Ed, this is a great observation. In the best of all worlds, consumers wouldn't turn to TrueCar to purchase a car. TrueCar cleaned up its advertising some time ago so the real gripe from (some) dealers is the cost. When we, as dealers, reach the level of trust that TrueCar has with consumers, we will bypass them in direct contacts and not pay the middleman's price. We are getting there but the complainers are usually the worst offenders and the slowpokes holding back the industry in consumer's minds.

Tom – "When we, as dealers, reach the level of trust that TrueCar has with consumers, we will bypass them..." I understand that is the wish for many dealers, but I ask you; is that an obtainable goal? You can't SEO your way into credibility. You can't PPC your way into trustworthiness. And most dealerships aren't even starting from level ground, they are starting in a hole that was dug over decades. From my perspective, TrueCar isn't selling leads, they are lending – no, leasing – their credibility to dealers. For that subset of customers that doesn't want to negotiate, the credibility and validity of the price is much more important than obtaining the lowest possible price. Building trust is a really difficult thing and doubly so when you are only selling to the customer every 3 or 4 years. Some dealers can do it. For many, perhaps most, it is a bit of a pipe dream.

First we have to acknowledge a few realities: 1) People will follow the path of least resistance 2) Managers will work their pay plans (bonuses for volume) 3) The majority of dealers will look for the easiest and most cost effective solution to address a problem a. Most often they treat the symptom and do not work to provide the cure to the problem In the case of TrueCar, dealers want "leads." Here are the dealers' options: 1) A dealer can spend more money to hire and properly train the right people, provide a great work environment to retain those folks, and then make them accountable for providing a great customer experience. a. This takes time, money, and a commitment to improve the business culture. b. While initially this may not be the most cost effective avenue to take; in the long run it will pay big dividends and save $50k annually in employee turn over costs 2) Or they can buy leads from TrueCar for $299 to $399 each. Which path did 9,000 auto dealers take?

Mark - I don't think of TrueCar being in the "Lead selling" business, I think of them as being in the "Price Validation" business. Most (not all) car dealers don't have enough credibility on price to appeal to the "no negotiation" customer.

Ed - Doesn't matter what you or i think. If you ask a dealer why they sign up with TrueCar, they will tell you its for the leads. They want more buyers in the door. Yes, the "hook" for the consumer is a "price on the car" and that's what generates the lead for the dealer. TrueCar makes no profit by providing a price validation. They make money when consumers purchase. Auto dealer advertising and marketing all focuses on price so they have effectively taught every consumer to focus primarily on price. Auto dealers have been very successful in training their customers to ask about price first. When they change their advertising the conversation will change.

Mark -I don't think most TrueCar shoppers are focused on getting the absolute best, "rock bottom", price. They want an easier, negotiation free, experience. For them, that is the primary goal. In order to have that negotiation free experience, they need a price that they can have faith in - and that is where TrueCar comes in.But you are 100% correct - dealers want more buyers thru the door.

Great stuff Ed, Mark, and Tom. Please allow me to throw my slant into the mix. I have nothing against TrueCar per say, but Cost per Action models generally have attribution problems. I think that is what will eventually shut this model down. The cost is not $299 per sale or $399 per used vehicle sold. It is $299 or $399 per vehicle touched. It does not matter how much or how little TrueCar contributed to the sale of the vehicle, if TrueCar touched the customer and the vehicle sells for any reason the dealer is going to pay. When the numerator is all the money paid to TrueCar, and the denominator is the cars sold that would not have sold without TrueCar, only then does the dealer know their true cost per sale. It can be astronomical. Before one even gets to the gross margin or the cultural clash, the true cost per sale is a huge hurdle to get over. And I'm going to agree with all of you before you even say it; it is impossible to believe those 9,000 dealers are all doing the math.

Dennis - I could be wrong but I don't think it's "per customer touched", rather it's only if a Price Certificate is delivered to this customer. Maybe more importantly it would be wrong to think the total advertising cost for this sale is only the $299 TrueCar cost - a dealer's ongoing branding efforts will come into a play, inflating the cost for this sale.

Ed, this is a great observation. In the best of all worlds, consumers wouldn't turn to TrueCar to purchase a car. TrueCar cleaned up its advertising some time ago so the real gripe from (some) dealers is the cost. When we, as dealers, reach the level of trust that TrueCar has with consumers, we will bypass them in direct contacts and not pay the middleman's price. We are getting there but the complainers are usually the worst offenders and the slowpokes holding back the industry in consumer's minds.

Tom – "When we, as dealers, reach the level of trust that TrueCar has with consumers, we will bypass them..." I understand that is the wish for many dealers, but I ask you; is that an obtainable goal? You can't SEO your way into credibility. You can't PPC your way into trustworthiness. And most dealerships aren't even starting from level ground, they are starting in a hole that was dug over decades. From my perspective, TrueCar isn't selling leads, they are lending – no, leasing – their credibility to dealers. For that subset of customers that doesn't want to negotiate, the credibility and validity of the price is much more important than obtaining the lowest possible price. Building trust is a really difficult thing and doubly so when you are only selling to the customer every 3 or 4 years. Some dealers can do it. For many, perhaps most, it is a bit of a pipe dream.

First we have to acknowledge a few realities: 1) People will follow the path of least resistance 2) Managers will work their pay plans (bonuses for volume) 3) The majority of dealers will look for the easiest and most cost effective solution to address a problem a. Most often they treat the symptom and do not work to provide the cure to the problem In the case of TrueCar, dealers want "leads." Here are the dealers' options: 1) A dealer can spend more money to hire and properly train the right people, provide a great work environment to retain those folks, and then make them accountable for providing a great customer experience. a. This takes time, money, and a commitment to improve the business culture. b. While initially this may not be the most cost effective avenue to take; in the long run it will pay big dividends and save $50k annually in employee turn over costs 2) Or they can buy leads from TrueCar for $299 to $399 each. Which path did 9,000 auto dealers take?

Mark - I don't think of TrueCar being in the "Lead selling" business, I think of them as being in the "Price Validation" business. Most (not all) car dealers don't have enough credibility on price to appeal to the "no negotiation" customer.

Ed - Doesn't matter what you or i think. If you ask a dealer why they sign up with TrueCar, they will tell you its for the leads. They want more buyers in the door. Yes, the "hook" for the consumer is a "price on the car" and that's what generates the lead for the dealer. TrueCar makes no profit by providing a price validation. They make money when consumers purchase. Auto dealer advertising and marketing all focuses on price so they have effectively taught every consumer to focus primarily on price. Auto dealers have been very successful in training their customers to ask about price first. When they change their advertising the conversation will change.

Mark -I don't think most TrueCar shoppers are focused on getting the absolute best, "rock bottom", price. They want an easier, negotiation free, experience. For them, that is the primary goal. In order to have that negotiation free experience, they need a price that they can have faith in - and that is where TrueCar comes in.But you are 100% correct - dealers want more buyers thru the door.

Great stuff Ed, Mark, and Tom. Please allow me to throw my slant into the mix. I have nothing against TrueCar per say, but Cost per Action models generally have attribution problems. I think that is what will eventually shut this model down. The cost is not $299 per sale or $399 per used vehicle sold. It is $299 or $399 per vehicle touched. It does not matter how much or how little TrueCar contributed to the sale of the vehicle, if TrueCar touched the customer and the vehicle sells for any reason the dealer is going to pay. When the numerator is all the money paid to TrueCar, and the denominator is the cars sold that would not have sold without TrueCar, only then does the dealer know their true cost per sale. It can be astronomical. Before one even gets to the gross margin or the cultural clash, the true cost per sale is a huge hurdle to get over. And I'm going to agree with all of you before you even say it; it is impossible to believe those 9,000 dealers are all doing the math.

Dennis - I could be wrong but I don't think it's "per customer touched", rather it's only if a Price Certificate is delivered to this customer. Maybe more importantly it would be wrong to think the total advertising cost for this sale is only the $299 TrueCar cost - a dealer's ongoing branding efforts will come into a play, inflating the cost for this sale.

I know a great article when I see one!

Only Ed would make this reference. But great post nonetheless! :-)

I referenced a VERY famous quote from court history ;-) Thank you very much!

Why is a name and an email or phone number too much to ask? If you'd like a price I can certainly provide it for you with your fake name, fake phone number and dummy pricing email account. That's definitely transparent.

Imagine selling your house and refusing to divulge an asking price unless you got all their contact info.

I'm not saying don't provide a price. Always answer the questions of the client. I'm saying transparency should work both ways. Be upfront with me about what you're trying to accomplish and I can provide accurate information in an efficient manner.

The customer hold all the cards. They don't care if you want transparency from them. The one that makes it easiest for them to get what they want will get their business. As per this discussion: http://www.drivingsales.com/blogs/mpiworldclass/2015/01/29/is-going-above--beyond-really-path-to-customer-loyalty?utm_medium=email&utm_source=CUNL-1-30-15&utm_campaign=CUNL_013015

Nice write-up Ed. Agreed with the group sans Mr. Niven (without judgment.) If there's a price for the information, it's not transparent. This from 8 years experience in a truly transparent environment. Our lowest, non-negotiable prices, new and used, are posted clearly on our website. We have no finance managers so our salespeople handle everything from drive-up to delivery. In advance of the haters: Yes we run over a grand in back-end and yes we sell 300+ a month. We turn the screens towards the guest while running numbers. We put up our best trade-in offer, ACV, right up front. No games or gimmicks and we pay our folks really well. It takes a ton of work but, speaking as the brand retention leader in our zone, we think it's worth it.

Exactly how we roll Paul. 13 years running, volume leader by a mile, Just shy of 500 in January... Customers seem to dig it.

We put our discounted prices on-line as well. I think to be competitive in today's marketplace you have to. "Call For Price" is sooooo 2006 :-)

Before the customer ever steps foot in the store, all they want to know is "Do you have what I want and how much is it going to cost?". If you can't or wont answer this question. They will most definitely go elsewhere. Answer their questions without hesitation. Don't try to control the sale online. Get them in the store, and then make a car deal.

Ed, There are plenty of other verticals where information is required before getting pricing. For example, many technology and software companies also require you enter information for trial versions of software or to discuss package pricing. The automotive industry isn't the only vertical where prospective clients are asked for information before getting pricing. That being said I think the transparency needs to begin after the initial collection. If your form gives the customer the perception they are requesting a price quote, then you should be willing to provide that information. If not you have already confirmed the customer's fears that you have something to hide.

