Kelley Blue Book
High Percentage of Consumers Interested in Self-Driven Cars
In a recent KBB.com Quick Poll, we asked consumers if they would ever consider purchasing a self-driving vehicle. While 53 percent replied “no, never,” the remaining 47 percent were either ready today or were waiting for the technology to mature.
Chalk me into the “no, never” category because as long as I can avoid serious congestion, I enjoy driving. However, a large percentage of consumers are interested in a potentially hands-off driving experience. A more interesting question is: Will they ever get one?
The handful of self-driving cars on the road today all have human operators at the wheel and pedals, ready to take over in the event that human correction becomes necessary, but in the first 300,000 miles of Google's small self-driving car feelt, not a single accident occurred. Still, as self-driving cars become more prevalent, accidents are bound to happen, which raises an important question: Who is liable – the human “driver” or the manufacturer? It seems unlikely manufacturers would put cars on the road they could be held liable for anything beyond today’s standards of safety, so I expect the brunt of liability will still fall on the human driver. This means that the human driver may not be able to completely tune out from driving to focus on other tasks while he or she is supposed to be paying attention to what their vehicle is doing.
Here are some other questions that surround this technology:
- How will this technology impact retail sales at the dealer level in the short and long term?
- How will insurance agencies handle these vehicles? Will premiums eventually be lower for them than human-driven vehicles?
- How does the car keep the human driver engaged enough to take over in an emergency situation since it’s human nature to tune out from processes that we are not wholly invested in?
- If we gradually move to only having self-driving cars on the road, will human drivers eventually lose so much of their driving abilities and instincts taught through months or years of practice today that it would actually be worse for the human driver to take over in an emergency?
- Will regular human-driven vehicles eventually be legislated out of existence?
What Questions Do You Want to Ask Consumers?
We frequently run Quick Polls on KBB.com. Is there a question you want consumers to answer? Ask it below in the comments and we will evaluate it for a future Quick Poll.
Kelley Blue Book
With Covered Maintenance Programs, Skeptics Abound
In a recent KBB.com Quick Poll, we asked consumers whether they trusted a vehicle with covered/free maintenance programs would be maintained as rigorously as it should be. As you can see from the results below, a skeptical 56 percent thought that maintenance would only be done the least amount necessary, 30 percent trusted that the maintenance would be done as if it weren't free, and 14 percent had sadly never heard of covered maintenance programs.
In this industry we know that customers are frequently skeptical of dealerships - a perception that is unfair in many cases because it reflects a few bad apples instead of the broad majority of dealerships. We can also see from the poll results that there is still some room to build awareness of these programs among the 14 percent that don't know about them.
How Will You Use This Data?
If your dealership has a covered maintenance program, how will you go about educating these skeptical customers? How will you enlighten the consumers in your market who don't know about covered maintenance?
If your dealership doesn't have a covered maintenance program, will you leverage this skepticism to sell against your competition?
What Questions Do You Want to Ask Consumers?
We frequently run Quick Polls on KBB.com. Is there a question you want consumers to answer? Ask it below in the comments and we will evaluate it for a future Quick Poll.
4 Comments
DealerTeamwork LLC
Great stats Alex - understanding these perceptions can surely help. We're missing opportunities with the messages being shared for these departments. Trust & transparency should be a focus & a priority for these programs as well.
Dealer eTraining
I love this post. It makes me realize that a dealership that takes in lease returns and buys them out in order to sell them as a CPO vehicle need to invest more time into reconditioning and making sure the vehicle is in top shape. I also see that finance managers are missing the boat 14% of the time when selling certain products. This means they need to improve their presentation and offer the real benefits. This way they will 7% more. A business managers that delivers 100 cars per month will sell 7 more and increase gross, penetration, as well as provide value to the guest. From a consumer standpoint, I get a new vehicle every three years. This makes me more weary of buying a pre owned vehicle because I know that 56% of the time it probably was not serviced. But from a retail perspective I would use that 56% figure to make sure the my used inventory is properly reconditioned.
