You’ve decided to get a CRM or replace an existing one. Now what?

A CRM system should help your staff connect with customers, increase sales productivity and provide actionable insights to deliver the great experiences that create long-lasting customer relationships.

We get it - there are a lot of options on the market. And in a time when the bottom line matters more than ever, it’s vital to choose with care. The wrong choice could lead you to abandon the new system and waste thousands of dollars and hundreds of employee hours in the process. No dealership needs that.

That’s why it’s crucial to ask these key questions before buying your CRM software.

Why am I investing in a new CRM?

This question gets to the core of your business needs and requires you to examine your current processes and methods of performance management.

Too often, dealership managers try to sweep front-line problems under the rug by turning to a new CRM. Yet, behaviors like lack of usage or poor process follow-through will not automatically change with a new tool.

Conversely, the problem could be a fundamental issue with a current tool. For example, if it can’t easily adapt to a growing dealership or it’s lacking in key integrations.

Once you identify your needs and pain points you can better decide if you need a new tool, or if you’d be better served by further training and support from your current provider.

What integrations are important to me?

The usability of a CRM tool depends on its integrations and OEM certifications. Consider the technology tools you rely on daily, such as desking, inventory, customer communications and data mining.

The ability to access these programs through one CRM platform will go a long way towards creating efficient and streamlined workflows that are easy for salespeople and your BDC to follow. Additionally, having one system that’s adaptable to both the front and back of the house will give you a full view of the customer’s history and value.

Examine your current integrations, but also the ability to create additional integrations and the costs associated with that. For example, if your salespeople text with customers, can you track those communications in the customer record? If you offer a digital retailing channel, can the work a customer completes online flow into your CRM seamlessly?  If not, is there an additional fee to add those options?

Can I customize workflows and scale up when needed?

What good is a tool if you can’t make it work with your unique processes and workflows? A good CRM should adapt to your business, not the other way around.  Make sure a tool is flexible enough so that you can customize it to fit your dealership’s needs and challenges.

You also need a solution that can grow with you, whether that’s adding another storefront or expanding your digital retailing. Today’s auto retail market is competitive and unpredictable. You need a solution that allows you to be nimble so you can pivot on a dime as the market advances.

What training and long-term support is available?

Training and performance management can be the different between a solution that sings and one that sinks.

Make sure your training solution covers not just how to use the system, but also how your staff can use the system according to your store’s processes.

Be wary of vendors who want to change how you do things to match how they want you to do things. That’s a red alert that a system is an inflexible CRM-in-a-box and the provider will likely be difficult to work with.

Look for hands-on guidance during the implementation process and live training with on-site assistance and coaching.

Will I gain insights to deliver the best customer experience?

A great customer experience starts with actionable insights into all customer touchpoints.

A CRM should bridge the gap between online, phone and text experiences, as well as sales and service activities and transactions in your store. You gain real-time visibility into your customers, and the ability to deliver great experiences, when every action and interaction is tied back to a customer record. 

Your CRM is crucial to capitalize on leads and opportunities, connect with customers, and create great experiences that lead to long-lasting relationships. Ask yourself these questions before committing to a new vendor and you’re much more likely to find a long-term partner in your success.

Are you ready for the glut of lease vehicles about to hit the market?

According to J.D. Power, nearly 2 million vehicles are coming off lease over the next five months. Attracting and selling to end-of-lease customers is a huge opportunity to emerge stronger from the current market downturn.

Competition for these buyers will be fierce. Other dealerships, banks and captive lenders are all going to want a piece of the pie. Aggressive retail programs launched during the quarantine add to the competitive landscape.

It pays to increase your lease portfolio. Customers will likely come back to you for service, and the trade cycle is short. If you deliver a great customer experience, customers will happily return every couple of years to trade up. This means you not only get repeat sales, but also quality used inventory, potentially with a known service history.

We generally see that most dealership lease portfolios are around 5-10 percent of overall business, but you can double or triple that penetration with the following four tactics.

Update your website now with actionable information.

Customers may not be packed in your showroom right now, but you can bet they are researching vehicles online. According to J.D Power, as many as 14 percent of end-of-lease customers are thinking about their next vehicle a year before lease end. Only 3 percent were thinking that far ahead in 2017.

Therefore, now is the time to update your website with details of your lease program. Include options to defer payments and extend or terminate leases.

Out of necessity, car buying and leasing processes have moved online which makes online retailing tools a “must-have.” Implement or improve your digital retailing strategy with tools that are accurate and fully integrated with your CRM, desking, and inventory solutions. This gives the best customer experience, eliminates double entry of data and allows you to control the sales process while migrating some of your process online.