@Brian - I can't think of a reputable B2C software company or reseller that isn't crystal clear and upfront about their pricing. If wanted to go buy a copy of Microsoft Office, it's for sale right now at Staples for $219.99. If I wanted to download a trial version of Adobe Photoshop (think of this as an extended test drive), I would have to part with some info before I "drove off with the car" - BUT they let me know, upfront, that the plan costs $9.99 a month. Additionally, I think that focusing on the "form-fill lead" customer is huge mistake. The majority of shoppers show up on your doorstep, after doing extensive research, without ever submitting a lead. If you don't show your pricing, you might gain a few suspects, while basically telling the majority of your shoppers, "don't bother".

@Ed - I agree that most b2c software is set up that way, I was referring to b2b where volume and server licenses apply. My point was that you need to do what your form suggest you are going to do, regardless of what form you use. As an aside, I'm in the complete transparency camp. So much so that we (ELEAD1ONE) were showcasing our Deal Builder product at NADA that allows a customer to walk themselves all the way through financing a real car deal from the comfort of their couch. Thanks for the post, and reply.

Research indicates that on average, new car shoppers/buyers will visit three to four dealer websites. Over 1/3 will submit an online request. Over 90% of these requests are for pricing information. You can't avoid answering their question without risking the loss of the opportunity.

I know a great article when I see one!

Only Ed would make this reference. But great post nonetheless! :-)

I referenced a VERY famous quote from court history ;-) Thank you very much!

Why is a name and an email or phone number too much to ask? If you'd like a price I can certainly provide it for you with your fake name, fake phone number and dummy pricing email account. That's definitely transparent.

Imagine selling your house and refusing to divulge an asking price unless you got all their contact info.

I'm not saying don't provide a price. Always answer the questions of the client. I'm saying transparency should work both ways. Be upfront with me about what you're trying to accomplish and I can provide accurate information in an efficient manner.

The customer hold all the cards. They don't care if you want transparency from them. The one that makes it easiest for them to get what they want will get their business. As per this discussion: http://www.drivingsales.com/blogs/mpiworldclass/2015/01/29/is-going-above--beyond-really-path-to-customer-loyalty?utm_medium=email&utm_source=CUNL-1-30-15&utm_campaign=CUNL_013015

Nice write-up Ed. Agreed with the group sans Mr. Niven (without judgment.) If there's a price for the information, it's not transparent. This from 8 years experience in a truly transparent environment. Our lowest, non-negotiable prices, new and used, are posted clearly on our website. We have no finance managers so our salespeople handle everything from drive-up to delivery. In advance of the haters: Yes we run over a grand in back-end and yes we sell 300+ a month. We turn the screens towards the guest while running numbers. We put up our best trade-in offer, ACV, right up front. No games or gimmicks and we pay our folks really well. It takes a ton of work but, speaking as the brand retention leader in our zone, we think it's worth it.

Exactly how we roll Paul. 13 years running, volume leader by a mile, Just shy of 500 in January... Customers seem to dig it.

We put our discounted prices on-line as well. I think to be competitive in today's marketplace you have to. "Call For Price" is sooooo 2006 :-)

Before the customer ever steps foot in the store, all they want to know is "Do you have what I want and how much is it going to cost?". If you can't or wont answer this question. They will most definitely go elsewhere. Answer their questions without hesitation. Don't try to control the sale online. Get them in the store, and then make a car deal.

Ed, There are plenty of other verticals where information is required before getting pricing. For example, many technology and software companies also require you enter information for trial versions of software or to discuss package pricing. The automotive industry isn't the only vertical where prospective clients are asked for information before getting pricing. That being said I think the transparency needs to begin after the initial collection. If your form gives the customer the perception they are requesting a price quote, then you should be willing to provide that information. If not you have already confirmed the customer's fears that you have something to hide.

@Brian - I can't think of a reputable B2C software company or reseller that isn't crystal clear and upfront about their pricing. If wanted to go buy a copy of Microsoft Office, it's for sale right now at Staples for $219.99. If I wanted to download a trial version of Adobe Photoshop (think of this as an extended test drive), I would have to part with some info before I "drove off with the car" - BUT they let me know, upfront, that the plan costs $9.99 a month. Additionally, I think that focusing on the "form-fill lead" customer is huge mistake. The majority of shoppers show up on your doorstep, after doing extensive research, without ever submitting a lead. If you don't show your pricing, you might gain a few suspects, while basically telling the majority of your shoppers, "don't bother".

@Ed - I agree that most b2c software is set up that way, I was referring to b2b where volume and server licenses apply. My point was that you need to do what your form suggest you are going to do, regardless of what form you use. As an aside, I'm in the complete transparency camp. So much so that we (ELEAD1ONE) were showcasing our Deal Builder product at NADA that allows a customer to walk themselves all the way through financing a real car deal from the comfort of their couch. Thanks for the post, and reply.

Research indicates that on average, new car shoppers/buyers will visit three to four dealer websites. Over 1/3 will submit an online request. Over 90% of these requests are for pricing information. You can't avoid answering their question without risking the loss of the opportunity.

Even with the new "transnational" process, there is still an equal need to communicate with the customer. So the leads are not going away, simply (in time) changing.

Robert - I think, if dealers give customers a good reason to reach out, digital interactions and communications will increase, not decrease. One issue is that many dealerships aren't nearly as comfortable interacting digitally -- with the exception of their Internet Departments. Getting the showroom and the digital side more closely aligned will be the challenge. Dealers will have to move beyond a 'just get em in' to the showroom mind-set.

I don't disagree. My thought was, even transnational leads will require contact. If the customer clicks "buy now", there surely is a immediate phone call to ensure satisfaction, discuss details, and possibly up-sell as well. Transnational leads will vastly move into the chat category however, as picking up the phone during an online transnational process is too disjointed.

What we find is that when you give customers what they want, when they want it, 24/7/365, your 1st party leads will double & triple. We cost effectively capture & convert more online shoppers and deliver those shoppers the information they want Immediatley. As a customer I could be on 2 or 3 different dealers websites and find 2 or 3 different cars I want to buy, BUT I might not engage with any of those Dealers website forms. With our tools, your dealership could be the only one they contact because we give them a reason to contact you.. Good luck to you all and a prosperous 2015. Tony @ Automark Solutions

@Tony - I watched the video on your website. Unfortunately this is exactly the sort of 'Lead Gen' that the big boys are moving away from. The idea of withholding pricing information until the customer is willing to share complete contact information is anathema to operations like Sonic or AutoNation. The linchpin of their new strategies is clear, transparent, upfront pricing. But I wish you well.

@Robert - I think a key for dealers is to be very comfortable communicating with customers in whatever format the customer chooses, whether it be chat, phone, email, etc. It's all about being customer-centric.

Great article, @Ed. Another thing to consider is the actual content on the website. If the website doesn't provide the information the customer is looking for (price(s), actual photos of the vehicle, real video walkarounds, detailed description, full list of features and options, etc.), it doesn't matter what kind of call to action buttons are placed on the site. Shoppers have too many online resources available to them. If they don't find the info they are looking for on your site, they will simply move on until they do find it.

Hi Ed, while we also have a "form" for a customer to engage with, the idea of course is to capture & convert the lead so now the dealer has someone to contact and build rapport with. I do agree with you that some dealers are trying different methods to differentiate themselves but if they give away price without capturing a lead, then its very easy for me as a customer to make a phone call and potentially beat that price so we integrate our Instant Pricing with a warm friendly transparent experience that allows the customer to take themselves down the buying funnel. We also have alot of the "big boys" that we partner with, and they have doubled their 1st party leads while being transparent and of course, transparency breeds trust. BTW, thanks so much for taking the time to view our video and I love this site and its content. Keep up the great work!!!

@Tony - I would never spite someone for trying to sell something and I wouldn't ask these questions on a post of yours. But since you're here trying to sell on this post, two questions; 1.) What's in it for the customer? (I fully understand what's in it for the dealer). 2.) What are you 'converting' them from? What are you 'converting' them to?

@Adam - You are so right! If you lack correct pricing, great photos, excellent video, quality seller's notes, you have very little right to expect that the customer would be ready to move forward to the transaction. Everything in these strategies is designed to help the customer move forward -- the job of the dealer is to remove the roadblocks to the deal.

Hi Ed,-To answer your questions and maybe the response to your 1st question will possibly answer the 2nd: 1.) What's in it for the customer? (I fully understand what's in it for the dealer). We know that today, customers want instant gratification and transparency when shopping online and if they dont find what they are looking for, i.e., they bounce to a competitors site or google search or True Car etc etc. so we have reversed engineered a suite of converters that we strategically & seamlessly embed on a Dealers website (regardless of platform) that give the consumer the ability to get an Instant Price Quote or Instant Lease Quote Immediately on all cars in inventory 24/7. Bottom line is most dealers are only capturing 1-3% of the amount of visitors to their websites, with our tools, we see an increase of 2-4% which can be a significant lift in internet sales while providing a friendly transparent experience for the consumer....I hope this answers your questions Ed

@Tony - "I hope this answers your questions Ed" Not even close, but it is good advertisement ;-) It seems "transparency" has lost all meaning...

I think everyone make great points and I can definitely see the value in customer experience digitally. I've been involved in internet sales for over 10 yrs and have studied their behavior and habits it keeps changing constantly so lets communicate in the world of our customers who is truly our bosses due to the fact they pay our bills.

Form "Leads" are NOT going anywhere and won't go anywhere anytime soon. Most dealerships and vendors alike view a form lead ass backwards. They shouldn't be considered a lead and you force them into a process; it's a potential customer initiating contact with the dealership. Customers see form submissions as a convenient way to start an email conversation, nothing more, nothing less. They don't know they're injecting themselves into dozens of phone calls per week, and 120-150+ days of email follow-ups. The more dealership understand that it's convenient method of contact - either they're at work, they don't like getting bombarded with calls, or they're simply in research phase of their buying process. Dealerships must use an adaptative follow up process that follows the timeline and what the customer was seeking. Was the customer trying to get more information about a car (starting research)? Seeing it's available (deeper in process)? Or scheduling an appointment (ready to buy).

Here is a tough question: Do you want leads at all, or, are pay plans and vendor contracts pushing leads? Ideally the best case scenario is the customer buys the car. If you have provided ALL the information, they have no need to contact you. They just, buy the car. So are more leads a good sign, or are they a sign you are not providing enough information. Furthermore, how many leads are artificially created to sustain monetary compensation in one form or another?

