Community

Share your automotive expertise

2 Write a Blog Post

Filed in: None

To Spiff or Not to Spiff? That is the Question!

By Ron Henson on Jan 9, 2013

Ok, full disclaimer.  I know that this is a polarizing topic in dealerships everywhere.  That having been said, without bias to either side, I would like to present an argument for both sides and see where the community lands.  Hilary Clinton once said, "Freedom means the right of people to assemble, organize, and debate openly.

So, SPIFF.  A dirty word to some dealers and a heavenly gateway to results for others.

Position A: I have spoken with many dealers who take the position that their sales consultants are very well compensated within the confines of their pay plan and should be expected to perform to certain standards without cash bonuses playing a part.  One dealer also expressed the very analytical opinion that the additional expense generated in manpower required to track such cash bonuses and assure that they are properly accounted for in payroll for tax purposes was not worth any "lift" they would receive from offering them.  Phew, quite a mouthful indeed.  And furthermore, (Yes, he had more to say) offering spiffs is like giving your consultants Crack Cocaine!  Give it to them one time and they are addicted.  

Position B: I heard it said by more than one GM in my NADA General Dealership Management class (Many moons ago)  that if they offer up a Saturday morning $100 spiff for the 1st unit sold, oldest unit sold, and for a hat trick, they are guaranteed to have a good day.  In fact, many sales consultants will chase that "Cash in Fist" so hard they will stack appointments for Saturday!  (Hmm, does that statement belong in position A?)  Someone even went so far as to say that he would offer a full commission at the end of the month or a 50% cash spiff on the spot in lieu of said full commission. (I do not advocate that for accounting and payroll legality reasons but it was his store surprise)  Any guesses on how many opted on the "Cash on the spot?"

In conclusion, I have my own thoughts about spiffs but I throw this debate out to the Ultra Intelligent DrivingSales community for a healthy discussion on what your position is......... TO SPIFF OR NOT TO SPIFF?

Let's move some metal!

 

Comments

Wow, Ron, what a great topic. I completely understand the sentiment about paying someone already to do their job, so spiffs seem over the top. And once you give a mouse a cookie, he's going to want some milk. However, I think one of the most important things in a leader is knowing what motivates your people. Everyone is motivated differently and it's not uncommon for average salespeople to be strongly motivated by money and short-term accomplishment. In this case, spiffs would seem a viable option. Of course, if your pay plans are set up differently or you know your team doesn't thrive in that setting, spiffs would be obsolete. Great question, Ron!

Jan 10, 2013

Once again and as usual, Lindsey Auguste is dropping the knowledge. Way to go Lindsey!

Jan 10, 2013

As we progress in this digital age, what about "spiffing" people to grow the business digitally? For example, "spiff" a guy at the morning meeting who put an idea out there that worked.

"Hey, let's video our sales guys Sunday morning run and put it on YouTube showing what we're like outside of the business."

Offer incentives to think outside the box....and watch as the ideas start to flow - even from an older team that's not very tech-savvy.

Jan 11, 2013

Well said Kyle! I like the way you think

Jan 11, 2013

Comments 1 - 4 of 4

You must be logged in to comment

Login Create an account

Add your comments:

   

Ron Henson's Recent Posts

Related Posts

  • Stages of Brand Loyalty

    Many businesses wonder where they are at in the grand scheme of things.  While success is definitely a relative term, for marketers the gold occurs when shoppers begin to develop brand loyalty.  There are three typical stages a business will go through before achieving brand loyalty at large. The first stage a business would want to achieve is awareness.  At it's most basic, this means that people are aware that the business exists.  Many never even reach this stage!  Marketing and a logo can go a long way towards establishing the existence of a business, but the path to brand loyalty doesn't truly begin until the enterprise becomes known for something. Once this occurs, the next stage should hopefully follow. When shoppers begin to develop affinity for a company, brand loyalty is on its way to being established.  In order to achieve this, a business needs to get the customer to care about it and feel that it represents them in some way.  Smart product placement and marketing,...Read post

  • The Tools to Help You Discover Your Market

    Finding your target market is a key part of a successful marketing strategy. Whether you want to highlight new inventory, promote an event, grow your service department’s customer base, or simply boost business, defining your ideal audience is key. It’s easy to be generic when marketing because the hope is always to connect with as many different demographics as possible, but the truth is that the more personal approach you have, the more success you’ll have. You’ll connect with YOUR people—the ones who are really interested in what you’re offering. When your customers feel like all of the attention is on them, they are more than willing to share their experience with their network and help your dealership achieve even higher community engagement. Dealerships already have a plethora of tools in front of them to discover their market, including customer insights and social media. Here are some ways your dealership can discover its market by fully utilizing these tools.   ...Read post