Transparency and trust are crucial to a successful online retail experience. Make sure your tools display penny-perfect calculations with a dynamic payment builder and provide complete information about F&I products and trade-in details. What customers see on deals online, they should see on deals in your store.

When a lead comes in, it’s imperative that you get back to the customer within one hour. As I highlighted in my last blog, companies that respond to a lead within the first hour are 7X more likely to have a meaningful conversation that can lead to a closed deal.

Create targeted marketing campaigns and follow up using your CRM.

Get out in front of prospects and end-of-lease customers with multi-channel, targeted marketing campaigns. When you proactively reach out with a relevant offer, you have a much better shot that customers will work with you instead of a competitor.

Lean on your CRM to segment your customer database. Create targeted lists for current customers who are coming up on the end of a lease or are on track to go over mileage. Another list should be populated with every unclosed lead in the last 90 days. Finally, create a list of customers who purchased a vehicle at least two years ago.

Follow-up is key and the best practice is to make seven calls and five emails per lead over a 30-day period. If that’s too much for your staff to handle, consider pulling in an external BDC for overflow. A trained automotive BDC will ensure proper follow-up and free up your sales team to concentrate on low-funnel opportunities.

Provide lease options to every customer early in the process.

Provide lease and finance options to every single customer early in the sales process. Earlier is always better because the customer has time to process and think about the benefits of leasing compared to financing before they make their final decision.

It’s easy for your sales managers to access lease information if your desking tool is integrated with rates and residuals. The best tools offer grid presentations so you can present up to nine different financing and lease options for side-by-side comparisons. This way, customers can see at a glance which option is right for them.

Another great strategy is to have your sales managers find the “sweet spot,” or lowest profitable lease offer, for potential lease vehicles on your lot. Print out this information for every salesperson to study, and display it prominently on your website. A great deal is hard to pass up. For example, I know a Honda dealership that’s offering a 36-month lease on a 2020 Honda Fit for under $200 a month. That’s a great opportunity to get into a new vehicle for a low monthly price.

Make the customer experience easy.

Customer satisfaction is the key to retention and loyalty. Studies show that the average overall satisfaction score is 862 (on a 1,000-point scale) among mass-market lease customers who leased again with the same brand. Overall satisfaction among lease customers who switched brands is 778.

So, what increases satisfaction? An efficient, fast and personalized experience. Set your dealership apart with tools and processes that help customers during these uncertain times as our economy recovers.

For example, implement technology that allows customers to schedule lease inspections and returns online. Consider creating a BDC leasing team equipped with information and scripts to answer questions about turning in vehicles, the steps to terminate a lease and other details about lease end. Blow your competition out of the water with a program where an employee picks up an end-of-lease vehicle at the customer’s home and leaves a new vehicle for them to test-drive.

Increasing lead penetration rates is a solid strategy to help your dealership succeed now and as business returns to normal. Refresh your website with lease information and online retailing tools, mine your CRM for multi-channel marketing campaigns, train your sales staff to always present a lease option and get creative with new tools and programs that give customers the easy and fast experience they want. Increase your lease portfolio to 40-50% and you’ll have a book of business that is virtually pandemic-proof.

Your dealership likely spends a lot of money each month for internet leads. Are you responding to each lead within minutes? If not, you’re throwing money away.

Fast responses win business. According to a study from the Harvard Business Review, companies that respond to a lead within the first hour are 7X more likely to qualify that lead (defined as having a meaningful conversation with a decision maker) than those who respond even an hour later.

Those who respond within an hour are 60X more likely to qualify a lead than companies that wait 24 hours.

As showroom visits decrease due to social distancing, internet inquiries are a crucial part of your business. The same is true of emails and texts. Responding to all leads in real time is critical to your success.

Ready to speed up your response time and deliver a better customer experience? Implement the following strategies.

Capitalize on every lead with BDC services that track inside your CRM.

An experienced automotive BDC is your best bet to ensure every lead is followed-up quickly and completely. Leaning on your BDC also frees up sales and service staff so they can focus on low-funnel opportunities.

Make sure your BDC is tracking all activity in your CRM to manage leads more effectively and provide an integrated customer experience. 

Many dealers prefer using internal BDCs so they can control leads and processes. But an internal BDC can be expensive in today’s circumstances and you’re typically not getting after-hours coverage. Going with an external BDC, or taking a hybrid approach, helps with overflow and after-hours inquiries, particularly in times where showroom visits are slower.

Outsourcing to a virtual BDC is not a silver bullet, but an additional tool to improve the experience customers have with your dealership.