Kelley Blue Book
Hey Stan - thanks. The data indicates that 56% of consumers think that maintenance performed under covered/free maintenance programs (similar to BMW's) will be performed the least amount necessary regardless of what the dealership actually does. The data is not indicative of whether or not actual vehicles are serviced on schedule over time or fully reconditioned for pre-owned sale. These Quick Polls ask consumers questions, so all we're getting out of this is consumer perception. To me, the way consumers answered this question means exactly what you said about finance managers needing to do a better job selling covered warranty programs. It also means, in my opinion, that both OEMs and dealers need to do a much better job evangelizing the value of covered warranty programs to consumers so that consumers understand the value of covered warranty programs when they're still researching their next purchase, making them more likely to choose a brand or dealer that offers one. We didn't ask consumers a similar question about CPO inventory, but I think that's a good idea and I'll add it to our queue of survey questions.
Kelley Blue Book
Old School Sales Tactics That Still Work
Today I received an email from Kourtney, my group and suite salesperson for the Dallas Stars, which is an NHL team for those of you who aren’t hockey-inclined. Reading that first sentence, you’re probably thinking I spend a lot of money going to Stars games, but I don’t. I can’t. I live out of state. I spent under $300 with the Stars last season and even less the season before, both times to take friends and family to a game when I was in town for the holidays. As far as group and suite purchases, this probably falls in the bottom five percent of her sales.
The email informed me that she was moving on to another company and someone else from the team would be in touch soon about next season. She provided a number to call with any needs in the meantime and thanked me for my business. While reading her email, I reflected on my limited experiences with Kourtney and compared it to all the other sales experiences I could remember with cars, high-end electronics, furniture, bicycles, and anything else costing more than $100. Some memories were good, some bad, but most were ‘so-so’ transactions typically performed by a friendly salesperson that went for the close, got it, and immediately moved on to the next one without thinking about me ever again.
Not so with Kourtney. When I placed my ticket orders, she took the time to listen to my needs and handled them in a friendly, personable way, in addition to having an infectious smile I could hear through the phone. This alone put her above most of the salespeople I’ve interacted with. Where she truly went above and beyond were the personal touches she added after the sale was closed. I received a handwritten thank you card with my tickets in the mail in November, and another handwritten card at the end of the season thanking me for my business. When was the last time you received a handwritten thank you card from anyone, let alone two for the same transaction? I get thank you cards for giving wedding gifts to friends and family, but I almost never get them from salespeople. I can only remember one other.
Kourtney could have sat back after getting my phone order and let the organization’s marketing department do the work to pull in the next round of leads. She could have relaxed and only included a receipt in the envelope with my tickets. She could have taken it easy and skipped all those written thank you notes at the end of the season that probably gave her hand cramps… but she didn’t cut any corners, and it made a big difference.
I grew up with computers and email, but a personalized, handwritten thank you note still has a very strong impact on me and so does being remembered and appreciated after the sale is made. I recognize that Kourtney has a better opportunity for repeat business from me because the buying cycle for sports tickets is much shorter than that of a car, but that doesn’t make sending written thank you cards any less valuable in making your customers feel appreciated. In fact, it may make them more likely to come to your dealership for service instead of an independent shop or give you a positive recommendation on Google, Yelp or your CSI survey. If you maintain that relationship, the customer is more likely to buy their next car from you instead of someone else.
In my reflection while reading her email, I realized I was losing something special with Kourtney leaving the Stars, so I let her know how impressed I was with the way that she treated me, and that I was a few weeks away from getting a firm head count on another order for next season. Her response? She thanked me for the kind words, emphasized that she treated people the way she would like to be treated in their position, and offered to connect on LinkedIn in case my new rep didn’t take care of me. She still cares about my satisfaction as a customer - even after she leaves the company. I was blown away again, and apparently so were others because her LinkedIn profile is a good collection of recommendations from happy customers. I added one more.
Sending written thank you notes is viewed by some as “old school” in this day of emails, instant messages and texts, but it carries significantly more weight because it’s far more personal. What do you do to make your customers feel special and appreciated after delivery?
4 Comments
Kelley Blue Book
I agree, Mike. With sales and marketing technology changing at a breakneck pace, at least there are some things that take a lot longer to go out of style. I don't see thank you notes losing their value until mail service stops.
