What’s the most iconic noise of our time? I’d argue it’s the text message alert sound associated with the iPhone. No matter where you are – the grocery store, Home Depot, a wedding – if you play this sound, people around will freeze and make an instinctual grab for their iPhones.

We’ve all been trained to react to it. That’s why texting is such an effective customer communication channel. People can’t help but respond, like Pavlov’s dog, to that sound.

Various studies back up this claim. Research shows text open rates are as high as 98 percent, compared to just 20 percent for emails. And, on average, it takes 90 seconds for someone to respond to a text and 90 minutes to respond to an email.

That doesn’t mean email is dead – far from it. But it does mean that texting is an extremely effective way to communicate with customers and should be included in every dealership’s communication strategy.

Like any type of communication, there are best practices. These texting dos and don’ts will help your team get the best results from this highly effective way of communicating.

Texting dos.

Keep it simple – Don’t try to say too much with a text. Your message is supposed to be short and sweet. If you have paragraphs to say, put it in an email. Then send a text asking the customer to please check email for an important message.

Limit videos to 30 seconds – Text is a great way to share videos of vehicle walk-arounds, service inspections, sales introductions, and more. But keep videos to 30-seconds or less. It’s difficult to hold attention past that point. So, keep it precise, get to the point, and make sure you’re smiling and welcoming throughout.

Transcend language barriers – Have a great conversation with customers who speak another language by using Google translate, or another service, to translate texts. You both “speak” in your native languages, something you cannot do effortlessly over the phone, for a seamless and gratifying experience.

Limit no-shows – Start texting customers to confirm sales appointments instead of calling. Confirming via text is easier and less pressure for customers. Think about it: Sales wants to close the deal so they probably convey a sense of urgency over the phone that can cause anxiety in customers and lead to no-shows. Text is a low-pressure, more neutral channel with better response rates.

Texting don’ts.

Allow employees to use personal phones – This has been said before, but bears repeating. Supply dealership-owned, CRM-integrated mobile phones to employees and mandate only those phones are used to communicate with customers. When employees use personal phones, you cannot track, manage, or review texts for quality control or continuity of customer records. Plus, if that employee leaves, those conversations and relationships go out the door too.

Allow messaging without templates – Text templates are hugely important to make sure messages are professional, on-brand, and include the right call to action. Create categories and templates for different messages that you want to parley into sales, including: service appointment confirmation, payment portal notification, CSI follow-up, sales appointment, and recommended services notification. Make sure to include a map hyperlink so customers can easily navigate to your store via GPS.

Ignore texting rules and regulations – The Telephone Consumer Protection Act includes specific rules about obtaining consent before sending texts to customers. It’s important to play by the rules. Fines are as high as $500 for every unsolicited text a consumer reports.

A couple more tips that don’t necessarily fall into the dos and don’ts categories include initiating texting while a customer is in the store. Face-to-face is the quickest and easiest way to nudge customers to opt-in to messaging. Ask if you can send them a text, then encourage them to save your number under your name, while they have their phone out. Becoming a saved contact and a customer’s “go to car guy” is a powerful opportunity to establish a relationship that will continue beyond the initial transaction.  

The last tip is to think ahead to all the possible ways you want to you use texting in the future and find a solutions partner that can handle what you want to do now and grow with you. A good list starts with sales quotes and worksheets, inventory links, vehicle photos and walk-around videos, secure credit app links, and completed work notifications. I’m sure you can think of more. Also, ensure that all texting will integrate with your CRM so you can track and manage conversations for quality control and better customer experiences.

Thanks to that iconic ‘ping’ alert and the ease and simplicity of responding, text messaging is an extremely effective way to communicate with customers. With a few dos and don’ts and a couple tips, you can use texting to establish strong customer relationships for years to come.

A new report from eLEND Solutions shows 80 percent of dealers surveyed fast-tracked adoption of digital retailing tools due to the pandemic. It’s no secret many dealers were caught unprepared for dramatic shifts in shopping and buying behavior and are now playing catch up.

