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Stan Sher

Stan Sher President

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It's the internet manager's fault...

Picture this scenario...

A high level Internet/BDC Manager gets hired into a dealership that is a goldmine of an opportunity.  This person comes very highly recommended and has a proven track record of building success for every dealership that they have worked with.  It is amazing how during the interview process this person's suggestions and views are not really cared for.  Here is a dealership that gets over 2000 leads per month with an underperforming BDC, very poor customer satisfaction, and untrained sales consultants.

This new BDC Manager starts working at the dealership that builds him a new BDC office with space to fit 10 BDC reps.  The dealership is operating with only 4 BDC reps that cherry pick the leads and do not follow up a set process.  This is because the CRM is not properly set up.  These 4 BDC reps are working 55 hours per week and milking the dealership for overtime with very little focus on performance since the commission plan is poor.  The sales staff is micro-managed and is required to spend an hour a day in the BDC to make random phone calls to random internet leads (only to aggravate prospects) without reading notes on the customers.

What does the BDC Manager accomplish in a 2 month period?

Start with the fact that this person works 50 hours per week.  Also take into consideration that the General Manager is really just a General Sales Manager who takes on way more responsibility than they should.  They handle websites, third party lead providers, and marketing without ever involving the BDC Manager (who has the best automotive digital marketing background in the whole dealership).  Take into consideration that while all of the dealerships that are smart are pulling out of using TrueCar, this dealership embraces it.  They get 1200 leads per month off of ZAG and only sell 30.  They are happy with that and do not care for the fact that 95% of the leads are garbage that clutter the CRM.  When the BDC Manager speaks up, the response that he gets is "look we delivered 30 cars at $2,700 per unit so it is a great resource".

Does this sound like a problematic situation?  So the BDC Manager puts up with it and works with what he has knowing that the dealership only talks about growing but does not want to make changes that will allow for the growth.

So in two months, here is what happens:

1. Pay Plan change for BDC reps.  No more overtime.  No more hourly pay.  They strictly get paid a weekly salary to work 40 hours per week.  The commission plan becomes lucrative.  There is a bonus put in place if the team hits their goals.  This causes issues and struggles because everyone started to complain.  However, everyone has the option of accepting the change and the ability to make more money or pack their things and leave.  Every single BDC rep stays loyal and decides to follow this new plan.

2. As we know it is impossible to manager 2000 leads for 4 people.  The BDC Managers hires 4 more people rounding out the staff to an even 8 person BDC.  Now we are in business.  This stops the cherry picking and starts to push the BDC reps to making more phone calls and appointments.

3. Training.  The BDC reps were all trained to follow the system that BDC Manager has put into place.  It was easier for the new people to learn and develop these new methods while the veterans had to incorporate this into what they were already doing.

4. CRM Process setup.  The CRM was a total disaster.  There was no work plan.  In fact the only leads that were followed up with were the ones that responded back.  Email templates were not clear and everyone just sent out a random email.  This would change as the BDC Manager installed processes and email templates that include 120 follow for internet leads consisting of emails and phone calls.  The emails had fresh, unique, content that triggered customers to respond.  This automatically increased contact rates and elevated to more phone calls.  There were processes installed for following up with unsold showroom customers as well as bringing in service customers to give them an opportunity to trade their vehicle into a new one.

The Results:

Before all of these changes were made, the average Saturday appointment log would have 60-70 appointments booked.  After these changes, an average Saturday appointment log with have between 85 and 104 appointments.  During the week the appointments went from 15 per day to as many as 35 per day.  Towards the end of the 2nd month the total amount of appointments for the store were 610 set and 317 shows.

The problem:

With 610 set and 317 shows, the dealership as a whole was sitting on only 115 delivered vehicles.  Keep in mind that lead count dropped as Zag/TrueCar made changes.  The leads went from 1200 to 600.  The BDC Manager was happy to have less garbage clutter the CRM.  The customers are being brought in yet the sales department is dropping the ball.  The dealership is starting to have more customer satisfaction problems than ever.  More and more customers email and call to complain.  They are being mishandled.  One of the sales consultants who consistently sell over 30 cars per month is politically tied in with the GM and he gets way with everything.  He skates other sales people and he is the main source of the customer satisfaction problems.

What else?  It is two months into this department being setup.  The BDC Manager still does not have as desk, computer, and phone.  There were times when the BDC Manager had to work out of their very own laptop.  The first month and half there were not enough phone lines.

So the finger pointing starts and the blame goes to the internet manager for the dealership not selling cars.  The blame also states that they are not focused on the job as much as they should be and the results are not there.  The dealership does not know what to do next but thinks that having this BDC Manager is a huge expense so they let him go.