Very interesting opinions.... I talk to many dealers across the country and what they tell me is that Leads submitted by customers on their Vehicle display pages are the number 1 leads they can get their hands on because they close at the highest closing ratio so I tend to agree that Form Leads are not going anywhere anytime soon. NOW, the amount and quality of leads depends on what information the Dealers serve up. In todays landscape, Im a big proponent of transparency but I dont agree in giving up price without something in return from the consumer i.e., name & contact info

Great question Robert! The goal is to move metal and make money, and leads aren't a prerequisite to making a sale. Different dealers have different strategies on how to achieve that goal. Some dealers will follow Tony's strategy of withholding information in return for something from the consumer -- a quid pro quo, if you will. Other dealers choose to freely provide as much information as possible, in the mold of Sonic, AutoNation, and CarMax. I do feel the dealers that have adapted the former strategy will see more customers that like to negotiate - work one dealer against the other - the grinders. While the dealers that have adapted the latter strategy will see more customers that will buy without the negotiation. I was on a webinar the other day that featured a dealer that uses up-front pricing. He is closing over 70% of his deals without negotiation and when he does negotiate, it is minimal. So, different strokes for different folks!

The traditional email lead is not going anywhere. AutoNation, Sonic and CarMax are not the industry standard that others mimic to be successful, and I have seen very few dealerships follow their lead. It's just not the most practical or profitable way to do business. If you want to look at a business model that works, just check out Dan Cummins Chevrolet in Paris, Ky (a small farm town of 20,000) where they sell between 500-600 units each and every month. That is a more realistic business model at this point in the automotive industry. It works well for the customer and still allows the dealer to make a comfortable profit. It may evolve into what you describe as a transactional web presence one day, but that is in the very distant future. It won't happen anytime soon on a large scale. Dealers as a whole have actually done a pretty good job of giving the customer some space, while giving up some control to allow the customer to complete around 60% of the buying process on their own. I expect it to remain about the same for the foreseeable future. Traditional email leads are still very much alive and well.

I do honestly believe that the "Get more info" traditional email lead will go away in the near future for many dealers, maybe not this year, but soon. It will be replaced with very highly targeted 'calls to action' that move the consumer closer to the transaction. Looking at Dan Cummins Chevrolet, they have already moved to a much more transactional web presence than most. Where many old school dealers would have a big "Get more info" button, they have placed a big green "Create Your Deal" Shop-Click-Drive button on the SRP and the VDPs. They have a prominent ATC Trade-In Marketplace box in the center of their homepage. All of this, combined with their up-front, pre-discounted pricing, is moving them closer to true eCommerce. It is a pretty impressive web presence!

I agree that the old school ways have seen their better days, but I think the middle of the road dealers such as Dan Cummins business model are what most of the other dealers are comfortable with at this time. There is no doubt that in time it will further evolve and eventually customers will complete nearly all of the buying process on their own. You have some great points. Most dealers just aren't ready to go that route.. Yet!

@Dennis - Just looking at the website tools they are already providing to their shoppers - combined with the their pricing structure - Dan Cummins looks to be way closer to 'bleeding edge' than 'old school'. If this is what middle-of-the-road looks like in your neck of the woods, I'm impressed! Just think of the website functionality they'll add in the coming year. They don't look to be a dealership that would be content to stop progressing!

@Ed - They are a very forward thinking organization, but they are still a little old fashioned in some ways. I have seen many others that are much closer to the transactional web presence than what Dan Cummins is now, but you are right in saying they won't stop. They will more than likely be the first in the state of Ky to have a purely transactional web presence when the time is right. They are the standard most dealerships in my region look to in order to evolve. What you see now is all fairly new, and has been implemented in the past 1 1/2 - 2 years. They were selling less than 200 cars a month 2 1/2 - 3 years ago, and now they sell 600+ fairly regularly, so they have come a long long way. They want to sell an additional 1000+ units this year compared to last year. I have several close friends who sold cars for me or I have worked with in the past that are a part of that organization currently. They have Big Plans!

Pet Peeve, Hello! I'm interested in the 2012 Mercedes-Benz you have listed on Cars.com for $25,995. I would like to know more about this vehicle. -- If you wanted my business, you'd have all the info I needed to know about this vehicle. Screw you if you don't. I am a visual learner and an analytical millennial who researches over and over. Once I make the decision, I have to make a buying decision. I know, that if it doesn't happen within a few hours of the initial decision to buy, I will second think and back out. I will not contact you if you do not have the information I am looking for. I will move to the next guy who does. Content is king. Example, I am looking for an 7 passenger Acadia and not a 8 passenger Acadia all you dealers without Bucket Seats listed or even 7 passenger commented in the detail notes I'm moving on. Lot of you get missed. 2015 and beyond, all that is needed is a "BUY IT NOW". We can worry about the actual purchase once the decision is made. As a dealer side, all I really care about is the guy ready to do it now on the exact vehicle they want. IMHO Sales Process on the lot. Meet and Greet Fact Find Demo Vehicle Writeup Close Sales Process on the internet Fact Find - Individual Research. Meet and Greet - Reads Dealership Info and Develops and an Idea of the dealership. Close - Makes an individual buying decision. Writeup - Dealer finalizes paperwork with communication. Demo - Delivery.

Love this thread, lots of great points from everyone. Tyler well said, highly agree. Transparency will win in the end. Remember when Travel websites finally were forced into "ALL IN PRICING"? Meaning that the price you see is the price you will pay... That made our lives as travellers much easier. Now-a-days, lets say you stumble across a travel site with no pricing, you are moving on FOR SURE! I know the car buying experience is much different from purchasing a flight, but I truly believe the research tactics fall under the same category. That category is called TRUST. Here is my opinion, build consumer trust in your brand, doing whatever it takes, the sales will follow... naturally. I don't believe leads will ever disappear. Leads are just a form of communication, it just so happens that person is in market for a vehicle so we as dealers see them as a target and call the communication a lead! That being said, the way we deal with leads is crucial to the success of closing the deal. This goes back to building trust, if you don't trust the customer, you can bet that they don't trust you! They should buy off of you because they WANT TO. Think about it this way... if they are just getting a price to SHOP YOU, DONT WORRY, chances are they weren't going to buy from you anyway!

I would disagree about leads going away. There are many examples of industries turning the customer into self-serving consumers. Apple is a great example. They made it so difficult to communicate with them online, that people just avoid it and go to the store or buy online. Travel is another example, the avg consumer just figures it out themselves and buys online. The only reason leads exist, is because all of the customers questions haven't been answered before they asked.

I think the biggest takeaway is the contrast of comfort and control the consumer enjoys online.The culture in far too many stores as mentioned is the sell me rather than help me buy attitude and approach. Well done Stard!

I was one of the pioneers of selling in the internet department. I started with Autonation in 1998. I found that sending price quotes with options creating more success for me. In fact I was closing 10% plus every month. Customers want price first without the hassle. That my friends will never change.

Even with the new "transnational" process, there is still an equal need to communicate with the customer. So the leads are not going away, simply (in time) changing.

Robert - I think, if dealers give customers a good reason to reach out, digital interactions and communications will increase, not decrease. One issue is that many dealerships aren't nearly as comfortable interacting digitally -- with the exception of their Internet Departments. Getting the showroom and the digital side more closely aligned will be the challenge. Dealers will have to move beyond a 'just get em in' to the showroom mind-set.

I don't disagree. My thought was, even transnational leads will require contact. If the customer clicks "buy now", there surely is a immediate phone call to ensure satisfaction, discuss details, and possibly up-sell as well. Transnational leads will vastly move into the chat category however, as picking up the phone during an online transnational process is too disjointed.

What we find is that when you give customers what they want, when they want it, 24/7/365, your 1st party leads will double & triple. We cost effectively capture & convert more online shoppers and deliver those shoppers the information they want Immediatley. As a customer I could be on 2 or 3 different dealers websites and find 2 or 3 different cars I want to buy, BUT I might not engage with any of those Dealers website forms. With our tools, your dealership could be the only one they contact because we give them a reason to contact you.. Good luck to you all and a prosperous 2015. Tony @ Automark Solutions

@Tony - I watched the video on your website. Unfortunately this is exactly the sort of 'Lead Gen' that the big boys are moving away from. The idea of withholding pricing information until the customer is willing to share complete contact information is anathema to operations like Sonic or AutoNation. The linchpin of their new strategies is clear, transparent, upfront pricing. But I wish you well.

@Robert - I think a key for dealers is to be very comfortable communicating with customers in whatever format the customer chooses, whether it be chat, phone, email, etc. It's all about being customer-centric.

Great article, @Ed. Another thing to consider is the actual content on the website. If the website doesn't provide the information the customer is looking for (price(s), actual photos of the vehicle, real video walkarounds, detailed description, full list of features and options, etc.), it doesn't matter what kind of call to action buttons are placed on the site. Shoppers have too many online resources available to them. If they don't find the info they are looking for on your site, they will simply move on until they do find it.

Hi Ed, while we also have a "form" for a customer to engage with, the idea of course is to capture & convert the lead so now the dealer has someone to contact and build rapport with. I do agree with you that some dealers are trying different methods to differentiate themselves but if they give away price without capturing a lead, then its very easy for me as a customer to make a phone call and potentially beat that price so we integrate our Instant Pricing with a warm friendly transparent experience that allows the customer to take themselves down the buying funnel. We also have alot of the "big boys" that we partner with, and they have doubled their 1st party leads while being transparent and of course, transparency breeds trust. BTW, thanks so much for taking the time to view our video and I love this site and its content. Keep up the great work!!!

@Tony - I would never spite someone for trying to sell something and I wouldn't ask these questions on a post of yours. But since you're here trying to sell on this post, two questions; 1.) What's in it for the customer? (I fully understand what's in it for the dealer). 2.) What are you 'converting' them from? What are you 'converting' them to?

@Adam - You are so right! If you lack correct pricing, great photos, excellent video, quality seller's notes, you have very little right to expect that the customer would be ready to move forward to the transaction. Everything in these strategies is designed to help the customer move forward -- the job of the dealer is to remove the roadblocks to the deal.

Hi Ed,-To answer your questions and maybe the response to your 1st question will possibly answer the 2nd: 1.) What's in it for the customer? (I fully understand what's in it for the dealer). We know that today, customers want instant gratification and transparency when shopping online and if they dont find what they are looking for, i.e., they bounce to a competitors site or google search or True Car etc etc. so we have reversed engineered a suite of converters that we strategically & seamlessly embed on a Dealers website (regardless of platform) that give the consumer the ability to get an Instant Price Quote or Instant Lease Quote Immediately on all cars in inventory 24/7. Bottom line is most dealers are only capturing 1-3% of the amount of visitors to their websites, with our tools, we see an increase of 2-4% which can be a significant lift in internet sales while providing a friendly transparent experience for the consumer....I hope this answers your questions Ed

@Tony - "I hope this answers your questions Ed" Not even close, but it is good advertisement ;-) It seems "transparency" has lost all meaning...

