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From: Jared Hamilton
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Bryan Armstrong

Bryan Armstrong e-Commerce Director

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Are you unknowingly alienating your customers?

Are you unknowingly alienating your customers?

                A few weeks ago I wrote about transparency in a new car sales transaction. Today I want to take it a step further. In the dealership world, to oft, we follow the old "some will, some won’t, so what? NEXT!", philosophy of old. We assure ourselves that C.S.I. is going to be great because we’ve made 3 calls and sent numerous e-mails and letters over the course of the first 30 days and everything was fine. The customer got a great price (200 under invoice), we under-allowed on the trade by $500 and made some back-end profit. Sound familiar? But it can all blow up because our customers, out of curiosity, logged on to our site and saw their car you assured them, through MMR reports and book sheets, was only worth $8,000 listed for $11,995. Now they are going over everything, re-financing at their credit union for 2 points less and canceling your gap, warranty, key and etch and hammering you on the survey to the O.E.M. that it was “shady and deceptive” and your on-line reviews are in the toilet.

                Sound familiar? Sure maybe not every customer, but we’ve all had it happen to us. What if we were able to turn even that adversary into an ally? It could be accomplished with a simple follow-up e-mail to every customer whose trade you are going to retail. Maybe something in the lines of:

                Dear Jim,

                We look forward to you seeing your previous vehicle on-line soon, here is the link. As you are aware we showed you a trade value of 8,000. We have sent your car through our shop and paid a master mechanic to look it over from stem to stern, luckily all it needed was new wipers, an oil change, air filter, 4 new tires and new brake pads. With our standard used diagnostic fee of $695 (to ensure everything was checked, protect our liability and comply with state and federal regulations) plus the parts and labor cost of $980 and a detail and marketing expense of $300 our cost in your vehicle is now approximately $10,000. You will see it listed at $11,995. The reason is of course that the new consumer will want to see some sort of discount and with us selling you your car at slightly below market, we hope to make approx 800-1000 on the sale of your trade so we net out approx $500 per car before commissions. By the way, since you know your previous vehicle better than anyone else, if you know of someone in the market for it send them in and if they buy it, or any other vehicle, we will gladly send you a referral fee of $100. With the excellent care you provided during your ownership term and the thorough re-conditioning we have given it, this car will surely provide someone years of good use.

                Thank you again for your business and should you have any questions or concerns please feel free to reach out.

                Sincerely,

                     Your car guy for life.

 

Again this may seem extreme, but it will surely defuse the angry customer who was going to be alienated without you ever knowing the reason why. Instead you hopefully now have a marketing ally who will tell his friends how the great car he traded is now even better and “you could probably pick it up for about 10k”.

                Transparency builds long term relationships. Are you willing to allow your customers into your business model or will you sit and hope that you can rip every trade and load the back end with no one being the wiser?

                I guarantee the client you take this extra step with, regardless of whether they were going to look or not, will at least give you first crack at their next purchase and appreciate your honesty and service before, during and after the sale.

 

Bryan Armstrong

435-862-1966

bryanthecarguy@gmail.com

http://www.linkedin.com/in/bryanarmstrong

Tony Rhoades
Bryan, How long have you been using this tactic?
Bryan Armstrong
Tony, Was just implementing it after pondering how to solve the exact scenario described here. I will keep you posted as to it's success.
Bart Wilson
I would be interested in the results as well. Of course you don't want to create an objection or issue where there isn't one, but how many of our customers actually call or come back in and complain about the price their car is listed for? They just tell the people they know instead. If the sales process was set up as transparent from the beginning this email could further support why they chose to do business with the dealership in the first place.
Cobalt An ADP Company
Bryan-this is certainly an interesting post! While it may appear extreme to the majority of the auto dealers today, there is much validity to your point. I would argue that with today’s consumer, it is wiser to err on the side of transparency rather than cause confusion and mistrust with obfuscation. Why? Because today’s consumers have much of the information they need before ever contacting a dealership. They are no longer calling us to get information, but rather to confirm it. Therefore, those dealers that practice transparency will have a much greater chance of earning their business. Many times we have “dealer’s intuition” during the buying process as to whether a particular customer is going to have the type of concerns listed in the posting. This type of transparent response would be especially appropriate to head off any concerns before they have a chance to ruin all credibility. Because of the reasons I named above, credibility is of utmost importance. Imagine how positive this customer could feel with this type of information being shared and what they might post to one of the many dealer rating services. According to an industry study published by Yahoo and The Cobalt Group (http://www.cobalt.com/pdf/2007_ebusiness_presentation.pdf), consumers will consider an average of 6 stores, but visit only one store per brand. What is going to make them decide to choose you? Practicing transparency in all aspects of the buying process can help you be at the top of consideration. Thanks, Tony Navarra, Performance Improvement Consultant at The Cobalt Group
Jim Bell
I think we all have come across this customer in this scenario. Great post. I would be interested to see how your customers respond to this since you just implemented this.

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