In this enlightening episode of "DrivingSales Defining Leadership," hosts Bart Wilson and J.D. Mixon engage in a profound conversation with Derrick Woolfson, the Vice President of Business Development with unparalleled expertise in revolutionizing the automotive and heavy-duty trucking sectors. Derrick shares his unique path from a fresh college graduate to becoming an instrumental figure in leveraging technology and customer relationships to drive growth and efficiency in an industry ripe with potential yet facing technological lag.

The discussion uncovers Derrick's strategic approach toward customer relationship management, the critical role of establishing a BDC, and the evolution of digital advertising strategies in maintaining a competitive edge. The trio delves into the necessity of building a strong corporate culture, emphasizing employee retention and development to navigate the challenges of a tight job market and the technician shortage. Derrick's insights into the significance of partnership over mere vendor relationships offer a fresh perspective on tackling industry-specific hurdles and fostering innovation.

Moreover, Derrick's narrative highlights the importance of mentorship and a growth mindset in achieving professional milestones, along with the value of listening, adapting, and executing strategies that resonate with employees and customers. This episode offers actionable strategies for automotive leadership and inspires a proactive stance on future trends, digital transformation, and the power of a united team vision.

Dive into the heart of digital innovation and consumer protection with this compelling episode of DrivingSales Insights, featuring the insightful Angelica Jeffreys from Equifax. As we navigate through the challenges and opportunities presented by online retailing, Angelica brings to light the critical issue of rising consumer fraud. She discusses the subtleties of in-person versus synthetic fraud, offering a clear view into the tactics used by modern criminals and the sophisticated strategies businesses can employ to counteract them.

But it’s not just about defense. This episode goes further, exploring how AI and Big Data are revolutionizing the way we engage with customers, offering personalized experiences that were once thought impossible. Angelica provides fascinating insights into Equifax's role in enriching dealer data, ensuring cleaner, more effective customer databases for a sharper marketing edge and improved sales tactics.

The current state of consumer fraud.

Yeah, you know, it's very interesting. One of my coworkers was a victim of fraud just this weekend, where a consumer stole her identity and walked into a dealership in the Atlanta area to buy a car. Everything was very suspect because it was a buy here, pay here dealer and my coworker has an exceptional super prime credit score. So the dealer got a little suspicious and called her and they arrested the woman on the spot. 

But in-person fraud is nothing new. That has been going on, somebody stealing a consumer's identity to go try to acquire, whether it's a car or an iPad or however, they're attempting to commit fraud. Where we're seeing increases in an incremental way that we haven't seen in the past is in the online shopping world. Of course, there are so many new platforms and capabilities to be able to transact online and the thieves are getting much, much more sophisticated. 

There are a lot of crime rings out there that are targeting the ability to transact online, in particular, with synthetic fraud. Synthetic is a very patient fraud. It takes some time to really build up the persona, which is pieces of different identity elements from different real people and deceased people, wherever it is they gather it together. It's very hard to detect. Although the three bureaus, Equifax, Experian, and TU, we all have solutions that can help prevent and identify when that's happening. In the next ten years, we anticipate fraud in automotive to be a $10 billion problem. And so we have a lot of our partners coming to us asking for whether it's first party, third party, synthetic, comprehensive solutions to try to waterfall into creating solutions that can address all of those types of fraud.

How do we protect ourselves and make online retailing easy for consumers?

We're all consumers, and I think we expect and almost appreciate a certain level of friction at a certain point. If you're just logging in and shopping for a car, you're not you're not expecting to be asked for certain forms of identity.

But as you're moving through the process and you're getting a little more serious and you want to get pre-qualified, for example, as part of that shopping process, you expect you're probably going to have to give some PII or the last four of a social or have your device at minimum authenticated. There are some pretty frictionless ways to do that.

And then again, as you're proceeding through that transaction and now you're saying, hey, I really do want to purchase this car, I think you're expecting a little bit more. You're going to have to provide your driver's license and expect that you're going to scan it with your phone. And there's probably going to be some level of detection to make sure that what you've provided is not a picture of a picture of when taking a picture or your cell phone that you need to upload.

So the trick there is and what our partners are looking to us to help them solve is to help us with the right solution at the right point in time, so as the consumer progresses, the expected friction that makes them feel secure and makes them feel like it's a trusted experience. It's not too soon and it's not too burdensome on them, too soon in the process.