Respond faster with texting.

All customers want information fast. So, how do you ensure your leads are getting the information they want at the speed they require?

Don’t sleep on text messaging. Texting is faster than a phone call and on average results in 78 percent higher open rates than email.

More than 90 percent of texts are read within three minutes of being received. It’s an excellent form of real-time, two-way, contactless conversation.

Texting is an efficient way for sales to stay connected to customers, but it’s just as helpful in your service department. It’s a fast way to send status updates, respond to inquiries, and get approval on service work – all while techs stay in their bays getting more done in less time.

It is a bad business practice to allow personnel to conduct any dealership business on their personal phones, which are not tied to your CRM. You can’t capture conversations, review texts for training purposes, or monitor what employees are really doing if they’re using their personal phones. An employee may look busy, but is that a customer exchange or a chat with a friend?

The high turnover in the auto industry also means you’re risking that employees will take valuable customer information with them if they decide to leave your dealership.

The easiest way to mitigate risk is to purchase business-only mobile devices for employees that tie into your CRM. You incur upfront costs, but those pale in comparison to safeguarding customer data and conversations. 

Customize communications.

Customers practicing social distancing are turning to phone, text, email, and digital retailing tools to interact with your dealership. Though they may not be in your showroom, they still expect a personal and efficient experience.

A personal interaction strategy makes customers and leads feel seen, heard, and valued. Ensuring your CRM has the tools to customize communication to each customer’s preference means happier buyers.

For example, if a customer sends a lead through your digital retailing tools, don’t pick up the phone and give them a call. They’ve indicated they want to work with you online. Calling them may make them feel pressured and turn them off to working with your dealership.

The more data you have, the more personal and targeted you can make your communications. Take advantage of advanced CRM functionality to aggregate, view, and analyze all customer data in one place. Then tailor follow-up processes to an individual buyer’s wants and needs. This gives you a much better chance of keeping customers happy and buying from your dealership.

Examine current Internet lead performance.

When sales staff don’t follow best practices, leads get dropped or never enter your CRM. Take advantage of the current drop in customer demand to do a benchmark audit of the health of your processes.

Take a look at your CRM sales data for the month before our current disruption hit (when business was still “normal”).  Benchmark your data against the industry standard that for every 100 leads, 40 percent should set an appointment. Of those 40 people, 50 percent should show up. Of those that show up, 50 percent should buy. That nets you a 10 percent closing ratio. The other five percent of buyers submit information online and show up at the dealership without setting an appointment.

Check employee contact reports if you are not hitting these benchmarks. Employees should make seven calls and send five emails per lead over a 30-day period to achieve these numbers. If they’re not, it’s an opportunity for coaching and improving your team.

When demand returns, keep an eye on those benchmarks. Still not hitting the right numbers? Consider adding an outsourced BDC or take the hybrid approach mentioned above. Dedicating more of the heavy lifting to a BDC can reduce your inquiry handling times up to 40 percent and ensure customers receive fast, quality responses.

It’s more important than ever to evaluate how fast you’re providing information to customers, especially internet inquiries. The shift away from in-person interactions may continue after this change in climate subsides, so take the time now to examine your processes and analyze your operations. Updating and modernizing your business means you will hit the ground running when demand surges back.

Good selling!

Various industry studies show over 80 percent of customers want to start the car buying process online. So, it makes sense that more dealerships are implementing digital retailing tools.

Today’s customers expect an Amazon-like online shopping experience that is connected, seamless and easy. If your digital retailing tools and process don’t deliver, customers will choose another dealership that can accommodate their needs.

The right experience is more important today as people distance themselves from each other to stay healthy. If proven valuable, the big shift away from physical stores to online shopping and buying may continue after health concerns pass.

It’s important to note that just having online shopping tools doesn’t guarantee success. Are the following three digital retailing mistakes costing you money? Now is a crucial time to evaluate your processes to ensure you are providing the online experience customers want.

Mistake #1: Implementing inadequate shopping tools.

Your digital retailing experience should allow shoppers to build a deal online that reflects a realistic car-buying scenario. Essential tools include penny-perfect payment calculations that include taxes and real lender programs, accurate trade-in valuations, credit app submission, and F&I product information and pricing.

It doesn’t do any good if customers have to repeat what they’ve done online when they enter your store. The online and in-store experience must be seamlessly connected or your customers will get frustrated with the inefficiency. Synchronizing your digital experience with your showroom CRM, desking software and a complete set of integrated shopping tools delivers the fast, connected experience that is crucial to winning online business.

Mistake #2: Running the same old sales model.