Fast forward one week later after the BDC Manager is gone.  This dealership has no clue to what to do next so they place their 30 car per month sales all-star (who barely speaks English and is the reason for most of the customer satisfaction problems) to be the acting BDC Manager.  This person has no BDC training and has no idea how to manage the CRM and anything about process.  Well that first Saturday, the appointment log drops down to 50 appointments instead of 90.

What is the point?

The point is that dealers need to stop looking for an instant miracle.  If you want to grow and you get someone great give them the chance and the support that they need to make it work.  Stop fighting it.  Control the dealership so that no one else gets in the way politically to make it difficult for the store to grow.  Start focusing on managing the sales staff and fixing all of the customer service issues that come with the problem.  At 317 customers showing up, the dealership should have sold 140-150 units just off the appointments and even more from the walk in traffic.  Yet the blame is still put on the internet manager.  This store does not look back and think "Why did we have to go through 5 and now 6 BDC Managers in 2 years?"  They just dream big and finger point.  Finger pointing and playing the blame game only takes you backwards.  So when you decide that you want to grow and make positive changes.  Stick with them and do not cause action that will make you go backwards.

By the way this is based on a true story and this actually happened within the last two months.  The statistics are 100% accurate.

Lindsey Auguste
Interesting post, Stan. I think the finger-pointing can go both ways in a situation like this when neither party feels like they are getting the support they require to be successful. In trying to glean take-aways from your post, you mention that "If you want to grow and you get someone great, give them the chance and the support that they need to make it work." How does a manager know when someone is "great" and that they just need more support vs. thinking that person isn't getting the results they need? It's completely understandable that a GM wants their hand in the bucket in certain departments and it would be hard and not always valuable for them to just turn the operations over to a new employee.
Stan Sher
Lindsey, You are right about that. However, it is the internet manager's job to ensure that the dealership has traffic coming in. In that regards, the job is being done. When the traffic is coming in, the BDC is told they are doing a good job. There are moments when things slow down and a small part of day can be slow. Let's face it there are moments in time when you can make calls and people are not picking up the phone at all. The internet manager should be blamed when they do not do their job or when they do their job poorly. The job is done poorly when the showroom is consistently empty. It is never the internet or BDC department's fault that cars are not sold. It is never their fault that customers are being treated poorly by sales people in the showroom. This comes from sales management and how they manage their people. If the BDC would go on an outrage and start blaming the sales department then I would see where finger pointing would go from both sides. In some respects there might be finger pointing from both sides. You mention, "how does a manager know when someone is great?". You look at their past success in the same role and you listen to the people that recommended this person to you. In terms of thinking that "this person is not getting the results that they need", well this needs to be looked at on a large scale and every aspect of the business needs to be evaluated and not just one part. Especially the part that does everything to the fullest extent to make sure that business opportunities are being developed.
Russ Chandler
In a similar situation I found that taking a look at how decisions are made around the table of managers, owners, and anyone else involved in the major decisions is a good way to streamline things. Most BDC or Internet managers make decisions based on analytics, trends, and consumer data. Most of the guys that haven't yet joined us in putting complete faith into the internet are still basing their decisions off gut feelings and past experiences. The thing is most past experience doesn't apply anymore and the gut feelings just aren't the best route anymore. Instead decisions need to be made based on hard data, everything can and should be tracked. That means there should be an answer to the decision that needs made in the data. For me getting my college's and boss to start thinking along these lines have brought us all much closer to seeing eye to eye. Let's quit guessing and thinking to much, let's just analyze the data we have. The answer is always in the data.
Lindsey Auguste
Russ, you are spot on! The success is in the data if you analyze it and track it effectively. The fact that things aren't the same as they used to be makes this paramount so dealers can continue to learn and grow from the right information. Stan, to your point about knowing if a person is right for the job or not, these things are changing so quickly that, as Russ mentioned, past experiences are not necessarily the best indicator of who is right for a particular job. Resources are different, responsibilities are different, and in many ways, the means to accomplish a goal have changed. The leadership constantly has to evaluate if a person is right for the position and producing the desired results. Sometimes that can come down to communication as well. If the goals and responsibilities aren't clearly defined, that can lead to a lot of unrecognized work and undesired results. From your description, it sounded like this Internet manager was also responsible for the marketing department, which can be very different role than organizing a team to handle email leads and follow up.
Jim Bell
Very interesting. Sounds like the plan was in place, the process was set in place, and the execution started to work and then just crumbled. That's a darn shame. Now they have no leader and no execution that this person put into place. There is no overnight cure to what happens on the sales floor and has to be given time to turn something like that around. I know that it took months for us to turn around, but it did. It all takes nurturing those leads and won't happen over night.

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