a quick tour of the new features so you can get the most from your experience in the community.  If you are not a member yet, join us by creating a profile here.

Filters: We have added filters (in the left column) so you can organize the steady flow of content by dealership department and action.  For example, you can view best practices relating to "Growing Sales" in the "Used Car" department, "Cutting Costs" in "Fixed Operations" or an unlimited number of options.  Simply click the departments and actions you wish to view.

Content Creation: Creating and sharing content is the foundation to social media and communities like DrivingSales.  We have added a "Create Some Buzz" box in the top right corner of every page to allow for one click content sharing.  Ask a question in the ...

Today, the Internet Sales Manager is one of the most important and emerging positions in your dealership.  Here is some direction to creating a pay plan that will fairly compensate an ISM and insure the success of your dealership’s web efforts.


1. The pay plan should focus the ISM on their responsibilities:
The objective of your pay plan is to align your employees’ job with your dealership objectives, so the employee is compensated for achieving what the store needs in way that generates fair pay in your market.  Thus, the very first step to creating your pay plan is to review your written job description to see the expectations you are asking the ISM to meet.  If you, like most people, do not have a written job description then your fist step is to create one.  Here are the most popular “Roles” ISMs have in dealerships. 

Various ISM roles:
Sales ISM: This ISM is directly responsible to take customers through your process and ...

The Chrysler Bankruptcy is pushing private creditors into a head on collision with the government and the government backed companies. What plays out in New York's bankruptcy court will largly determine the direction General Motors, and our industry heads.  Will the government keep the playing field level and let the markets rebuild themselves naturally from here, or force their hand to achieve some predefined objective?
President Obama delivered a great speech when he announced that Chrysler would seek Chapter 11 protection.  Despite announcing some really bad news, he kept things very positive and encouraged the public to buy American.  The largest problem facing Chrysler has been, and still is, a steep decline in consumer confidence. The president should be commended for attacking that head on.  However, he ripped a small group of Chrysler creditors for not settling their debt according to the government’s recommendation and thus laying balme on them for f...

Preparing for a Chrysler or GM bankruptcy is an ugly thought that nobody wants to discuss.  However, if you are prepared for such an incident you could save your store hundreds of thousands of dollars.
If your manufacturer does file BK, your dealership will be hit in two main ways.  First, consumer confidence will fall, making the bankrupt franchise’s products harder to sell and sending ripples through the retail and wholesale markets.  Second, your dealership's cash flow will be significantly altered in the form of holdback, incentive, warranty and other payments that are owed your store.
Here are some tips I recommend to shield your dealership form the worst.
Manage your cash position daily

Typically a weekly cash meeting is sufficient, but today as a GM you must be looking at the appropriate schedules daily to insure the dealership has as much cash in the system as possible.
A cash meeting is a time when the department heads get together with the GM or Pr...

This past week I took a couple days off the hustle of office life and traveled back to sunny Florida to attend ward’s Spring Training event in Tampa.  For all those who didn’t attend, I figure Id share a few words and let you know what you missed.

First, I’m a firm believer in industry events.  One problem quite prevalent in the car business is that we tend to have a fairly insular view of our positions within the industry.  As a whole, we do not look outside our companies, let alone our industry, near enough for inspiration and solutions to our issues.   I view Professional events as one way to remedy this problem (participating in a network like DrivingSales is another).  The events allow us to take a step away from the grind, re-evaluate our position, strategy and be inspired for the return.  However, too often these events become such a busy hub for business dev that they turn into a blur of a few days where your feet throb ...

Welcome friends and family of the deceased.

We are gathered here today to honor the life and mourn the passing of the infamous “4-square.”  The 4-square was born at the dawn of the auto industry when vehicle margins were thick, consumers were uneducated and invoice data was guarded with upmost secrecy.  In recent years, with transparency increasing, the four square has been on life support plagued with “old-schooler’s disease, but the time has come to bid farewell. Our beloved 4-square is survived by market based pricing, transparent information exchanges and multi choice menu styled write-ups.  Unless you want to die of old school-ers disease too, I suggest you move on and find a new way of negotiating.

 
How do you negotiate?

Like many of you, my first sales manager was a master negotiator who indoctrinated me on “4-Square” negotiating.  He would role-play tactics to avoid price and “hit, hit, commit” ...