Digital shoppers need nurturing, not a hard sell. That’s because they are much further down the sales funnel than traditional Internet customers. When they call your dealership or send an email, they’re often looking for more information on their vehicle of interest.

Running the same old sales model of pushing for the appointment before providing the information requested or answering every customer question signals your dealership is aggressive or hard to work with. This can make customers eliminate your dealership from consideration.

To win sales, focus on rapport and building a relationship. Two new sales models will help you do this.

In the first, a sales manager handles every aspect of the deal from start to finish - including F&I. In the second, a product specialist nurtures the customer until he or she is ready to come into the dealership; then, a manager takes over in-store and transacts the deal in one sitting.

Both of these models respect and honor the work customers have already done online and limit the number of transfers between salespeople. They also make it easy and comfortable for customers to transition from online to in-store for a faster and more convenient experience.

Mistake #3: Limiting your knowledge of customers.

Creating rapport and relationships is difficult when salespeople have a limited view of what a customer needs and wants.

That’s why flexible shopping intelligence technology is gaining speed as dealerships use it to maintain a 360-degree view of each customer’s overall online browsing behavior inside the CRM.

With shopping intelligence tools, you’ll know what vehicles your prospects and customers are looking at and on which sites they are shopping in real time. And when you know what they’re searching for as they’re searching for it, you can communicate smarter.

A better understanding of the customer’s challenges or needs enables salespeople to stay in touch at key points in the customer lifecycle. You will have insight as to which vehicles the shopper is researching. This means you can deliver the perfect message – for example, a list of similar vehicles that the customer is searching for - at the perfect time for better results.

Ultimately, digital retailing is a powerful channel for selling more vehicles – if you do it right. Avoid these three common mistakes to create an experience that is connected, seamless and easy. As shopping behaviors change due to health concerns, you’ll be prepared for digital customers and your bottom-line will reflect that.

Good selling!

In our digital world, it can be easy to discredit direct mail – but that’s a mistake.

According to the Direct Marketing Association, direct mail has a response rate of up to five percent versus just under one percent for digital.

That makes sense when you consider that it’s not unusual for the average person to receive 300 emails a day, half of which they delete without even opening. On the flip side, the average person may receive only three pieces of actual mail a day, all of which they at least scan.

After all, people don’t take half of the mail out of their mailbox and throw it away without even scanning it. There could be a bill in there!

Mail may still end up in the garbage or recycling bin. But at least your customers see it and process the message. Here are three reasons why you should still involve direct mail in your marketing mix.

Direct mail is a team player.

Every great marketing strategy uses multiple channels. In a digital strategy, you can’t just run Google ads and call it a day. Similarly, direct mail is a great team player to combine with digital, phone campaigns and BDC follow-up.

Consider this example of a large dealer group in New York. They ran two separate sales campaigns and saw very different results.

In the first, 4,500 Kia store customers received a direct mail offer followed-up with a live call from its BDC. In the second, 6,500 Nissan store customers received a direct mail offer with no BDC follow-up.

The Kia store sold 158 cars. The Nissan store sold 116. The Kia store saw a 36 percent increase in sales simply by combining direct mail with live calls.

That’s the power of multi-channel marketing. The direct mail gets you in front of customers. The BDC follow-up spurs them to act.

Direct mail is a relationship-marketing tool.

Your dealership likely spends a lot of time emailing and calling customers, which are both very viable methods of communication. But sometimes customers get tired of one particular channel. Direct mail is a great way to surprise them with something different so they actually read and digest what you’re sending.

Remember that everyone at least glances at their mail. A customer who has a relationship with you will be even more likely to read a letter or postcard. After all, it could be important information about a recall or service issue. In this way, direct mail keeps you front-of-mind.

Just like with other channels, it doesn’t make sense to send the same mail to every customer. Irrelevant messages lead to frustration with and distrust of your dealership.

Use your CRM to create targeted lists and create a message for each customer segment. For example, a customer coming up on a lease end would be a good target for information about newer vehicles of the same make and model. A customer coming up on 50,000 miles will look more closely at an offer for shocks and struts.

A final thought:  It costs your dealership up to five times more to acquire a new customer than retain one you already have. Same with retention - it’s more than 350 percent more profitable to sell to an existing customer than a new one.

Direct mail is a great way to nurture existing relationships to create lifelong customers.

Direct mail is tangible.

Email may be easy to send, but it’s also easy to ignore. Direct mail is tangible. Customers actually hold it in their hands and scan it.

According to research company Mailmen, the average household keep advertising mail for 17 days. They may tack coupons to the fridge or leave a pile on the kitchen counter where everyone in the family has plenty of time to review it and act on it. 

