Jessica Russell

Company: Performance Management Associates, Inc.

Jessica Russell Blog
Total Posts: 7    

Evans Bridges

Performance Management Associates, Inc

Jun 6, 2010

From “as vehicle sales go, so goes service” mentality, to believing that you own 100% of that business and you can capture more of it and grow service regardless of what sales is doing.

 
From focusing exclusively on generating prospects to replace the customers that are leaving
To realizing that nothing is more important or profitable to a dealership than knowing and working its current customers.
 
From allowing 84% of our customers to leave and go to the competition, to implementing and requiring processes that get them stuck on you and coming back again and again.
 
From less than 40% of vehicle buyers initiating any kind of visit to our service departments to requiring that all vehicle buyers receive an orientation at delivery and have that critical first service appointment established with your dealership.
 
From being only transactional (If I cut another $2000 will you take it home today?) to realizing that at least 50% of your prospects and customers are relational (Do I like you and can I trust you?) and that your sales and service staffs have little idea how to recognize them or treat them. And so on…..
 
Today, dealerships are faced with extreme competition and finding it problematic maintaining margins and finding it impossible to grow margins because dealerships typically develop customer relationships based solely on price with little that differentiates them.
 
What’s the solution? Dealerships have to learn to have some relationship with customers that, to some degree, overrides price- or dealerships will slowly, then suddenly go broke as is happening to far too many of them today. The success of a dealership today depends simply on its understanding of psychology. How each individual sales or service employee connects with customers and how each individual employee connects with the dealership. 
 
Dealerships won’t survive continuing to focus only on transactional buyers and allowing that culture to dictate how they look at their customer base and the opportunities inherent in it. Twenty years or so ago it was so easy when sales got slow, just put up a big tent, set up a prize box, get the clowns or the bands, fire up the grill, invite the radio station in for a remote, and we could easily sell thirty or forty cars on a Saturday. Ten years ago that didn’t work so well and today it just doesn’t work at all. Okay so it’s the weather right? No it’s delivering the same old message to a new market filled with a new kind of shopper. It’s not just those transactional shoppers that believe they already know everything to make an informed decision, except the price. It’s also those transactional shoppers that are well aware they don’t know enough to make an informed decision and are shopping for an adviser they can trust not to take advantage of them.
 
Dealerships can no longer work only in the transactional dimension. They must learn to recognize the relational shopper and understand how to do business with them.   Its time to adjust that dial from all transactional and accept that 50% of your customers are relational and that both relational and transactional customers shop in both modes. You must recognize both and adjust to both or continue to loose 84% of your customer base to your competition. 
 
In just thirty-five short years how could the industry go from nearly thirty thousand mostly profitable dealers to less than twenty thousand today? How could the dealer body that sold 100% of the 240,000,000 vehicles on US Highways today give 84% of that business away and allow 400,000 service venues that didn’t exist thirty years ago to be flourishing off dealer customer bases today? How?

 

Evans Bridges

Performance Management Associates, Inc

President

1151

No Comments

Evans Bridges

Performance Management Associates, Inc

Jun 6, 2010

From “as vehicle sales go, so goes service” mentality, to believing that you own 100% of that business and you can capture more of it and grow service regardless of what sales is doing.

 
From focusing exclusively on generating prospects to replace the customers that are leaving
To realizing that nothing is more important or profitable to a dealership than knowing and working its current customers.
 
From allowing 84% of our customers to leave and go to the competition, to implementing and requiring processes that get them stuck on you and coming back again and again.
 
From less than 40% of vehicle buyers initiating any kind of visit to our service departments to requiring that all vehicle buyers receive an orientation at delivery and have that critical first service appointment established with your dealership.
 
From being only transactional (If I cut another $2000 will you take it home today?) to realizing that at least 50% of your prospects and customers are relational (Do I like you and can I trust you?) and that your sales and service staffs have little idea how to recognize them or treat them. And so on…..
 
Today, dealerships are faced with extreme competition and finding it problematic maintaining margins and finding it impossible to grow margins because dealerships typically develop customer relationships based solely on price with little that differentiates them.
 
What’s the solution? Dealerships have to learn to have some relationship with customers that, to some degree, overrides price- or dealerships will slowly, then suddenly go broke as is happening to far too many of them today. The success of a dealership today depends simply on its understanding of psychology. How each individual sales or service employee connects with customers and how each individual employee connects with the dealership. 
 
Dealerships won’t survive continuing to focus only on transactional buyers and allowing that culture to dictate how they look at their customer base and the opportunities inherent in it. Twenty years or so ago it was so easy when sales got slow, just put up a big tent, set up a prize box, get the clowns or the bands, fire up the grill, invite the radio station in for a remote, and we could easily sell thirty or forty cars on a Saturday. Ten years ago that didn’t work so well and today it just doesn’t work at all. Okay so it’s the weather right? No it’s delivering the same old message to a new market filled with a new kind of shopper. It’s not just those transactional shoppers that believe they already know everything to make an informed decision, except the price. It’s also those transactional shoppers that are well aware they don’t know enough to make an informed decision and are shopping for an adviser they can trust not to take advantage of them.
 
Dealerships can no longer work only in the transactional dimension. They must learn to recognize the relational shopper and understand how to do business with them.   Its time to adjust that dial from all transactional and accept that 50% of your customers are relational and that both relational and transactional customers shop in both modes. You must recognize both and adjust to both or continue to loose 84% of your customer base to your competition. 
 
In just thirty-five short years how could the industry go from nearly thirty thousand mostly profitable dealers to less than twenty thousand today? How could the dealer body that sold 100% of the 240,000,000 vehicles on US Highways today give 84% of that business away and allow 400,000 service venues that didn’t exist thirty years ago to be flourishing off dealer customer bases today? How?

