Below is my article from Digital Dealer magazine, March 2008. This is not a cheap shot at self-promotion. It is merely an entry to remind people of using the basics, focusing on process and audit your vendors regularly and thoroughly.
Beechmont Ford and Montgomery Ford both located in Cincinnati, Ohio, and Lawrenceburg Chevrolet Pontiac Buick GMC, located in Lawrenceburg, Indiana, are three award-winning, highly successful dealerships whose Internet departments are all under the directorship of one man: Andy Warner. Beechmont Ford, a family-owned dealership operating for 15 years, is nationally renowned for winning the Ford Motor Company’s “President’s Award” – an award recognizing Ford dealerships that have made a commitment to consistently deliver exceptional sales, service and vehicle ownership experiences to their customers – eight times. Montgomery Ford has won the award four times and Lawrenceburg Chevrolet Pontiac Buick GMC is hot on their heels with a reputation for providing a best-of-its-kind customer experience to every customer who walks through the door or heads to the dealership’s web site. Obviously, Warner and his colleagues are doing a lot right to ensure that their bricks-and-mortar locations and their dealership websites are delivering the best service and information. As a bonus of that superior service, the dealerships are consistently taking their Internet sales to new heights. How does Warner keep track of three busy Internet departments and keep them returning stellar leads and sales figures? He wholeheartedly believes in Internet marketing and surpassing customer expectations.
Since Warner began his position as Internet sales manager, all three dealerships have, without fail, doubled their monthly lead count (compared to the previous year) and experienced double and sometimes triple Internet sales (compared to the previous year). The last two quarters of 2007 witnessed Internet sales accounting for slightly over 30 percent of total dealership sales at one store alone. Such phenomenal achievement can be credited to Warner’s thorough and proven Internet marketing approach that includes: search engine optimization(SEO), e-coupons, lead enhancers, landing sites, his sales team’s passion for creating sales videos and their commitment to relentlessly following up with their customers. Read on to discover how his “ever-vigilant” Internet marketing approach, meticulously planned and strictly followed by Beechmont Ford, Montgomery Ford and Lawrenceburg Chevrolet Pontiac Buick GMC, has led to record numbers of leads, sales and devoted customers.
Please tell me about your background.
I started as the Internet sales manager for our two Ford stores in the greater Cincinnati area in 2007. We recently purchased a multi-franchise GM dealership in the Eastern Indiana area, giving me Internet sales responsibility over three rooftops. Prior to my current position, I worked for Dealer Specialties as a business analyst. From there, I was promoted to data partner manager and was closely involved with our data partners including: ADP, AutoTrader.com, Cars.com, Cobalt, Homenet and Reynolds Web Solutions. I worked with them on product plans to help transmit dealership data and consulted them with the most effective products for their dealerships.
How many people work in your internet sales department?
We have eight salespeople, at a minimum, that handle our leads for our three stores. Our Internet department is not structured in the traditional sense. Within our organization, we’ve been able to bridge the chasm between Internet sales and floor sales. Our process includes routing Internet leads to qualified, trained floor salespeople as soon as the leads arrive. We only permit our top salespeople to receive the leads. The leads are delivered to the salespeople via their individual CRM account preferences, including: cell phone, text messaging and e-mail. We have internal criteria to determine lead distribution; while we have a location-specific minimum number of salespeople eligible to receive leads, that number can rise based on lead counts and closing ratios. Our salespeople report their status daily via e-mail, phone or text message. I report weekly to the GMs and dealer principal.
What percentage of your dealership's overall sales is generated from the Internet?
We’ve been able to grow our Internet sales as a percentage of total retail from about 10 percent to over 30 percent. When we first started, our sales were very inconsistent. The reason is because we did not have a process that fit well with our dealerships’ structure. It was comparable to someone fitting a square peg into a roundhole.
What tools or lead generators have really worked on your site to pull in leads?