We don’t know if the market will be forever changed once Covid-19 is firmly in the rearview mirror. But we do know the past year has taught us that preparation and a back-up plan are key in case another virus takes the world by storm.

Strategic use of the CRM is one of the best ways to get yourself back to pre-pandemic revenue numbers and build a pandemic-proof book of business moving forward. Here’s why:

AI Helps You Run Lean.

A CRM that supports some AI heavy-lifting allows you to run lean while still growing your business. AI technology can follow-up on those cold leads that still need attention but aren’t a good use of salespeople time.

AI is not appropriate for a low-funnel, engaged customer ready to act. That requires a human. But if you have salespeople spending half their days following-up on leads that are 60 days old? That’s a huge waste of time.

Determine when AI should take over with an honest and true assessment of your sales team’s strengths and available resources. Is your team phenomenal at closing hot leads but no good with leads 45 days old? Flip leads to AI at that 45-day mark. Are you working with fewer salespeople? Have them fully engaged for the first 10 days then let AI take over.

Every dealership is different. Identify why and where your store should use AI, then lean on it to engage cold leads while your team is closing those low in the funnel.

Flexibility Allows for Adaptation.

A lot of dealerships learned very quickly that they didn’t have a back-up plan for selling cars. It’s no wonder so many hit the gas on digital retailing adoption. A CRM with the flexibility to support different types of sales processes like digital retailing is key right now.

A CRM also needs to support big factors that go beyond digital retailing like touchless delivery, contactless payment, and fraud protection. You need to be able to easily integrate all these vendors and easily identify customer preference when it comes to sales options.

Every truly capable CRM today recognizes customers who have opted out of calls and emails. In the near future, I would bet the farm there will be a contactless status similar to opt-out. A flexible CRM will support new customer preferences moving forward.

Reporting Reveals New Opportunities.

The pandemic has changed the way people shop, and how they drive. Many people ditched the long commute for the home office. Dealers with the ability within the CRM to quickly identify customers who are driving less have a huge opportunity to build a profitable lease portfolio and score high-quality used inventory.

Use CRM reporting to identify customers that put far more miles on their vehicles in 2019 than they did in 2020. With high-mileage penalties off the table, you can capitalize on current driving habits to get customers into a nicer vehicle at a lower payment with a shorter trade cycle.

A CRM that helps you quickly shift gears depending on customer behavior helps you build a pandemic-proof book of business.

Filtering Data Cuts Costs.

The shake-up in the market also makes this an optimal time to look at your true cost of a sale. Lean on reports in your CRM that break down cost-per-lead and cost-per-sale per lead provider.

To spend smarter, you need to find the channels that deliver the best sales leads, not the most leads. High volume does not equal high quality or high sales. In fact, high volume with low close could be costing you money because you’re also paying the salaries of internal staff to follow-up on those leads.

By filtering the data down to your sales qualified leads and sold leads, you’ll see clearly what’s really impacting your bottom line.

A flexible CRM that supports AI and includes robust reporting is one of your best defenses against rapid market change. Not every dealer knows what their business will look like long term. But with the right technology and a back-up plan, your business can meet and exceed pre-pandemic benchmarks and be prepared for whatever comes next.

If you’ve been in the business for a long time like I have, you’ll remember when every dealership desk had a built-in ashtray. When I’m in a dealership and the desk manager pulls out a green Sharpie and a piece of paper to work a deal, I flash back to that time. We’re not smoking in dealerships anymore, so why are so many still using pen and paper instead of a digital desking tool?

I know what you’re thinking: “That’s the way we’ve always done it and it’s profitable.” That may be true when it comes to the uneducated buyer but, in our increasingly digital world, those buyers are becoming few and far between.

The modern buyer knows exactly what a car is worth before they ever step foot on your floor. If you try to keep numbers close to your chest, they’ll know you’re hiding something. That’s no way to build trust.

The average shopper knows so much ahead of time that they visit an average of only 1.2 dealerships before buying. You give that buyer an old-school experience and they’ll never give you another chance to earn their business. The old-school store is that 0.2 that doesn’t get the deal. 

