Hats off to them for thinking Progressively.

"Dream coming true". The early adopters of processes like this will own their markets.

Dennis, Is this going to be similar to the "Shop, Click & Drive" campaign by GM? We have looked into that several times but worry with the lack of dealership in Louisiana and across the nation that actually use it. I think it is a great concept simply because how many customers do we get on a regular basis that this the vehicle they have been looking at is over priced once they start comparing. This will be an easier way to make the sale before the talk them selves into it and then back out of it. Or so it seems.

Early adopters? Sonic is the first to try this? Who knew?The better question: Why will Sonic "win" when Saturn, the Ford Collection, SCION, and numerous other efforts to do the same thing failed miserably? What has changed between then and now to make this approach viable? The fact is, what consumers say and what they mean are two different things? A certain number of people will take advantage of the program, just not enough to make it viable. Who will benefit will be Sonic stores nearest competitors.It takes some real balls to roll out a process new to your organization, that has already failed miserably in the market, especially when you are doing it with your shareholders money. But HEY! There must be some new survey that proves this will finally work.

RE: "The fact that Sonic Automotive has comfortably been so forthcoming with information about a strategy just getting ready to go into the pilot stage says volumes about how slow they think their competition will be to change." Yes, the competition will change. I'm sure there are consultants lined up to teach Sonic's competitors how to sell against it. Its like teaching someone how to play poker when you get to see your adversary's cards before you bid. I think they can figure it out.

The idea is good, the execution will probably flop. There are more industries involved than just Sonic. It's much easier to do with pre owned and is probably why carvana is able to pull it off. New car is a whole different ball game.

Lauren, Shop, Click and Drive is more of a bolt-on tactic. What Sonic is doing is a strategic shift with the entire marketing mix involved. Chris, I agree, used is easier for a variety for reasons. I mentioned the product portion of the marketing mix because my understanding is they have not been adding new franchise stores and do plan to open more used-vehicle stores. It fits. David, I knew you would focus exclusively on the one-price aspect and act like it's the entire story. You never let me down sir.

Why is a one size fits all approach considered innovative? There is a segment of the population that wants to do business this way and they may capture that segment. The research we read about suggest the key is delivering the relevant experience to the right audience so they get the experience they are looking for.

I have worked with a dealership, Roberts Auto Sales, in Modesto, CA for years. This is a pre-owned dealership with anywhere from 250 to 300+ vehicles in inventory at any given time. They sell a couple hundred (give or take) cars a month with zero salesmen and 3 finance managers. A customer comes on the lot, can look through the vehicles, go on a test drive, then when ready, they come into one of two small buildings, sit down with a finance guy and done. One price, one guy to deal with and the dealership has done incredible. 30+ years in business. I can't say how a franchise dealer would do with new vehicles, but I can absolutely say without a doubt that this pre-owned dealer has thrived. They even sit on the exact same street as all the franchise dealers, being directly across the street from Honda. It is awesome to see more stores trying to do this. It absolutely can work.

Blake, No Salesmen?? Who is test driving and Selling on getting to Finance??

Blake, I absolutely love the idea but would have some hang ups. It removes the typical "Car Salesman" stereotype and allows customers the freedom to look around the lot and talk without the pressure of a salesman breathing down their back. Also, they already know that whatever price is on the vehicle is what it's price is. No negotiating. If they don't like the price they look for a different car.

Well said Lauren. and Rick. Great example Blake. Lauren's question about the difference from Shop Click and Drive deserves a more complete answer than I gave it. Programs like Shop Click and Drive try to capture a portion of a shopper segment without fundamental change to how the store serves most of its customers. What Sonic Automotive is starting, and what CarMax has done, is a transformation into something all shoppers will recognize as unique and many will find refreshing. It won't be for everyone, and when the shopping process is not right for you then you need to find another store. The bet is that the segment is large enough today and growing fast enough tomorrow to justify the big investment in not only moving into this segment but attempting to dominate it with entry barriers others cannot easily step up to.

One price doesn't mean no negotiation does it? If you claim one price on the price of the car, you still will negotiate the other items like the trade, the rate/term/downpayment, gap, service warranty, etc. right? So to be pure and honest, if a company is going to claim to be "haggle free" or "one price" or "no negotiation", I assume that means for everything. You would need a standard to go by on the trade (NADA, KBB or whatever) and stick to it.... true no negotiation means no negotiation, period. Or am I missing something?

I am not saying it can't work I am saying for a group as large as Sonic with a diverse audience in many markets. This approach is going to work for some customers and not for others. Unless you are selling grossly under market prices in many markets people do not believe that is your best price and do want to negotiate no matter what the survey says. Their emotional state and brain chemistry changes when they actually spend the money compared to survey's. Many people will also like the approach because it saves them time and do not like negotiating.

There is a dealership in Canada, (hour north of Toronto) Haldimand Motors that has been operating on this philosophy for years. No negotiations. Quick process. 1 person per entire transaction. The entire sales team, works as a TEAM. Split all commissions. They are located in a town of 1,622 people (Cayuga, ON) and happily sell over 500 vehicles a month.

Wow Robert! that is incredible. Thank you so much for the example. I think Rick is right. it will work for some customers and not for others. Clearly, there are a lot of folks north of Toronto it does work for.

Thanks Dennis. Yes Haldimand is a magical place. They have an annual tricycle race every year for charity that shuts down the highway. You can see pics here: http://www.thegreattricyclerace.com/ Pretty incredible.

Hats off to them for thinking Progressively.

"Dream coming true". The early adopters of processes like this will own their markets.

Dennis, Is this going to be similar to the "Shop, Click & Drive" campaign by GM? We have looked into that several times but worry with the lack of dealership in Louisiana and across the nation that actually use it. I think it is a great concept simply because how many customers do we get on a regular basis that this the vehicle they have been looking at is over priced once they start comparing. This will be an easier way to make the sale before the talk them selves into it and then back out of it. Or so it seems.

Early adopters? Sonic is the first to try this? Who knew?The better question: Why will Sonic "win" when Saturn, the Ford Collection, SCION, and numerous other efforts to do the same thing failed miserably? What has changed between then and now to make this approach viable? The fact is, what consumers say and what they mean are two different things? A certain number of people will take advantage of the program, just not enough to make it viable. Who will benefit will be Sonic stores nearest competitors.It takes some real balls to roll out a process new to your organization, that has already failed miserably in the market, especially when you are doing it with your shareholders money. But HEY! There must be some new survey that proves this will finally work.

RE: "The fact that Sonic Automotive has comfortably been so forthcoming with information about a strategy just getting ready to go into the pilot stage says volumes about how slow they think their competition will be to change." Yes, the competition will change. I'm sure there are consultants lined up to teach Sonic's competitors how to sell against it. Its like teaching someone how to play poker when you get to see your adversary's cards before you bid. I think they can figure it out.

The idea is good, the execution will probably flop. There are more industries involved than just Sonic. It's much easier to do with pre owned and is probably why carvana is able to pull it off. New car is a whole different ball game.

Lauren, Shop, Click and Drive is more of a bolt-on tactic. What Sonic is doing is a strategic shift with the entire marketing mix involved. Chris, I agree, used is easier for a variety for reasons. I mentioned the product portion of the marketing mix because my understanding is they have not been adding new franchise stores and do plan to open more used-vehicle stores. It fits. David, I knew you would focus exclusively on the one-price aspect and act like it's the entire story. You never let me down sir.

Why is a one size fits all approach considered innovative? There is a segment of the population that wants to do business this way and they may capture that segment. The research we read about suggest the key is delivering the relevant experience to the right audience so they get the experience they are looking for.

I have worked with a dealership, Roberts Auto Sales, in Modesto, CA for years. This is a pre-owned dealership with anywhere from 250 to 300+ vehicles in inventory at any given time. They sell a couple hundred (give or take) cars a month with zero salesmen and 3 finance managers. A customer comes on the lot, can look through the vehicles, go on a test drive, then when ready, they come into one of two small buildings, sit down with a finance guy and done. One price, one guy to deal with and the dealership has done incredible. 30+ years in business. I can't say how a franchise dealer would do with new vehicles, but I can absolutely say without a doubt that this pre-owned dealer has thrived. They even sit on the exact same street as all the franchise dealers, being directly across the street from Honda. It is awesome to see more stores trying to do this. It absolutely can work.

Blake, No Salesmen?? Who is test driving and Selling on getting to Finance??

Blake, I absolutely love the idea but would have some hang ups. It removes the typical "Car Salesman" stereotype and allows customers the freedom to look around the lot and talk without the pressure of a salesman breathing down their back. Also, they already know that whatever price is on the vehicle is what it's price is. No negotiating. If they don't like the price they look for a different car.

Well said Lauren. and Rick. Great example Blake. Lauren's question about the difference from Shop Click and Drive deserves a more complete answer than I gave it. Programs like Shop Click and Drive try to capture a portion of a shopper segment without fundamental change to how the store serves most of its customers. What Sonic Automotive is starting, and what CarMax has done, is a transformation into something all shoppers will recognize as unique and many will find refreshing. It won't be for everyone, and when the shopping process is not right for you then you need to find another store. The bet is that the segment is large enough today and growing fast enough tomorrow to justify the big investment in not only moving into this segment but attempting to dominate it with entry barriers others cannot easily step up to.

One price doesn't mean no negotiation does it? If you claim one price on the price of the car, you still will negotiate the other items like the trade, the rate/term/downpayment, gap, service warranty, etc. right? So to be pure and honest, if a company is going to claim to be "haggle free" or "one price" or "no negotiation", I assume that means for everything. You would need a standard to go by on the trade (NADA, KBB or whatever) and stick to it.... true no negotiation means no negotiation, period. Or am I missing something?

I am not saying it can't work I am saying for a group as large as Sonic with a diverse audience in many markets. This approach is going to work for some customers and not for others. Unless you are selling grossly under market prices in many markets people do not believe that is your best price and do want to negotiate no matter what the survey says. Their emotional state and brain chemistry changes when they actually spend the money compared to survey's. Many people will also like the approach because it saves them time and do not like negotiating.

There is a dealership in Canada, (hour north of Toronto) Haldimand Motors that has been operating on this philosophy for years. No negotiations. Quick process. 1 person per entire transaction. The entire sales team, works as a TEAM. Split all commissions. They are located in a town of 1,622 people (Cayuga, ON) and happily sell over 500 vehicles a month.

Wow Robert! that is incredible. Thank you so much for the example. I think Rick is right. it will work for some customers and not for others. Clearly, there are a lot of folks north of Toronto it does work for.

Thanks Dennis. Yes Haldimand is a magical place. They have an annual tricycle race every year for charity that shuts down the highway. You can see pics here: http://www.thegreattricyclerace.com/ Pretty incredible.

Well said as always Dennis! Value can be demonstrated in so many ways. We have dug into the OMVIC regulations and decided to really drive home the "Buy With Confidence" message. Basically we explain what "All In Pricing" is (through content rich landing pages & call to actions) being transparent, our initiative is to build trust and value with the customer, with an end goal of conversion!