Our homepage video is working very well. We’ve been able to bridge the gap between annoying or confusing our customers, as most homepage videos do, in favor of actually helping them navigate our site with the video. This has led to increased lead conversions. Additionally, both our online credit application and our pop-up coupon offer have been instrumental in driving qualified leads from our web site. The coupon is by far the number one lead source for each of our dealerships. It’s a $300 coupon that pops up as soon as the consumer lands on our site. The coupon is used as a discount toward the buyer’s vehicle purchase.
What interactive media resources do you utilize? And, please tell me what services they provide and why you decided to go with them.
There are four interactive media resources that we currently utilize. First, we incorporate video on our homepage that is seamlessly integrated into our site and provided by our web site vendor, BZResults. We also use video “walk-arounds” for our used inventory. We’ve been evaluating this product for about six months, and we like what we’ve seen. All of the video we use seems to provide some level of "stickability” with our Internet customers. Given this, we are considering incorporating additional video technology like instant messaging, mobile communication and vehicle valuation. The goal for us is to become driven by individual customers, which is the opposite of traditional media. We aim to address the individual customers’ needs, not the masses. We think video helps us get there.
The second interactive piece that we use from BZ Results is virtual test drives. This product allows the consumer to ask questions of an interactive module on a particular vehicle. Our salespeople use this to improve the individual customer’s interest on the vehicle of interest. Again, this addresses the customer’s individual request and doesn’t seek to just throw something at the customer hoping it sticks. The virtual test drive answers the customers’ specific questions on their specific vehicle of interest.
Third is Time Highway, a vendor of OneCommand, that provides real-time appointments for our service department. The consumers can book their own appointment online. They can look at our “live” appointments and see where they can fit in and be reminded of that appointment by e-mail, phone or text messaging.
Lastly, we also work with Unity Works. We work with them because they understand how to display video by bridging the multi-width predicament. For instance, you have dial-up. You have broadband. Then you have all of those bands in between. With Unity Works, they have consistently proven that they can handle those various types of streamsbetter than any other company that I’ve worked with. They also serve upa much better quality product at a better price, and they aretraceable. We can see with Unity Works what videos customers areviewing and how frequently. Again, what we are trying to accomplishwith our Internet marketing is to make it very customer specific andcustomer driven, which is obviously the opposite of traditional media. Thus, we aim to address individual customer needs and not the masses.
Do you help design/update your dealership site? For example, update inventory, create specials, add photos, etc.
Absolutely! However, we do adhere to a team approach. I am responsiblefor the design and updates of our web sites, including specials. I also work with our used car managers as they play a major role in providing inventory updates at various times during a given week. Our used carmanagers ensure that our dealerships stay competitive. We don’t want tooffer the lowest prices all the time because we want to remaincompetitive in the marketplace. We feel confident that our customersaren’t always pursuing the cheapest route; they want the best experience. So, we will remain competitive in that perspective.
I’m also beginning to work more closely with our F&I managers to increase our share of regular and special finance customers, mainly through our use of SEO and micro sites. Additionally, we’re working on similar initiatives with our fixed operations teams.
How do you use e-mail campaigns to generate leads?
We use a two-pronged approach in our stores. Obviously, we will utilizea shotgun approach to blast e-mail offers to a broad customer base. Generally, we use this method to highlight new incentives or move agedinventory. Our opt-out rates, while initially high, are now quite low, and we’ve seen great success with these blasts. We also employ a more targeted approach by crafting offers to customers’ specific vehicle needs. This unsold follow-up has helped us capture incremental business.
For example, Ford might promote to customers zero percent interest for60 months on all F-150s. The shotgun approach is that we distributebulk e-mail to all of our customers detailing this special. The good thing about that is that we get the word out to our customers that Ford has this promotion going. The downside is that we could end up turning off customers that are only interested in a Taurus or a Fusion, or those who know that their credit isn’t strong enough for 0 percent for 60 months. Our solution to this problem is to distribute a monthly e-mail to all our customers that is season or holiday specific, like: “During the holiday season, it’s cold outside. So, why don’t you come in and check out our hot deals?” Then we list various deals that could appeal to many. These are broad offers sent to our entire database meant to keep our store in front of our customers and alert them to what we have going on.
