CDK's purchase of Auto/Mate may create a major disruption in the dealer management system (DMS) industry. Here is our take. DOWNLOAD
It’s one thing to try to view the auto industry through the eyes of a consumer when you work for a dealership. It’s quite another to attempt to view it as a vendor. But to TRULY get the feel for what it’s like to see the industry like a car shopper, one needs to actually shop for – and buy – an automobile. And during the past 10 days that’s exactly what I did.
For most of us in the industry, we either have the inside track on factory employee pricing or a shot to buy trades near cost and typically avoid pricey dealer fees. But my journey through the auto industry has put me in a position about every five years in which I have to purchase a vehicle on the open market, either with stores where I’m not really connected or on eBay. Yes, I know how to work a deal and where fair numbers should be on my trade and my purchase vehicle, but it can still be like a lion’s den.
So what does this have to do with live chat on your dealership website? Only EVERYTHING! When dealers put chat on their website it’s basically offering shoppers a contract – a contract that they’re offering buyers a new way to interact with the dealership that meets the website visitors on their own terms. It’s an acknowledgement that the auto industry is changing to create a better experience for car buyers from first contact.
Quality dealerships and quality chat providers tend to strive for chat conversations that offer car buyers on their websites a good experience, with the goal of generating accurate lead information. But when a dealer perpetuates old-school car sales games with pedestrian behaviors like hiding the real prices behind bogus discounts or credits they blow the deal before it starts. It’s one thing to throw out a TV ad for a new vehicle with every improbable rebate thrown in, like military AND college graduate AND loyalty, or similar. But to have an AutoTrader.com ad with used car prices displayed $2,000 below list price with a ridiculous qualifier print that offers an arbitrary $1,000 “additional trade allowance” and $1,000 discount for “financing through the dealership” is a slap in the face to buyers.
What makes it even worse is when a dealer plays these ‘hide the salami’ games with live chat. Take this example:
[10:27:25 AM]<HB>Hello, how may I help you?
[10:28:07 AM]<Customer>I saw a certified 2011 santafe. Still have?
[10:28:44 AM]<HB>I can check for you, Okay?
[10:30:15 AM]<HB>I am showing I have this vehicle on line but for me to be certain I need to physically check for you,okay?
[10:30:57 AM]<Customer>Assumin g you what is current price? No trade, cash deal?
[10:31:10 AM]<Customer>Assuming u have it
[10:31:44 AM]<HB>I am almost certain, I can secure the vehicle for your visit
[10:31:55 AM]<HB>When are you available to come in?
[10:32:19 AM]<Customer>That isn't the question... how much is it listed for?
[10:32:55 AM]<HB>I am checking it for you do you happen to see the stock number
[10:33:55 AM]<Customer>Not on my phone
[10:34:20 AM]<HB>You are referring to the one with 53,098 miles on it?
[10:34:59 AM]<Customer>Like 30k
[10:35:35 AM]<HB>What color is the Santa Fe I have several 2011's
[10:36:03 AM]<Customer>Silver I think. Awd
[10:38:26 AM]<HB>I believe the internet price is 14,996
[10:39:50 AM]<HB>Who do I have the pleasure of working with?
[10:40:12 AM]<Customer>Do I have to trade or finance for that price?
[10:41:18 AM]<HB>Hi Tom yes that is the bases of that promotion thru our Dealership
[10:41:44 AM]<HB>Managesr are very motivated to earn your business
[10:42:01 AM]<Customer>My original question...what is the price no trade and cash deal?????
[10:42:21 AM]<Customer>List price?
[10:43:06 AM]<HB>Who you like to make a offer?
[10:43:10 AM]<Customer>Thank you.
We can debate the finer points of chat strategy (like avoiding very poor grammar and typos with pre-written scripts), but the customer experience here was epically frustrating. For starters, first she said she still has the car then asks me which car I’m asking about (lie number one). Then she says she has several; there are only two (lie number two). Then she ‘believes’ the internet price is 14,996 (lie number three because that’s the listed price). Finally, after being asked three times, she finally acknowledged the price. By then I was done being yanked around, and so would anyone else looking for a smooth transaction.
I have no qualms with her asking early and often for contact information. It’s one thing (though not a good thing) to avoid answering the price question directly, but lying outright? That’s a travesty in the era of dealers of trying to generate leads with live chat, text, and social media. It doesn’t matter if a dealer uses smoke signals or two tin cans on a string, they need to treat shoppers with integrity and respect. And if business practices NEED chat operators and call centers to use classic ‘tin man’-style tactics, like ‘bait and switch’ or ‘hide the salami’, than a managed chat system will never work, and self-managed chat will only end up costing deals, like this situation. I may have actually pursued that vehicle and worked a deal, but I was so disgusted with the experience, I went for other options.
A U.S. Marine Corps veteran, Tom has an MBA in Marketing and is an automotive writer and author with nearly 20 years experience in virtually every aspect of the retail auto industry. He has been involved with the internet from the beginning, building websites at Johns Hopkins University in the 90's, and has been a performance leader in nearly every dealer role, from sales and service, to BDC / internet sales and viral marketing.