Dennis, I agree that dealers need to build value to justify the price but this true whether they are one price or not. I personally believe in a fixed pricing model as a way of removing that obstacle to the sale and most of the No haggle dealerships I know aggressively monitor market conditions to remain fair priced. I think the key point is how ARE dealers representing value to the consumer. Dealers spend hundreds of thousands of dollars to drive traffic to their website and don't put enough focus on WHAT they are communicating to the consumer. Many websites and portals display car, pictures, price & heavy VIN explosion of features which builds no value to the consumer. When there is lack of evidence to support their decision we force the consumer to bounce around and hunt for value. Sourcing content and market data sites like KBB, Edmunds & TrueCars. Sorting through listings on Cars.com, Autotrader & CarGuru's. Validating vehicle's history w/ Autocheck or Carfax. Confirmation of trust with Google, DealerRater & Yelp. We don't give the consumer everything they need in one place. A few companies are making strides to bridge the value deficiency gap like Edmunds for example with Price Promise, the consumer gets a no haggle price set by the dealership and Edmunds highlights how that price measure against True Market Value showing the customer they can win ease of buying and trust that it is a good deal. The second company is PureCars, who shows the value that make up the vehicle's price with their Value Intelligence Platform. Example: If a consumer is torn between 2 preowned vehicles that are similar in price but one has; $700 of reconditioning, a Clean Carfax report, CPO warranty and 4.5 star Review those two cars are no longer equal. One has proven a significantly higher Value. Seth Godin reminded all at the Driving Sales 2013 Presidents Club that people will pay for value, time and time again as long as its clear what they are getting!

Seems pretty straight forward and on point Dennis, thank you. I agree with April in that the "one-price" message isn't the important piece. It's the value statements. And I think that the point is even more basic and lends itself as the reason one-price is working so well for the dealers that commit to it: It's transparent. Your website must clearly represent your brand and, to Grant's point, if your brand message is transparency, your conversion rate (web visits-to-showroom visits) will tell you if you're on track. One-price is just one segment of transparency, so is a price-to-value statement. Does the rest of your messaging indicate a transparent showroom experience? And does that hold true once the guest arrives? A yes on both and you win.

Most dealers I know fantasize about waking up tomorrow to find out all of their competitors have just gone "One Price." I can't believe this is coming around again and being touted as "New." It ain't. And who is pushing it as before? Vendors who want to charge you money to come in and show you how to do it. Saturn, SCION, Ford Collection. Check 'em out. http://www.autodealermonthly.com/article/story/2014/05/no-haggle-no-problem-or-not.aspx

If your brand message is transparency, you're probably lying. Consumers don't believe it. You might be talking "relative transparency," but NOT real transparency unless you disclose EVERYTHING the consumer wants to know. Hell, dealers don't even tell their employees everything. What makes you think we will have real transparency between dealerships and consumers before we have transparency between dealers and their employees? A better question: Why should we? It has always been a requirement to gain a certain level of RELATIVE trust with consumers if you hope to do business. There is nothing new about any of this.

Oh David. We went 'round on this a while back and here you are again, defining the "transparency" discussion for everyone. Look, transparency is what the business makes of it. It is not, as David believes, an all or nothing proposition. If you can be more upfront in your pricing, answer more customer questions directly, and give the customer more of what they want so that they can make a better-educated decision, you are being transparent. You do not have to publish your P&L statement on your Facebook page to get there. This post is about one-price and we are experts at it here. It is one area where we are more transparent than our competitors. There are many areas of our store where we are more transparent than our competitors. Many would call us 'radically transparent." This is why we are a successful dealership and regularly beat our competitors, especially those who are stuck in the old-school bus as it heads closer and closer to the cliff. You don't have to go as far as we do but you do have to be willing to share more information with your customers than you have in the past. You have to do research with your customers and understand what it is that they want and need from you. On the research tangent, David, I'd encourage you to get out of your own seat on that bus and do a little more research before issuing blanket statements like "you're probably lying" with no supporting evidence. You're singing the same sad song and it's playing like the oldies station.

Transparency is what it is. We can't make up our own definition and expect that to fly. But feel free to try real transparency if you think it will work. In the meantime you can try to sell "perception of transparency" or "relative transparency." RE: "If you can be more upfront in your pricing" - Well there you go. Relative transparency. Do you really think using the word convinces consumers? You're doing what we've done from the beginning, trying to earn trust via relative transparency. RE: One Price - What more do you need to know other than what Tom Hudson wrote. Perhaps you haven't read that column. You might want to take a look. You probably think you can bait people to your store with claims of transparency and the No Haggle deal. Better yet for your competitors, go with One Price. If you make the claim, you'd better live with it. That means letting customers walk if they won't pay your No Haggle/One Price number. You certainly wouldn't want to make a liar out of yourself by negotiating after to claimed in your advertising you don't. Why would any sane person even put themselves in that position? Last I looked we pay our bills with gross profit, not transparency. You seem to think it is about a race to see who wins the transparency battle. I stand by my statement, if you claim transparency "you're probably lying." To begin with, you're making up your own definition. I've lost count of the dealerships I've mystery shopped. If you think One Price is real and something that will revolutionize retail auto sales, I say, "Go for it." Your competitors will be glad you did. RE: "This post is about one-price and we are experts at it here." What does that have to do with anything?

Well said as always Dennis! Value can be demonstrated in so many ways. We have dug into the OMVIC regulations and decided to really drive home the "Buy With Confidence" message. Basically we explain what "All In Pricing" is (through content rich landing pages & call to actions) being transparent, our initiative is to build trust and value with the customer, with an end goal of conversion!

Dennis, I agree that dealers need to build value to justify the price but this true whether they are one price or not. I personally believe in a fixed pricing model as a way of removing that obstacle to the sale and most of the No haggle dealerships I know aggressively monitor market conditions to remain fair priced. I think the key point is how ARE dealers representing value to the consumer. Dealers spend hundreds of thousands of dollars to drive traffic to their website and don't put enough focus on WHAT they are communicating to the consumer. Many websites and portals display car, pictures, price & heavy VIN explosion of features which builds no value to the consumer. When there is lack of evidence to support their decision we force the consumer to bounce around and hunt for value. Sourcing content and market data sites like KBB, Edmunds & TrueCars. Sorting through listings on Cars.com, Autotrader & CarGuru's. Validating vehicle's history w/ Autocheck or Carfax. Confirmation of trust with Google, DealerRater & Yelp. We don't give the consumer everything they need in one place. A few companies are making strides to bridge the value deficiency gap like Edmunds for example with Price Promise, the consumer gets a no haggle price set by the dealership and Edmunds highlights how that price measure against True Market Value showing the customer they can win ease of buying and trust that it is a good deal. The second company is PureCars, who shows the value that make up the vehicle's price with their Value Intelligence Platform. Example: If a consumer is torn between 2 preowned vehicles that are similar in price but one has; $700 of reconditioning, a Clean Carfax report, CPO warranty and 4.5 star Review those two cars are no longer equal. One has proven a significantly higher Value. Seth Godin reminded all at the Driving Sales 2013 Presidents Club that people will pay for value, time and time again as long as its clear what they are getting!

Seems pretty straight forward and on point Dennis, thank you. I agree with April in that the "one-price" message isn't the important piece. It's the value statements. And I think that the point is even more basic and lends itself as the reason one-price is working so well for the dealers that commit to it: It's transparent. Your website must clearly represent your brand and, to Grant's point, if your brand message is transparency, your conversion rate (web visits-to-showroom visits) will tell you if you're on track. One-price is just one segment of transparency, so is a price-to-value statement. Does the rest of your messaging indicate a transparent showroom experience? And does that hold true once the guest arrives? A yes on both and you win.

Most dealers I know fantasize about waking up tomorrow to find out all of their competitors have just gone "One Price." I can't believe this is coming around again and being touted as "New." It ain't. And who is pushing it as before? Vendors who want to charge you money to come in and show you how to do it. Saturn, SCION, Ford Collection. Check 'em out. http://www.autodealermonthly.com/article/story/2014/05/no-haggle-no-problem-or-not.aspx

If your brand message is transparency, you're probably lying. Consumers don't believe it. You might be talking "relative transparency," but NOT real transparency unless you disclose EVERYTHING the consumer wants to know. Hell, dealers don't even tell their employees everything. What makes you think we will have real transparency between dealerships and consumers before we have transparency between dealers and their employees? A better question: Why should we? It has always been a requirement to gain a certain level of RELATIVE trust with consumers if you hope to do business. There is nothing new about any of this.

Oh David. We went 'round on this a while back and here you are again, defining the "transparency" discussion for everyone. Look, transparency is what the business makes of it. It is not, as David believes, an all or nothing proposition. If you can be more upfront in your pricing, answer more customer questions directly, and give the customer more of what they want so that they can make a better-educated decision, you are being transparent. You do not have to publish your P&L statement on your Facebook page to get there. This post is about one-price and we are experts at it here. It is one area where we are more transparent than our competitors. There are many areas of our store where we are more transparent than our competitors. Many would call us 'radically transparent." This is why we are a successful dealership and regularly beat our competitors, especially those who are stuck in the old-school bus as it heads closer and closer to the cliff. You don't have to go as far as we do but you do have to be willing to share more information with your customers than you have in the past. You have to do research with your customers and understand what it is that they want and need from you. On the research tangent, David, I'd encourage you to get out of your own seat on that bus and do a little more research before issuing blanket statements like "you're probably lying" with no supporting evidence. You're singing the same sad song and it's playing like the oldies station.

Transparency is what it is. We can't make up our own definition and expect that to fly. But feel free to try real transparency if you think it will work. In the meantime you can try to sell "perception of transparency" or "relative transparency." RE: "If you can be more upfront in your pricing" - Well there you go. Relative transparency. Do you really think using the word convinces consumers? You're doing what we've done from the beginning, trying to earn trust via relative transparency. RE: One Price - What more do you need to know other than what Tom Hudson wrote. Perhaps you haven't read that column. You might want to take a look. You probably think you can bait people to your store with claims of transparency and the No Haggle deal. Better yet for your competitors, go with One Price. If you make the claim, you'd better live with it. That means letting customers walk if they won't pay your No Haggle/One Price number. You certainly wouldn't want to make a liar out of yourself by negotiating after to claimed in your advertising you don't. Why would any sane person even put themselves in that position? Last I looked we pay our bills with gross profit, not transparency. You seem to think it is about a race to see who wins the transparency battle. I stand by my statement, if you claim transparency "you're probably lying." To begin with, you're making up your own definition. I've lost count of the dealerships I've mystery shopped. If you think One Price is real and something that will revolutionize retail auto sales, I say, "Go for it." Your competitors will be glad you did. RE: "This post is about one-price and we are experts at it here." What does that have to do with anything?