Maryann Keller & Associates
There are always going to be exceptions to every trend. I'm still amazed when I receive a sale from a free car buyer's magazine offered at a supermarket.
Dealer eTraining
When you provide a great experience you build a loyal following. When you leave to take another position the loyalty might just stay with you and you can continue to earn your client's business. This is also the difference between veteran sales professionals that sell 40 units per month over the average 10-12 unit sales person.
Kelley Blue Book
Webinar Hosted by Jared Rowe, President of Kelley Blue Book: Introducing the All-New Kbb.com Classifieds
Kelley Blue Book President Jared Rowe will be hosting a free webinar to introduce the industry to the new kbb.com Classifieds on Tuesday, June 5, at 2PM EST/11AM PST. You can register for it here.
This month, Kelley Blue Book’s kbb.com is launching an all-new Classifieds experience in partnership with AutoTrader.com that will allow dealers to reach millions of in-market car buyers that largely cannot be found on other automotive websites.1 The “cars for sale” section of kbb.com has been completely rebuilt, featuring a new design and functionality created for the unique audience of consumers who use kbb.com to research new- and used-vehicle information and reviews, obtain values and pricing information, and find the right car for sale in their area.
More than 75% of visitors to kbb.com are undecided on which make and model they want to purchase,2 and with supply and demand pushing used-vehicle pricing close to new-vehicle pricing, many are also uncertain about whether they will purchase new, used or certified. Therefore, kbb.com’s new Classifieds experience is uniquely designed to allow consumers to search cars for sale based on their needs, while also keeping the option to run a traditional make/model search. This new approach allows consumers who are undecided on make/model to see vehicles that both meet their needs and possibly be exposed to some that they might not have otherwise considered. Consumers also have the option to return new, used and certified inventory within the same search. As a time-saver, changing or refining search parameters is possible within the same search, without starting over from scratch and filling out all the parameters again. The redesigned Classifieds also allows them to continue researching vehicles via trusted Kelley Blue Book information such as reviews and ratings without leaving the Classifieds experience.
The initial SRP (search results page) is prioritized based on “Best Match,” a formula that ranks vehicles based on what is determined to be most relevant and engaging to the consumer performing the search. This formula is in part based on the quantity and quality of vehicle information dealers provide, including the number of photos, video, detailed vehicle descriptions as well as certain characteristics of the vehicle such as distance from the user, mileage vs. the average for that model year, and the length of time the listing has been on the site. This means that participating dealers have the opportunity to directly influence their placement on the SRP through better merchandising of their listings.
To make things as easy as possible, the new kbb.com Classifieds is a turnkey experience for dealers: your contact for kbb.com Classifieds is your AutoTrader.com Advertising Consultant, your inventory is automatically pulled from dealer data already on AutoTrader.com, and listings and reporting for both sites are managed within one system. This means no additional data feed setup and management is required, you have a single point of contact for both sites, and there’s no extra backend to log into to manage everything.
To find out more, Kelley Blue Book President Jared Rowe will be hosting a free webinar on Tuesday, June 5, at 2PM EST/11AM PST. You can register for it here.
1Comscore Media Metrix: Cross Visiting Report: March 2012
2 AutoTrader.com Shopper Frame of Mind Research Study: March 2011
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Kelley Blue Book
10 Tips to Boost Your EdgeRank
Facebook is a topic that has been nearly beaten to death at industry events. It seems every dealer not living under a rock has a Facebook page, but few are taking the actions necessary to build their Facebook EdgeRank to a point where messages the dealer posts are able to get through to a critical mass of users. EdgeRank is an important Facebook search algorithm for dealers to understand because if it isn’t optimized, most of your fans will never see your posts. The Power of Like, a study performed by comScore in conjunction with Facebook, found that “on average, 16 percent of fans are reached by branded content by a brand that posts five out of seven days.” One of the key reasons for that low percentage is brands not putting a high enough priority on optimizing EdgeRank. Without building your content strategy with EdgeRank in mind, your Facebook page could look like a tumbleweed-filled ghost town.
What is it?