Unlike emails that get deleted or filed away somewhere never to be seen again, direct mail has a great shelf life.  Households see it and hold onto relevant offers and information. You’re marketing the driveway with one piece of mail, instead of multiple emails and/or phone calls.

Every time a customer walks by the fridge or counter, they see your dealership name and branding. What could be better for keeping you top-of-mind?

Direct mail is dead? Don’t believe the hype. In our age of digital overload, it’s more alive than ever. Add direct mail into your marketing mix to help retain customers, increase the shelf-life of your advertising and keep your brand top-of-mind.

Good selling!

Instead of staying tethered to your cushy swivel chair, Bill Wittenmyer encourages managers to make it a point to wander a bit throughout the day to spot issues with your team.

Digital retail opens new possibilities and responsibilities for engaging with today's connected car shopper. As Bill Wittenmyer explains, being the "Go-To" person for your customers using digital retail is more important now than ever.

As Bill Wittenmyer says "Change your words and you'll change the result." Setting yourself up for success starts with eliminating words from your vocabulary that remove doubt that you will produce.

It costs most dealers about five times as much to acquire a new customer than to retain those they already have. Yet, increasing customer retention by as little as five percent can increase profits by up to 95 percent, according to the research group Bain & Company.

That’s because loyal customers and enthusiastic fans will keep coming back - and they’ll refer friends and family to your dealership. Loyal customers also tend to prioritize great customer service over price and scoring the best deal.

Bottom line? It pays to put time and resources into nurturing your existing customer relationships.  Begin cultivating loyal customers immediately with these three retention strategies.

Build loyalty in the service lane.

Customers are wary of being sold unnecessary services. A multi-point inspection tool with photo and video capabilities allows service advisors to show customers what needs to be done, instead of just telling them. This goes a long way to build trust and loyalty.

Prioritizing customer convenience by implementing helpful technology also improves customer satisfaction. The J.D. Power 2019 Customer Service Index (CSI) Study found that satisfaction is 75 points higher (on a 1,000-point scale) among customers who have an all-digital experience where they can schedule service online, communicate via text message and view service recommendations on a tablet.

Some of the best results happen when service advisors change their communication strategy to emphasize the safety aspects of necessary services. When customers learn that a faulty spark plug or alternator could leave them stranded on the side of the road, they will be more likely to approve the service. They’ll also feel gratitude towards your service department for recognizing and fixing the problem.

Capitalize on your BDC.

The human connection goes a long way to create loyal buyers. Customers will reward companies that take the time to build genuine, personal relationships. Give your sales associates and service advisors that time by delegating everyday tasks to your BDC.

Don’t have the resources to handle these tasks? You might look at outsourcing the work, or a portion of it, to a trusted virtual BDC.

Your BDC should handle the majority of inbound and outbound phone calls, especially in the service department. When inbound service calls are handled properly by your BDC, up to 72 percent convert to an appointment.

Your BDC should also help with personalized, targeted marketing campaigns that build loyalty. Use your CRM to schedule event-based marketing triggers that re-engage customers at the perfect time in the buying cycle. For example, create a special offer for service customers you haven’t seen in six months. Then, have your BDC follow up with phone calls. Well-targeted cross-channel campaigns build momentum and loyalty because you’re offering a relevant message that meets your customers’ unique needs.

Practice Strategic Data Mining

Data mining can help you build loyalty at both the sales desk and in the service drive. It’s also a great way to source well-maintained vehicles for your pre-owned inventory without paying auction and delivery fees.

The best way to execute this strategy is to have a dedicated data mining expert or team. These individuals keep an eye on service appointments for customers in an equity position with vehicles that are in-demand in your market.

Eligible customers receive a written trade-in offer and suggestions for a new vehicle with confirmed incentives, interest rates, and lease options, if applicable. Keep in mind that few customers will accept a deal on the spot, so have a process in place for BDC follow up.

Customers who accept a deal will get a fair price for their trade-in vehicle, plus a new vehicle with the most modern safety and technology features, all fully protected by a manufacturer’s warranty.

This way, you meet vehicle needs your customers may not even know they have, which helps to engender loyalty and increase the likelihood they will return to your dealership for future service.  Plus, now you have well-maintained vehicles to stock your pre-owned lot. It’s a win-win.

Good selling!

Be prepared for the outside issues that may impact your ability to meet your personal income goals. In this #WittsWiseWords - Bill Wittenmyer says to stick with what brought you success in the first place - great processes, and using your CRM to keep your pipeline full.