Dennis I think this is a great article. It's common sense but as Joe Verde said years ago, "Common sense isn't that common." Online reviews and video reviews are everywhere and folks who aren't making this a priority are foolish. Just like in your grandfather's day, we still live and die by our reputation - only today the reputation spreads a lot further :) I think many dealers in our industry get confused with the phrase 'customer centric' because some idiot consultant years ago told them that being customer centric means selling vehicles for low profit because the only way to make a customer happy is to give your cars away. WRONG! If the experience is great and the value is good, the price doesn't have to be a giveaway. I remember selling a Nissan Frontier Pickup for $600 more than the Nissan Dealer that my consumer spoke to that was 70 miles away. She had the info from the other dealer who was barely an hour away but they were willing to pay more because they wanted to do business with us at Cole Nissan. She enjoyed the experience and I made sure to introduce her to her service writer who would be taking care of her needs going forward. I explained how our customers, who purchased from us would ALWAYS get priority in service over those who bought elsewhere - it was a priority service for customers who did business with us. The benefits of buying from us were worth the extra $600 to her. In my opinion, being customer centric means working to serve the consumer's wants, needs and desires better than anyone else so that if they leave and shop elsewhere, they'll appreciate the experience enough to come back and do business. I said to my customers before, as I still say today: "I'm not the cheapest person to work with but I can tell you that I'll work harder for you and do it better than anyone else." Keep up the great content DG.

Thanks Mat, you hit it right on the head. It seems to me it would be tough to maximize profits from a kissing booth by focusing on the price while you're doing the kissing. Is your focus the negotiating process over price or is it getting the customer into the right vehicle, listening and meeting their needs, and confirming beyond a doubt you're the preferred place to do business? Being customer centric is not about cutting the price; it's about elevating the relationship beyond the price. That said, there is room for all kinds of dealership, provide they can be true to what they set out to be.

I have seen the transformation work. Give 110%, follow the sales process, ask for the money, be professional, and they had the highest grosses in the zone and unbelievable CSI. #1 in the country in 5 areas. No customer could even take a demo without a full vehicle explanation. That was a customer centric approach that really worked. Thanks for being customer centric yourself!

Good subject Dennis. I am not sure that many orgs really know what "Customer Centric" really means. IMHO, I think it means having tools and processes that suit the buyer best. I have worked with orgs that made decisions largely from an ivory tower- instilling changes they felt were beneficial to the customer, but without really asking customers if that was the right move. Sure everybody does CSI surveys post-sale, but wouldn't it also make sense to gather some pre-sale information? The car business is still largely price-driven, I believe in large part due to the reasons you cite above. If you dance around answering the price question over the phone, you will have a tough time holding credibility and trust. A lot of buyers may already be distrustful of car salespeople even before they pick up the phone. The buyer may think their biggest fear is that they may get ripped off, but I think it really is the fear of making a "wrong decision." If a salesperson tells me that based on my needs (which hopefully they asked me about), that vehicle B may be a better fit for me than vehicle A, I think I have someone that is more concerned about helping me than getting me over the curb. If an organization truly wants to be customer centric, they should take the time to study what happens in the customer's journey. Take a lesson from Jon Taffer (Bar Rescue) and have your cousin do some mystery shopping on the phone and in person. That will provide better feedback than any CSI survey.

If you're making gross profit, then you might not be customer centric. If you aren't completely transparent, down to disclosing your bare costs and negotiating the margin, you might not be customer centric.

If you are not making gross profit and you can't afford to stay in business to serve your clients, you might not be employee or customer centric.

David I disagree. There are many retailers today that serve the customer well while naming a fair profit without sharing their cost. This business isn't about sharing margins and being a "price whore". There are many dealers who give am of that info out yet they are far from consumer centric. Consumer centric means having a servant mentality imho but that doesn't mean serving for little or no profit. If you provide better service than the dealer down the road it's ok to be more expensive within reason as you are providing more value. Price isn't what seeks cars or Saturn would still exist.

Sorry for the typos, darn galaxy s4 lol :-)

Thanks Sheila! Great point about listening Jeff! Consultative selling starts with listening.

Define "fair profit," then tell me whether you are a sales person, manager, or dealer. If you aren't disclosing your cost, you aren't being "transparent." Consumers will NOT pay you a fair profit if they know exactly what it is. They will ALWAYS take your "best price" to shop with UNLESS they are dealing with a trusted sales person that they already have a relationship with. And since our industry turns over sales people 3 - 4 times per year, every time the consumer goes out to buy, they have to find a new sales person. And there is a cohort that would prefer to cut out the middle man and buy direct from the OEM. While one can always cite anecdotes that prove one thing or another, let me point out a couple of things. The Ford Collection didn't implode that long ago. I can't understand why so many people in our industry have forgotten that. Ford Motor Company certainly hasn't. But that turnover thing raises its ugly head again. I guess there just aren't that many people who have been around to recall it in the retail world. Recall Saturn. The cars were priced at retail $1500 under the market and supplies were limited be design. GM lost money on every one from the beginning, trying to establish the brand. They thought they could raise margins later on. Never happened. A Silicon Valley startup tried to sell cars at a loss for a while to get established. Consumers took their prices and shopped with them. The fact is, the industry's cost structure is so complicated, to provide it to consumers would be like asking them to drink from a fire hose. Hell, our own people don't understand it half the time. Dealers aren't transparent with their own staff. But lets go back to defining what a fair profit is.

Great question David. Let me first say that my perspective comes from the viewpoint of 12 years on the retail side, and the past 8 years on the Vendor side. That said; I know there are many schools of thought regarding a 'fair profit' and I don't believe I can change your opinion, I am merely stating mine. Since you point to Silicon Valley though, let's talk about a company who isn't the cheapest but their products and service experience are arguably some of the best in the world: Apple. A Macbook pro with the same specs as a comparable windows PC is nearly $1000 more expensive. Both have intel processors, etc., and heck, you can even install windows on the Mac too but what makes it ultimately worth more? The experience with it is better. It doesn't crash as often, when you need help the Apple support staff is friendly, fun and cool to deal with. They almost make it fun to get service done (go figure). I don't think we should hide the margins when a customer asks, but I don't think that we should make the focus of a presentation all about price. Your title says "jack of all trades" so I don't know what you do but let's take an Automotive Consultant for example. Their cost structure is mostly for their labor right? What's that cost financially for them - zero. But what do they charge? Good ones charge quite a bit but the Dealer doesn't say: "Well since your labor really doesn't have a cost associated I'd like to know what all of your expenses are related to consulting with me and I'll give you $100 for your time." Time is valuable, every hour away from your family is valuable. For each person that value is different so I don't believe there is a one size fits all answer and it will depend on how competitive the market place is that you're selling vehicles in. One thing that I can say to a certainty is that giving a way all of your gross does not, and never will, make you 'customer centric'. All it does is make you a person who gives away profit. There is a reason that McDonalds isn't the only place to eat. For me, I'd rather pay $20 for a great salad in a clean restaurant where someone cares to serve me as a customer than to pay $6 in a fast food joint where I'm #326 and my table may not be clean unless I grab a napkin to wipe it down. Your rational regarding the Saturn demise only goes to further my point. They were selling cars below margin - giving them away in relation to profit/loss - yet that didn't get consumers excited enough to purchase them. That said, as we all recall, in the later years of Saturn the 'experience' went into the toilet because they started negotiating trades more 'creatively' and overall changed their model from a 'good car with a great experience' to 'the same experience as everywhere else with a cheaper car'. There are dealers today that have great reviews, great reputations, and they don't sell their cars at net or near net. Again, I don't expect we'll agree on this notion but I will close with what Shiela mentioned: "you can't afford to stay in business to serve your clients, you might not be employee or customer centric." If you're broke, you can't provide better service than the competition. Dealers should serve better than anyone and charge what they believe they're worth. If consumers disagree with your value proposition as a dealer, you'll learn that quickly. Thanks for keeping the dialogue going :)

My opinion is that you will NEVER make a fair profit based on consumers perception of what that means. My perspective comes from 43 years in the auto business starting as a sales person who stayed in the same dealership for 7 years, and was a price quoter who managed to sell some cars. I've been around to know this business is about the production of gross profit and your perception of what happened with Saturn is just wrong.... not totally wrong, but you haven't given proper weight to the fact that consumers are consumers. I don't care how good your price is, UNLESS you have managed to hang around long enough for previous buyers to come back to you, quoting a higher price than your competition assumes you are better than they are at building value. And it most cases, that isn't even the primary reason people will buy from you. It has more to do with how your personality jives with them than anything, and in the beginning a commissioned sales person will have a really difficult time. Ford lost BILLIONS trying to do business the way consumers said they wanted to do business in surveys. What they say and what they mean are two different things. RE: "Since you point to Silicon Valley though, let's talk about a company who isn't the cheapest but their products and service experience are arguably some of the best in the world: Apple." Let's talk about Mercedes Benz. Apple products aren't sold through franchise dealers. MB products are. MB sales people can earn enough to make auto sales a career. They have managed to maintain some semblance of gross profit via perceived value. Volume franchises like Toyota or Ford are much different. Have you seen the national numbers for gross profit on Toyota and Honda volume models lately? Comparing the Apple model to the car business is so far from valid I really don't know where to start. Apple can control their pricing, just as Elon Musk hopes to control pricing by owning his own sales outlets. At Apple, they don't take trade ins, let alone trades where the consumer owes more on it than its worth. They certainly aren't transparent and would nicely tell a consumer to kiss off if they were offered less than "their price." Try doing that in the car business with a competitive dealer within an easy drive or a phone call. Credit? You either have room on your card or you don't. And Apple is under tremendous pressure to keep coming up with ground breaking products that can command the high margins. Much of that has to do with patents, BTW.

RE: "I don't think we should hide the margins when a customer asks, but I don't think that we should make the focus of a presentation all about price." Perception of low price is what draws car buyers. Price your inventory too high and see how many hits you get. So when a customer asks about margin, what do YOU tell them? Which "cost" do you use?"

RE: "Your rational regarding the Saturn demise only goes to further my point. They were selling cars below margin - giving them away in relation to profit/loss - yet that didn't get consumers excited enough to purchase them." You misunderstood what I said. The dealers made plenty of money while the factory lost money on every car. When they moved AWAY from their original model, the factory lost less but still couldn't sustain it. And that was with a single dealer owning all the Saturn outlets in a market, making the price fixing legal. Toyota has tried this in Japan, where it failed miserably as well.

RE: "Their cost structure is mostly for their labor right? What's that cost financially for them - zero. But what do they charge? Good ones charge quite a bit but the Dealer doesn't say: "Well since your labor really doesn't have a cost associated I'd like to know what all of your expenses are related to consulting with me and I'll give you $100 for your time." This also has absolutely nothing at all in common with retailing cars.

RE: "One thing that I can say to a certainty is that giving a way all of your gross does not, and never will, make you 'customer centric'." So who decides what is "customer centric," and what isn't? YOU or the consumer? The consumer doesn't usually know what is in their best interest. They certainly are not always right. Less than 30% of them have a fast track credit score. Many are quite demanding even when they will need considerable help from the dealer to get a deal done. As an industry we have to get over the false analogies between our business and others. We need to be strategic. We need to provide all the transparency the law demands and then some, but there is a point when it is not the consumer's business to know our inner workings. IN fact, it isn't the business of our employees to know so much. Hell, if they want to know let them all scrape up the money to buy one of these joints, hire a bunch of folks to expect to get paid, then let them all tell you how to run your business. Then they can have complete transparency. http://autosandeconomics.blogspot.com/2013/05/transparency.html

RE "If you are not making gross profit and you can't afford to stay in business to serve your clients, you might not be employee or customer centric." TRU DAT!! The REAL bottom line. Its all about gross profit. Imagine a world with no dealers. That's what an efficient market creates once buyers and sellers have the same info. With no dealers the OEMs are free to do whatever they want on pricing. After all, there are no middle men competitors to worry about, only other OEMs. Consumers don't know what they want because most don't understand business. There are MANY consumers who will NOT buy an APPLE because of the independent nature furthered by the monopoly they have on their own products. Android seems to be eating into that. Plus they manufacture in 3rd world countries and pay squat to those employees. Have to use iTunes? No interchangeable battery? No SD card slot? No "Flash?" Let them have to deal with unions once and do business in a REAL environment. It will catch up with them unless they can keep inventing and maintaining their dominance.

