Gas prices, inventory and parts shortages are going to take car sales back to the basics. We are already seeing a decrease in incentives from the manufacturers as we have started to see this month as most of the plants in the US are on limited schedules due to parts shortages coming in from Japan including some of the domestic manufacturer plants. Salespeople are going to have to get back to selling themselves, the dealership, and the product and not deep discounts and special A.P.R.'s.

Dealers won't be able to offer the discounts just due to Economics 101; the basics of supply and demand. A lot of the Honda, Toyota, and Nissan dealers are really starting to see the ripple effect that is showing in their inventory levels right now and in the coming months and will really see the effects of the earthquake in the coming months. Some of the domestic makes are starting to see it also as a result of the earthquakes. Dealers have to get creative in the coming months to stay afloat with new car inventory levels being as low as they will be. The salespeople will have to start selling out of stock more and more and not be able to rely on other dealers' inventories for dealer trades.

Fuel prices are also going to affect the used car market on used SUVs and some of the more fuel efficient vehicles. Most dealers are going to be conservative on their trade values on the 'gas guzzlers' just due to the fact that gas may be pushing $6 a gallon according to some reports. Everyone is going to want to be dumping their SUVs for something more fuel efficient to lower their outgoing cash flow. Auction acquisition costs are going to go up on all of the fuel efficient vehicles just due to the gas costs and new car inventory levels being lower than normal.

Back to sales 101. We as salespeople will have to hold our ground a little more than previous years. The supply won't be there to do dealer locates for the customer. If the customer wants a red one and all you have is pink, well, you will have to sell the benefits of the pink one that you have in stock. You wont have other dealers' inventory in your back pocket and we won't be able to offer the discounts that have been available since the factory won't be supporting us as much with factory incentives since the inventory levels will be lower than normal.

When a customer is wanting to trade their gas guzzler, they have to take everything into consideration; the total cost of ownership. I am guessing that the online trade-in tools like kbb, edmunds, and Autotrader Trade-in Market Place aren't caught up with the market with as fast as gas is going up. The customer has to realize that and take into consideration the gas savings that he or she will be getting with the new vehicle that they are looking at. Break out a spread sheet and show gas savings on paper their gas savings. Of course they know in their head they will save money, but put it on paper and it has a much stronger affect on people when they see the actual savings. In some cases, they may be able to save enough money with moving to something more efficient and keep their gas guzzler for when they need it.

If there is one thing that all of you must start doing and that is building up your used car inventory. We are not sure what 2011 will bring with regards to the production of new vehicle inventory, so in case, production is not what we will hope it is, and your used inventory will play a large part in your dealership's profitability. Be conservative on this gas guzzlers and be aggressive on the fuel efficient cars since you won't be able to buy them at auctions. Work your CRM and when you need a certain car, search your CRM and call those customers that have them and try to get them in something new that you have in stock and get that used car for your lot. Also, look at the newspaper just like the old days and also look at the online ads. Most of those people are just looking to sell their vehicle. Another option is to call other dealerships that are carrying something that you specialize in. A Ford dealer may not do well with Chrysler product and visa versa. You also may want to consider spiffing the salespeople for tracking vehicles down for your used car inventory.

I think the coming months with shortage of inventory is going to bring the cream to the top in sales professionals and dealerships. The salespeople that are mining their database and finding their customers that are ready to trade whether they know it or not and selling the trade to the customer in front of them are going to be the successful ones. There will still be the walk in traffic, but they will have to work hard through the inventory issues and get their selling shoes on. Sales Managers will have to count on the most successful salespeople to get the inventory they need. Now is the time to make it happen.  Sell yourself, the dealership, and what you have in stock.

Gas prices, inventory and parts shortages are going to take car sales back to the basics. We are already seeing a decrease in incentives from the manufacturers as we have started to see this month as most of the plants in the US are on limited schedules due to parts shortages coming in from Japan including some of the domestic manufacturer plants. Salespeople are going to have to get back to selling themselves, the dealership, and the product and not deep discounts and special A.P.R.'s.

Dealers won't be able to offer the discounts just due to Economics 101; the basics of supply and demand. A lot of the Honda, Toyota, and Nissan dealers are really starting to see the ripple effect that is showing in their inventory levels right now and in the coming months and will really see the effects of the earthquake in the coming months. Some of the domestic makes are starting to see it also as a result of the earthquakes. Dealers have to get creative in the coming months to stay afloat with new car inventory levels being as low as they will be. The salespeople will have to start selling out of stock more and more and not be able to rely on other dealers' inventories for dealer trades.