I think everyone make great points and I can definitely see the value in customer experience digitally. I've been involved in internet sales for over 10 yrs and have studied their behavior and habits it keeps changing constantly so lets communicate in the world of our customers who is truly our bosses due to the fact they pay our bills.

Form "Leads" are NOT going anywhere and won't go anywhere anytime soon. Most dealerships and vendors alike view a form lead ass backwards. They shouldn't be considered a lead and you force them into a process; it's a potential customer initiating contact with the dealership. Customers see form submissions as a convenient way to start an email conversation, nothing more, nothing less. They don't know they're injecting themselves into dozens of phone calls per week, and 120-150+ days of email follow-ups. The more dealership understand that it's convenient method of contact - either they're at work, they don't like getting bombarded with calls, or they're simply in research phase of their buying process. Dealerships must use an adaptative follow up process that follows the timeline and what the customer was seeking. Was the customer trying to get more information about a car (starting research)? Seeing it's available (deeper in process)? Or scheduling an appointment (ready to buy).

Here is a tough question: Do you want leads at all, or, are pay plans and vendor contracts pushing leads? Ideally the best case scenario is the customer buys the car. If you have provided ALL the information, they have no need to contact you. They just, buy the car. So are more leads a good sign, or are they a sign you are not providing enough information. Furthermore, how many leads are artificially created to sustain monetary compensation in one form or another?

Very interesting opinions.... I talk to many dealers across the country and what they tell me is that Leads submitted by customers on their Vehicle display pages are the number 1 leads they can get their hands on because they close at the highest closing ratio so I tend to agree that Form Leads are not going anywhere anytime soon. NOW, the amount and quality of leads depends on what information the Dealers serve up. In todays landscape, Im a big proponent of transparency but I dont agree in giving up price without something in return from the consumer i.e., name & contact info

Great question Robert! The goal is to move metal and make money, and leads aren't a prerequisite to making a sale. Different dealers have different strategies on how to achieve that goal. Some dealers will follow Tony's strategy of withholding information in return for something from the consumer -- a quid pro quo, if you will. Other dealers choose to freely provide as much information as possible, in the mold of Sonic, AutoNation, and CarMax. I do feel the dealers that have adapted the former strategy will see more customers that like to negotiate - work one dealer against the other - the grinders. While the dealers that have adapted the latter strategy will see more customers that will buy without the negotiation. I was on a webinar the other day that featured a dealer that uses up-front pricing. He is closing over 70% of his deals without negotiation and when he does negotiate, it is minimal. So, different strokes for different folks!

The traditional email lead is not going anywhere. AutoNation, Sonic and CarMax are not the industry standard that others mimic to be successful, and I have seen very few dealerships follow their lead. It's just not the most practical or profitable way to do business. If you want to look at a business model that works, just check out Dan Cummins Chevrolet in Paris, Ky (a small farm town of 20,000) where they sell between 500-600 units each and every month. That is a more realistic business model at this point in the automotive industry. It works well for the customer and still allows the dealer to make a comfortable profit. It may evolve into what you describe as a transactional web presence one day, but that is in the very distant future. It won't happen anytime soon on a large scale. Dealers as a whole have actually done a pretty good job of giving the customer some space, while giving up some control to allow the customer to complete around 60% of the buying process on their own. I expect it to remain about the same for the foreseeable future. Traditional email leads are still very much alive and well.

I do honestly believe that the "Get more info" traditional email lead will go away in the near future for many dealers, maybe not this year, but soon. It will be replaced with very highly targeted 'calls to action' that move the consumer closer to the transaction. Looking at Dan Cummins Chevrolet, they have already moved to a much more transactional web presence than most. Where many old school dealers would have a big "Get more info" button, they have placed a big green "Create Your Deal" Shop-Click-Drive button on the SRP and the VDPs. They have a prominent ATC Trade-In Marketplace box in the center of their homepage. All of this, combined with their up-front, pre-discounted pricing, is moving them closer to true eCommerce. It is a pretty impressive web presence!

I agree that the old school ways have seen their better days, but I think the middle of the road dealers such as Dan Cummins business model are what most of the other dealers are comfortable with at this time. There is no doubt that in time it will further evolve and eventually customers will complete nearly all of the buying process on their own. You have some great points. Most dealers just aren't ready to go that route.. Yet!

@Dennis - Just looking at the website tools they are already providing to their shoppers - combined with the their pricing structure - Dan Cummins looks to be way closer to 'bleeding edge' than 'old school'. If this is what middle-of-the-road looks like in your neck of the woods, I'm impressed! Just think of the website functionality they'll add in the coming year. They don't look to be a dealership that would be content to stop progressing!

@Ed - They are a very forward thinking organization, but they are still a little old fashioned in some ways. I have seen many others that are much closer to the transactional web presence than what Dan Cummins is now, but you are right in saying they won't stop. They will more than likely be the first in the state of Ky to have a purely transactional web presence when the time is right. They are the standard most dealerships in my region look to in order to evolve. What you see now is all fairly new, and has been implemented in the past 1 1/2 - 2 years. They were selling less than 200 cars a month 2 1/2 - 3 years ago, and now they sell 600+ fairly regularly, so they have come a long long way. They want to sell an additional 1000+ units this year compared to last year. I have several close friends who sold cars for me or I have worked with in the past that are a part of that organization currently. They have Big Plans!

Pet Peeve, Hello! I'm interested in the 2012 Mercedes-Benz you have listed on Cars.com for $25,995. I would like to know more about this vehicle. -- If you wanted my business, you'd have all the info I needed to know about this vehicle. Screw you if you don't. I am a visual learner and an analytical millennial who researches over and over. Once I make the decision, I have to make a buying decision. I know, that if it doesn't happen within a few hours of the initial decision to buy, I will second think and back out. I will not contact you if you do not have the information I am looking for. I will move to the next guy who does. Content is king. Example, I am looking for an 7 passenger Acadia and not a 8 passenger Acadia all you dealers without Bucket Seats listed or even 7 passenger commented in the detail notes I'm moving on. Lot of you get missed. 2015 and beyond, all that is needed is a "BUY IT NOW". We can worry about the actual purchase once the decision is made. As a dealer side, all I really care about is the guy ready to do it now on the exact vehicle they want. IMHO Sales Process on the lot. Meet and Greet Fact Find Demo Vehicle Writeup Close Sales Process on the internet Fact Find - Individual Research. Meet and Greet - Reads Dealership Info and Develops and an Idea of the dealership. Close - Makes an individual buying decision. Writeup - Dealer finalizes paperwork with communication. Demo - Delivery.

Love this thread, lots of great points from everyone. Tyler well said, highly agree. Transparency will win in the end. Remember when Travel websites finally were forced into "ALL IN PRICING"? Meaning that the price you see is the price you will pay... That made our lives as travellers much easier. Now-a-days, lets say you stumble across a travel site with no pricing, you are moving on FOR SURE! I know the car buying experience is much different from purchasing a flight, but I truly believe the research tactics fall under the same category. That category is called TRUST. Here is my opinion, build consumer trust in your brand, doing whatever it takes, the sales will follow... naturally. I don't believe leads will ever disappear. Leads are just a form of communication, it just so happens that person is in market for a vehicle so we as dealers see them as a target and call the communication a lead! That being said, the way we deal with leads is crucial to the success of closing the deal. This goes back to building trust, if you don't trust the customer, you can bet that they don't trust you! They should buy off of you because they WANT TO. Think about it this way... if they are just getting a price to SHOP YOU, DONT WORRY, chances are they weren't going to buy from you anyway!

I would disagree about leads going away. There are many examples of industries turning the customer into self-serving consumers. Apple is a great example. They made it so difficult to communicate with them online, that people just avoid it and go to the store or buy online. Travel is another example, the avg consumer just figures it out themselves and buys online. The only reason leads exist, is because all of the customers questions haven't been answered before they asked.

I think the biggest takeaway is the contrast of comfort and control the consumer enjoys online.The culture in far too many stores as mentioned is the sell me rather than help me buy attitude and approach. Well done Stard!

I was one of the pioneers of selling in the internet department. I started with Autonation in 1998. I found that sending price quotes with options creating more success for me. In fact I was closing 10% plus every month. Customers want price first without the hassle. That my friends will never change.

Well done, Ed! Not sure about the percentages, but I agree with the message. There are great opportunities available for some, while others flee the current Facebook platform.

Google "Facebook Organic Reach" and you'll see more studies devoted to this topic other than the one from ATC. One recent article quoted Mark Zuckerburg himself as saying "We optimize for users, not businesses" http://marketingland.com/mark-zuckerberg-facebook-town-hall-107096 With a 2% organic reach, as the Forrester report states, and is on the money from what I see with our pages, it is no longer a ROI equation, but ROE, return on effort. A lot of work is going into posts that no one sees.

Facebook posts are not meant to reach new customers, that is what ads are for. Honestly, in my opinion, the biggest point of a store's actual Facebook page is to interact with current customers.

Bingo Dara! Here were my comments on a post in DealerRefresh's forum dated Jan 15, 2010 - Every great salesman I ever worked with back in the "olden days" kept 2 boxes of cards under or in their desk. One was filled with greeting cards, the other was a tickler file of customer's dates: birthdays, wedding anniversaries, the anniversary of their last car purchase, etc. No one ever expected the card they sent on a Monday to sell them a car on Saturday. They did expect to stay top-of-mind with their customers, maybe get a referral or two and have a better than average shot in a year, 3 years or 5 years when their customer was ready for a new vehicle. I'd submit that Social Media is the equivalent of those greeting cards. The ROI won't be measured in days, weeks or months, but rather in years. Is it worth the time? Every dealer has to be the judge of that for themselves. But I'll repeat, every great salesman, back in the day, kept in touch, developed an on-going relationship, built trust and a referral business. Even if the medium is different today, why can't we do the same thing?

I wrote about this in the latest edition of Dealership Innovation Guide: http://drivingsalesinnovationguide.com/2014/10/the-hard-truth/

Thanks for your (great) insights, Robert! My main take-away is that a dealer has to be willing to Pay-To-Play *AND* they need to know what they are doing.

Exactly!

Building relationships on Facebook has always been the key and one of the best ways to do this is by building social capital. Share information that is important to your local market to demonstrate your community mindedness and pick and choose your self promoting posts. Mix in some paid reach but save that for promotional posts. I actually did a webinar last month on 7 Ways to Use FB Boost Post Button to Promote Your Business. Here's a link if anyone is interested: http://nextgendealer.com/2014/10/09/7-powerful-ways-to-promote-your-business-with-the-facebook-boost-post-button/

Pay to play. Ive been saying it for years! Great post.

I am curious to know from you guys and please take some time before you answer that question to think about it. Why do you have a business Facebook Page?