Let's back up for just a moment. First and foremost I think it's fine that we agree to disagree but my statements regarding the Apple comparison for example are more relevant than we in this industry want to embrace. Apple can price the way they do because they believe that their product has value. Take away Apple's name and replace it with any successful dealership or dealer group that has made the decision to sell value over price. I'm not saying that we can just price our vehicles as high as we like and act willy nilly about it. Any intelligent person is going to evaluate their market, the competition, etc., and price accordingly. My response, initially was to your comment: "If you aren't disclosing your cost, you aren't being "transparent." Consumers will NOT pay you a fair profit if they know exactly what it is. They will ALWAYS take your "best price" to shop with UNLESS they are dealing with a trusted sales person that they already have a relationship with. And since our industry turns over sales people 3 - 4 times per year, every time the consumer goes out to buy, they have to find a new sales person. And there is a cohort that would prefer to cut out the middle man and buy direct from the OEM." I believe the part I'm struggling with is the statement that dealers aren't transparent if they don't disclose cost. So by that statement, transparency would look like selling up from 'cost' right? I've been in dealership environments with many different pricing models. One was a Nissan Dealership with very little competition but they thought that you had to price up from invoice, advertise XXX over invoice, etc. The franchise barely sold enough units to stay afloat and it was a failure. I took over that Nissan department as the manager, retrained our staff on every aspect of the sales process so that we could learn how to serve our consumers better and create an environment that would allow us to ask for what our vehicles were worth rather than starting each deal with the old manager's model. He used to write a deal like so... "Invoice is, plus this cost, that cost, this other cost, etc., which brings us to a selling price of..." Within 18 months we increased sales volume and profit drastically, and we increased our repeat and referral business too. It wasn't because we raised the prices so I don't want to misspeak or be misunderstood. I'm saying that by changing the culture and the overall experience for the buyer, as well as the focus of our sales people, we were able to focus on find the right vehicle, right equipment etc., and we saw that there were less and less customers in the negotiation asking to see invoice. By the way, if they asked, I would always show it to them. Then I would tell them the exact same price that I had before I showed it to them. Depending on availability of the unit and other scenarios some vehicles may have had a lower margin and some may have held a higher margin but we didn't just drop price. My job as a leader was, and still is, to make sure that my client gets better service from me than my competitors. My job is also to make sure my sales team serves the customer better than anyone else - and that they are compensated very well for doing so. Happy sales people who make a good living are less likely to come to work stressed about finances, etc., which means they won't come off like the 'hungry' or 'aggressive' sales people that they compete (at least in my experience that has been the case - obviously there is no way to make a blanket statement for all). When it comes to pricing I do agree with you that the definition of fair is not going to be the same for every customer or every dealer. Heck, the amount of profit varies on market, vehicle availability and the number of competitors you have within driving distance. My point was simply this: Transparency doesn't mean hanging the invoice on the cars and selling from cost up. At the end of the day it comes down to what you and your customer agree is fair. In your 40+ years of experience I'm sure you've seen dealers who sell below invoice that still get outsold by a nearby competitor who isn't selling cars as cheap right? So ultimately, it's not just about 'price'. I agree wholeheartedly that we need to be transparent, but if I'm understanding you correctly, you believe transparency means digging into the cost with the buyer and in my opinion (just an opinion) I believe that cost doesn't need to be initiated on the seller's end unless it is addressed by the buyer. Then, by all means, share it and then be sure you can justify your value. If you can't justify why you're asking for the price you're asking, you'll likely lose the business. Someone smarter than me once said: "If two people want to do business on a product, money won't get in the way of it happening." I understand that to mean that if we have done a proper job of listening to our customer's wants, needs and desires. If we have the right vehicle for them. If we actually care about helping them get it, and they truly want it, we will work together to find a way for it to fit their budget. Thanks for the fun dialogue this evening, I'm off to dinner with the family :) Have a great night all!

Another false analogy with Apple: When your Apple whatever breaks, you take it back in for exchange or mail it in to an Apple repair center. That isn't likely to happen on a car after the sales tax has been paid and the vehicle is registered. Another: With Apple, there are few color choices and options, compared to a car. Inventory isn't quite the deal it is in the car business.

RE: "Apple can price the way they do because they believe that their product has value." They can't price the way they do because THEY think their product has value, they can price because. for now, CONSUMERS think it has value. AND Apple doesn't have to worry about a competitive layer of distribution, such as auto dealers. They don't need them. They don't have to build in margin to maintain them. RE: "Take away Apple's name and replace it with any successful dealership or dealer group that has made the decision to sell value over price." Wrong. Just because the dealer decides to price higher than his market doesn't mean the consumer will pay it. Try Apple's model with the additional layer of dealers competing with each other. Its a HUGE difference.

RE: "I understand that to mean that if we have done a proper job of listening to our customer's wants, needs and desires. If we have the right vehicle for them. If we actually care about helping them get it, and they truly want it, we will work together to find a way for it to fit their budget." This assumes our competitors aren't out equal or better. What does it come down to when all other issues are virtually equal? What if the consumer likes the Kia Optima better but the dealer sticks to MSRP because the market allows it based on supply and demand. So the consumer buys from a sales person and dealer they don't like as well because the monthly payment fits, like on an Accord with a strong lease subvention. "For every complex problem there is an answer that is clear, simple, and wrong." H. L. Mencken

David, I appreciate the dialogue. There is one point that I want to touch on because I believe you misunderstood me: I said: "Take away Apple's name and replace it with any successful dealership or dealer group that has made the decision to sell value over price." You replied: "Wrong. Just because the dealer decides to price higher than his market doesn't mean the consumer will pay it. Try Apple's model with the additional layer of dealers competing with each other. Its a HUGE difference." My comment didn't mean a dealer can just advertise a higher price and ta-da, people will pay it. The point I'm trying to convey is that there are plenty of dealers who sell the same product (new car wise) that are within the same geographic area. Some advertise giveaway prices, some do not. Amazingly, the dealers who do not are still selling vehicles. Some of them outsell the ones who are giving things away. The long and the short of it, in my opinion, is that low price does not make a business consumer centric. You brought up a good point in saying "who decides, you or the consumer" and I believe we will both agree, it is the consumer who decides if we're consumer centric or not. That said, many consumers still choose, in their opinion, dealers who they (the consumer) feel are more 'consumer centric' - even when the price is higher.

RE: "My comment didn't mean a dealer can just advertise a higher price and ta-da, people will pay it. The point I'm trying to convey is that there are plenty of dealers who sell the same product (new car wise) that are within the same geographic area." TRU DAT! Which makes the auto industry much different from APPLE. RE: "Some advertise giveaway prices, some do not." Often price leader advertisers maintain higher gross profits than those who don't. RE: "Amazingly, the dealers who do not are still selling vehicles." Its not about the selling of vehicles, but the production of gross profits. RE: " Some of them outsell the ones who are giving things away. The long and the short of it, in my opinion, is that low price does not make a business consumer centric." As a dealer I was gross profit centric. Yes, it is a balance. Some might say that when some consumers pay a higher profit than others, that isn't consumer centric. And I would say if you have a problem with that you are in the wrong business. RE: "You brought up a good point in saying "who decides, you or the consumer" and I believe we will both agree, it is the consumer who decides if we're consumer centric or not." A fact of life in business: In negotiation, if neither party gets their feathers ruffled, money was left on the table. As a dealer, if you want to have the luxury of leaving money on the table in pursuit of all happy customers you had better maintain a lower overhead than your competitors, difficult to do with OEMs cramming "image programs" down dealer's throats. RE: "If your prices are negotiable, yet your customer cannot speak directly with the only person who has pricing authority, then you might not be customer centric." We figured out LONG ago that giving sales people our triple net cost info is a losing proposition. They will figure out a way to give it away. It sounds like you want to give up every gross profit building negotiating strategy there is. Consumers are NEVER going to understand out cost structured. They will NEVER understand stairsteps, holdback, CSI incentives, etc. They don't give a rat's ass about your sales people making enough money to stay on board. Your interest on your inventory, insurance, taxes, administrative, etc. isn't anything they care about. As far as consumers are concerned you can charge that to the next customer. A dealer needs 10% margin per transaction to survive and make a minimal ROI. That's about $3K per deal these days. It is doubtful that many consumer would consider that margin "customer centric." If you give someone a $2K deal, the next consumer needs to pay $4k to maintain the average. This is just the math of the business. But a consumer would NOT consider that "customer centric." I've done extensive surveys on this. You might be pursuing the wrong goal. Perhaps you should be pursuing the PERCEPTION of "customer centricity" in the pursuit of maximizing gross profit. That said, many consumers still choose, in their opinion, dealers who they (the consumer) feel are more 'consumer centric' - even when the price is higher."

Dennis, thanks for a great article. Yes, not all dealerships are equal in their standards of customer excellence, nor should they. However, with any business, there is always room for improvement. So last year, we had some fun and Interviewed our top dealer clients that lead in CSI in their respective regions. From those discussions we developed the Take The Challenge: How Customer-Centric is Your Dealership Test. Click here to take this quick 12 question survey and see if your dealership is Leading The Pack, Standing Tall, Treading Water or Missing the Mark. And, perhaps learn a few easy initiatives to make the customer experience more enjoyable at your store.

Dennis, here is the link to take the quick 12 question survey: http://www.women-drivers.com/howfriendlyisyourdealership/

Thank you for sharing the link to the survey Anne. Although the battery of questions has an expected slant, these are all things dealers should be asking themselves. It's an exercise worth going through. Linking back to the interesting debate between Mat and David, I don't recall any of your survey questions being about price. Refreshing :o)

@ Dennis - RE: "Linking back to the interesting debate between Mat and David, I don't recall any of your survey questions being about price. Refreshing :o)" If price isn't important a dealer can give in to the OEMs on their image programs, not worry about expenses, and ignore the elephant in the room. Just charge everyone the same margin, be "customer centric," whatever that is, and everything will work out fine. To listen to consumers properly you have to often ignore the words they say and discern what they mean. One can get a completely different message on any topic by wording survey question differently, same group same topic. Observing their behavior is essential. Understanding that you might have problem making gross profit from 750 FICO Internet enabled, experienced at negotiating boomers with cash might help. If one wonders why some dealerships engage in perfectly goofy advertising it is because they are trying to attract less sophisticated buyers on whom they can make gross profit. Anyone ever watch "King of Cars?"

