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Jim Radogna

Jim Radogna President

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Transparency is Not a Dirty Word

Shortly after I began writing this post, an article popped up on my Google Alerts about another dealer group, accused of deceptive marketing by their state attorney general’s office, having to pony up a six-figure settlement. Not surprising at all, I’m used to seeing these types of articles on a regular basis. Another day, another enforcement action against a car dealer.

In this case, the dealerships were accused of “having advertisements online and in print publications that misrepresented the actual prices of automobiles”, “dealership employees asking consumers to sign incomplete documents with the understanding that they would be completed using the negotiated vehicle price, but later entering a higher price”, and “allegedly charging consumers fees for unwanted or undisclosed warranties and services”. According to the article, the auto group denied any wrongdoing but agreed to the settlement.

But I digress. The above story really isn’t the point of this post, nor is it my intention to try to warn you of the legal dangers of non-compliance with the laws of the land. I, and my peers, write enough about that. Sure, I’m now a compliance consultant, but my ramblings here are based on the things I learned during my 20 plus years in automotive retail - and the realization that I probably had it all wrong.

This post is about Transparency. It’s about the Big Picture. It’s about opening your mind and stopping to think about the absurdity of old school tactics. Not from a legal or ethical mindset, but from a common-sense business perspective.

I realize that “Transparency” is the latest, and perhaps most over-used, buzzword in the car business. But please bear with me for a few moments while I pose a few questions. Hopefully, it will stimulate some “outside the box” thinking.

First, what is the upside of hiding information from your customers?

Sure, you have to do whatever it takes to stay ahead of the competition. Sure, that’s what the legendary automotive sales trainers taught us. Sure, the chances of getting into a legal bind are pretty slim. Sure, everybody else is doing it. Sure, if you give customers too much information they’ll just use it to shop you. Sure, there are ways to “manage” your online reputation, even if you have some unhappy customers. I get all that.

But – Big Picture Time – is the “anything it takes to make a deal” mentality really a sensible way to do business in today’s world? Do you really think this will lead to customer satisfaction and retention? Do you really believe that customers will continue to put up with this type of behavior forever?

Here’s how I look at it: Every time you…

Post a misleading ad, or

Charge a customer more than the advertised price, or

Lie to a customer about a vehicle being in stock, or

Present a foursquare with inaccurate numbers in order to confuse a customer, or

Present “packed” payments, or

Fail to truthfully disclose a vehicle’s history, or

You’re not completely honest and upfront with your customers

…there are some things you might want to consider:

  1. You may be breaking the law – but it’s only illegal if you get caught, right?
  2. What you’re doing may be an unethical business practice – but customers have no loyalty and you’re just trying to make a buck in a fiercely competitive marketplace, right?
  3. You may be pissing off customers (or potential customers) – but “ya gotta have haters, right”?
  4. You’re gambling with your future - this is an unsustainable way of doing business in the modern world and your continued success is greatly at risk.

Now you may be perfectly comfortable rolling the dice on number 1 and not care a lick about numbers 2 or 3, but what’s your answer for number 4?

I challenge you to think about it. Just think about it. Unfortunately, I didn’t when I worked in dealerships – I was a faithful practitioner of the old school ways.

Now, I realize that you may feel that this post is just more nonsense from an ex-car-guy-turned-consultant who doesn’t get it - and you may be right. Only time, and customer sentiment, will tell. But you may still want to ask yourself just how long are customers going to put up with business as usual?

Let’s face it; consumers have access to much more information, and choices, than they ever did. You can hate the internet and all its information. You can hate the idea of “transparency”. You can hate all the regulations that dealers have to contend with. You can hate the consumer advocates. You can hate the media and all of its anti-dealer sensationalism. But guess what? None of it is going away. The “But We’ve Always Done It This Way” mentality just doesn’t hold water anymore.

Now, I’m not a believer that the internet is going to somehow take over car buying. I totally agree that dealerships are, and will continue to be, the primary way that customers will purchase vehicles for a long time to come. But remember this; while customers may always choose to do business with dealerships, they don’t have to choose to do business with your dealership.

One final question: Are you a true professional who is ready, willing and able to succeed in the new world or are you hoping that things will never change?

In my book, transparency is not a dirty word, but complacency is.

Good luck and good selling.

Jim Bell
Great post Jim. I think with the whole buzz on transparency is we all have to realize that the customer can get some or all of the info right at their fingertips on their phones right in the showroom while the salesperson is behind the curtain with the sales manager. There have been multiple times where I see a customer on their phone while waiting for the salesperson to get back from having a trade appraised or getting numbers from the manager. We all just have to aware of that and there is no reason to try to pull the wool over someone now or it will just come back and bite you in the arse.
Jim Radogna
Thanks Jim! You make a great point. We've always been taught to do whatever it takes to get the customer into the store because we could then take "control". But what about now? Customers are connected to the outside world through their mobile devices. Think about all of the traditional closes: "you won't find a better price or lower payment..." or "you won't be able to find this model/color/equipment anywhere else...". To which the customer can now confidently respond "watch me!"
Casimiro (Casey) Garza
Reminds me a little about the current politics and the "Change", things do have to change for it is changing right before us AND WE NEED TO KEEP UP. Like in the politics, these changes are just not accepted by "old school", they are just too drastic in their minds and will not accept them..too many changes and too drastic. It is all about getting rich today, and the heck with tomorrow! can preach all that you want, coach it all you want, say it over and over all that you want....BUT the "old school" still has the money, and as long as they have it,they are not going to reason and make it more transparent...they'll mislead, pack it all day, twist the truth, lie, charge exra, and continue to do "anything to do a deal"! PERIOD! It is all about the PVR!! PERIOD!!....Sorry Jim, nice try but it is just going to happen, "transparency" will continue to be a "see right thru it" idea that will not work for now! (if you are curious, Yes, I am a "Yellow Dog Democrat" explaining the "change" analogy)......

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