Fuel prices are also going to affect the used car market on used SUVs and some of the more fuel efficient vehicles. Most dealers are going to be conservative on their trade values on the 'gas guzzlers' just due to the fact that gas may be pushing $6 a gallon according to some reports. Everyone is going to want to be dumping their SUVs for something more fuel efficient to lower their outgoing cash flow. Auction acquisition costs are going to go up on all of the fuel efficient vehicles just due to the gas costs and new car inventory levels being lower than normal.

Back to sales 101. We as salespeople will have to hold our ground a little more than previous years. The supply won't be there to do dealer locates for the customer. If the customer wants a red one and all you have is pink, well, you will have to sell the benefits of the pink one that you have in stock. You wont have other dealers' inventory in your back pocket and we won't be able to offer the discounts that have been available since the factory won't be supporting us as much with factory incentives since the inventory levels will be lower than normal.

When a customer is wanting to trade their gas guzzler, they have to take everything into consideration; the total cost of ownership. I am guessing that the online trade-in tools like kbb, edmunds, and Autotrader Trade-in Market Place aren't caught up with the market with as fast as gas is going up. The customer has to realize that and take into consideration the gas savings that he or she will be getting with the new vehicle that they are looking at. Break out a spread sheet and show gas savings on paper their gas savings. Of course they know in their head they will save money, but put it on paper and it has a much stronger affect on people when they see the actual savings. In some cases, they may be able to save enough money with moving to something more efficient and keep their gas guzzler for when they need it.

If there is one thing that all of you must start doing and that is building up your used car inventory. We are not sure what 2011 will bring with regards to the production of new vehicle inventory, so in case, production is not what we will hope it is, and your used inventory will play a large part in your dealership's profitability. Be conservative on this gas guzzlers and be aggressive on the fuel efficient cars since you won't be able to buy them at auctions. Work your CRM and when you need a certain car, search your CRM and call those customers that have them and try to get them in something new that you have in stock and get that used car for your lot. Also, look at the newspaper just like the old days and also look at the online ads. Most of those people are just looking to sell their vehicle. Another option is to call other dealerships that are carrying something that you specialize in. A Ford dealer may not do well with Chrysler product and visa versa. You also may want to consider spiffing the salespeople for tracking vehicles down for your used car inventory.

I think the coming months with shortage of inventory is going to bring the cream to the top in sales professionals and dealerships. The salespeople that are mining their database and finding their customers that are ready to trade whether they know it or not and selling the trade to the customer in front of them are going to be the successful ones. There will still be the walk in traffic, but they will have to work hard through the inventory issues and get their selling shoes on. Sales Managers will have to count on the most successful salespeople to get the inventory they need. Now is the time to make it happen.  Sell yourself, the dealership, and what you have in stock.

Thinking about last week and digesting everything that was presented at Digital Dealer is exhausting. I looked at a ton of products, and was a great week overall making connections on a vendor and dealership level.  There were a lot of really good products there and caught not only my eye, but a lot of dealer's eyes in the sea of vendors in the exposition hall, but any solution is only how great you use that product. 

Thinking on all of the sessions that I attended, they all had a similar underlying theme. The bottom line theme comes down to processes. There's a process for social media, a process for online marketing, a process for first responses and follow up, and a process for reputation management.  Everything has a process.  If your processes aren't there and not being executed, you won't see the success that you were promised by the vendor and you will fail.  But it doesn't end there. Have them in writing so you can watch the flow of things over time and make sure that all of the tasks are being completed according to plan.  No matter how great the product is, even if it is the best thing since sliced bread, it may be horrible with your dealership because of your process that is in place or lack there of.

Every dealer has different processes, but you have to find the sweet spot and find the processes that works for you. It will take some trial and error time, but in the long run, it will all be worth it. You have to come up with a good Internet process, good follow up process for unsold showroom traffic, unsold I-leads, unreachable customers that have submitted for info over the Internet. Not one process will work for every dealership. It may have the same concept or be similar, but they will be different in every store.

The process has to be unique to the customer to make you stand out from others. It will make the experience for the consumer great if you have the right processes in place.  I heard in the last week that it's not the best price that matters, it is the best experience that will get you the business. It all comes down to how you handle the Internet lead or incoming phone call.  It's all your process.  People will travel over 30 miles when the process is flawless and be executed correctly. 

If you don't have a process in a certain area, get one.  Collaborate with managers within the dealership that are involved in that area of focus and talk about it. Let that process work for 30-60 days and reevaluate it and make sure things are happening correctly and is being executed correctly. If the process that was decided on isn't working as planned, steer the ship back onto course and make changes on the fly as needed.  Once you have all of the processes in place, you will have the success you are looking for. 

What products did you see that can take your dealership to the next level and have a clean process with it?