Advertising / Having a place where a customer can express gratitude or displeasure.

@Chris, A number of very savvy Social Media Marketing experts have contributed to a discussion about this post over on Facebook; https://www.facebook.com/groups/Carbucks/831937860183382 The consensus seems to be that Facebook advertising works (dark posts, etc) and you have to have a business Facebook Page to advertise effectively. But Facebook is strictly Pay-To-Play today.

@ Chris, because it's follow the leader. From everything I've noticed, people don't want to connect with "Any Town Motors", they want to connect with the person/people they met at "Any Town Motors". After all, it's not called "Placebook" it's called "Facebook" right?

Facebook likes money -- therefore, of course they are making it pay to play. It just needs to be done strategically & effectively.

@Robert, your article was awesome! Thanks for sharing: http://drivingsalesinnovationguide.com/2014/10/the-hard-truth/

Yes, but this has been public knowledge for nearly a year, no offense, this is ANCIENT information. Rival site: http://www.automotivedigitalmarketing.com/profiles/blogs/how-your-facebook-page-can-thrive-despite-the-death-of-facebook http://www.forbes.com/sites/ewanspence/2014/06/06/facebook-puts-everyone-on-notice-about-the-death-of-organic-reach/ http://blogs.forrester.com/nate_elliott/14-03-17-facebook_is_still_failing_marketers Comment by Alexander Lau on June 18, 2014 at 11:10am Here's an E-mail I had sent to a colleague a while back (actually, almost two years ago). -----Original Message----- From: Alex Lau Sent: Monday, November 05, 2012 8:50 AM Subject: RE: Custom Audience? Not a bad concept if used correctly. Obviously, it's a ploy by Facebook to sell more ads through customization techniques, which is smarter than what they're doing now. Their business model was or is failing on that level currently, hence the drop in stock price. Investors are saying to themselves, "Yes, Facebook is popular, but so the hell what, what's their business model?" The only thing they have going is their advertising model, so they had to do something like this, IMO. Promote better reception of case specific ads. Organic is going to die and shortly. Etc.,

I'll throw a wrench into this article. Want to know more about your fans and your competition's fans in order to market or re-market to them, contact me? This example alone gave me 4189 potential leads, just for one single page for 'New York Car Dealer'. An upgrade, will also export telephone numbers. Voila! http://api.ning.com/files/MOC7BqAcxPsipd6Ea0KWXTZ*bdHFq62q5QtHSATUpNQLUupJAOKnBqsxPqCY3O6wpm-GyTx2HbiP-qQ8stegVg3Nx-pwbnDj/20140707_142050.jpg

I'm unsure why you haven't mentioned FB's PowerEditor as well. Facebook PowerEditor = reaching out to current and potential customers via Facebook through their timeline and ads. Utilize your current dB's in your CRMs. Facebook PowerEditor It was a matter of time before they integrated this into their system. Basically, it's a matching tool, which they have always had (a weak predecessor), but previously was not built on a CRM integration level (importation of CRM dB's for use in customer matching). Having to match up customers or potential customer manually was a painstaking experience. I'll be interested in seeing how dealerships cope with this new requirement and what CRM's actively support them. Custom audience targeted ads will be much more relevant than ads just targeted to a business fan’s or some biographical demographic. They can reach people who a business is sure purchased its products before, or that haven’t thanks to exclusionary targeting. Yes, businesses could just email these existing customers for free. However, Facebook can help them hone in on certain demographic segments of their customers by overlaying additional targeting parameters, and reach them vividly through the news feed instead of their dry inbox. A car company with email addresses of its customers could target “buy a new SUV” ads to people who bought an SUV 5+ years ago, while targeting “Find nearby charging stations” to those who recently bought an electric vehicle. IMO, it's a ploy by Facebook to sell more ads through customization techniques, which is smarter than what they were doing. It should have better results for dealerships, especially since most of them have a CRM of some type that exports out CSV and/or XML for importation into the Facebook Power Editor.

Good luck with those "Potential Leads", Alexander!

Actually, I've measured those to work, albeit a small %, they have turned into sales. They are no different than the people / leads garnered from organic and paid motions. If that's your only reply, in reference to my detailed comments, wow, go back to the drawing board bro.

http://www.automotivedigitalmarketing.com/forum/topics/adweek-facebook-organic-reach-to-shrink-1-2 http://www.automotivedigitalmarketing.com/profiles/blogs/facebook-confirms-reduced-page-exposure-is-because-your-content Comment by Alexander Lau on April 10, 2014 at 9:06am Yes, but Reach and Like mean squat! The ability to fine tune your marketing efforts using their PowerEditor and Advertising is where everything is going. Organic is DEAD. Comment by Alexander Lau on April 10, 2014 at 6:37am Point of the article, your content sucks. 99% of it. Now, it's pay to play. Don't forget, FB is a publicly traded company. Wake up, everyone. Time to move on...

Far be it for me to argue with a "Automotive Digital Marketing Superhero" ;-)

And yes, the squeeze is getting tighter, "Facebook is cracking down on 'overly promotional' posts from brands" (dated Nov, 14, 2014) http://mashable.com/2014/11/14/facebook-is-cracking-down-on-overly-promotional-posts-from-brands/

He he, I'll take that as a compliment. Again, wasn't trying to be a jerk, just saying this has been around for a while. :-)

The trend has been around for a while. But, please note that the post that I cited from Forrester was dated Nov 17 - so, new. And many dealers are under the mistaken impression that having a Facebook page alone, will yield tangible results. So it bears repeating. I was all set to cut and paste from your company's "Social Media Management" page, but I decided to follow your lead and not be a jerk. :-)

LOL, post away, here you go, it's just generic fluff @ http://www.worlddealer.net/digital-marketing-services/social-media-management. If anyone is interested, they contact our business development crew and we dive much deeper in terms of deliverables. The site ranks through the roof, due to my SEO powers, like ranking 3rd for 'Automotive Content Marketing' @ https://www.google.com/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF-8#q=automotive+content+marketing, etc., etc. ahead of the "giant" boys.

Do you two need someone to moderate in between? :P

No Robert, facts and figures are my game. :-)

If we didn't have to have a page to run ads I don't think I would even have one any more. Think about it this way. Before Targeting was available the only way to get good data about your fans was to have a lot of them so you could then segment and target. Well, what little you could anyways. So now we have the ability to super target, retarget, interest target, target the targets. So in all reality the result of what we do with the data hasn't changed. How we are able to collect it and build campaigns around it certainly has though. There is nothing, I mean nothing out there where you can deploy an email and social ad campaign based on a list of folks that you scrubbed in your crm and then automatically trigger and deploy a 2nd level campaign based on their actions. That's where the real business is happening. IMHO Shopping Malls attract people which in turn attract shoppers. Shoppers are what stores want so they pay higher rent to be in the spot where people go to shop. Yes, you could be the guy that flyers the parking lot during the day but then you're that guy... Pages were cool when they were cool. The export of pages has become so efficient that we really don't need them anymore.

Chris, you're right, but it cannot hurt you to use FB's PowerEditor or Google+ or Google's social advertising system, when running a social advertisement. What do you mean, there is nothing out there, exactly? There are plenty of datasets that can be pushed to social networks, that will enable you to match dBs (versus) in order to help targeting. As you probably know, targeting via Facebook can be as granular as you like. Use that to your advantage. A hyper-targeted audience guarantees cheaper traffic from the audience you're after—users who have visited your website, but have not converted yet, users that are known customers of a certain make and model (new and used), etc., etc. The way to convert the audience you're remarketing to is to have consistent, quality marketing. Customize your message in a way that includes relevant and additional information to what customers already know about your product from visiting your site.

Although, there is a Social Bias, BEWARE!!!! Actually, when I worked at Carnegie Mellon University, I built and maintained a distance education website for Juergen Pfeffer. Carnegie Mellon's Juergen Pfeffer http://www.forbes.com/sites/bridaineparnell/2014/11/27/scientists-warn-about-bias-in-the-facebook-and-twitter-data-used-in-millions-of-studies/ Although social networks seem like a fount of free data, they often have substantial population biases that prevents that data from being extrapolated to the general public. "Instagram, for instance, has special appeal to adults between the ages of 18 and 29, African-Americans, Latinos, women and urban dwellers, while Pinterest is dominated by women between the ages of 25 and 34 with average household incomes of $100,000," Pfeffer and Ruths said. Even worse, social sites use proprietary algorithms to create or filter their data streams, algorithms that they could change at a moment's notice and that the scientists know nothing about. "How can anybody evaluate the results if neither the data nor the exact methods are allowed to be published?" asked Pfeffer. Those lucky enough to get privileged access to this proprietary information, so-called embedded researchers, are creating a divided social media research community, making it difficult to compare competing outcomes or objectively analyse a paper derived from social data.

@ Alexander, that's strong as death and very interesting!

Thanks Chris, agreed dude. :-)

Additionally, it's a matter of time before Google(bot) starts applying these same principles to Facebook advertising as well, whether they deem it as positive or negative. It's a greed game now. Old news thought, but relevant to this thread. "Facebook has seen a dramatic rise in advertising revenue, simply because it’s able to target specific user sets better than anyone else online. If audiences are rapidly becoming the preferred currency of online marketers, Google has to make AdWords conform to this new paradigm." Preparing For A Keywordless SEM World http://www.mediapost.com/publications/article/235593/preparing-for-a-keywordless-sem-world.html

It should be mentioned. If I were a car dealer, I wouldn't go anywhere near Facebook advertising. I would go to LinkedIn and advertise there, through their targeting. Credible people; more money, people with actual jobs. Same model as FB, better results, from the looks of it. HootSuite has a $10 / month LinkedIn plugin that allows for content publishing and advertising. https://www.linkedin.com/static?key=advertising_info

Nice share Alex!

Thanks Robert and great 2015 article. Haven't had the time to respond in an educated manner. Will do, over the holidays, while my 2 year old is crawling on my head. ;-)

Well done, Ed! Not sure about the percentages, but I agree with the message. There are great opportunities available for some, while others flee the current Facebook platform.

Google "Facebook Organic Reach" and you'll see more studies devoted to this topic other than the one from ATC. One recent article quoted Mark Zuckerburg himself as saying "We optimize for users, not businesses" http://marketingland.com/mark-zuckerberg-facebook-town-hall-107096 With a 2% organic reach, as the Forrester report states, and is on the money from what I see with our pages, it is no longer a ROI equation, but ROE, return on effort. A lot of work is going into posts that no one sees.

Facebook posts are not meant to reach new customers, that is what ads are for. Honestly, in my opinion, the biggest point of a store's actual Facebook page is to interact with current customers.