Similar to Google’s PageRank, which decides the ranking of Google search results, Facebook’s EdgeRank algorithm exists to serve the newsfeed content that Facebook believes would be most relevant to each individual user. This is determined by engagement metrics such as the number of comments, likes and shares an individual post receives, as well as the individual user’s historical interactions with the person or Facebook page posting. Edgerank also takes into account other, less frequent engagement activities like tagged photos.
If a Facebook user interacts with your page frequently, this increased amount of interactions make your posts more likely to appear in that particular user’s newsfeed. When that same user interacts with your post, it also makes your post more likely to be visible to that user’s friends, whether those users Like your page or not. On the other side of the coin, fans that never interact with you are much less likely to see your page’s posts. EdgeRank also can increase and decrease over time, depending on how engaged an individual has been by your content recently. This means that if you slack off, you will have to work harder to build your Edgerank back up again.
As with Google PageRank, there is a lot of speculation about Edgerank and exactly what actions have the most influence on the algorithm, but here are the basics:
- Comments on a post are weighted heavier than liking a post. If a user comments on your post, that user is more likely to see your future posts. That user’s friends also are more likely to see that post appear in their newsfeed, compared to if the original user simply liked the post. Post likes still have value; just not as much value as comments.
- Photos and videos are rated a higher EdgeRank weight than links.
For an EdgeRank explanation that goes a little deeper, check out this TechCrunch article.
What can I do about it?
Here are several tips you can leverage to build and maintain a stronger EdgeRank:
- If you haven't already been automatically converted to it, adopt the new Facebook Timeline and fill out your dealership timeline using photos of your store and vehicles that have been sold there. For example, if your store has a lot of history, you could share photos of classic cars dated to when they were released or historical photos of your store. If your store is newer, you could still highlight halo vehicles based on when they were first available at your store. Not only will this make your page more interesting to your fans, but the fans who visit your page for the first time are more likely to interact with something on your page. If that happens, you will have a higher EdgeRank with those fans from the start, instead of earning a fan and then effectively losing them soon after due to a low EdgeRank score with that individual.
- Also on the topic of engaging fans who visit your page, learn how to control the content on your Facebook page and make it more noticeable with recently released features such as cover photos, starred posts, pinned posts and changing post dates.
- Keep the text in posts short and keep the language simple.
- Ask questions. A study performed by Buddy Media found that questions starting with “where,” “when,” “would” and “should” generated more engagement. Fill-in-the-blank style questions also work well.
- When you want to share a link, try sharing a photo instead with the text and link as the caption to a photo. The photo will catch more eyeballs and generate more engagement than just text and a link.
- Along the same lines, make it a point to share photo and video content on a regular basis.
- Establish a series of weekly activities, which will encourage fans to interact with your content and create something to look forward to week after week. Setting up a weekly trivia game is a great example of this. To get even more comments out of a trivia question post, after several people have answered the first question, wade into the comments and ask a follow-up question. Everyone who already commented will get a Facebook notification that your page responded and many will come back to check it out and respond again. This extends the life of a post and increases the chance for both fans and friends of fans to see your post through the additional comments it will generate.
- Include content that is local and interesting to your audience in the mix of posts you publish on a monthly basis.
- Don’t post too much. Find your sweet spot: for some dealers it will be one post per week and for others, one post per day. It depends on how engaged your audience is and how interesting your content is, but for many Facebook users, fatigue from seeing the same page over and over again can set in - especially if your content is repetitive. You can determine whether or not you are ‘fatiguing’ your audience with content overload by watching the ‘unsubscribe count’ in your page’s Facebook Insights. Keep your activity consistent, then look at your ‘Likes’ and ‘unsubscribes’ to see if you are at a net gain or at a net loss for that period of time.
- If you start trying some of these tips on your Facebook page and don’t see immediate results, don’t get discouraged. It often takes a Facebook audience time to warm up to the new content. Keep a consistent level of activity up for two to three weeks. If you still don’t see the level of interaction you were working towards, you should start rethinking either your goals or your strategy. Do you have a critical mass of local fans? Don’t underestimate the value of an audience: the more fans you have, the greater opportunity for reach you have as well as a greater diversity of fans.