Our more targeted approach consists of us mining our database and then sending customer-specific e-mails. For example, with the F-150 financing special, we can sort our databases and just send this particular promotional e-mail to potential F-150 customers. This way we aren’t turning off the majority of the people out there. Once we moved to that type of approach, it has been more successful for us because:1) It has saved our marketing powers because we are not trying to blast it out to everybody; and 2) We aren’t losing customers. They aren’t coming back to say, “Take me off of your e-mail list because you aren’t really addressing my concern.”
Can you give me an example of a successful e-mail campaign that pulled in a good number of leads?
We ran monthly used car promotions in one of our dealerships during the fourth quarter of 2007 to move aged inventory. While the e-mails were delivered to thousands of prospects, we received over 40 responses that generated 14 vehicle sales. The campaign cost us nearly nothing to run and we received only a few opt outs. We believe it’s important to deliver compelling offers to customers’ inboxes. This keeps the opt outrate low, because even if a customer isn’t interested today, they are afraid to opt out for fear of missing a future offer.
If you could keep one tool from your current interactive arsenal to generate leads, what would it be?
Our pop-up coupon, it truly drives an amazing number of conversions. While we don’t sell a vehicle to every prospect that completes the coupon, we do add these consumers to our database for future marketing opportunities. Through targeted marketing offers, we’ve successfully sold many of these prospects months after they’ve completed the coupon.
Please take me through the process from when an Internet lead is received, to how it is eventually closed (via a sale or a long-termprospect).
We use a combination of automated and personal processes. The automatic processes entail an auto response that’s distributed when the lead isgenerated. Based on the type of lead, if the customer is non-responsiveto our personal processes, he/she receives automated e-mails for the next 180 days. Of those who buy, 30 to 45 percent of our customers buywithin 30 days, another 30 to 45 percent buy after 90 days, while 10 to40 percent buy between 31 to 90 days.
The personal processes are based on our lead distribution schedule. These leads are sent to salespeople immediately via phone and e-mail. If the salesperson is successful at engaging the customer, the automated e-mail process changes to address the customer’s individual need. Our salespeople use phone guides to set appointments and to make sure those appointments are kept. Once the customer is in the door, traditional retail processes take over.
Then wrapped around that, I speak to the salespeople daily via e-mail, phone, and text messaging to ensure we are constantly staying in contact with these customers and no one is dropping the ball.
How important is follow-up in closing Internet leads?
It’s extremely important. This is what Internet customers demand. We must be diligent and thorough in our follow-up, or else risk losing a sale. Given that during some months nearly 70 percent of our sales occur more than 30 days after the initial contact, we would not be successful if we didn’t believe in follow-up. We monitor calls, closing rates and ROI (return on investment). We train salespeople on proper calling techniques and we report closing rates monthly. We use the closing rates and individual ROI from one month to help determine the lead distribution for the next month. This keeps closing ratios and ROI top of mind.
There are a lot of new tools in the space getting attention: blogs, social networks, SEO and SEM, do you use any of them? If so, how have they worked?
We’ve investigated SEM, and we currently don’t see a great ROI. Keywords have become too competitive and we feel our SEO is strong enough to capture the majority of in-market customers. Additionally, because we have such a large database, we find e-mail marketing to be more successful and cost-effective. Interestingly, we benefit greatly from not only our SEO, but also our unique domain name for the hub site of our two Ford stores: InternetFord.com.
We’ve recently begun to work with a vendor on blogs and social networking, though the jury is still out on whether this will drive incremental business or whether it’s just another shiny object.
With his knowledge of Internet marketing, a driving passion to meet each customer’s individual needs and wants, and a strong commitment to continually fine-tune and tweak his Internet marketing strategies, Warner has created a hands-on Internet sales department that consistently delivers impressive sales figures. His insistence on immediate customer follow-up and his “watchdog” eye for ROI have proven that he is the “best in class” for managing and increasing the bottom line of not just one, but three award-winning dealerships.