AI and Big Data

AI is something that I think if we look at the glass half full, there's so much opportunity.

I'll give you an example of how we can help enable AI. In a lot of our non-regulated data, which is modeled data against what we call our IXI database, we acquired a business 15 years ago that essentially is a consortium of the nation's investable assets, we manage that database is about 50% of the of the investment accounts in the country.

Because of that, we know better in an aggregated way what's in people's wallets. We can understand what kind of discretionary spending you have. We know what your ability is to pay in an anonymized and aggregated way. And so when you take that data and you apply it to the many ways that you can use AI to create a custom and personalized experience for a consumer, you're layering in insights that can help inform. When you know this type of consumer comes into a funnel, AI's going to know, okay, well, they're an economic cohort 72, and they're likely to want to engage in conversation about the, the economic, the like the gas mileage, things that that our data will tell them about the consumer in addition to what they can afford. It's a much richer experience for the consumers to have the data in that API process if you will. So a lot of the conversational AI either Stella of course, who's out there, and some of these other businesses that are doing a wonderful job in using it to improve the consumer experience could make that process a lot more personalized by using data like we have with IXI. And that type of application is what we're exploring.

What is the current state of CDPs?

I think there are a couple of topics in that question because big data means a lot of things. And you're right, it's a very exciting time right now with the way that companies are able to activate the data. But I think you have to start with clean data. And dirty data is a problem right now. There are some of the capabilities of some of the DMS providers and the CRM providers that are going to need to advance so that the data that is being pushed into these CDPs has been corrected, normalized, keyed, and linked so that it is at the right level of cleanliness and accuracy to be acted upon. There are a lot of partnerships and providers that really need to come together to help create that foundation of clean data. And so dealers really need to try to figure out, okay, who am I going to partner with to help with that?

And so finding a partner who is familiar with how to correct and normalize and key and link the data is going to be key. The second piece to that on the activation side is I think the industry really has to come together to determine, okay, what role does the CDP play, what role does the agency play and what role do the data providers play? There's probably more that I can throw into that conversation, but really in trying to activate in the most efficient way. 

Agencies play a big role in this too, And most agencies that you have out there today are much more accustomed to a traditional advertising model. They have to kind of morph a little bit to become consultants if they're really going to support their dealer body or their OEM customers. You've got OEMs in this conversation, too. So the agency is really taking on a more consultative role to make sure that the campaigns that are being pushed out by some of these CDPs fall in line with the strategy and also are efficient in the overall deployment of the agency strategy on behalf of the OEM, of the dealer, and the data providers also to help enhance the data.

There's this conversation about first-party data and how to activate that data. And the thing to remember, even once you've cleansed the data and keyed and linked it in this piece, most dealers have a fraction of the PII or the data about the consumer. I'm going to give you my name and address. But what else do you know about me that can be used for marketing? So insightful third-party data that can be pulled into these clips can help enhance these consumer records and fill in the gaps. I mean, people move, people change their phone numbers, people have multiple email addresses, and so bringing in a source of truth that can help fill in all those gaps and then layering in third-party data that provides insights about that consumer that can help with personalization, which is what consumers expect today.

To wrap that all up, this is really to your point, your question. We're now finally at the precipice, which is what has always been the promise of digital. We've dreamed of this moment and here it is. It's really an exciting time to see this come to fruition.

How does Equifax use dealer data?

That's a great question. So Equifax does not ingest data. What we do is we work through our vendors and our third-party providers to append to the dealer's data. For example, we will get or we will give a file of the entire universe to a CDP provider who can then ingest it and use it to append to a dealer's first-party data. We do have data cleansing, banking, and linking capabilities that we will take the file in then normalize it and send it back from that perspective. We don't house any of that data. We don't keep any of that data. It is simply a file transfer keying and linking, then a cleansing process, and then it comes back.

And, of course, we're a credit bureau. We house PII on hundreds of millions of consumers and it is of the utmost importance to us to protect consumer data no matter what. It would be against every DNA cell in our makeup to do anything other than whatever we're tasked to do with that data.

What will the role of CRM be? 