Bingo Dara! Here were my comments on a post in DealerRefresh's forum dated Jan 15, 2010 - Every great salesman I ever worked with back in the "olden days" kept 2 boxes of cards under or in their desk. One was filled with greeting cards, the other was a tickler file of customer's dates: birthdays, wedding anniversaries, the anniversary of their last car purchase, etc. No one ever expected the card they sent on a Monday to sell them a car on Saturday. They did expect to stay top-of-mind with their customers, maybe get a referral or two and have a better than average shot in a year, 3 years or 5 years when their customer was ready for a new vehicle. I'd submit that Social Media is the equivalent of those greeting cards. The ROI won't be measured in days, weeks or months, but rather in years. Is it worth the time? Every dealer has to be the judge of that for themselves. But I'll repeat, every great salesman, back in the day, kept in touch, developed an on-going relationship, built trust and a referral business. Even if the medium is different today, why can't we do the same thing?

I wrote about this in the latest edition of Dealership Innovation Guide: http://drivingsalesinnovationguide.com/2014/10/the-hard-truth/

Thanks for your (great) insights, Robert! My main take-away is that a dealer has to be willing to Pay-To-Play *AND* they need to know what they are doing.

Exactly!

Building relationships on Facebook has always been the key and one of the best ways to do this is by building social capital. Share information that is important to your local market to demonstrate your community mindedness and pick and choose your self promoting posts. Mix in some paid reach but save that for promotional posts. I actually did a webinar last month on 7 Ways to Use FB Boost Post Button to Promote Your Business. Here's a link if anyone is interested: http://nextgendealer.com/2014/10/09/7-powerful-ways-to-promote-your-business-with-the-facebook-boost-post-button/

Pay to play. Ive been saying it for years! Great post.

I am curious to know from you guys and please take some time before you answer that question to think about it. Why do you have a business Facebook Page?

Advertising / Having a place where a customer can express gratitude or displeasure.

@Chris, A number of very savvy Social Media Marketing experts have contributed to a discussion about this post over on Facebook; https://www.facebook.com/groups/Carbucks/831937860183382 The consensus seems to be that Facebook advertising works (dark posts, etc) and you have to have a business Facebook Page to advertise effectively. But Facebook is strictly Pay-To-Play today.

@ Chris, because it's follow the leader. From everything I've noticed, people don't want to connect with "Any Town Motors", they want to connect with the person/people they met at "Any Town Motors". After all, it's not called "Placebook" it's called "Facebook" right?

Facebook likes money -- therefore, of course they are making it pay to play. It just needs to be done strategically & effectively.

@Robert, your article was awesome! Thanks for sharing: http://drivingsalesinnovationguide.com/2014/10/the-hard-truth/

Yes, but this has been public knowledge for nearly a year, no offense, this is ANCIENT information. Rival site: http://www.automotivedigitalmarketing.com/profiles/blogs/how-your-facebook-page-can-thrive-despite-the-death-of-facebook http://www.forbes.com/sites/ewanspence/2014/06/06/facebook-puts-everyone-on-notice-about-the-death-of-organic-reach/ http://blogs.forrester.com/nate_elliott/14-03-17-facebook_is_still_failing_marketers Comment by Alexander Lau on June 18, 2014 at 11:10am Here's an E-mail I had sent to a colleague a while back (actually, almost two years ago). -----Original Message----- From: Alex Lau Sent: Monday, November 05, 2012 8:50 AM Subject: RE: Custom Audience? Not a bad concept if used correctly. Obviously, it's a ploy by Facebook to sell more ads through customization techniques, which is smarter than what they're doing now. Their business model was or is failing on that level currently, hence the drop in stock price. Investors are saying to themselves, "Yes, Facebook is popular, but so the hell what, what's their business model?" The only thing they have going is their advertising model, so they had to do something like this, IMO. Promote better reception of case specific ads. Organic is going to die and shortly. Etc.,

I'll throw a wrench into this article. Want to know more about your fans and your competition's fans in order to market or re-market to them, contact me? This example alone gave me 4189 potential leads, just for one single page for 'New York Car Dealer'. An upgrade, will also export telephone numbers. Voila! http://api.ning.com/files/MOC7BqAcxPsipd6Ea0KWXTZ*bdHFq62q5QtHSATUpNQLUupJAOKnBqsxPqCY3O6wpm-GyTx2HbiP-qQ8stegVg3Nx-pwbnDj/20140707_142050.jpg

I'm unsure why you haven't mentioned FB's PowerEditor as well. Facebook PowerEditor = reaching out to current and potential customers via Facebook through their timeline and ads. Utilize your current dB's in your CRMs. Facebook PowerEditor It was a matter of time before they integrated this into their system. Basically, it's a matching tool, which they have always had (a weak predecessor), but previously was not built on a CRM integration level (importation of CRM dB's for use in customer matching). Having to match up customers or potential customer manually was a painstaking experience. I'll be interested in seeing how dealerships cope with this new requirement and what CRM's actively support them. Custom audience targeted ads will be much more relevant than ads just targeted to a business fan’s or some biographical demographic. They can reach people who a business is sure purchased its products before, or that haven’t thanks to exclusionary targeting. Yes, businesses could just email these existing customers for free. However, Facebook can help them hone in on certain demographic segments of their customers by overlaying additional targeting parameters, and reach them vividly through the news feed instead of their dry inbox. A car company with email addresses of its customers could target “buy a new SUV” ads to people who bought an SUV 5+ years ago, while targeting “Find nearby charging stations” to those who recently bought an electric vehicle. IMO, it's a ploy by Facebook to sell more ads through customization techniques, which is smarter than what they were doing. It should have better results for dealerships, especially since most of them have a CRM of some type that exports out CSV and/or XML for importation into the Facebook Power Editor.

Good luck with those "Potential Leads", Alexander!

Actually, I've measured those to work, albeit a small %, they have turned into sales. They are no different than the people / leads garnered from organic and paid motions. If that's your only reply, in reference to my detailed comments, wow, go back to the drawing board bro.

http://www.automotivedigitalmarketing.com/forum/topics/adweek-facebook-organic-reach-to-shrink-1-2 http://www.automotivedigitalmarketing.com/profiles/blogs/facebook-confirms-reduced-page-exposure-is-because-your-content Comment by Alexander Lau on April 10, 2014 at 9:06am Yes, but Reach and Like mean squat! The ability to fine tune your marketing efforts using their PowerEditor and Advertising is where everything is going. Organic is DEAD. Comment by Alexander Lau on April 10, 2014 at 6:37am Point of the article, your content sucks. 99% of it. Now, it's pay to play. Don't forget, FB is a publicly traded company. Wake up, everyone. Time to move on...

Far be it for me to argue with a "Automotive Digital Marketing Superhero" ;-)

And yes, the squeeze is getting tighter, "Facebook is cracking down on 'overly promotional' posts from brands" (dated Nov, 14, 2014) http://mashable.com/2014/11/14/facebook-is-cracking-down-on-overly-promotional-posts-from-brands/

He he, I'll take that as a compliment. Again, wasn't trying to be a jerk, just saying this has been around for a while. :-)

The trend has been around for a while. But, please note that the post that I cited from Forrester was dated Nov 17 - so, new. And many dealers are under the mistaken impression that having a Facebook page alone, will yield tangible results. So it bears repeating. I was all set to cut and paste from your company's "Social Media Management" page, but I decided to follow your lead and not be a jerk. :-)

LOL, post away, here you go, it's just generic fluff @ http://www.worlddealer.net/digital-marketing-services/social-media-management. If anyone is interested, they contact our business development crew and we dive much deeper in terms of deliverables. The site ranks through the roof, due to my SEO powers, like ranking 3rd for 'Automotive Content Marketing' @ https://www.google.com/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF-8#q=automotive+content+marketing, etc., etc. ahead of the "giant" boys.

Do you two need someone to moderate in between? :P

No Robert, facts and figures are my game. :-)

If we didn't have to have a page to run ads I don't think I would even have one any more. Think about it this way. Before Targeting was available the only way to get good data about your fans was to have a lot of them so you could then segment and target. Well, what little you could anyways. So now we have the ability to super target, retarget, interest target, target the targets. So in all reality the result of what we do with the data hasn't changed. How we are able to collect it and build campaigns around it certainly has though. There is nothing, I mean nothing out there where you can deploy an email and social ad campaign based on a list of folks that you scrubbed in your crm and then automatically trigger and deploy a 2nd level campaign based on their actions. That's where the real business is happening. IMHO Shopping Malls attract people which in turn attract shoppers. Shoppers are what stores want so they pay higher rent to be in the spot where people go to shop. Yes, you could be the guy that flyers the parking lot during the day but then you're that guy... Pages were cool when they were cool. The export of pages has become so efficient that we really don't need them anymore.

Chris, you're right, but it cannot hurt you to use FB's PowerEditor or Google+ or Google's social advertising system, when running a social advertisement. What do you mean, there is nothing out there, exactly? There are plenty of datasets that can be pushed to social networks, that will enable you to match dBs (versus) in order to help targeting. As you probably know, targeting via Facebook can be as granular as you like. Use that to your advantage. A hyper-targeted audience guarantees cheaper traffic from the audience you're after—users who have visited your website, but have not converted yet, users that are known customers of a certain make and model (new and used), etc., etc. The way to convert the audience you're remarketing to is to have consistent, quality marketing. Customize your message in a way that includes relevant and additional information to what customers already know about your product from visiting your site.

Although, there is a Social Bias, BEWARE!!!! Actually, when I worked at Carnegie Mellon University, I built and maintained a distance education website for Juergen Pfeffer. Carnegie Mellon's Juergen Pfeffer http://www.forbes.com/sites/bridaineparnell/2014/11/27/scientists-warn-about-bias-in-the-facebook-and-twitter-data-used-in-millions-of-studies/ Although social networks seem like a fount of free data, they often have substantial population biases that prevents that data from being extrapolated to the general public. "Instagram, for instance, has special appeal to adults between the ages of 18 and 29, African-Americans, Latinos, women and urban dwellers, while Pinterest is dominated by women between the ages of 25 and 34 with average household incomes of $100,000," Pfeffer and Ruths said. Even worse, social sites use proprietary algorithms to create or filter their data streams, algorithms that they could change at a moment's notice and that the scientists know nothing about. "How can anybody evaluate the results if neither the data nor the exact methods are allowed to be published?" asked Pfeffer. Those lucky enough to get privileged access to this proprietary information, so-called embedded researchers, are creating a divided social media research community, making it difficult to compare competing outcomes or objectively analyse a paper derived from social data.

@ Alexander, that's strong as death and very interesting!