  • May the Phone Be With You - Why Mobile Marketing Is Taking Over

    Have you ever walked down the street and all of a sudden had your phone alert you that you’re near a Starbucks or Walgreens, automatically displaying your loyalty card in Apple Passbook or Google Wallet? Or perhaps you have received push notifications from Waze and other apps that deliver real-time notifications based on your location.  As consumers increasingly rely on mobile phones for information, location-based marketing is becoming more important. Facebook recently launched Facebook Bluetooth Beacons, which enables push messages, tips and invitations to like your page, whenever a customer opens the Facebook app while at your business.   Geo-targeted technology allows businesses to push coupons and offers to nearby users. Many industries - especially retail and hospitality - are adopting these technologies to capture more immediate business. Traditional - and even digital - marketing may still be effective. However,   it takes time for that message to reach the customer b...Read post

  • Top Recommendations for Inspecting Your Service Advisor Process

    In a recent email response to one of Automotive Process Champion’s clients we pointed out several areas to consider when inspecting their Service Advisors Process. They were going to observe 3 of their stores prior to making a commitment to training. Here is the email: Using our 9 Step Service Advisor process that we installed at the Ford location as a reference, when we observe the service advisors process we would want to know: Does the Service Advisor perform a walk-around inspection of the customer’s vehicle at check-in? What items are on the inspection? Do we verbally assure the customer of what they can expect and let them know that “they’ve come to the right place”? Does the Service Advisor perform an active delivery with each customer prior to checkout? How do you randomly inspect the end result from the oil change process? (Do we inspect any of the customer’s vehicles upon completion?) In addition we would want to know: What percentage of oil change customers...Read post

  • This Week in Social Media – Week of 8.24.15

    Social Media News for the Week of August 24 via @SocialLittleMan Blab.im Hitting the Social Scene Still in Beta, Blab.im is a chat app marketers and various other users are keeping their eyes on.  Similar to Periscope, its live streaming functionality allows groups of up to four to video chat simultaneously.  Boasting easy-to-install and easy-to-integrate usability, users will also the Blab emoticons, link accessibility, and variety of color schemes for personalization.  With the popularity of instant-message chat, dealerships will want to keep an eye on this app and consider applying to their daily interactions with savvy online consumers.  Chat away, answer shopper questions, and participate in live sales conversations. Twitter Ad Network Expands As it continues to improve and expand its advertising offerings, Twitter recently announced the Twitter Audience Platform, an expanded advertisement platform offering new creative features such as Tweet engagement campaigns that be...Read post

  • The Security Risks of Outdated Software

    There are always early adopters of technology – using the latest and greatest in their business and personal lives – and late adopters, who would rather let all the kinks get worked out by someone else first. And who needs a huge disruption to their business – to their life – just to upgrade technology that’s working just fine? If it ain’t broke, don’t fix it. The problem is, with technology, it may be broken in ways you can’t see. You could be gambling your enterprise – your data, your financial resources, your reputation, your security – all while thinking you’re being responsible and avoiding disruption to your business, your employees, and your customers.Read post

  • Vehicle Service Interval Adherence Decreases by 15.6%

    New research from DMEautomotive reveals vehicle age, and lack of awareness of manufacturer recommendations, contributing to drop in number of consumers following manufacturer recommended service intervals   Daytona Beach, FL – August 25, 2015 – New research from DMEautomotive analyzes the factors influencing the decrease in the number of consumers who adhere to manufacturer’s recommended service intervals for their vehicles. The study of over 8,000 respondents from 2011 to 2014 revealed that the number of consumers who indicate that they regularly follow manufacturers’ recommendations has dropped by 15.6%. With a 4.2 day increase in the service interval from 2013 to 2014, this data reveals a trend of Americans paying less attention to manufacturers’ service schedules and servicing their vehicles less frequently. The DMEa “2015 Service Excellence” study pinpoints several potential contributors to this drop, including the increasing age of vehicles on the road, level...Read post

  • DealerSuccess Sets the Bar for Online Auto Sales, Launches VirtualDeal – The Easiest way for Customers to Buy a Vehicle, Ever

    74 Percent of daily visitors to auto dealer websites, if given the option, would prefer to work the entire deal online, including financing, price negotiation, back office, paperwork and home delivery, according to a recent automobile survey by Accenture. To meet this growing need, DealerSuccess, an automotive industry marketing/branding company, today announced the launch of Virtual Deal, an Online Deal Creator for the consumer that uses an innovative perfect payment DMS-integrated technology. Auto dealers are currently desking 50-200 extra deals a month with VirtualDeal, at a 96 percent consumer closing ratio. “We have been implementing web conversion tools for the better part of a decade. In that time, we have never seen a conversion tool dominate like VirtualDeal. Since inception, 37 percent of ALL our web conversions are the result of VirtualDeal. As a result, our stores are rapidly switching over to this superior way of engaging and converting car shoppers. With VirtualDeal, we are truly one step closer to true automotive e-commerce,” said Sean McKannay, CIO Dick Hannah Dealerships. VirtualDeal is a simple plug-in to an auto dealership’s existing website and works as follows: A customer can select a vehicle, click the VirtualDeal button and complete their entire deal from home. Customers are able to get multiple lease/payment options, trade value, financing and fees, and reserve their vehicle for up to 24 hours. VirtualDeal also creates perfect payments that both theRead post