Yeah, I think they play a key role in being a source of data for the CDP, and some of the CRM companies, as I understand it, are looking to become CDPs themselves or create a mechanism where they're consistently purging the data back and forth so that as the data goes out to be cleansed and linked and append a unique key is assigned to it, and it comes back in as a sort of refreshed version of that data.

They're either going to be output only or they're going to create a mechanism to have the input, cleansed, keyed, and linked household data corrected within their system. Many of them have already started down that path. Some of them have not. I think if they're going to stay relevant, they're going to have to create a mechanism to have that bi-directional correction and data coming back so that it is normalized, keyed linked, and standardized with the most recent information about that consumer.

Pent-up consumer demand

For the market analysis piece, we rely pretty much on our partners in the marketplace. We work with Cox Automotive, we work with J.D. Power for those types of trends. As I understand it, there is a good pool of consumers waiting, and I think the last number I saw was 1.8 million, of what they're calling pent-up demand. Those consumers are sitting on the sidelines waiting for pricing to come down, and interest rates to come down. And so the people that are in the market are people who aren't that price sensitive and or paying cash and or leasing. But there is a subsection of the market that is just kind of sitting on the sidelines waiting for market dynamics to shift.

You are seeing in certain pockets in the subprime consumer that really, really needs a car and very much struggling with affordability. You're starting to see strain within lender portfolios of those payments going delinquent and derogatory. But as I mentioned, we have credit trends and there's another person on my staff who really speaks to that part of how loans are performing and what that might predict for near-term and longer-term sales in the marketplace.

There is a good amount of pent-up demand, and it remains to be seen when that pendulum shifts and that group of people comes back out to the marketplace to buy.

Where will this be in three years?

So I believe that we are entering an era of efficiency and personalization for our consumers that if we embrace it we've only ever dreamed about in the past. To me, it's very, very exciting. I mean, we all know the biggest complaint from consumers is how one system doesn't talk to the other and how I started something online and I ended up in the showroom. It was completely different and it took me 3 hours, you know, to transact. That's all going to be gone in three years. I'm confident of that. It won't be a year. It won't be two years. I'm pretty comfortable saying that in three years we should be at a place where the ability to transact online and the ability to pick up that car in a showroom will be integrated in a way that makes it a much better experience for consumers. I'm very excited about that.

Targeted marketing is going to change

I think you're 100% right about that. The ability to understand exactly what the consumer has in their garage, what they can swing, when is the right time, what's important to them, and how quickly they can get from step A to step Z is really going to change significantly and to your point, AI is going to be a big part of that.

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We recently chatted with Gary Graves, CEO of TotalCX, about the current state of call management and how he sees the future.

How has AI impacted the Call Management category?

AI, when used responsibly, will take data context, whether it's historical or in the moment, and provide insights that would be cost-prohibitive for a company to employ people to do. So if you take like the mundane process of crunching a lot of information to determine whether the outcome of an event happened or not, now that's a good way to depict how a lot of companies are using AI and how we're using AI today.

There are also companies that are using A.I. to provide a pass-through service such as chatbots and even phone engagement through artificial intelligence. And that has been necessitated by a lack of proper process for handling consumer inquiries.

We've all bought a car. And, you know, that process can be extremely cumbersomel. Even when it gets to the service side, it's always hard to get someone on the phone. It's usually a broken process that creates that.

That broken process creates an opportunity for A.I. to create a handling system for people to be serviced by a machine immediately versus waiting on hold and having a poor experience to talk to a human.

How can AI enable proactive call monitoring?

I'm not sure how many providers are doing that, but we've been doing that for quite some time. I think that a lot of them are doing it on the on the post-call side, which is good because what was being done prior was sending dealers conversations and recorded calls over to third-world countries where they could have low-cost labor to provide a price point that the dealer could stomach. They're at a great price point and I expect there to be a lot of derivative products that come down the line as a lot of these companies start to take ownership of their own AI journey.

You'd be surprised at how many companies in our space are now using, you know, ChatGPT or some derivative of Openai's or another platform that's very similar service versus investing in the talent and infrastructure, and they kind of take ownership of that model. And when you first see that is when these companies have a white outage. And if ten companies in automotive that are having issues with their servers at that time, you'll know they are.

How is TotalCX building their AI?