Old habits are hard to break. The good news is that the right desking tool can help you deliver the transparency that today’s buyers demand and structure more profitable deals in less time.

For the next few minutes, let’s pretend I’m in charge of evaluating and hiring a desking provider at your store. Here’s what I would look for:

Auditing in real time

I want a tool that prompts salespeople to enter all the deal information before they approach the desk. It’s a waste of time to go back and forth when a salesperson says they’re ready to go but hasn’t collected all the necessary details, like if the buyer has a trade and if tax credits apply, or even contact info that includes a zip code. Searching for the answers to these questions slows down deals. Give me a tool that automatically alerts the desk manager when information is missing, so they can hold their salespeople accountable to collect everything needed to accurately desk the deal before approaching the desk.

Accountability and consistency

I want to know how my desking managers are writing deals. Who immediately discounts the deal right away? Who goes back and forth with the customer and holds onto gross profit? I want a tool that allows me to review deals by employee so I can hold them accountable for who’s working to hold onto the most profit. I also want to account for consistency. If I train my salespeople in how to negotiate, but my desk managers don’t follow that process, I lose the equity in that training. A DMS desking tool isn’t going to tell me, but the right digital tool will.

The best rates — period

My people are pulling captive rates out of the and writing deals, but are those the best rates? What if a third-party lender is offering a special rate that will lower a customer’s payment without discounting the sales price? Or what if there’s a lower rate out there that will help the customer afford additional back-end products? The CRM isn’t going to show me special rates from my non-captive lenders. I want a digital tool that does so I can transparently build the most profitable deals.

Integration with my CRM

I want a desking tool that is housed within my CRM. Why? It’s an easy way to ensure your salespeople and desking managers use it. If the only way to desk a deal is by entering deal information into the CRM, guess what? Everyone starts using the CRM.

All the bells and whistles

I want to make it easier and faster to build and present accurate deals. That means I need a tool that highlights the best rates and incentives, gives side-by-side comparisons, generates an accurate tax number and is mobile so I can work a deal in the dealership’s parking lot if I want to capitalize on the customer’s excitement immediately after a test drive, or at the customer’s home or office  The bells and whistles help generate profitable deals for a healthier bottom line and meet the needs of modern buyers for greater customer satisfaction and higher CSI. Everybody wins.

I’ve worked deals with a green Sharpie and with a digital desking tool. The right digital tool always wins. It’s faster, more accurate and, ultimately, more profitable. Use my list as a starting point when evaluating desk providers and challenge them all to a desking duel. If your Sharpie wins, it’s not the right provider.

If you’re like most independent dealers, you loaded up on used inventory  during the first few months of the pandemic. Inventory shortages and high demand pointed toward selling those cars all day long at higher-than-average prices. Now that the market is beginning to correct, book values are dropping. Are you concerned about moving that inventory?

A robust CRM system is a proven way to move vehicles faster because leads don’t fall through the cracks. Don’t get me wrong - I’m not saying a CRM is a magic bullet. As the saying goes, you put garbage in, and you’ll get garbage out. But CRM software backed by strong lead management processes is proven to get you results.

Consider a smaller independent store that sells less than 50 cars a month but, because there is no clear lead follow-up process, the store misses out on 5% of their deals. Those few deals can make the difference between being in the red or in the black. Just a handful of deals! 

How do you know if you are losing deals due to poor lead management? Mystery shop your store. Have someone go to your website and submit a lead. Then have that person call your sales line and leave a message. See what happens. Does that person get a follow-up call or an email? If so, how many?

More times than not, an email goes to the owner’s personal email. He or she prints it out, hands it off to a salesperson and then never knows what happened. The same scenario happens with phone messages.

It’s understandable. Your store is likely employing fewer people, all wearing multiple hats. You don’t have time to go back and manage the lead process. A CRM backed by proper processes helps you capture every lead and monitor follow-up efforts so you can close more deals.

I know I’m hammering on proper process, but behind-the-scenes training is the only way to make a CRM work for you. You can’t just plug it in and watch your sales numbers soar. Look for a CRM provider that offers account management along with software. The provider should check in on you, call you at least quarterly to see how things are going and offer you the option to train in the way that is best for your store. Look for options such as remote, in-person and completely self-paced training.