David, I don't think you and I have a fundamental disagreement. Nowhere in the more than one thousand pages I have written on automotive marketing have I ever said price was not important. I have said many times, and I think you agree, that price should not be the central focus of the discussion with the customer. The discussion of price is pointless if it is not about the right vehicle. To know what the right vehicle is, you must listen to the customer's needs and in many cases help them identify it. In any respectable sales training program, the term listening is used holistically, listening to facial expressions, body language, tone of voice, data (e.g. credit score) as well as the words. I don't mind a good argument my friend, I'm just not sure we disagree.

Certainly price is not an issue WE want to bring up except possibly in price leader advertising to draw traffic or when we post pre0owned inventory. In fact, I have taught for years that a sales person, soon after greeting a customer on the lot, should say, "Before you leave WE want to answer all of your questions so you can make a rational purchase decision, PLUS WE want to give you some figures to consider." We can actually make a better gross profit if we take the "curse" off the relationship as early as possible. Communication is 20% the words we say, and 80% everything else. I take issue with this idea that we should be completely transparent with our consumers. Gross profit is the objective. AND in negotiation, if neither party gets their feathers ruffled, money has been left on the table. This is just the facts of life. Dealers aren't transparent with their own employees, and aren't required to be. And having the dealer/GM negotiate every deal, giving up the 3rd party negotiating strategy, makes no sense. No one in their right mind is going to "empower" their sales staff with complete information. At some point we need to be more concerned with retaining good talent, not having to constantly train green peas because we forever run off good talent. That's the elephant in the room. As a guy who spent twenty years training all over the U.S. and Japan, it was always good to be able to pick up a check for constantly training new hires. And I could pick up a check for teaching dealership management how to use personality assessments to hire the best from their pool of candidates. I became disgusted with what our industry has done to these people after they were hired and its time to for me to speak out about why we have run off so much talent. We will never have good closing ratios and owner loyalty turning over our sales staff 3 - 4 times per year. Its good for trainer/consultants. But counter productive in the big picture.

Great subject Problem is, almost ALL CRM's do not function as advertised. While user error and laziness accounts for 50% of the lack of customer centered thinking. MOST CRM's actually do not work as promised. Oh, I mean in their current release!!!! That version is coming, again. Lets see more written on the smoke and mirrors these vendors sell to dealers, and the cause and effect of spending productive sales time submitting tickets to CRM vendors over what doesn't work in ALL of them. They are not integrated as advertised and I challenge any one to prove to me in their store that they really are. That all with standing, the point of this article is very valid.

My beef is with the vague term "Customer Centric." Customer Centric from whose perspective? The fact is we have to make money. The fact is the price has to be negotiated. Those two facts work against "Customer Centric." DO the math. From a consumer's standpoint, it seems immoral to charge a different profit to different customers. A consumer thinks everyone should pay the same profit. The only way that happens is with price fixing, both illegal and also lacking in "Customer Centricity" from the perspective of a consumer. Most consumers wouldn't think it to be Customer Centric for them to pay us a 10% gross transaction profit.

Dennis I think this is a great article. It's common sense but as Joe Verde said years ago, "Common sense isn't that common." Online reviews and video reviews are everywhere and folks who aren't making this a priority are foolish. Just like in your grandfather's day, we still live and die by our reputation - only today the reputation spreads a lot further :) I think many dealers in our industry get confused with the phrase 'customer centric' because some idiot consultant years ago told them that being customer centric means selling vehicles for low profit because the only way to make a customer happy is to give your cars away. WRONG! If the experience is great and the value is good, the price doesn't have to be a giveaway. I remember selling a Nissan Frontier Pickup for $600 more than the Nissan Dealer that my consumer spoke to that was 70 miles away. She had the info from the other dealer who was barely an hour away but they were willing to pay more because they wanted to do business with us at Cole Nissan. She enjoyed the experience and I made sure to introduce her to her service writer who would be taking care of her needs going forward. I explained how our customers, who purchased from us would ALWAYS get priority in service over those who bought elsewhere - it was a priority service for customers who did business with us. The benefits of buying from us were worth the extra $600 to her. In my opinion, being customer centric means working to serve the consumer's wants, needs and desires better than anyone else so that if they leave and shop elsewhere, they'll appreciate the experience enough to come back and do business. I said to my customers before, as I still say today: "I'm not the cheapest person to work with but I can tell you that I'll work harder for you and do it better than anyone else." Keep up the great content DG.

Thanks Mat, you hit it right on the head. It seems to me it would be tough to maximize profits from a kissing booth by focusing on the price while you're doing the kissing. Is your focus the negotiating process over price or is it getting the customer into the right vehicle, listening and meeting their needs, and confirming beyond a doubt you're the preferred place to do business? Being customer centric is not about cutting the price; it's about elevating the relationship beyond the price. That said, there is room for all kinds of dealership, provide they can be true to what they set out to be.

I have seen the transformation work. Give 110%, follow the sales process, ask for the money, be professional, and they had the highest grosses in the zone and unbelievable CSI. #1 in the country in 5 areas. No customer could even take a demo without a full vehicle explanation. That was a customer centric approach that really worked. Thanks for being customer centric yourself!

Good subject Dennis. I am not sure that many orgs really know what "Customer Centric" really means. IMHO, I think it means having tools and processes that suit the buyer best. I have worked with orgs that made decisions largely from an ivory tower- instilling changes they felt were beneficial to the customer, but without really asking customers if that was the right move. Sure everybody does CSI surveys post-sale, but wouldn't it also make sense to gather some pre-sale information? The car business is still largely price-driven, I believe in large part due to the reasons you cite above. If you dance around answering the price question over the phone, you will have a tough time holding credibility and trust. A lot of buyers may already be distrustful of car salespeople even before they pick up the phone. The buyer may think their biggest fear is that they may get ripped off, but I think it really is the fear of making a "wrong decision." If a salesperson tells me that based on my needs (which hopefully they asked me about), that vehicle B may be a better fit for me than vehicle A, I think I have someone that is more concerned about helping me than getting me over the curb. If an organization truly wants to be customer centric, they should take the time to study what happens in the customer's journey. Take a lesson from Jon Taffer (Bar Rescue) and have your cousin do some mystery shopping on the phone and in person. That will provide better feedback than any CSI survey.

If you're making gross profit, then you might not be customer centric. If you aren't completely transparent, down to disclosing your bare costs and negotiating the margin, you might not be customer centric.

If you are not making gross profit and you can't afford to stay in business to serve your clients, you might not be employee or customer centric.

David I disagree. There are many retailers today that serve the customer well while naming a fair profit without sharing their cost. This business isn't about sharing margins and being a "price whore". There are many dealers who give am of that info out yet they are far from consumer centric. Consumer centric means having a servant mentality imho but that doesn't mean serving for little or no profit. If you provide better service than the dealer down the road it's ok to be more expensive within reason as you are providing more value. Price isn't what seeks cars or Saturn would still exist.

Sorry for the typos, darn galaxy s4 lol :-)

Thanks Sheila! Great point about listening Jeff! Consultative selling starts with listening.

Define "fair profit," then tell me whether you are a sales person, manager, or dealer. If you aren't disclosing your cost, you aren't being "transparent." Consumers will NOT pay you a fair profit if they know exactly what it is. They will ALWAYS take your "best price" to shop with UNLESS they are dealing with a trusted sales person that they already have a relationship with. And since our industry turns over sales people 3 - 4 times per year, every time the consumer goes out to buy, they have to find a new sales person. And there is a cohort that would prefer to cut out the middle man and buy direct from the OEM. While one can always cite anecdotes that prove one thing or another, let me point out a couple of things. The Ford Collection didn't implode that long ago. I can't understand why so many people in our industry have forgotten that. Ford Motor Company certainly hasn't. But that turnover thing raises its ugly head again. I guess there just aren't that many people who have been around to recall it in the retail world. Recall Saturn. The cars were priced at retail $1500 under the market and supplies were limited be design. GM lost money on every one from the beginning, trying to establish the brand. They thought they could raise margins later on. Never happened. A Silicon Valley startup tried to sell cars at a loss for a while to get established. Consumers took their prices and shopped with them. The fact is, the industry's cost structure is so complicated, to provide it to consumers would be like asking them to drink from a fire hose. Hell, our own people don't understand it half the time. Dealers aren't transparent with their own staff. But lets go back to defining what a fair profit is.

Great question David. Let me first say that my perspective comes from the viewpoint of 12 years on the retail side, and the past 8 years on the Vendor side. That said; I know there are many schools of thought regarding a 'fair profit' and I don't believe I can change your opinion, I am merely stating mine. Since you point to Silicon Valley though, let's talk about a company who isn't the cheapest but their products and service experience are arguably some of the best in the world: Apple. A Macbook pro with the same specs as a comparable windows PC is nearly $1000 more expensive. Both have intel processors, etc., and heck, you can even install windows on the Mac too but what makes it ultimately worth more? The experience with it is better. It doesn't crash as often, when you need help the Apple support staff is friendly, fun and cool to deal with. They almost make it fun to get service done (go figure). I don't think we should hide the margins when a customer asks, but I don't think that we should make the focus of a presentation all about price. Your title says "jack of all trades" so I don't know what you do but let's take an Automotive Consultant for example. Their cost structure is mostly for their labor right? What's that cost financially for them - zero. But what do they charge? Good ones charge quite a bit but the Dealer doesn't say: "Well since your labor really doesn't have a cost associated I'd like to know what all of your expenses are related to consulting with me and I'll give you $100 for your time." Time is valuable, every hour away from your family is valuable. For each person that value is different so I don't believe there is a one size fits all answer and it will depend on how competitive the market place is that you're selling vehicles in. One thing that I can say to a certainty is that giving a way all of your gross does not, and never will, make you 'customer centric'. All it does is make you a person who gives away profit. There is a reason that McDonalds isn't the only place to eat. For me, I'd rather pay $20 for a great salad in a clean restaurant where someone cares to serve me as a customer than to pay $6 in a fast food joint where I'm #326 and my table may not be clean unless I grab a napkin to wipe it down. Your rational regarding the Saturn demise only goes to further my point. They were selling cars below margin - giving them away in relation to profit/loss - yet that didn't get consumers excited enough to purchase them. That said, as we all recall, in the later years of Saturn the 'experience' went into the toilet because they started negotiating trades more 'creatively' and overall changed their model from a 'good car with a great experience' to 'the same experience as everywhere else with a cheaper car'. There are dealers today that have great reviews, great reputations, and they don't sell their cars at net or near net. Again, I don't expect we'll agree on this notion but I will close with what Shiela mentioned: "you can't afford to stay in business to serve your clients, you might not be employee or customer centric." If you're broke, you can't provide better service than the competition. Dealers should serve better than anyone and charge what they believe they're worth. If consumers disagree with your value proposition as a dealer, you'll learn that quickly. Thanks for keeping the dialogue going :)

My opinion is that you will NEVER make a fair profit based on consumers perception of what that means. My perspective comes from 43 years in the auto business starting as a sales person who stayed in the same dealership for 7 years, and was a price quoter who managed to sell some cars. I've been around to know this business is about the production of gross profit and your perception of what happened with Saturn is just wrong.... not totally wrong, but you haven't given proper weight to the fact that consumers are consumers. I don't care how good your price is, UNLESS you have managed to hang around long enough for previous buyers to come back to you, quoting a higher price than your competition assumes you are better than they are at building value. And it most cases, that isn't even the primary reason people will buy from you. It has more to do with how your personality jives with them than anything, and in the beginning a commissioned sales person will have a really difficult time. Ford lost BILLIONS trying to do business the way consumers said they wanted to do business in surveys. What they say and what they mean are two different things. RE: "Since you point to Silicon Valley though, let's talk about a company who isn't the cheapest but their products and service experience are arguably some of the best in the world: Apple." Let's talk about Mercedes Benz. Apple products aren't sold through franchise dealers. MB products are. MB sales people can earn enough to make auto sales a career. They have managed to maintain some semblance of gross profit via perceived value. Volume franchises like Toyota or Ford are much different. Have you seen the national numbers for gross profit on Toyota and Honda volume models lately? Comparing the Apple model to the car business is so far from valid I really don't know where to start. Apple can control their pricing, just as Elon Musk hopes to control pricing by owning his own sales outlets. At Apple, they don't take trade ins, let alone trades where the consumer owes more on it than its worth. They certainly aren't transparent and would nicely tell a consumer to kiss off if they were offered less than "their price." Try doing that in the car business with a competitive dealer within an easy drive or a phone call. Credit? You either have room on your card or you don't. And Apple is under tremendous pressure to keep coming up with ground breaking products that can command the high margins. Much of that has to do with patents, BTW.