Well, I mean, I mean, let's face it, you know, the funding that OpenAI had to build is ridiculous. We can't we can't even begin to compete. But at the same time, there are a lot of open-source starting points. I'm going to give away some trade secrets here, so this is an exclusive for you guys. One of the things that we do is we take a hybrid approach. Instead of using these models to serve our customers or to serve our business processes directly, we use them to generate additional data that we train on. We train our own models on the data generated by these commercial models in addition to the data that we have from our own operations.

So we kind of have the best of both worlds. We have the organic, grassroots data that's indicative of the way our customers operate. And we also have the shiny new object version of it with all the bells and whistles that enriches the data. So we kind of take a hybrid approach.

Are customers comfortable communicating with AI?

If they can get what they need in a matter of minutes 3 minutes with the machine versus 9 minutes or 12 minutes or three callbacks with the human, obviously they're going to be better served by the machine. Ultimately, the best experience, though, is that when they call, they speak to someone who can help them immediately.

And that's good for all parties because now the relationship like a machine will not or the chatbot or voice bot will not perpetuate a relationship. It will facilitate the delivery of a service or establishment of an appointment and things like that. But in terms of brand building, driving customers toward loyalty building, that is something that always will have to have a human touch. And there's never going to be someone to refer to. No one says, "Yeah, you should call my machine. Over here at ABC Motors, They get my oil changed much quicker and lower cost."

What are the shortcomings of AI communication today?

Consider a scenario where someone is calling in on a recall on their vehicle and they're in the third year of the finance on that vehicle. When they're calling in because of that recall there's a chance that they're coming up their three years and they may want to transition to a new vehicle. So they may ask the question or that may be a conversation that leads to the discussion of that potential opportunity in a subsequent transfer to sales. I can't see that happening in a known AI service, you know, voice bot scenario.

What are common issues dealers have with their phone processes?

So there are a couple of different categories. So the first one is a process issue, and the process issue is typically one where they call in, they get placed on hold. They're on hold for a while and then they hang up, they call back and they ask again and then they get transferred to voicemail. They just never end up getting routed to the proper place. So that typically is a process issue in terms of how those calls are handled.

The other thing is customers having to exert an undue amount of effor to be a customer at a dealership. There are even conversations where the customer reminds the the person they're talking to, Hey, I'm the customer here and I have to call back three times in order to speak to the service manager because my car is supposed to be ready two days ago." You hear these types of conversations a lot.

So the majority of it is a lack of responsiveness, which is typically associated with a process issue of how their phone menu is set up. You press one to get here, you press three to get there. So they call back again and you hear or you have calls where the customer will state. I called back three times. I've been on hold for 12 minutes.

When you have a customer telling you about their experience in a way that's not positive, not only are they telling you, but they're also going to express their discontent when it comes to referrals or the next time they buy a car, like I'm just never going there again, or they may just take their service business elsewhere, which will also mean when the time comes to roll that vehicle, they're not going to roll it at that dealership.

How has COVID impacted dealership phone processes?

There's a friend of mine has a saying. He's an industry veteran and he says that good habits are developed in bad times and bad habits are developed in good times. So the inventory shortage, chip shortage, and everything that happened post-COVID and during the market adjustment and all the record-breaking profit that the automotive retailers experience, I mean, I think that could be called a good time.

You know, so a lot of bad habits were cultivated because they didn't have to have a lot of effort. People were buying cars sight unseen especially trucks, because there was just a tremendous shortage. Now we have dealership groups that are calling us now that the feeding frenzy is over and they're trying to improve their customer experience because they're having a large number of disgruntled customers all associated with the level of service they receive and responsiveness to service concerns.

How vendors can help with phone processes

I think there are vendors in the space that are, looking to help a lot of it. This isn't a new problem. This cycle, it happened during Cash for Clunkers and any other type of market event that changed the dynamic of supply and demand.

So we're here again. And I think that it's up to us vendors who are in the sales cycle for our car dealership customers to innovate and help them toe the line on their processes and tighten them up. And I think, you know, now dealers are becoming more receptive to it.

How does TotalCX approach phone training?

We approach it internally first and foremost because we have to eat our own dog food. That's why we changed our name. And now we've created a Chief Experience Officer position and all of our customer success people became Experienced Managers because if we want to teach something, then we also have to live with those same values.