The aftershock effect of a solid lead follow-up process is robust CRM reporting. Once you have a process down and employees are accountable for using the system properly, reporting becomes invaluable. You can manage and monitor salesperson activity to see who needs more training, check daily traffic reports to see where your leads are coming in and regularly review opportunity reports to see leads that need attention. Therefore, your CRM should operate from a mobile device. That way, accountability can be enforced and stats can be confirmed from anywhere anytime in real time.

Another key report tracks the growth of your customer database. Building a database in your CRM of every person that has ever shopped your store (whether they purchased or not) has huge marketing value.

Typically, a dealership without a CRM will add the names of sold customers to an Excel spreadsheet or another type of software. A store that sold 300 cars last year added 300 names to its database. That next email blast will reach 300 more people. Sounds good, right?

Not when you consider that you’re missing all those people who shopped but didn’t buy. For easy math, let’s say the store’s closing rate was 10 percent. So, ten times the customers should have been added to the database. That email blast should reach 3,000 customers that in some way contacted the store and shopped the inventory but bought elsewhere.

A CRM captures all those leads and provides reports to monitor the database on a regular basis so you can market to everybody and grow your business. The best part? That marketing costs you pennies. You don’t have to buy a list or partner with a bank. It’s your customer data and you own it. You can build your recession-proof book of business and reduce your reliance on advertising budgets and marketing specifications. It costs a lot of money to go out and find lists. It costs pennies to market to those already in your database.

CRM software backed by clear lead management processes is the best way for independent dealers to record every lead, grow a customer database, and move more inventory. Don’t overlook revenue producing technology that can help your business grow for years to come. 

2020 has been an unexpectedly challenging year for dealers. The coronavirus continues to affect nearly every facet of our business.

But whatever the timeframe, at some point we will return to a sense of normalcy. Finishing the year strong is key to ensuring your dealership will be able to hit the ground running, no matter what 2021 brings.

The following strategies will help you navigate changing market conditions and set your dealership up for success, not just in the immediate future but for years to come.

Remain alert and nimble. The irony of the pandemic is that it’s actually been good for most stores from a profitability standpoint.

High vehicle demand and low inventory puts dealers in a power position. In this market, the window sticker is king and profit margins are strong. To add to that, marketing is also on the back burner. Many dealers have scaled back marketing budgets to as little as 15 percent of normal spend. This all equates to a very profitable semester.

However, stores are not bulletproof and the tide rises all boats.  Coronavirus factors will eventually fade away and complacent dealers will have a rude awakening. To stay ahead of the curve, remain alert to changing market conditions. Create practical contingency plans so you can act quickly when used vehicle supply, new vehicle allocations and competitive marketing factors return to pre-pandemic levels.

Re-think holiday promotions. Traditionally, now is the time to create and push out tried and true holiday promotions. This year is a bit different. Customers are primarily concerned about health and safety.

Focus on value branding messaging, not a hard sell of service. Make use of multi-channel marketing tools integrated with your CRM to educate customers about how their safety is top of mind at your dealership. Explain the cleaning procedures at your store and elaborate on your touchless sales and service options.

Talk about safety, but still encourage customers to come in.  Messaging example:

Don’t put your family, your vehicle or your re-sale value at risk. We have taken all the necessary steps, including touch-less options, to keep you safe while still getting the quality vehicle service you need and deserve.

Develop a hybrid sales model. During the pandemic we’ve seen consumers use digital retailing tools at unprecedented levels. What’s interesting is that online closing rates don’t correspond to lead volume.

Turns out, the majority of customers still want to come into the dealership to finish the buying process. Marry an alternative shopping experience with the traditional buying route and you have a new hybrid sales model that is likely here to stay.

So, how do you establish a hybrid sales model? First, identify the need. Are your customers demonstrating that they want a hybrid approach? Second, identify what you are currently doing to support this need. Third, assess if you have the right people with the right training and the right tools to meet this need. If not, hire the people and invest in the tools. Finally, determine what you need to do to ensure your customers know that you offer this hybrid approach.