Thinking about last week and digesting everything that was presented at Digital Dealer is exhausting. I looked at a ton of products, and was a great week overall making connections on a vendor and dealership level.  There were a lot of really good products there and caught not only my eye, but a lot of dealer's eyes in the sea of vendors in the exposition hall, but any solution is only how great you use that product. 

Thinking on all of the sessions that I attended, they all had a similar underlying theme. The bottom line theme comes down to processes. There's a process for social media, a process for online marketing, a process for first responses and follow up, and a process for reputation management.  Everything has a process.  If your processes aren't there and not being executed, you won't see the success that you were promised by the vendor and you will fail.  But it doesn't end there. Have them in writing so you can watch the flow of things over time and make sure that all of the tasks are being completed according to plan.  No matter how great the product is, even if it is the best thing since sliced bread, it may be horrible with your dealership because of your process that is in place or lack there of.

Every dealer has different processes, but you have to find the sweet spot and find the processes that works for you. It will take some trial and error time, but in the long run, it will all be worth it. You have to come up with a good Internet process, good follow up process for unsold showroom traffic, unsold I-leads, unreachable customers that have submitted for info over the Internet. Not one process will work for every dealership. It may have the same concept or be similar, but they will be different in every store.

The process has to be unique to the customer to make you stand out from others. It will make the experience for the consumer great if you have the right processes in place.  I heard in the last week that it's not the best price that matters, it is the best experience that will get you the business. It all comes down to how you handle the Internet lead or incoming phone call.  It's all your process.  People will travel over 30 miles when the process is flawless and be executed correctly. 

If you don't have a process in a certain area, get one.  Collaborate with managers within the dealership that are involved in that area of focus and talk about it. Let that process work for 30-60 days and reevaluate it and make sure things are happening correctly and is being executed correctly. If the process that was decided on isn't working as planned, steer the ship back onto course and make changes on the fly as needed.  Once you have all of the processes in place, you will have the success you are looking for. 

What products did you see that can take your dealership to the next level and have a clean process with it?

I had the opportunity to demo the new product that ResponseLogix released yesterday.  They have made some major improvements to the quote templates that they have had in place.  The email quotes that were being sent were in HTML format and are now going to what I would consider a micro site just for the customer.  It is also in a format where it is more user-friendly and has some more trackable capabilities to it. There are 5 sections to the email quote that is sent.

In the first section of the email that is sent is a personalized message from thedealership.  Along with the message, on the side, are links back to the dealership website for service appointment, credit application, online trade appraisal, specials, request another quote, and visit our website.

 In the second section, which has the quote itself on the particular vehicle that was requested, you can incorporate the window sticker itself along with the EPA portion of the window sticker.

The third portion incorporates the Truecar Price Report. It is like being on the site itselfand looking at where the dealer is priced at according to it. This feature can be turned on and off if you are priced above the market on any particular vehicle, which is a great option for dealers.

The forth section includes other options. You can choose one level up and one level down for a new car. For used cars, you can add up to four other comparable vehicles that you have in stock.

In the fifth section is the signature of the representative from the dealership. They do put a tracking number that is assigned to that particular lead to track analytics to make sure that there is dialogue with the customer and the salesperson.

The other portion is tracking. When the lead comes in, ResponseLogix will scrub the customer's phone number and assign a toll free number with an extension to track the phone calls. It will allow for tracking of the customer contact and falls in an analytics tool that managers have access to.

There is another component to the system where it will do certain emails to the customer if there is no contact in 72 hours or however you want to set it up. It will also send out an email after 14 days or however you want to set it up and it is like a survey type email. Are you still in the market, do you want to set up a test drive, etc.

There is one last portion and that is if the customer opens the lead and goes away from the email and goes to a site that has banner ads or tower ads, they somehow cookie the user. When they hit say CNN.com, there will be the car on the side of the page, click here to schedule your test drive. It then links back to your site.

I really feel this is a product that will take things to the next level for dealerships across the nation.

I had the opportunity to demo the new product that ResponseLogix released yesterday.  They have made some major improvements to the quote templates that they have had in place.  The email quotes that were being sent were in HTML format and are now going to what I would consider a micro site just for the customer.  It is also in a format where it is more user-friendly and has some more trackable capabilities to it. There are 5 sections to the email quote that is sent.

In the first section of the email that is sent is a personalized message from thedealership.  Along with the message, on the side, are links back to the dealership website for service appointment, credit application, online trade appraisal, specials, request another quote, and visit our website.

 In the second section, which has the quote itself on the particular vehicle that was requested, you can incorporate the window sticker itself along with the EPA portion of the window sticker.

The third portion incorporates the Truecar Price Report. It is like being on the site itselfand looking at where the dealer is priced at according to it. This feature can be turned on and off if you are priced above the market on any particular vehicle, which is a great option for dealers.