Sorry, but I have to RANT a bit.  I just read an article by a VC who totally misunderstands the issues our industry is facing. As usual, I experienced the run of emotions when I read the post, but ended up somewhat fired up.  People just dont get it.
I do typically start out intrigued when I see successful business people criticize our industry and offer solutions. I believe we would be wise to look for outside influence in these times of reinvention. Then I chuckle a bit because these brilliant people are often in left field as to our industry's struggles.  This particular article argues the wrong reasons why Steve jobs could be the savior of the industry.  I contemplate the proposed solutions, fear sets in, then anger becasue this type of ignorance could really do some great damage.  There is a good chance congressional leaders and the Obama task force think the same way, or be influenced by these other wise successful people, but in the end i...

Social Media Marketing is a great way for companies to engage and energize their audience.  Dealerships and other companies are moving to these mediums to extend their marketing.  While the benifits can be big, there are some very common mistakes that businesses so regularly made it’s almost embarrassing to admit.  Commiting these errors could cause a disaster for your brand that will take a while to repair.
Here are some mistakes to avoid:
Mistake # 1.   Interrupting and shouting.
Social Media Marketing is about connecting and creating conversations around your brand or areas of expertise.  However, marketing professionals have been trained to grab the attention of the consumer and insert their message inside the short moment that they have captured. This does not work on social mediums.   I liken this to sitting around the coffee table talking with friends and interruping with your company's call to action at every pause in conversatio...

At the conclusion of the convention, a few friends and I were having lunch and discussing the show highlights. We talked about the important stuff, like the coolest new product release; and we talked about the not so important stuff, like the parties.  That conversation led to the creation of the first annual DrivingSales “Attendee Choice Awards”  where we will nominate, and let the users add their own thoughts, to the most memorable moments of the Convention.


The awards are 100% scientifically false.  There is no rhyme or reason here, just fun memories. Add your own, disagree with ours or just simply smile as you read the list: (Naturally you know this is simply a bunch of opinion, and is in NO WAY affiliated with the convnetion or the people who put it on.)

Here it goes:

Best face-off between two vendors:  vAuto v.s. First Look  - They were literally 10 feet across the walkway, you could stand at one booth and hear the other&...

 President Bush and President Clinton both spoke today as part of the “main event” for the convention.  Personally I was unable to attend, which was the only disappointment for me this entire convention.  From what I heard President HW Bush was hilarious. President Clinton then got up and said something to the effect of, “I couldn’t get away telling the jokes he can.  Could you imagine if I said some of the things he did??”  Meaning Bush must have said something good… and I missed it.

I didn’t realize how good of a relationship these two prior presidents have, I guess they work together quite a bit.  It’s a rather elite club, to be one of 44 men in history to hold the post of  “The worlds most powerful person.”  It’s also a good example to those of us in the car business about sportsmanship.  As President Bush said about President Clinton, “He beat me like a drum, bu...

As those of you hear can attest, yesterday was another rock solid day of networking and getting things done, not to mention the party scene really picked up last night with some solid events!
I spoke again yesterday, went over my time allotment because we had lots of good questions.
Met some DrivingSales community members, it was great to shake everyone’s hand and get your impressions, feedback and support for some future items.  Steve, we will all be in touch soon!  Thanks!
While on the floor for a few hours I spent some time with the boys from eBay Motors.  Those of you who know Clayton know is he is always a hoot to be around, I’m stoked because he has promised some participation and knowledge from his world at eBay to help the dealers here on DrivingSales... stay tuned.  For those of you who don’t know him, he is a great speaker and knows his stuff.  He is heading up 100 workshops this year in cities across the country.  Ill be att...

Its the morning of Day 2 of the convention, I actually begin my next workshop in just a few minutes but wanted to update everyone on how the first day was...  BUSY!
The day flew by, Bart and I started the day wandering the floor with Rafi Hamid and saying hello to friends.  The big buzz of the morning was that JM Solutions sold off AAX and affiliated companies .  I dont know the details of the transaction, but rumor had it the JM employees found out on the way here.  The booths are seperate, but there is a sign up notifying people of the purchase.
Another interesting note, the vAuto booth and First Look booth are all of 10 feet away from each other on the floor.  Its funny standing at the vAuto booth listening to First Look Demoing their pricing tool.  Market based pricing is hot and your store needs to be invovled. If you have experience with either (or a competitor's product) lets us know your review of them in the Vendor Rating System.  Note...