RE: "I don't think we should hide the margins when a customer asks, but I don't think that we should make the focus of a presentation all about price." Perception of low price is what draws car buyers. Price your inventory too high and see how many hits you get. So when a customer asks about margin, what do YOU tell them? Which "cost" do you use?"

RE: "Your rational regarding the Saturn demise only goes to further my point. They were selling cars below margin - giving them away in relation to profit/loss - yet that didn't get consumers excited enough to purchase them." You misunderstood what I said. The dealers made plenty of money while the factory lost money on every car. When they moved AWAY from their original model, the factory lost less but still couldn't sustain it. And that was with a single dealer owning all the Saturn outlets in a market, making the price fixing legal. Toyota has tried this in Japan, where it failed miserably as well.

RE: "Their cost structure is mostly for their labor right? What's that cost financially for them - zero. But what do they charge? Good ones charge quite a bit but the Dealer doesn't say: "Well since your labor really doesn't have a cost associated I'd like to know what all of your expenses are related to consulting with me and I'll give you $100 for your time." This also has absolutely nothing at all in common with retailing cars.

RE: "One thing that I can say to a certainty is that giving a way all of your gross does not, and never will, make you 'customer centric'." So who decides what is "customer centric," and what isn't? YOU or the consumer? The consumer doesn't usually know what is in their best interest. They certainly are not always right. Less than 30% of them have a fast track credit score. Many are quite demanding even when they will need considerable help from the dealer to get a deal done. As an industry we have to get over the false analogies between our business and others. We need to be strategic. We need to provide all the transparency the law demands and then some, but there is a point when it is not the consumer's business to know our inner workings. IN fact, it isn't the business of our employees to know so much. Hell, if they want to know let them all scrape up the money to buy one of these joints, hire a bunch of folks to expect to get paid, then let them all tell you how to run your business. Then they can have complete transparency. http://autosandeconomics.blogspot.com/2013/05/transparency.html

RE "If you are not making gross profit and you can't afford to stay in business to serve your clients, you might not be employee or customer centric." TRU DAT!! The REAL bottom line. Its all about gross profit. Imagine a world with no dealers. That's what an efficient market creates once buyers and sellers have the same info. With no dealers the OEMs are free to do whatever they want on pricing. After all, there are no middle men competitors to worry about, only other OEMs. Consumers don't know what they want because most don't understand business. There are MANY consumers who will NOT buy an APPLE because of the independent nature furthered by the monopoly they have on their own products. Android seems to be eating into that. Plus they manufacture in 3rd world countries and pay squat to those employees. Have to use iTunes? No interchangeable battery? No SD card slot? No "Flash?" Let them have to deal with unions once and do business in a REAL environment. It will catch up with them unless they can keep inventing and maintaining their dominance.

Let's back up for just a moment. First and foremost I think it's fine that we agree to disagree but my statements regarding the Apple comparison for example are more relevant than we in this industry want to embrace. Apple can price the way they do because they believe that their product has value. Take away Apple's name and replace it with any successful dealership or dealer group that has made the decision to sell value over price. I'm not saying that we can just price our vehicles as high as we like and act willy nilly about it. Any intelligent person is going to evaluate their market, the competition, etc., and price accordingly. My response, initially was to your comment: "If you aren't disclosing your cost, you aren't being "transparent." Consumers will NOT pay you a fair profit if they know exactly what it is. They will ALWAYS take your "best price" to shop with UNLESS they are dealing with a trusted sales person that they already have a relationship with. And since our industry turns over sales people 3 - 4 times per year, every time the consumer goes out to buy, they have to find a new sales person. And there is a cohort that would prefer to cut out the middle man and buy direct from the OEM." I believe the part I'm struggling with is the statement that dealers aren't transparent if they don't disclose cost. So by that statement, transparency would look like selling up from 'cost' right? I've been in dealership environments with many different pricing models. One was a Nissan Dealership with very little competition but they thought that you had to price up from invoice, advertise XXX over invoice, etc. The franchise barely sold enough units to stay afloat and it was a failure. I took over that Nissan department as the manager, retrained our staff on every aspect of the sales process so that we could learn how to serve our consumers better and create an environment that would allow us to ask for what our vehicles were worth rather than starting each deal with the old manager's model. He used to write a deal like so... "Invoice is, plus this cost, that cost, this other cost, etc., which brings us to a selling price of..." Within 18 months we increased sales volume and profit drastically, and we increased our repeat and referral business too. It wasn't because we raised the prices so I don't want to misspeak or be misunderstood. I'm saying that by changing the culture and the overall experience for the buyer, as well as the focus of our sales people, we were able to focus on find the right vehicle, right equipment etc., and we saw that there were less and less customers in the negotiation asking to see invoice. By the way, if they asked, I would always show it to them. Then I would tell them the exact same price that I had before I showed it to them. Depending on availability of the unit and other scenarios some vehicles may have had a lower margin and some may have held a higher margin but we didn't just drop price. My job as a leader was, and still is, to make sure that my client gets better service from me than my competitors. My job is also to make sure my sales team serves the customer better than anyone else - and that they are compensated very well for doing so. Happy sales people who make a good living are less likely to come to work stressed about finances, etc., which means they won't come off like the 'hungry' or 'aggressive' sales people that they compete (at least in my experience that has been the case - obviously there is no way to make a blanket statement for all). When it comes to pricing I do agree with you that the definition of fair is not going to be the same for every customer or every dealer. Heck, the amount of profit varies on market, vehicle availability and the number of competitors you have within driving distance. My point was simply this: Transparency doesn't mean hanging the invoice on the cars and selling from cost up. At the end of the day it comes down to what you and your customer agree is fair. In your 40+ years of experience I'm sure you've seen dealers who sell below invoice that still get outsold by a nearby competitor who isn't selling cars as cheap right? So ultimately, it's not just about 'price'. I agree wholeheartedly that we need to be transparent, but if I'm understanding you correctly, you believe transparency means digging into the cost with the buyer and in my opinion (just an opinion) I believe that cost doesn't need to be initiated on the seller's end unless it is addressed by the buyer. Then, by all means, share it and then be sure you can justify your value. If you can't justify why you're asking for the price you're asking, you'll likely lose the business. Someone smarter than me once said: "If two people want to do business on a product, money won't get in the way of it happening." I understand that to mean that if we have done a proper job of listening to our customer's wants, needs and desires. If we have the right vehicle for them. If we actually care about helping them get it, and they truly want it, we will work together to find a way for it to fit their budget. Thanks for the fun dialogue this evening, I'm off to dinner with the family :) Have a great night all!

Another false analogy with Apple: When your Apple whatever breaks, you take it back in for exchange or mail it in to an Apple repair center. That isn't likely to happen on a car after the sales tax has been paid and the vehicle is registered. Another: With Apple, there are few color choices and options, compared to a car. Inventory isn't quite the deal it is in the car business.

RE: "Apple can price the way they do because they believe that their product has value." They can't price the way they do because THEY think their product has value, they can price because. for now, CONSUMERS think it has value. AND Apple doesn't have to worry about a competitive layer of distribution, such as auto dealers. They don't need them. They don't have to build in margin to maintain them. RE: "Take away Apple's name and replace it with any successful dealership or dealer group that has made the decision to sell value over price." Wrong. Just because the dealer decides to price higher than his market doesn't mean the consumer will pay it. Try Apple's model with the additional layer of dealers competing with each other. Its a HUGE difference.

RE: "I understand that to mean that if we have done a proper job of listening to our customer's wants, needs and desires. If we have the right vehicle for them. If we actually care about helping them get it, and they truly want it, we will work together to find a way for it to fit their budget." This assumes our competitors aren't out equal or better. What does it come down to when all other issues are virtually equal? What if the consumer likes the Kia Optima better but the dealer sticks to MSRP because the market allows it based on supply and demand. So the consumer buys from a sales person and dealer they don't like as well because the monthly payment fits, like on an Accord with a strong lease subvention. "For every complex problem there is an answer that is clear, simple, and wrong." H. L. Mencken

David, I appreciate the dialogue. There is one point that I want to touch on because I believe you misunderstood me: I said: "Take away Apple's name and replace it with any successful dealership or dealer group that has made the decision to sell value over price." You replied: "Wrong. Just because the dealer decides to price higher than his market doesn't mean the consumer will pay it. Try Apple's model with the additional layer of dealers competing with each other. Its a HUGE difference." My comment didn't mean a dealer can just advertise a higher price and ta-da, people will pay it. The point I'm trying to convey is that there are plenty of dealers who sell the same product (new car wise) that are within the same geographic area. Some advertise giveaway prices, some do not. Amazingly, the dealers who do not are still selling vehicles. Some of them outsell the ones who are giving things away. The long and the short of it, in my opinion, is that low price does not make a business consumer centric. You brought up a good point in saying "who decides, you or the consumer" and I believe we will both agree, it is the consumer who decides if we're consumer centric or not. That said, many consumers still choose, in their opinion, dealers who they (the consumer) feel are more 'consumer centric' - even when the price is higher.