So in terms of phone training, the first thing to do is to have a baseline. You have to understand what you're dealing with because not every dealership has the same issues or the same problems. So establishing a baseline and analyzing calls by department for a week or so will give you a good baseline to understand, you know, what's happening with that dealership.

You don't want to put a Band-Aid on it or some Novocaine or just smooth the issue over. You want to get down to causality. What is the root cause of this issue and what can be done to address it? This is sometimes it's as much as a cultural issue that stems from the top-down management style in automotive that's been pervasive for years, where the GM is driving down to the sales manager, this is your number. You hit this number. You'll make this number or find a new job. That translates down to the salespeople who have the same mindset. If it doesn't seem to be a promising opportunity or profitable deal I'm not going to give it a lot of attention. That means that the value of each customer is now being read by the salespeople.

This is all stuff that you can see and measure based on, you know, the conversations and the outcomes from these types of transactions. But we really have to understand the root cause. So we always start with root cause analysis and then, you know, create a custom approach to helping that dealership group, you know, solve their issues.

The importance of phone analytics

I think that there are more numbers than just op line and gross profit that matter and also indicate health and growth. If you think about it in any car dealership, most of them have a six-figure per rooftop marketing budget, or something even more than that.

So they spend all this money to create all this opportunity. And how much money and effort do they spend to ensure that they're handling that attention, that traffic that they paid for to produce the outcome that they're actually trying to get? So they're paying attention to spend over here, and the outcome over here in terms of the balance sheet.

But all the things that happen in between, that's where the CRM companies and companies like us come in to try to help give additional context and perspective of what's happening between those two milestones.

What are successful dealers doing today?

They're they're a little more progressive. So we also use Google Analytics inside of our platform to understand, you know, user adoption, how our dealers use our platform so we can see what areas they leverage, what areas they don't, and in what frequency to help us create a better platform and also to give our Experience Managers some context and to help advocate for better usage.

But the people who are the raving, die-hard fans are the people who use the platform in totality. And one of the downsides of our platform is that it's powerful. We have the richest analytical offering in automotive hands down. And the problem for that is that there isn't necessarily a person or a job position in a dealership that has trans-departmental powers to fully leverage the platform.

You have all these different stakeholders who may or may not work together productively like they're supposed to inside a dealership. So the dealership groups that have the most invested into our platform are the people who have empowered someone to go across sales, finance, and service and parts to make sure that all of these departments are, meeting the same bar of customer service and customer experience.

How should dealers use an outsourced BDC?

I don't think it's a long-term solution because I think that at the end of the day, you want the dealership to own the relationship. Our outsourced BDC is a domestic product, meaning all of the agents are American citizens working here, typically in a contiguous 48, and they all handle typically like overflow while a dealer has a moment to take a breath and try to design a better process or a better outcome.

It may be because they're buying stores hand over fist because there are a lot of transitions in the marketplace right now. And so as they're onboarding all of these dealerships, there tends to be processes that are broken in this new acquisition. And the best way to fix it temporarily is to just outsource it to ABC.

And then we'll kind of walk that back as we help them establish and stand up the proper processes to support it themselves. So think of it kind of like roadside assistance, if you will, for overflow phone calls for dealership service and sales.

AI is going to change everything

Yeah, I tell you, A.I. is going to change everything. It's going to change the world. Specifically to our market, The things that we've been doing since our initial partnership with Google back in 2017, when we brought live transcription like transcribing a call as is happening with keyword alerts. For example, if somebody says the safe words "pepperoni pizza", t somebody gets a text message. Like so we've been doing that for a long time.

And we had, you know, we had a technology advantage over our competitors because they just couldn't seem to get there. But now just like like that, you know, they're there, but not because of their own innovation. It's because the climate has totally changed, which is awesome, because now that applies pressure to everyone in the marketplace to continue to innovate in order to differentiate and disrupt and stay relevant.

And for us, like that's that's that's the kind of pressure, you know, we respond to. So it's gonna be pretty fun.

Several trends are impacting dealers’ end-of-year inventory. New model year inventory is arriving, old model year inventory is discounted, and inventories are rebounding. These factors can work in your favor - if you avoid the freeze. It’s time to make room and move aging inventory. Leverage machine learning and AI to move your inventory faster.

In this webinar we were joined by Suzanne Reimer, the Chief Marketing Officer for Lotlinx. She dove into these trends and how they will affect your dealership’s profitability. She gave insights on how, with VIN-specific solutions driven by AI, you can implement at your dealership to move your inventory faster this winter. 