The forth section includes other options. You can choose one level up and one level down for a new car. For used cars, you can add up to four other comparable vehicles that you have in stock.

In the fifth section is the signature of the representative from the dealership. They do put a tracking number that is assigned to that particular lead to track analytics to make sure that there is dialogue with the customer and the salesperson.

The other portion is tracking. When the lead comes in, ResponseLogix will scrub the customer's phone number and assign a toll free number with an extension to track the phone calls. It will allow for tracking of the customer contact and falls in an analytics tool that managers have access to.

There is another component to the system where it will do certain emails to the customer if there is no contact in 72 hours or however you want to set it up. It will also send out an email after 14 days or however you want to set it up and it is like a survey type email. Are you still in the market, do you want to set up a test drive, etc.

There is one last portion and that is if the customer opens the lead and goes away from the email and goes to a site that has banner ads or tower ads, they somehow cookie the user. When they hit say CNN.com, there will be the car on the side of the page, click here to schedule your test drive. It then links back to your site.

I really feel this is a product that will take things to the next level for dealerships across the nation.

Online advertising in the car business can be a tough at times to track.  We hear the numbers from all of the vendors in how many people search and research on the internet before coming into a dealership.  Some will submit for more info, some will call, and some will just show up in your showroom.  There are some pretty stout numbers out there from Northwood University.  So how true are they?

We had a sourcing done by Autotrader and confirmed a lot of info that we kind of knew, but learned a lot in the process too.  We learned that 75% of OUR used car customers were on the internet doing research before they set foot in our door.  Of that 75%, 61% were what a lot of salesmen would say is 'drive-by' traffic.  Only 29% made contact with us before making the trip into the dealership.  This coincides with the Northwood University studies that have been done over the last few years.  They were using websites that we have not advertised on before and had no idea that they relied on that information that much.  With that in mind, we are now advertising there.  Still a little early to see the results.

On the new side of things, 73% of OUR buyers used the internet.  This may be a little low as we are a single point dealership and we rely heavily on repeat and referral business which was confirmed in our study (35% were a referral from a friend/family member).  69% of those people were just 'walk-in' traffic and didn't make any contact with us through email or phone.

This goes to show that even though some of the online advertisers may be a little pricy, it validated where we were putting our advertising dollars online.  We are now advertising on the top 6 of the 7 websites.  The one doesn't allow for advertising as of yet to my knowledge.  People are looking at you online and you have to look good.

You have to have good photos, good descriptions, and competitive pricing.  You almost have to have a pricing tool of some sort like vAuto, VIN Solutions, or something equivalent.  When you have that combination, you will succeed.  Just about every customer is an 'internet customer.'  So is your dealership an internet dealership?  All of the staff has to be prepared to handle the internet shopper because if they didn't submit for info or call in, 6 or 7 out of 10 did do their research online on the car, and the dealership.

Online advertising in the car business can be a tough at times to track.  We hear the numbers from all of the vendors in how many people search and research on the internet before coming into a dealership.  Some will submit for more info, some will call, and some will just show up in your showroom.  There are some pretty stout numbers out there from Northwood University.  So how true are they?

We had a sourcing done by Autotrader and confirmed a lot of info that we kind of knew, but learned a lot in the process too.  We learned that 75% of OUR used car customers were on the internet doing research before they set foot in our door.  Of that 75%, 61% were what a lot of salesmen would say is 'drive-by' traffic.  Only 29% made contact with us before making the trip into the dealership.  This coincides with the Northwood University studies that have been done over the last few years.  They were using websites that we have not advertised on before and had no idea that they relied on that information that much.  With that in mind, we are now advertising there.  Still a little early to see the results.

On the new side of things, 73% of OUR buyers used the internet.  This may be a little low as we are a single point dealership and we rely heavily on repeat and referral business which was confirmed in our study (35% were a referral from a friend/family member).  69% of those people were just 'walk-in' traffic and didn't make any contact with us through email or phone.

This goes to show that even though some of the online advertisers may be a little pricy, it validated where we were putting our advertising dollars online.  We are now advertising on the top 6 of the 7 websites.  The one doesn't allow for advertising as of yet to my knowledge.  People are looking at you online and you have to look good.

You have to have good photos, good descriptions, and competitive pricing.  You almost have to have a pricing tool of some sort like vAuto, VIN Solutions, or something equivalent.  When you have that combination, you will succeed.  Just about every customer is an 'internet customer.'  So is your dealership an internet dealership?  All of the staff has to be prepared to handle the internet shopper because if they didn't submit for info or call in, 6 or 7 out of 10 did do their research online on the car, and the dealership.