RE: "My comment didn't mean a dealer can just advertise a higher price and ta-da, people will pay it. The point I'm trying to convey is that there are plenty of dealers who sell the same product (new car wise) that are within the same geographic area." TRU DAT! Which makes the auto industry much different from APPLE. RE: "Some advertise giveaway prices, some do not." Often price leader advertisers maintain higher gross profits than those who don't. RE: "Amazingly, the dealers who do not are still selling vehicles." Its not about the selling of vehicles, but the production of gross profits. RE: " Some of them outsell the ones who are giving things away. The long and the short of it, in my opinion, is that low price does not make a business consumer centric." As a dealer I was gross profit centric. Yes, it is a balance. Some might say that when some consumers pay a higher profit than others, that isn't consumer centric. And I would say if you have a problem with that you are in the wrong business. RE: "You brought up a good point in saying "who decides, you or the consumer" and I believe we will both agree, it is the consumer who decides if we're consumer centric or not." A fact of life in business: In negotiation, if neither party gets their feathers ruffled, money was left on the table. As a dealer, if you want to have the luxury of leaving money on the table in pursuit of all happy customers you had better maintain a lower overhead than your competitors, difficult to do with OEMs cramming "image programs" down dealer's throats. RE: "If your prices are negotiable, yet your customer cannot speak directly with the only person who has pricing authority, then you might not be customer centric." We figured out LONG ago that giving sales people our triple net cost info is a losing proposition. They will figure out a way to give it away. It sounds like you want to give up every gross profit building negotiating strategy there is. Consumers are NEVER going to understand out cost structured. They will NEVER understand stairsteps, holdback, CSI incentives, etc. They don't give a rat's ass about your sales people making enough money to stay on board. Your interest on your inventory, insurance, taxes, administrative, etc. isn't anything they care about. As far as consumers are concerned you can charge that to the next customer. A dealer needs 10% margin per transaction to survive and make a minimal ROI. That's about $3K per deal these days. It is doubtful that many consumer would consider that margin "customer centric." If you give someone a $2K deal, the next consumer needs to pay $4k to maintain the average. This is just the math of the business. But a consumer would NOT consider that "customer centric." I've done extensive surveys on this. You might be pursuing the wrong goal. Perhaps you should be pursuing the PERCEPTION of "customer centricity" in the pursuit of maximizing gross profit. That said, many consumers still choose, in their opinion, dealers who they (the consumer) feel are more 'consumer centric' - even when the price is higher."

Dennis, thanks for a great article. Yes, not all dealerships are equal in their standards of customer excellence, nor should they. However, with any business, there is always room for improvement. So last year, we had some fun and Interviewed our top dealer clients that lead in CSI in their respective regions. From those discussions we developed the Take The Challenge: How Customer-Centric is Your Dealership Test. Click here to take this quick 12 question survey and see if your dealership is Leading The Pack, Standing Tall, Treading Water or Missing the Mark. And, perhaps learn a few easy initiatives to make the customer experience more enjoyable at your store.

Dennis, here is the link to take the quick 12 question survey: http://www.women-drivers.com/howfriendlyisyourdealership/

Thank you for sharing the link to the survey Anne. Although the battery of questions has an expected slant, these are all things dealers should be asking themselves. It's an exercise worth going through. Linking back to the interesting debate between Mat and David, I don't recall any of your survey questions being about price. Refreshing :o)

@ Dennis - RE: "Linking back to the interesting debate between Mat and David, I don't recall any of your survey questions being about price. Refreshing :o)" If price isn't important a dealer can give in to the OEMs on their image programs, not worry about expenses, and ignore the elephant in the room. Just charge everyone the same margin, be "customer centric," whatever that is, and everything will work out fine. To listen to consumers properly you have to often ignore the words they say and discern what they mean. One can get a completely different message on any topic by wording survey question differently, same group same topic. Observing their behavior is essential. Understanding that you might have problem making gross profit from 750 FICO Internet enabled, experienced at negotiating boomers with cash might help. If one wonders why some dealerships engage in perfectly goofy advertising it is because they are trying to attract less sophisticated buyers on whom they can make gross profit. Anyone ever watch "King of Cars?"

David, I don't think you and I have a fundamental disagreement. Nowhere in the more than one thousand pages I have written on automotive marketing have I ever said price was not important. I have said many times, and I think you agree, that price should not be the central focus of the discussion with the customer. The discussion of price is pointless if it is not about the right vehicle. To know what the right vehicle is, you must listen to the customer's needs and in many cases help them identify it. In any respectable sales training program, the term listening is used holistically, listening to facial expressions, body language, tone of voice, data (e.g. credit score) as well as the words. I don't mind a good argument my friend, I'm just not sure we disagree.

Certainly price is not an issue WE want to bring up except possibly in price leader advertising to draw traffic or when we post pre0owned inventory. In fact, I have taught for years that a sales person, soon after greeting a customer on the lot, should say, "Before you leave WE want to answer all of your questions so you can make a rational purchase decision, PLUS WE want to give you some figures to consider." We can actually make a better gross profit if we take the "curse" off the relationship as early as possible. Communication is 20% the words we say, and 80% everything else. I take issue with this idea that we should be completely transparent with our consumers. Gross profit is the objective. AND in negotiation, if neither party gets their feathers ruffled, money has been left on the table. This is just the facts of life. Dealers aren't transparent with their own employees, and aren't required to be. And having the dealer/GM negotiate every deal, giving up the 3rd party negotiating strategy, makes no sense. No one in their right mind is going to "empower" their sales staff with complete information. At some point we need to be more concerned with retaining good talent, not having to constantly train green peas because we forever run off good talent. That's the elephant in the room. As a guy who spent twenty years training all over the U.S. and Japan, it was always good to be able to pick up a check for constantly training new hires. And I could pick up a check for teaching dealership management how to use personality assessments to hire the best from their pool of candidates. I became disgusted with what our industry has done to these people after they were hired and its time to for me to speak out about why we have run off so much talent. We will never have good closing ratios and owner loyalty turning over our sales staff 3 - 4 times per year. Its good for trainer/consultants. But counter productive in the big picture.

Great subject Problem is, almost ALL CRM's do not function as advertised. While user error and laziness accounts for 50% of the lack of customer centered thinking. MOST CRM's actually do not work as promised. Oh, I mean in their current release!!!! That version is coming, again. Lets see more written on the smoke and mirrors these vendors sell to dealers, and the cause and effect of spending productive sales time submitting tickets to CRM vendors over what doesn't work in ALL of them. They are not integrated as advertised and I challenge any one to prove to me in their store that they really are. That all with standing, the point of this article is very valid.

My beef is with the vague term "Customer Centric." Customer Centric from whose perspective? The fact is we have to make money. The fact is the price has to be negotiated. Those two facts work against "Customer Centric." DO the math. From a consumer's standpoint, it seems immoral to charge a different profit to different customers. A consumer thinks everyone should pay the same profit. The only way that happens is with price fixing, both illegal and also lacking in "Customer Centricity" from the perspective of a consumer. Most consumers wouldn't think it to be Customer Centric for them to pay us a 10% gross transaction profit.

Dennis, I think you're so right. Unfortunately for so many folks, technology has become a crutch for helping us do 'less' instead of a tool for helping us do MORE. I remember getting our first AutoBase TERMINALS back in 1995 at Battle Creek Honda Mazda (no longer Mazda) and holy golden calf moses...I was blown away at how many more customers I could contact now that I could find their information quicker than my index card file. I went from selling 15 cars to 20 cars per month just because the CRM gave me time to do more. Today, it seems like I see a lot of folks who look at their CRM as a tool to do all their busy work but people just don't maximize the free time that they've been given. I don't think it's because they're lazy though, I think it's because they don't know what to do. Leadership, in many cases, needs to get involved instead of just looking at their CRM reports too and spend more one on one time with the sales reps in the store to help guide them so their team will know how to effectively use the phone, work the service department for referrals, etc. I can't wait to see what will have changed by 2018 but my gut (which is too big right now btw) says that we'll have a wide selection of more tools that empower us to sit back and "come to work to wait". The great news is, there is the smaller percentage of folks out there who will really take advantage of the new technologies, and who understand the importance of being in the PEOPLE business, and those folks will absolutely CRUSH their competition. Thanks again for a great post.

Dennis, guru, indeed the idea of a forward-looking vision is vital for participants in Auto Retail Future. Like hitting a baseball, the anticipation of where the sweet spot might be combined with the proper form and follow through can lead to a great success at home plate. As Mat mentions, there are likely to be many additional tools, and the idea of the 'sit back and waiters' isn't likely to change. They may be replaced by robots, though - according to Bloomberg. Also, the most significant constant I see affecting our industry is "Change". As almost no other industry has ever accomplished, auto retail remained the same for over a century in the core defining processes and principles involved with transacting business with the consumer public. At the onset of the Internet, change began to affect the traditional 'Road to a Sale' that anchored the brick and mortar galaxy of Auto Retail Past. More has changed for auto retailers/dealers since the emergence of the Internet as a new information exchange for automotive consumers than had changed in centuries before. I soundly believe, the 'change' is what dealers can count on seeing (possibly in greater proportion than now, even) constant in the next 20 years. And, I also believe, they must step profoundly into the batter's box and be ready to anticipate what these changes might bring down the pipe. Jeff Bezo's was right, paying attention to the things that will remain the same is the name of the game for dealers going into the 2018's and beyond. Change is the thing most likely to stay the same. A Big Championship Trophy Hoist to you and the DrivingSales.com for keeping ahead of the count on informative industry topics like these, Dennis. You are well appreciated, indeed.

Great work, Dennis. I believe some semblance of technology (regarding a software to house, maintain, continue relationships, trigger tasks) is imperative. Today it is a CRM, but it may not always look as our current ones do. However, that style of technology-assisted management of opportunities will need to remain for dealers to keep consumers engaged. I too believe that a dealer's online presence/entity will be at the forefront, but websites will be 100% different amalgamations than they are now in just 10 years. Lastly, I would say it is the ability to "sell" trust to the consumers. (I hate using the word "sell" there, but I am in a hurry.) ALL consumers, even in 20 years, will prefer to do business with an organization that they trust or have a previous relationship with that they still...well... trust. We, as dealers, need to define all interaction we ever do (and online information we put out on the Interwebs) with the end goal of building trust-based relationships. Our "trust auras" need to be in full bloom for auto dealers to survive the next 20 years.

Thank you Mat, Dee, and Joe. Wow Chris, an increasing focus on the total consumer experience sounds like a future worth working toward. Great vision my friend!

Dennis, I think you're so right. Unfortunately for so many folks, technology has become a crutch for helping us do 'less' instead of a tool for helping us do MORE. I remember getting our first AutoBase TERMINALS back in 1995 at Battle Creek Honda Mazda (no longer Mazda) and holy golden calf moses...I was blown away at how many more customers I could contact now that I could find their information quicker than my index card file. I went from selling 15 cars to 20 cars per month just because the CRM gave me time to do more. Today, it seems like I see a lot of folks who look at their CRM as a tool to do all their busy work but people just don't maximize the free time that they've been given. I don't think it's because they're lazy though, I think it's because they don't know what to do. Leadership, in many cases, needs to get involved instead of just looking at their CRM reports too and spend more one on one time with the sales reps in the store to help guide them so their team will know how to effectively use the phone, work the service department for referrals, etc. I can't wait to see what will have changed by 2018 but my gut (which is too big right now btw) says that we'll have a wide selection of more tools that empower us to sit back and "come to work to wait". The great news is, there is the smaller percentage of folks out there who will really take advantage of the new technologies, and who understand the importance of being in the PEOPLE business, and those folks will absolutely CRUSH their competition. Thanks again for a great post.