We discuss the results of our inventor polls:

Do you know all there is to know on your inventory to move it as fast as possible?

YES: 28%

NO: 71%

Where are you using AI in your dealership?

Inventory Search and Recomendations: 23% 

Consumer Demand: 7%

Digital Advertising: 46%

Customer Experience & Engagement: 15%

Sales Process: 7%

Takeaways: 

• Learn how to embrace AI
• Learn how your dealership’s profitability will be impacted by these trends
• Formulate a solution by leveraging VIN-specific strategies to move your inventory

Listen to learn about these trends that are impacting end-of-year inventory and what VIN-specific solutions you can implement in your dealership.

In this webinar, we dive into the success story of J. Bertolet Volkswagen, a family-owned dealership adapting to the digital age. Discover how they built a connected online to in-store experience customized to their ‘hands-off’ selling process.

Learn how their lead-to-sale rate soared to 4X the national average, and how they grew profit over 400 percent.

In our recent conversation, Brent Towne of Cox Automotive talks about the efficiencies that can be realized when AI is built into your dealership software. AI efficiencies have experienced remarkable advancements in recent years, and machine learning algorithms, such as deep learning, have been instrumental in enhancing AI capabilities. This has led to more accurate and faster decision-making processes. With the availability of massive datasets and powerful computing resources, AI systems can now be trained to perform complex tasks that were once thought to be exclusive to human intelligence. As AI continues to mature, it is streamlining operations, optimizing resource allocation, and automating mundane tasks, which results in increased productivity and cost savings for your dealership.

I'm constantly asked by sales associates for one great way to better engage with their customers. I seem to always go back to open-ended questions as the solution. If you can get your customer to open up, it will make every aspect of the transaction better. Most importantly, you will be better prepared to help the customer find their perfect vehicle. So what's the difference between open and closed-ended questions?

The primary difference between open-ended and closed-ended questions lies in the type and depth of responses they elicit. Closed-ended questions are designed to produce specific, typically short, answers such as "yes" or "no," "true" or "false," or a choice among a limited set of pre-determined options. For example, "Do you like this car?" is a closed-ended question because the answer can be a simple "yes" or "no."

On the contrary, open-ended questions are crafted to invite a more extensive, descriptive answer, encouraging conversation and enabling deeper understanding. These questions often start with "why," "how," "what," "describe," or "tell me about..." They create room for the respondent to express their thoughts, feelings, and ideas more fully.

For instance, if a sales team member is facing objections to a sale, asking open-ended questions can help uncover the root of the client's hesitation and guide the conversation towards resolution. More importantly, it helps the customer see that you care what's best for them and not just about getting the sale. Here are some examples:

1. "Can you tell me more about what you're looking for in a vehicle?" This invites the customer to share their specific needs and preferences, which the salesperson can then address.
2. "What factors are most important to you when choosing a car?" Understanding the customer's priorities can help the salesperson emphasize relevant features of the vehicle.
3. "How do you feel about the financing options we've discussed?" This can bring out concerns about affordability or value, which the salesperson can then help alleviate.
4. "Could you describe your ideal car-buying experience?" This may reveal issues with the sales process itself, enabling improvements in service.
5. "Why do you think this might not be the right car for you?" A direct approach can sometimes be best, giving the customer an open invitation to express their concerns.

Sales associates significantly boost their customer engagement by utilizing open-ended questions. These questions encourage customers to offer in-depth insights, helping salespeople cater more effectively to the customers' specific needs and preferences. Open-ended questions promote rich conversations, resolve objections, and underscore the salesperson's genuine interest in the customer's well-being. In essence, open-ended questioning is a powerful tool that fosters a more successful, customer-centric sales environment and aids in matching the customer with their perfect vehicle.

If you would like more help, feel free to reach out to me anytime.

In today's competitive landscape, dealerships are recognizing the significant role employee engagement plays in driving overall profitability. Let’s explore the direct and indirect impacts of employee engagement on financial performance and highlight the strategies you can adopt to enhance engagement

According to Gallup’s State of the American Workplace study, highly engaged business units resulted in 21% greater profitability. Why is employee engagement so important?