Thanks Chris, agreed dude. :-)

Additionally, it's a matter of time before Google(bot) starts applying these same principles to Facebook advertising as well, whether they deem it as positive or negative. It's a greed game now. Old news thought, but relevant to this thread. "Facebook has seen a dramatic rise in advertising revenue, simply because it’s able to target specific user sets better than anyone else online. If audiences are rapidly becoming the preferred currency of online marketers, Google has to make AdWords conform to this new paradigm." Preparing For A Keywordless SEM World http://www.mediapost.com/publications/article/235593/preparing-for-a-keywordless-sem-world.html

It should be mentioned. If I were a car dealer, I wouldn't go anywhere near Facebook advertising. I would go to LinkedIn and advertise there, through their targeting. Credible people; more money, people with actual jobs. Same model as FB, better results, from the looks of it. HootSuite has a $10 / month LinkedIn plugin that allows for content publishing and advertising. https://www.linkedin.com/static?key=advertising_info

Nice share Alex!

Thanks Robert and great 2015 article. Haven't had the time to respond in an educated manner. Will do, over the holidays, while my 2 year old is crawling on my head. ;-)

I believe you are right......maybe in more ways than one! :)

Great article Ed. I doubt highly Auto Nation would dump 100 million+ into an idea based on a "hunch"...I often wonder if this whole battle with Tesla wanting to sell directly to customers isn't going to put us dealers in a really bad light. Even though I think the current franchise system does offer customers more value than meets the eye. I also think if we (as an industry) allow transactions to take place in a manner the buying public likes (dare I say...enjoys?) then it becomes a non-issue all together. I mean where would a factory owned store get their employees from anyway? The same exact place we do now, the community! The only difference comes down to process, training and culture. All three things we have control over RIGHT NOW. Examples of world class customer service and experience are all around us in almost every other industry and yet the car business is somehow existing inside a bubble (for some dealerships anyway)...People aren't comparing one dealer to another anymore, they're comparing us to the Apple store, to Amazon, Nordstrom's, their favorite restaurant and so on. Your article hits the nail on the head and we have a lot of work to do.

Guess it depends on how you define success. We used to sell cars for fun and profit. These days, new cars are sold for fun and practice. That ceases to be fun after a while. @ Chris - Ford dumped many hundreds of dollars in their own experiment to sell cars the way customers say they wanted to buy in the surveys they took. RE: "People aren't comparing one dealer to another anymore, they're comparing us to the Apple store, to Amazon, Nordstrom's, their favorite restaurant and so on. Your article hits the nail on the head and we have a lot of work to do." You left out Disney. I hope you guys are in the vanguard with your own money on the line in this effort to transform auto retail. Actually, I think Disney, Apple, etc. need to send their people to auto dealerships to help them learn how to sell high ticket items in a competitive environment, where trades have to be taken, most with negative equity, with complex financing issues, and still make gross profit and get a 90% CSI score. But then those guys sell gadgets, meals, and small ticket items, with no trades, etc. But knock yourself out. Talk is cheap. Put your own money in a deal and show us how its done.

AutoNation, Sonic, CarMax are all betting on this as being the future. And yes, the automotive space is much more complex, but all that means is that the solutions will be more complex, just as they've always been. But yesterday's solutions aren't the answer to today's problems.

Thanks David. You're right, how could I forget the "Disney Experience"! It looks great on paper, until someone in a leadership role contradicts the entire concept and the employees go right back to being "Gomo's" and "D-grunts". Look, I get it. The good old days selling cars like it was the wild wild west, before the Internet, before Trucks had window stickers, when you could hold 5 points in F&I...Of course making tons of money with very little effort is fun! Does anyone have a plan to get us back there? Today, the real "magic" happens when we can make a very complex, very large ticket item FEEL like they should be paying us admission, because they've enjoyed their experience that much. Our people aren't $10 hourly kids picking up trash, nor do I think we can learn from their pimply faced order takers. We are trained sales professionals. Many of us earn a 6 figure professional wage because we're great at making a very complex transaction...look and feel easy. Bottom line is this. Customers don't care how hard or complex it is and they don't want to hear our excuses, they expect us to figure it out (while they hold our surveys hostage in the process). As far as being on the front lines, working to make this a reality, my team and I put our own incomes on the line everyday. We're in the trenches, well aware that our customers pay our salaries. When I see something like this coming down the line at such a high rate of speed, the last thing I want to do is live in the past, resenting how hard it's gotten. I'd rather step up and get my team prepared to grab all the lost market share possible once the fit hits the shan... ; )

Chris, Let me know when you find those $10 Hourly kids picking up trash....Lord knows that's not around here. But on to the point. I think it all goes back to customer experience. Disney can charge outrageous prices because they are giving a "magical Experience" that most kids remember the rest of their lives and want to pass on to their children. That is something dealerships need to strive to do, and encourage sales staff to do the same thing. Almost sounds like it's time for me to break out my Frozen songs and start dressing like Elsa and singing "Let it Go"

I understand Apple pays their "associates" $30K per year. If you survey auto buying consumers they tell us that they'd rather not pay their sales person a big commission. They'd prefer to do business with the $30K kid. After all, they know everything from the Internet, right? They don't need much "salesmanship." So should we give consumers what they say they want in surveys? OR should we give them enough "transparency" to earn their trust to the extent we need to to do business at a substantial gross profit? That's what we've done from the beginning. We've provided "relative transparency." Interesting that some say this is a "new" concept. The great thing is that the market has always, and will continue, to sort this stuff out. Every dealer who wants to do business by giving consumers what they say they want in surveys is free to do so. And pundits, and vendors with their own agenda, will continue to make predictions. Its when you have your own money invested that your decisions really count. Corporate approaches lack the same level of accountability to the person making the decision. When your competitor announces a "new way of doing business" is it a marketing ruse or the real deal? Do you follow suit or do you realize you were just gifted a huge competitive advantage?

David, you make a great point about customer surveys being extremely flawed and they certainly don't know our business better than we do. Customers don't know what it is they want half the time, nor do they remember what they wanted yesterday or for long. What they do know, is that they want to get in and out of the dealership as quickly as possible and what matters most is how we make them feel. A good deal will always be a state of mind, and the people we make the most on, give us the best surveys. The customer that spends all their time worrying about price often crushes us on the survey, even after we lost money on the deal. You try putting $30k order takers or $10 an hour kids in place of todays real professionals and CSI will tank, right along with gross, retention and so on. What I think we should be working on is cutting out as many of the "points of pain" we can for our customers while changing the perceptions most people have when they think of a "car salesman".

@Chris I need a like button for some of your comments! Very well said. So many dealerships don't focus enough on changing customers attitudes towards themselves and too much on price. Show customers that your not that "sleezy salesman" and price can come later.

Thank you! A like button would a lot of fun. That and one of those "easy buttons" from staples and we're all set!

When you find the "Easy" button send one my way. I have lots of things that I could use it for. As for the Like button I mentioned it to one of the ds guys a few months back. Maybe we'll see it implemented soon.

Can you imagine a time when the auto maker forces their franchise dealers to rebuild their dealerships to look the same. Wait, they have already done that. What about a time when the consumer can get the exact cost of the new vehicle before they even get there, and find out what other paid for the exact car. Wait, they have already done that too. The worst thing world be the customers ability to shop every dealers inventory , both new and used and get the lowest price before they left the house. See the pattern here. As mentioned before, it is likely that the way people buy cars is going to change , change is inevitable, all we can do is adapt, evolve or perish.

"It is not the strongest or the most intelligent who will survive but those who can best manage change." -- Attributed to Charles Darwin

@Ed, Very well said. And Ben, you hit the nail on the head. Maybe instead of all the visibility, they should maybe focus on letting dealership order vehicles that will actually sell instead of putting so many constraints you end up with tons of inventory that you will never sell. once again, if only there was an easy button!

Man, I wish there was an "Easy Button" - this transformation will be difficult. But as this article shows (just published on Friday) the rewards can be substantial. The test store for Sonic "has seen its marketshare increase to 20% from 13% since implementing One Sonic. And the store's customer-satisfaction scores, administered by Toyota, are at 96% so far this month, higher than any point this year." "Sonic Automotive's bold shift to the future" www.bizjournals.com/charlotte/print-edition/2014/11/21/sonic-automotives-bold-shift-to-thefuture.html?ana=sm_clt_ucp62&b=1416523393%5E15983051&page=all

Nicely written! I do appreciate that, but this is the far far far from reality. How many years of experience do you have actually working in a car dealership? How can you possibly be qualified to make such a prediction? It is a nice article.. It is however just a huge exaggeration of what facts already tell us. As a 3rd party vendor to dealers you cannot in your right state of mind, and with your companies blessing, state such an opinion. Who are you to change the way cars are purchased in other peoples mind? More research and a lot more experience are needed before making such claims. I know vAuto cannot possibly be happy with you posting such a controversial article. That is why people are looking at it. Car dealers are growing more and more tired of being told how to sell cars by vendors who, in most cases, have not even held an upper level management position (GSM - GM) while actually working for a car dealership. Nice article, but it's just not true. Good luck!

Ed, this is a good article and certainly a great Call to Action for Dealerships that want to be successful going forward. I'm in Canada so I expect that things might be a little different in our markets but the structure is very similar. I think one of the biggest issues we face in adopting a transactional approach to selling on-line is the breech in transparency that happens in the transition from the OEM to the distribution channel (the dealership). If you think about other goods and services and the shopping process involved in acquiring those g&s, the transition down the sales funnel is a little more seamless than it is in the auto industry. Typically shopping and research might start at the OEM level and progress towards the distribution channel. As the customer moves into the distribution channel, the customer is closer to transaction and the pricing typically gets more competitive. In our convoluted industry, the customer could begin the journey with review sites, transition to the manufacturer's site once a brand is chosen and begin to fully utilize the shopping tools available there... Build and Price tools, Regional incentives (for vehicles that are sold out), test Drive forms, and on and on. The manufacturer is putting the cart before the horse here. At this point, Cash credits are offered, targeted lease payments are promoted, and finance payments including loyalty credits (which some customers don't qualify for) are HEAVILY promoted. This is the part of the process where the manufacturer is going Mano-a-Mano with their competitors and shaving gross away so there Civic leases out cheaper than the competitive Corolla. The problem is, the offerings at the OEM site are often plus taxes, excluding Freight and Prep and Dealer admin fees. Now the waters are muddied! The customer has now taken the bait and is ready to start checking out availability and the convenience of local dealerships. Now there is a wrinkle. Because of regional regulatory boards, dealers are not permitted to advertise in a similar manner to the OEM. Dealers have to include all fees except taxes and licensing where I operate, so no the customer is left to wonder "why is the vehicle getting more expensive" as they are getting closer to transacting. Now the customer is getting confused! Now trust is compromised and the user experience begins to suffer. If you can figure out this twisty roadmap to the sale, success is waiting for you at the end!