How do I measure EdgeRank?
Facebook both keeps the EdgeRank algorithm confidential and makes frequent updates. Various online tools claim to offer the ability to measure your EdgeRank, but in reality, there is no way for them to know it and your EdgeRank differs with each individual fan – it is not one set number for all fans. The best way to measure improvement as it relates to EdgeRank is to track your engagement over time and how many people you are able to reach, both of which are accessible in Facebook Insights and various third-party tools.
By understanding EdgeRank and tracking your progress as you implement tactics designed to boost engagement in the form of likes, comments and other actions, your dealership brand and the message you want to convey will be much more likely get through to a wider audience on Facebook.
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7 Comments
BRUCE HARTZ
BOB BELL AUTOMOTIVE
How famous would a 13 year old hacker be who could claim he just caused the world biggest traffic accident !!
Alex Schoeneberger
Kelley Blue Book
Pretty famous, Bruce. That's a scary thought!
Jeremy Alicandri
Maryann Keller & Associates
Hi Alex, Below are some resources that may answer some of your questions (thanks to Cliff Banks for sharing them). I'm certain today's consumer doesn't fully understand the implications of the self-driving car, but keep in mind some stats: "Google’s claims for the car, as described by Sebastian Thrun, its lead developer, are: 1.We can reduce traffic accidents by 90%. 2.We can reduce wasted commute time and energy by 90%. 3.We can reduce the number of cars by 90%." Now run that poll again with the above stats, and you may get a different result. Links: Fasten Your Seatbelts: Google's Driverless Car Is Worth Trillions (Part 1) http://www.forbes.com/sites/chunkamui/2013/01/22/fasten-your-seatbelts-googles-driverless-car-is-worth-trillions/ *This is a 7-part series by a Forbes contributor. Google Poses Serious Competitive Threat to Auto Industry http://wardsauto.com/blog/google-poses-serious-competitive-threat-auto-industry *This is an article which reviews some of the research by analysts over the potential impact. Doom & Gloom? Self-Driving Cars and Dealership Valuations… http://www.drivingsales.com/blogs/jeremy/2013/03/05/doom--gloom-selfdriving-cars-dealership-valuations *This is my opinion piece on dealership valuations.
Alex Schoeneberger
Kelley Blue Book
Hi Jeremy - interesting stuff! Running the poll again with Google's stats included in the question would definitely sway opinion. I'll see if we have the space in the Quick Poll question section to feature them as part of the question. The only point Thrun made that I contest is the reduction of cars by 90%. I can see potential for reduction, especially in major cities, but I think it will be a long time before we see anything approaching 90%, if ever. There are a lot of errands, especially when you're talking about family vehicles, that occur on the way to and from work, and I see that and the added commute time factoring into many people avoiding ride sharing during peak vehicle usage hours. We may see a societal shift away from the 8 to 5 office job that many of us have, but until that occurs wholesale, typical working hours will have a heavy influence over where people are going to go and when. While peak travel times have opportunities for optimization, I do wonder how open people will be to that optimization if it inconveniences them.
Jeremy Alicandri
Maryann Keller & Associates
Hi Alex, The article states those are Google's stats - not my own. I can't predict the future. However, I believe it's safe to assume that car count will decrease once this technology fully matures. But when will this all happen? I recently e-mailed Glenn Mercer(NADA Facilities Consultant) about this issue and he summed it up quite well - autonomous cars will make tremendous progress by 2020, but we won't see a 100% autonomous car for quite some time. There are too many cultural/legal issues, and too many cars currently in service, for a paradigm shift to occur within the next ten years. However, in another 20 years, it may be a different story. Jeremy
Alex Schoeneberger
Kelley Blue Book
Hey Jeremy - I definitely agree that all of this will take a long time. By then, we may be printing our own cars out of 3D printers in our garage. ;-)
Stan Sher
Dealer eTraining
In my opinion it is like driving automatic over manual. A person that drives manual is a real driver while the person that drives automatic is just an operator. While there are some neat benefits to being driven by technology I still cannot trust it to get me where I need to go safely. Technology is created by man and no man is too perfect enough to create a device that will never break.