First, employee engagement fosters a sense of commitment and motivation, leading to increased productivity and performance. Employees are” invested” in their careers and the success of the dealership. They are more likely to put in extra effort, going above and beyond their job requirements. They are driven by a sense of purpose, aligning their goals with those of the organization. Studies have consistently shown that engaged employees outperform their disengaged counterparts in key performance metrics, resulting in improved operational efficiency and effectiveness.

Next, a highly engaged workforce is more likely to stay loyal to a dealership, reducing turnover rates and associated costs. Engaged employees are emotionally invested in the success of the organization, which translates into higher levels of job satisfaction and commitment. They are less prone to seek alternative employment opportunities. Moreover, lower turnover ensures that valuable knowledge and expertise are retained within the dealership, facilitating efficiency and having a positive impact on profitability.

In addition, employee engagement also influences customer satisfaction and customer loyalty. Engaged employees who feel valued and supported are more likely to deliver a better overall customer service experience. They exhibit higher levels of empathy, problem-solving abilities, and dedication, which translates into enhanced customer interactions. Satisfied customers are more likely to become loyal, leading to increased repeat sales and service business and referrals. This, in turn, generates higher revenues and contributes to overall profitability.

Engaged employees are more likely to contribute and participate process improvement. They feel empowered to voice their opinions, share insights, and collaborate with their peers. Such an environment fosters creativity, problem-solving, and a culture of innovation. They are more “agile”, and can better adapt to change. They embrace new technologies and processes, leading to operational efficiencies and competitive advantages.

Engaged employees also tend to have lower absenteeism rates and are more punctual. They often exhibit higher safety consciousness, reducing workplace accidents and associated expenses.

Employee engagement is a critical factor that significantly influences a dealership’s profitability. From increased productivity and performance to reduced turnover costs and improved customer satisfaction, the impact of engagement extends across various dimensions. By prioritizing employee engagement and implementing strategies to foster a positive work environment, organizations can unlock the full potential of their workforce and drive sustainable profitability.

Coaching plays a crucial role in enhancing the performance of your employees. However, to effectively coach your team, it is essential to identify and address the specific gaps in their skills and knowledge. In this article, we will explore six key strategies that can help managers identify coaching gaps in employees, enabling them to provide targeted and impactful coaching for improved sales performance. These strategies can be used with any customer-facing employee, including salespeople, service advisors, BDC agents, etc.

1. Assessing Metrics: One of the first steps in identifying coaching gaps is to analyze performance metrics. I’ve always said that if you want me to be successful, you need to show me what success looks like. Analyze individual performance data, such as appointments, CSI, and closing ratios. Identify patterns or inconsistencies in their performance compared to the dealership's benchmarks. A significant deviation from the expected performance may indicate areas where coaching is needed.

2. Conducting Skills Assessments: Carry out skills assessments to evaluate your employee’s abilities in various areas. This can involve role-playing scenarios or interactions with customers to assess their communication, objection handling, soft skills, and product knowledge. You can spot-check email communication, read chat transcripts, and listen to phone call recordings. By observing their performance, you can identify specific weaknesses or gaps that need to be addressed through coaching.

3. Soliciting Self-Assessment: One of the advantages of conducting a scorecard review with your employees is the opportunity to solicit their feedback. Encourage employees to participate in identifying their own coaching gaps. Provide them with an open forum to share their strengths and weaknesses. Employees need to participate in their development. This self-reflection can help team members recognize areas where they feel less confident or lack the necessary skills. Their self-assessments can guide coaching conversations and enable a more targeted approach to addressing individual needs. It also builds rapport between management and employees.

4. Analyzing Training Effectiveness: Evaluate the effectiveness of the existing training programs provided to your employees. Said another way, is your training working? Assess whether the training adequately covers the necessary skills and knowledge required in the dealership. Don’t forget the products your team uses. Product knowledge includes the products you sell and service as well as the software and tools you use. Gather feedback from employees on their training experiences and identify any gaps in their training that may hinder their performance. By understanding the limitations of current training programs, you can focus coaching efforts on areas where additional support is needed.

Identifying coaching gaps in an employee is crucial for enhancing their performance and overall results. By using a combination of metrics analysis, skills assessments, observation, self-assessment, and training evaluation, dealership managers can tailor their coaching efforts to address specific gaps and empower their teams to excel.