CDK's purchase of Auto/Mate may create a major disruption in the dealer management system (DMS) industry. Here is our take. DOWNLOAD
If there's one thing that I've seen in the last 17 years while working on the vendor side of the business, it's that there are often products and services presented to dealers that simply do not deliver what they promise. It's one of the reasons that I partnered with JD Rucker to form our own company. We wanted control to deliver results no matter what, something that we couldn't always promise when working for larger companies.
It's not that the various sales representatives or marketing departments at automotive vendors hope to rip off their customers. We all want our products to be amazing, but sometimes it's hard, particular for the larger companies trying to offer scalable solutions that can somehow serve their individual dealer clients. Then, there are the smaller companies who often bite off more than they can chew. In the competitive automotive industry, finding great products can be challenging.
Here are some of the things that I've learned that dealers can apply to help determine whether or not a vendor will be delivering what they promise.
Every vendor has a set of clients that they can count on for good references and good results. There's no need to talk to them. Find the ones that the vendor does not offer up. You can do this by checking the website for testimonials or case studies and then asking the sales representative for references.
Finding the other clients can be easy with larger companies but harder for smaller companies. Either way, compile your list of dealerships that the vendor is highlighting on their website and during their presentation. Ask for examples. THEN, ask for more examples. They should be able to do this on the spot. If they can't there's a potential problem (unless they're really, really small, in which case you might have to press harder).
It's okay to tell them what you're doing AFTER you've received their list of people they want you to talk to. Letting them know is important because it immediately lets them know that you're going to be aggressive in your monitoring of the results. Believe it or not, this makes a difference in how your account is treated. As sad as it is, the concept of the squeaky wheel getting the oil applies for most vendors, big and small. It's okay to be a little squeaky.
There are many dealers who have been doing this for some time. Some vendors simply won't do it. Despite the concept that a company that believes in itself won't need contracts or setup fees, there are still too many risks for some products such as CRM and DMS. However, most products that can be delivered on a monthly basis have few upfront costs other than a setup that normally falls within the cost collected for the first month.
With that said, it's not worth passing on a great product for the sake of contracts or setup fees. There are those who simply do not offer month-to-month contracts or that cannot waive setup fees. That does not mean that their products are inferior, necessarily, but making the request and putting out a little fuss is a good way to find out exactly what is entailed with the initial setup.
This is a tough one and not every sales representative is prepared to answer this question. You might even want someone who isn't able to answer the question well so that you can ask to have the name of a couple of dealers who have cancelled recently.
Be careful. If you're looking for a perfect vendor you'll have to keep looking regardless of the segment. Nobody is perfect. Everyone messes up. Sometimes, the expectations are too high. Sometimes, there are things that happen that make a product or service ineffective. Sometimes, it's simply a matter of a new GM or ISM who came in and made a bunch of changes.
The sales representative is trained to answer sales questions. Ask the same questions of the people doing the actual work. If you're strongly considering a company, ask for the customer service or operations people to be on the second call. They're more inclined to under-promise.
Most companies have a guru or a "micro-celebrity" who represents the company at conferences or in the blogs. Get them on the phone and ask them to personally take interest in your cause. They do not want to get a bad personal rap against them in most cases and will help you to perform better.
Doing this goes beyond asking. This is where the power of reviews and public testimonials can come into play. Be willing to speak out whether they do a great job or a poor job and make certain they know about it.
When you're narrowed down to a handful of candidates, bring them all in together. Let them know that they'll be going head to head with other vendors. Get multiple people on your side to ask questions of everyone. The way they present their products will be different when they know a competitor or two is on the phone with them.
There are plenty of things you can do to get the real picture, but the best thing you can do is to do a ton of research. That's not to say that you need to work slowly. Believe it or not, there are times when a dealership can do more damage than good by establishing up front that they'll be "high maintenance" clients. Keep it fair. Stay polite. Make great decisions.