Handling internet leads successfully usually requires moving the lead from the web, to the phone, to the store.  Phone skills are very important since that is how you build raport and a relationship to bring the customer to the dealership.

I heard this simple question from a rep of mine a while back and it  works GREAT to open up the conversation to set an appointment. Adapt this to your personality and it will engage your guest in a trial close and let you know where you stand.  Remember, the road to any successful sale is to build value, build a relationship and overcome any objections.
Wording:

After responding to the vehicle inquiry, get the guest on the phone confirm that you have the correct vehicle.  Then simply ask them, “Are you the type of customer that would like to test drive the vehicle before making a selection or will you just handle everything over the web?”
The vast majority of customers will answer that they would like to &ldquo...

The Internet has transformed from a static network of electronic brochures, where sites published information for users to consume, to a network of dynamic platforms, where users share and publish information for others to see.  Wikipedia has over taken Encyclopedia Britannica.  Google has overtaken the yellow pages and the masses are publishing more information on blogs than professional journalists are on syndicated news portals. (This is really nothing new to most DrivingSales participants, as you are a perfect example of the transition web from just reading information to publishing and sharing your knowledge on a platform like DrivingSales.com)

What effect will this transformation have on your dealership?  Does your dealership’s web strategy need to evolve inside this environment?  What are the most prominent tools and technology your dealerships need to leverage to succeed?
Today, I believe the most important technologies dealers need to be familiar...

This is not 1996 anymore. It's 2009 and we have some exciting trends taking place in our industry; its time to come out of the cave and participate in these exciting opportunities!  

 
What’s Out: Internet Departments

What’s In: Teaching your entire staff, desk included, how to handle Internet shoppers

The Internet is NOT a niche market anymore.  Since over 80% of your customers are using the web to purchase cars, shouldn't at least that much of your staff be prepared to handle the demand? 

 
What’s Out: CRM as a technology

What’s In: CRM as a management tool for your entire dealership

In today’s market follow up is imperative, especially with Internet marketing.  We reach consumers much earlier in the buying cycle, requiring much more robust follow up. 
(Check out CRM vendor ratings right here.)

 
What’s Out: Traditional marketing to drive customers to your store

What&rsqu...

Merry Christmas to the thousands of DrivingSales community members who frequent the community and participate. We wish you all the very best this holiday season!  Ill share my 2 most memorable Christmas in the Car Business.  (Feel free to add your own if you so desire.)

Most memorable Christmas #1:

When I was 10 or so years old, on Christmas day, my father told us kids that he had some work to do and needed to go into the dealership for a few hours.  He offered to bring us, and said since it was Christmas he thought we could have some fun playing in the Jeeps.  We all went down to his Jeep dealership, my 2 brothers, my sister and even some cousins, and to our surprise as we got there he said, “it looks like Santa visited the dealership.”  Inside the showroom, decked out with the real Jeep Wranglers was a Power Wheels Wrangler for each of the younger boys (I was the oldest by 4-5 years)  The Power Wheels were in between the real ones on ...

For those of you who do not know what the "job bank" program for the UAW is let me give you a crash course:
After heavy layoffs of union workers in the 1970’s, and the threat of automation cutting more factory jobs, the UAW and the big 3 negotiated an agreement.  It was clear that the big 3 would (and should) continue building automated factories where robots completed much of the labor to increase quality and decrease costs; as a result fewer factory workers were needed.  As automation increased, so would the layoffs.  Rather than reward the Big 3 for the ingenuity, and despite the quality enhancements and the cost savings, the UAW demanded that the factory workers still get paid even if they didn’t have a job.  The result of the union negotiation was the "Job Bank."
The job bank is an account, funded by the Big 3 that pays factory workers up to 95% of their prior wages if they have been laid off due to restructuring or automation...

Split deals can be a headache for Management and a downer for the department.  They affect more than the two or three sales people involved, because the team tends to pick sides with their friends and the “ill-will” spreads like a contagious cancer around the showroom floor.
The saying, ‘the best offence starts off with a solid defense” definitely applies here.  Set ground-rules and insure everyone, including management, plays by them; your team will be much better off.
Your CRM tool is one of, if not THE most important piece of technology since it holds the keys to your success, your customers.  Regarding split deals, your CRM tool can take on added value as the end all answer to many of your stores in house disputes.
I feel strongly that “process” is key to one’s success.  Mediocre sales people perform above average if they execute a process well and good sales people will be unstoppable.  As a manager define and A...