 

Evans Bridges

Performance Management Associates, Inc

President

1151

No Comments

Evans Bridges

Performance Management Associates, Inc

May 5, 2010

It’s referred to as the “car business”, but true car professionals know it isn’t and never has been just the car, the transaction, or the money.  Beyond the negotiating, bargaining, and adversarial activity over the terms, conditions, and other costs of these temporary contacts, it’s the “people”…the personal connections and relational interactions between vehicle buyers and service visitors and frontline dealership employees in those departments. 

 

Routinely dealerships focus everything and everyone on transactional buyers that have little willingness to commit beyond the “current deal”. Relational buyers who are seeking a lasting connection and wanting to become actively engaged with the dealership are more prevalent in today’s market than ever before consisting of up to 80% of new car buyers.

 

True car “professionals” always managed customer relationships to turn prospects into customers and customers into repeat and referral business.  They realized that making a connection and building trust lead to many benefits: less price resistance, more future work, more referrals, better working relationships with their customers, and more revenue…repeat customers spend 33% more.

 

Technology only vendors continue to enter the market place touting “CRM” applications they say will revolutionize the “car business”.  These highly automated, low touch, and impersonal systems continue to fail at alarming rates, up to 80% according to experts.  These folks just don’t get it…customers are not just numbers and do not want to be made to “feel” like they are just a number and all car people are not stupid idiots.

 

Unfortunately these high-tech CRM systems, many dealership frontline employees, and many in middle management rely totally on a transactional view of prospects and customers, not any reliance on a relational viewpoint.  They continue trying to automate and totally mechanize the industry as a substitute for the human process.  It appears they really have no interest in changing…its just about driving “new traffic” and the “current deal”. They may all say they want the benefits of retention, yet they continue to act in ways that suggest that what they are really interested in is the one-time sale.  It’s all about “what can I do to sell you today”.  What it should be is what can I do to sell you today, what can I do to get you to return and buy from me again, and what can I do to earn the right to referrals from your family, friends, and co-workers.

 

Please don’t accuse us of being “phobic” about technology or CRM systems because that would be a mistake.  In fact we know that technology and CRM combined with the human element can be a powerful tool to incrementally improve vehicle and service sales and increase customer retention.   By the way, we think we have a better knowledge of how to really make it work in “real world” dealership environments than about anybody in the industry.

 

However, it seems the up front agenda of these non-car people, dot-com types, techno-freaks, and techno-only companies is to exterminate retail car professionals, make new vehicles commodities, take all the profit out of car sales, recklessly stereotype car dealerships and the folks working there.

 

You can let these folks force their ways into your dealership or you can require them to work CRM and technology into your dealership in a way that enhances the culture of your clients and frontline employees...not breaking it.  Quite frankly we do not believe the car business is broken… it just needs to adapt and adjust to take advantage of the new emotional relational driven economy.

 

 

Evans Bridges

Performance Management Associates, Inc

President

3046

No Comments

Evans Bridges

Performance Management Associates, Inc

May 5, 2010

It’s referred to as the “car business”, but true car professionals know it isn’t and never has been just the car, the transaction, or the money.  Beyond the negotiating, bargaining, and adversarial activity over the terms, conditions, and other costs of these temporary contacts, it’s the “people”…the personal connections and relational interactions between vehicle buyers and service visitors and frontline dealership employees in those departments. 

 

Routinely dealerships focus everything and everyone on transactional buyers that have little willingness to commit beyond the “current deal”. Relational buyers who are seeking a lasting connection and wanting to become actively engaged with the dealership are more prevalent in today’s market than ever before consisting of up to 80% of new car buyers.

 

True car “professionals” always managed customer relationships to turn prospects into customers and customers into repeat and referral business.  They realized that making a connection and building trust lead to many benefits: less price resistance, more future work, more referrals, better working relationships with their customers, and more revenue…repeat customers spend 33% more.

 

Technology only vendors continue to enter the market place touting “CRM” applications they say will revolutionize the “car business”.  These highly automated, low touch, and impersonal systems continue to fail at alarming rates, up to 80% according to experts.  These folks just don’t get it…customers are not just numbers and do not want to be made to “feel” like they are just a number and all car people are not stupid idiots.

 

Unfortunately these high-tech CRM systems, many dealership frontline employees, and many in middle management rely totally on a transactional view of prospects and customers, not any reliance on a relational viewpoint.  They continue trying to automate and totally mechanize the industry as a substitute for the human process.  It appears they really have no interest in changing…its just about driving “new traffic” and the “current deal”. They may all say they want the benefits of retention, yet they continue to act in ways that suggest that what they are really interested in is the one-time sale.  It’s all about “what can I do to sell you today”.  What it should be is what can I do to sell you today, what can I do to get you to return and buy from me again, and what can I do to earn the right to referrals from your family, friends, and co-workers.

 

Please don’t accuse us of being “phobic” about technology or CRM systems because that would be a mistake.  In fact we know that technology and CRM combined with the human element can be a powerful tool to incrementally improve vehicle and service sales and increase customer retention.   By the way, we think we have a better knowledge of how to really make it work in “real world” dealership environments than about anybody in the industry.

 

However, it seems the up front agenda of these non-car people, dot-com types, techno-freaks, and techno-only companies is to exterminate retail car professionals, make new vehicles commodities, take all the profit out of car sales, recklessly stereotype car dealerships and the folks working there.

 

You can let these folks force their ways into your dealership or you can require them to work CRM and technology into your dealership in a way that enhances the culture of your clients and frontline employees...not breaking it.  Quite frankly we do not believe the car business is broken… it just needs to adapt and adjust to take advantage of the new emotional relational driven economy.

 

 

Evans Bridges

Performance Management Associates, Inc

President

3046

No Comments

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