Traditionally, dealers want to have one process that is followed by every sales associate every time. The truth is, the future must be more flexible than that. Create a fully digital process, an in-store experience and a hybrid approach. Communicate that you have options and customers will be more receptive to doing business with you.

Be open to new employee roles. Consumers who research vehicles online don’t want a hard sell when they eventually reach out to your dealership. They just want their questions answered by an expert. This change in customer shopping behavior is beginning to be reflected in the dealership.

We’re seeing new employee roles like sales consultants, product specialists and customer experience consultants. These employees engage with customers throughout the process in the way the customer prefers, whether that’s online, on the phone, in person or some combination of the three.

It’s a controversial topic, but the model of one employee handling a deal from initial contact through the F&I paperwork is picking up speed in dealerships. This may be the wave of the future as customers prefer working with only one person vs. being handed off between employees and dealerships can scale down staff to cut costs.

Prioritize employee training. You can never spend too much on training, especially as staff take on new roles. Use training as a way to evaluate your team in light of the changing market. Assess who can adapt to new processes and who struggles with change. To move your dealership forward, you have to have the right team.

Training is a proven investment that will strengthen your business. However, some dealers complain about spending money on training only to have employees leave a few months later. This is an excellent opportunity to honestly assess if you’re offering an exceptional work environment along with competitive pay.

Make sure you ask your vendors if they offer free digital or on-site training. Most do, and it would benefit you to take advantage of it. The key is to hold your staff accountable to attending and implementing what they learn. Another training tip is that the success of the training is far greater when the managers take the training with the salespeople. It’s everyone’s job in the dealership to be professionals!

Invest in the right tools. Digital retailing is a hot topic that’s here to stay. It’s smart to invest now in your digital showroom.  Other touch-less technologies may also persist long term. One the service side, it’s worth your time to investigate solutions that keep customers safe and speed up the process, like online appointment scheduling and payments via text.

A robust CRM is integral to the success of varied sales models. It must be able to support different processes (digital, touch-less, in-store and hybrid), integrate with your systems seamlessly and automatically arrange customers into an appropriate status. This ensures any employee who interacts with the customer can see the full customer journey, history and preferences so they can interact with them in a personal, customized way.

2020 continues to be a wild and crazy ride and new ways of selling and servicing vehicles are likely here to stay. The above tips will help you finish the year strong with sales strategies, technology, and training, that will set you up for a prosperous 2021 and beyond.

As profit margins continue to shrink on new vehicles, what’s your strategy to make up some of that lost profit? I’ve talked with dealers who are pushing more extras like extended warranties, buying more leads or hiring more staff. But we all know that in this type of market, trying to stay competitive can be a race to the bottom and additional expenses don’t always equal results. 

I believe a better strategy is to focus on increasing your volume and decreasing your trade cycle through better maintenance of your lease portfolio. Inside every CRM there should be a recession-proof book of business that requires few budget dollars to reach.

A high percentage of your lease customers are already accustomed to coming back to your dealership for maintenance. They also boast a shorter trade cycle of 24-48 months, compared to five- to eight years for a sold vehicle. Play your cards right and you’ll have lease customers coming in every couple of years to trade-up, resulting in more service revenue opportunity, PLUS, a continuous stream of off-lease vehicles to boost your used car inventory.

Yet, most dealership’s lease portfolios are only five to 10% of total business. You can easily double or triple that penetration by making a few minor adjustments to your sales processes. 

Train the Benefits of Leasing

First, train your salespeople on the benefits of leasing and how to present finance and lease options to customers. This step is critical. Most car shoppers intend to finance their vehicles but in many cases, leasing makes more sense. Your salespeople need to know who these ideal candidates are and when it makes more sense to lease, and they need to be able to clearly articulate those reasons.

Additionally, your salespeople should offer different finance and lease options to customers early in the sales process. Earlier is better because the customer has time to process and think about the benefits of leasing compared to financing. To break the ice, ask questions during the sales information gathering process, such as “Mr. Customer, do you prefer traditional financing or residual based financing?" or "Are you familiar with the benefits of residual based financing?"