Dave - you are correct, there's isn't a clear path to the sale. The old funnel is gone. Customers bounce around, each following a path unique to themselves.

How are we doing on the time table? Sonic is making the move - 

http://www.autonews.com/apps/pbcs.dll/article?AID=%2F20160801%2FRETAIL07%2F308019991%2Fsonic-will-offer-online-car-buying

I believe you are right......maybe in more ways than one! :)

Great article Ed. I doubt highly Auto Nation would dump 100 million+ into an idea based on a "hunch"...I often wonder if this whole battle with Tesla wanting to sell directly to customers isn't going to put us dealers in a really bad light. Even though I think the current franchise system does offer customers more value than meets the eye. I also think if we (as an industry) allow transactions to take place in a manner the buying public likes (dare I say...enjoys?) then it becomes a non-issue all together. I mean where would a factory owned store get their employees from anyway? The same exact place we do now, the community! The only difference comes down to process, training and culture. All three things we have control over RIGHT NOW. Examples of world class customer service and experience are all around us in almost every other industry and yet the car business is somehow existing inside a bubble (for some dealerships anyway)...People aren't comparing one dealer to another anymore, they're comparing us to the Apple store, to Amazon, Nordstrom's, their favorite restaurant and so on. Your article hits the nail on the head and we have a lot of work to do.

Guess it depends on how you define success. We used to sell cars for fun and profit. These days, new cars are sold for fun and practice. That ceases to be fun after a while. @ Chris - Ford dumped many hundreds of dollars in their own experiment to sell cars the way customers say they wanted to buy in the surveys they took. RE: "People aren't comparing one dealer to another anymore, they're comparing us to the Apple store, to Amazon, Nordstrom's, their favorite restaurant and so on. Your article hits the nail on the head and we have a lot of work to do." You left out Disney. I hope you guys are in the vanguard with your own money on the line in this effort to transform auto retail. Actually, I think Disney, Apple, etc. need to send their people to auto dealerships to help them learn how to sell high ticket items in a competitive environment, where trades have to be taken, most with negative equity, with complex financing issues, and still make gross profit and get a 90% CSI score. But then those guys sell gadgets, meals, and small ticket items, with no trades, etc. But knock yourself out. Talk is cheap. Put your own money in a deal and show us how its done.

AutoNation, Sonic, CarMax are all betting on this as being the future. And yes, the automotive space is much more complex, but all that means is that the solutions will be more complex, just as they've always been. But yesterday's solutions aren't the answer to today's problems.

Thanks David. You're right, how could I forget the "Disney Experience"! It looks great on paper, until someone in a leadership role contradicts the entire concept and the employees go right back to being "Gomo's" and "D-grunts". Look, I get it. The good old days selling cars like it was the wild wild west, before the Internet, before Trucks had window stickers, when you could hold 5 points in F&I...Of course making tons of money with very little effort is fun! Does anyone have a plan to get us back there? Today, the real "magic" happens when we can make a very complex, very large ticket item FEEL like they should be paying us admission, because they've enjoyed their experience that much. Our people aren't $10 hourly kids picking up trash, nor do I think we can learn from their pimply faced order takers. We are trained sales professionals. Many of us earn a 6 figure professional wage because we're great at making a very complex transaction...look and feel easy. Bottom line is this. Customers don't care how hard or complex it is and they don't want to hear our excuses, they expect us to figure it out (while they hold our surveys hostage in the process). As far as being on the front lines, working to make this a reality, my team and I put our own incomes on the line everyday. We're in the trenches, well aware that our customers pay our salaries. When I see something like this coming down the line at such a high rate of speed, the last thing I want to do is live in the past, resenting how hard it's gotten. I'd rather step up and get my team prepared to grab all the lost market share possible once the fit hits the shan... ; )

Chris, Let me know when you find those $10 Hourly kids picking up trash....Lord knows that's not around here. But on to the point. I think it all goes back to customer experience. Disney can charge outrageous prices because they are giving a "magical Experience" that most kids remember the rest of their lives and want to pass on to their children. That is something dealerships need to strive to do, and encourage sales staff to do the same thing. Almost sounds like it's time for me to break out my Frozen songs and start dressing like Elsa and singing "Let it Go"

I understand Apple pays their "associates" $30K per year. If you survey auto buying consumers they tell us that they'd rather not pay their sales person a big commission. They'd prefer to do business with the $30K kid. After all, they know everything from the Internet, right? They don't need much "salesmanship." So should we give consumers what they say they want in surveys? OR should we give them enough "transparency" to earn their trust to the extent we need to to do business at a substantial gross profit? That's what we've done from the beginning. We've provided "relative transparency." Interesting that some say this is a "new" concept. The great thing is that the market has always, and will continue, to sort this stuff out. Every dealer who wants to do business by giving consumers what they say they want in surveys is free to do so. And pundits, and vendors with their own agenda, will continue to make predictions. Its when you have your own money invested that your decisions really count. Corporate approaches lack the same level of accountability to the person making the decision. When your competitor announces a "new way of doing business" is it a marketing ruse or the real deal? Do you follow suit or do you realize you were just gifted a huge competitive advantage?

David, you make a great point about customer surveys being extremely flawed and they certainly don't know our business better than we do. Customers don't know what it is they want half the time, nor do they remember what they wanted yesterday or for long. What they do know, is that they want to get in and out of the dealership as quickly as possible and what matters most is how we make them feel. A good deal will always be a state of mind, and the people we make the most on, give us the best surveys. The customer that spends all their time worrying about price often crushes us on the survey, even after we lost money on the deal. You try putting $30k order takers or $10 an hour kids in place of todays real professionals and CSI will tank, right along with gross, retention and so on. What I think we should be working on is cutting out as many of the "points of pain" we can for our customers while changing the perceptions most people have when they think of a "car salesman".

@Chris I need a like button for some of your comments! Very well said. So many dealerships don't focus enough on changing customers attitudes towards themselves and too much on price. Show customers that your not that "sleezy salesman" and price can come later.

Thank you! A like button would a lot of fun. That and one of those "easy buttons" from staples and we're all set!

When you find the "Easy" button send one my way. I have lots of things that I could use it for. As for the Like button I mentioned it to one of the ds guys a few months back. Maybe we'll see it implemented soon.

Can you imagine a time when the auto maker forces their franchise dealers to rebuild their dealerships to look the same. Wait, they have already done that. What about a time when the consumer can get the exact cost of the new vehicle before they even get there, and find out what other paid for the exact car. Wait, they have already done that too. The worst thing world be the customers ability to shop every dealers inventory , both new and used and get the lowest price before they left the house. See the pattern here. As mentioned before, it is likely that the way people buy cars is going to change , change is inevitable, all we can do is adapt, evolve or perish.

"It is not the strongest or the most intelligent who will survive but those who can best manage change." -- Attributed to Charles Darwin

@Ed, Very well said. And Ben, you hit the nail on the head. Maybe instead of all the visibility, they should maybe focus on letting dealership order vehicles that will actually sell instead of putting so many constraints you end up with tons of inventory that you will never sell. once again, if only there was an easy button!

Man, I wish there was an "Easy Button" - this transformation will be difficult. But as this article shows (just published on Friday) the rewards can be substantial. The test store for Sonic "has seen its marketshare increase to 20% from 13% since implementing One Sonic. And the store's customer-satisfaction scores, administered by Toyota, are at 96% so far this month, higher than any point this year." "Sonic Automotive's bold shift to the future" www.bizjournals.com/charlotte/print-edition/2014/11/21/sonic-automotives-bold-shift-to-thefuture.html?ana=sm_clt_ucp62&b=1416523393%5E15983051&page=all

Nicely written! I do appreciate that, but this is the far far far from reality. How many years of experience do you have actually working in a car dealership? How can you possibly be qualified to make such a prediction? It is a nice article.. It is however just a huge exaggeration of what facts already tell us. As a 3rd party vendor to dealers you cannot in your right state of mind, and with your companies blessing, state such an opinion. Who are you to change the way cars are purchased in other peoples mind? More research and a lot more experience are needed before making such claims. I know vAuto cannot possibly be happy with you posting such a controversial article. That is why people are looking at it. Car dealers are growing more and more tired of being told how to sell cars by vendors who, in most cases, have not even held an upper level management position (GSM - GM) while actually working for a car dealership. Nice article, but it's just not true. Good luck!

Ed, this is a good article and certainly a great Call to Action for Dealerships that want to be successful going forward. I'm in Canada so I expect that things might be a little different in our markets but the structure is very similar. I think one of the biggest issues we face in adopting a transactional approach to selling on-line is the breech in transparency that happens in the transition from the OEM to the distribution channel (the dealership). If you think about other goods and services and the shopping process involved in acquiring those g&s, the transition down the sales funnel is a little more seamless than it is in the auto industry. Typically shopping and research might start at the OEM level and progress towards the distribution channel. As the customer moves into the distribution channel, the customer is closer to transaction and the pricing typically gets more competitive. In our convoluted industry, the customer could begin the journey with review sites, transition to the manufacturer's site once a brand is chosen and begin to fully utilize the shopping tools available there... Build and Price tools, Regional incentives (for vehicles that are sold out), test Drive forms, and on and on. The manufacturer is putting the cart before the horse here. At this point, Cash credits are offered, targeted lease payments are promoted, and finance payments including loyalty credits (which some customers don't qualify for) are HEAVILY promoted. This is the part of the process where the manufacturer is going Mano-a-Mano with their competitors and shaving gross away so there Civic leases out cheaper than the competitive Corolla. The problem is, the offerings at the OEM site are often plus taxes, excluding Freight and Prep and Dealer admin fees. Now the waters are muddied! The customer has now taken the bait and is ready to start checking out availability and the convenience of local dealerships. Now there is a wrinkle. Because of regional regulatory boards, dealers are not permitted to advertise in a similar manner to the OEM. Dealers have to include all fees except taxes and licensing where I operate, so no the customer is left to wonder "why is the vehicle getting more expensive" as they are getting closer to transacting. Now the customer is getting confused! Now trust is compromised and the user experience begins to suffer. If you can figure out this twisty roadmap to the sale, success is waiting for you at the end!

Dave - you are correct, there's isn't a clear path to the sale. The old funnel is gone. Customers bounce around, each following a path unique to themselves.

How are we doing on the time table? Sonic is making the move - 

http://www.autonews.com/apps/pbcs.dll/article?AID=%2F20160801%2FRETAIL07%2F308019991%2Fsonic-will-offer-online-car-buying