Dennis, guru, indeed the idea of a forward-looking vision is vital for participants in Auto Retail Future. Like hitting a baseball, the anticipation of where the sweet spot might be combined with the proper form and follow through can lead to a great success at home plate. As Mat mentions, there are likely to be many additional tools, and the idea of the 'sit back and waiters' isn't likely to change. They may be replaced by robots, though - according to Bloomberg. Also, the most significant constant I see affecting our industry is "Change". As almost no other industry has ever accomplished, auto retail remained the same for over a century in the core defining processes and principles involved with transacting business with the consumer public. At the onset of the Internet, change began to affect the traditional 'Road to a Sale' that anchored the brick and mortar galaxy of Auto Retail Past. More has changed for auto retailers/dealers since the emergence of the Internet as a new information exchange for automotive consumers than had changed in centuries before. I soundly believe, the 'change' is what dealers can count on seeing (possibly in greater proportion than now, even) constant in the next 20 years. And, I also believe, they must step profoundly into the batter's box and be ready to anticipate what these changes might bring down the pipe. Jeff Bezo's was right, paying attention to the things that will remain the same is the name of the game for dealers going into the 2018's and beyond. Change is the thing most likely to stay the same. A Big Championship Trophy Hoist to you and the DrivingSales.com for keeping ahead of the count on informative industry topics like these, Dennis. You are well appreciated, indeed.

Great work, Dennis. I believe some semblance of technology (regarding a software to house, maintain, continue relationships, trigger tasks) is imperative. Today it is a CRM, but it may not always look as our current ones do. However, that style of technology-assisted management of opportunities will need to remain for dealers to keep consumers engaged. I too believe that a dealer's online presence/entity will be at the forefront, but websites will be 100% different amalgamations than they are now in just 10 years. Lastly, I would say it is the ability to "sell" trust to the consumers. (I hate using the word "sell" there, but I am in a hurry.) ALL consumers, even in 20 years, will prefer to do business with an organization that they trust or have a previous relationship with that they still...well... trust. We, as dealers, need to define all interaction we ever do (and online information we put out on the Interwebs) with the end goal of building trust-based relationships. Our "trust auras" need to be in full bloom for auto dealers to survive the next 20 years.

Thank you Mat, Dee, and Joe. Wow Chris, an increasing focus on the total consumer experience sounds like a future worth working toward. Great vision my friend!

I friend of mine just responded to me with a link to an article on how Big Data is being used to stop suicide among veterans, http://www.fastcolabs.com/3014191/this-may-be-the-most-vital-use-of-big-data-weve-ever-seen This is a great example of data that is changing human conversations. These models are not perfect. They are not going to lead to an email telling someone they are about to take their own life. They are going to lead to a question coming from a human, the right question or questions at the right time in enough cases to save lives. The same will be true for enhancing quality of life within the showroom.

Dennis - this activity is definitely coming, and it may even arrive sooner than we think in the form of intelligent sites that are able to read our behavioral data before we arrive to a website. Imagine the website pulling in your desktop or mobile history, or even your social graph (Facebook) or knowledge graph (Google) to provide you with the content you're most interested in seeing without having to search for anything - it's already there. Better experience, more accurate information and improved performance. That's what I see...

The biggest problem you have with all of this "big data" is exactly what is pointed out in the article about Nordstrom's. Consumers are opting out from being tracked and it's negatively impacting consumers perceptions of businesses that use and collect the data. We as an industry are at a tipping point. We need to dial in what we have before adding more confusion to the mix!! http://www.drivingsales.com/blogs/iMagicLab/2013/07/12/how-will-sell-cars

Thanks Dennis, I believe that it is important that we understand "big data" and more important, how we can use that information to shift our everyday interaction with consumers. I think Google and Nielsen did a good job in March of sharing some info on how the mobile consumer is interacting and the relevance between their online (mobile) engagement to their in-store purchases http://www.google.com/think/research-studies/creating-moments-that-matter.html Thanks again for sharing the post and I look forward to having you on our weekly Hangout on Air next week to discuss the vendor ratings system you have here at drivingsales. Be sure to share the link so others can watch our conversation live! http://koing.co/hangoutsonair

Apologies everyone, my fat fingers did a typo. The correct address for the weekly hangout is http://konig.co/hangoutsonair Thank you very much to Paul Rushing for the heads up :)

Paul - that's the key factor: making it into something that people don't want to opt out of. Take Google now for instance. It's delivering me info only I am interested in seeing. It may all be worthless or even considered spam to another user - but it's special to me. That's where I see this going. Users have warmed up to retargeting over the users and they know it happening. It'll just get smarter and more personalized.

Eric I agree if the data is being used to improve the user experience the users will adopt it. For now no one is doing a great job with this not even the big G. Its why I have two browsers open on my desktop. One is logged to he G and the other is not and all tracking is disabled..

Paul, I deeply appreciate your article last week and your continued involvement in this issue. I saw your article as being more about the use of data to know what to purchase or continue to purchase. I’ll add to that post regarding that issue. With respect to how data will impact showroom operations, let’s not throw the baby out with the bathwater. 1. Some shoppers are opting out, not all, not even most. 2. Some shoppers are taking a dim view of this practice, which is one of the benefits our industry has as a follower. If the cultural shift turns increasingly negative or accepting of the practice within big-box retailers, we will know before dealers invest. 3. We do need to use the data we have now, and that requires systems that make things simpler and easier. I think we all agree paralysis by analysis is a bad thing. Automated analytic tools that get you the information you need when you need it without even requesting is the future. It’s tempting to try to identify a handful of data points dealers should care about. No one has time to deal with the mountain of data dealers already have at their disposal. However, the dealer taking this approach will be at a competitive disadvantage to those who employ systems sifting through the data with little or no human involvement to produce better information when the salesperson or decision maker needs it. Data is but a means to better information. Better information relative to selling vehicles with time left to focus on the practice of selling those vehicles is what we need. We cannot get the focus on selling if we try to analyze everything, and we cannot get the rich information we need by simply discarding most of the data. We need automated systems that will turn the increasing amount of incoming data into increasingly valuable information. There is almost certainly more agreement here than first meets the eye. I think progressive guys like you will be leading the effort to get dealers there.

A specific answer to the question about using big data to sell more cars is being provided by my partners at eShare, Sean Marra and Eric Miret. They have leveraged data aggregation into a GUARANTEED!!! way for dealers to sell more cars. The company has plays on big data in other sectors, but the automotive offering is the headliner. These guys are doing really BIG things with big data. (learn more here www.ePush.us/#automotive) Also, to the point about auto retail not being a place of early adoption for big data, you all are the data. In order for big data to have massive effect on industry, their must be large multiples of transactions. Big data has no finer home for optimization and study about how to make it of best use than right here in automotive. Few industries are able to generate the type of data created by automotive retail. The sheer size of each transaction is a distinctive factor - and, the growth potential for 20 Million plus transactions by the end of the decade means every one from IBM to the White House (including Google) has their 'Glass' on us.

I friend of mine just responded to me with a link to an article on how Big Data is being used to stop suicide among veterans, http://www.fastcolabs.com/3014191/this-may-be-the-most-vital-use-of-big-data-weve-ever-seen This is a great example of data that is changing human conversations. These models are not perfect. They are not going to lead to an email telling someone they are about to take their own life. They are going to lead to a question coming from a human, the right question or questions at the right time in enough cases to save lives. The same will be true for enhancing quality of life within the showroom.

Dennis - this activity is definitely coming, and it may even arrive sooner than we think in the form of intelligent sites that are able to read our behavioral data before we arrive to a website. Imagine the website pulling in your desktop or mobile history, or even your social graph (Facebook) or knowledge graph (Google) to provide you with the content you're most interested in seeing without having to search for anything - it's already there. Better experience, more accurate information and improved performance. That's what I see...

The biggest problem you have with all of this "big data" is exactly what is pointed out in the article about Nordstrom's. Consumers are opting out from being tracked and it's negatively impacting consumers perceptions of businesses that use and collect the data. We as an industry are at a tipping point. We need to dial in what we have before adding more confusion to the mix!! http://www.drivingsales.com/blogs/iMagicLab/2013/07/12/how-will-sell-cars

Thanks Dennis, I believe that it is important that we understand "big data" and more important, how we can use that information to shift our everyday interaction with consumers. I think Google and Nielsen did a good job in March of sharing some info on how the mobile consumer is interacting and the relevance between their online (mobile) engagement to their in-store purchases http://www.google.com/think/research-studies/creating-moments-that-matter.html Thanks again for sharing the post and I look forward to having you on our weekly Hangout on Air next week to discuss the vendor ratings system you have here at drivingsales. Be sure to share the link so others can watch our conversation live! http://koing.co/hangoutsonair

Apologies everyone, my fat fingers did a typo. The correct address for the weekly hangout is http://konig.co/hangoutsonair Thank you very much to Paul Rushing for the heads up :)

Paul - that's the key factor: making it into something that people don't want to opt out of. Take Google now for instance. It's delivering me info only I am interested in seeing. It may all be worthless or even considered spam to another user - but it's special to me. That's where I see this going. Users have warmed up to retargeting over the users and they know it happening. It'll just get smarter and more personalized.

Eric I agree if the data is being used to improve the user experience the users will adopt it. For now no one is doing a great job with this not even the big G. Its why I have two browsers open on my desktop. One is logged to he G and the other is not and all tracking is disabled..

Paul, I deeply appreciate your article last week and your continued involvement in this issue. I saw your article as being more about the use of data to know what to purchase or continue to purchase. I’ll add to that post regarding that issue. With respect to how data will impact showroom operations, let’s not throw the baby out with the bathwater. 1. Some shoppers are opting out, not all, not even most. 2. Some shoppers are taking a dim view of this practice, which is one of the benefits our industry has as a follower. If the cultural shift turns increasingly negative or accepting of the practice within big-box retailers, we will know before dealers invest. 3. We do need to use the data we have now, and that requires systems that make things simpler and easier. I think we all agree paralysis by analysis is a bad thing. Automated analytic tools that get you the information you need when you need it without even requesting is the future. It’s tempting to try to identify a handful of data points dealers should care about. No one has time to deal with the mountain of data dealers already have at their disposal. However, the dealer taking this approach will be at a competitive disadvantage to those who employ systems sifting through the data with little or no human involvement to produce better information when the salesperson or decision maker needs it. Data is but a means to better information. Better information relative to selling vehicles with time left to focus on the practice of selling those vehicles is what we need. We cannot get the focus on selling if we try to analyze everything, and we cannot get the rich information we need by simply discarding most of the data. We need automated systems that will turn the increasing amount of incoming data into increasingly valuable information. There is almost certainly more agreement here than first meets the eye. I think progressive guys like you will be leading the effort to get dealers there.

A specific answer to the question about using big data to sell more cars is being provided by my partners at eShare, Sean Marra and Eric Miret. They have leveraged data aggregation into a GUARANTEED!!! way for dealers to sell more cars. The company has plays on big data in other sectors, but the automotive offering is the headliner. These guys are doing really BIG things with big data. (learn more here www.ePush.us/#automotive) Also, to the point about auto retail not being a place of early adoption for big data, you all are the data. In order for big data to have massive effect on industry, their must be large multiples of transactions. Big data has no finer home for optimization and study about how to make it of best use than right here in automotive. Few industries are able to generate the type of data created by automotive retail. The sheer size of each transaction is a distinctive factor - and, the growth potential for 20 Million plus transactions by the end of the decade means every one from IBM to the White House (including Google) has their 'Glass' on us.