Desking tools integrated with rates and residuals make it easy for your sales managers to present lease information. The best desking tools offer grid presentations that display up to nine different financing and lease options so customers can see side-by-side comparisons. 

Next, have your sales managers find the monthly “sweet spots” for potential lease vehicles on your lot and print out this information for every salesperson to study. Make sure these offers match the marketing messages on your website, social media & SEO/SEM. For example, I know of a CDJR dealership that identified a legitimate 39-month lease on a $35,000 Jeep Grand Cherokee for well under $400 a month. It was a great opportunity to get into an expensive new vehicle for a budget friendly payment. Because the salespeople knew about it, they could speak about, it and customers snapped it up. 

Finding Lease Customers

Have your salespeople present lease options to every showroom up and appointment. You'll be surprised how many customers will choose the option if presented.

Additionally, mine your CRM for a list of current customers with leases maturing in the next 6 months. Create campaigns to contact these customers so they can schedule their new vehicle selection and transition into their next lease vehicle. Your message should be compelling, relevant and reflect an easy process for the customer to come in for another lease.

The key here is to have a script that clearly states the benefits of leasing to the customer.

Your CRM should also allow you to easily pull a list of customers who are trending to go over lease mileage. Have your salespeople or BDC call these customers (again, using a call guide) to offer an end to the current lease without paying for any extra mileage or penalties if the customer enters into a new lease.

Increasing lease penetration rates is a sound strategy to combat shrinking margins and build a book of virtually recession-proof business. Train your sales staff to always present a lease option, find those “sweet spot” deals on leasable vehicles, and mine your CRM for existing lease opportunities. Set a goal of increasing your lease portfolio to 40-50%, because if vehicle sales continue to slow, profit margins continue to shrink and you don't stay on top of volume, you'll be left in the dust.

When you see someone using their smartphone, what is your first impression? Do you assume that person is engaged in personal business or professional business? Logically there’s no way to know because people use their smartphones for both reasons.

On a personal level, smartphones are used to text family and friends, check social media and play games. On a professional level, smartphones are used primarily for phone calls and replying to emails.

Recently however, vendors in the retail automotive industry (and other industries) are releasing mobile versions of applications that can be used on either smartphones or tablets. If you ask your employees what their personal preference is, many of them will choose the smartphone versions of these apps.

I believe this is a mistake. Based on feedback from our dealership clients, I now believe that mobile tablets are the better choice for mobile apps in the workplace.

The usage of mobile apps in the dealership is a relatively recent phenomenon. For this reason, most consumers’ first impression of an employee using their smartphone is that the employee is doing something personal in nature.

For example, many salespeople are now using smartphone apps to scan customer driver’s licenses. We have heard feedback that some customers feel uncomfortable with this and have complained to the manager. Their perception is that the salesperson has taken a photo of their license with their personal phone, and they are afraid of identity theft.

However, when mobile tablets are used to scan their driver’s license, customers do not suspect nefarious activity and they are less likely to complain. Why is this?

We have all been programmed to associate tablet usage with a professional digital experience in stores like Apple, AT&T and Best Buy. On some level, the customer perceives that a mobile tablet is more like a computer, and is tied into the store’s software system. They don’t mind if their personal information is stored in that system, because they trust that brand.

However, they are not as comfortable with the idea of their personal information being stored on someone else’s personal device. Whether or not their data is actually stored on the device is irrelevant; it’s all about customer perception.

If you leave the choice to your employees, they will probably prefer to use mobile apps on their smartphones. Phones are less bulky and easier to use.

However, smartphone usage in the dealership may be perceived by some of your customers as unprofessional, annoying or downright creepy. Why risk losing their trust? Building customer trust is difficult enough without placing obstacles in the way.  

A mobile tablet provides a professional, interactive experience that most consumers are comfortable with. This may not always be the case; talk to me in a couple years and I may change my mind. But for now, if you care about customer experience, mobile tablets should be the device of choice when you are implementing mobile apps in your dealership.