Digital dealer magazine january 2009

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Just as you are trying to keep your store(s) on the cutting edge, we are doing the very same thing as we venture into a new frontier in the publishing biz. We can get this digital version in your hands 2-3 weeks faster than the print version, giving you the freshest information possible. You can click on links at the end of each article to email the author of such. And you can click on the ads to link to that advertiser’s website (and you’d REALLY be helping us out by doing just that). It’s quite intuitive…I don’t think that someone who uses the Internet to make a living will have any trouble easily figuring it out. Please let me know what you think about it… [email protected] Welcome to the digital edition of Digital Dealer magazine! Michael Roscoe Editor-in-Chief

Transcript of Digital dealer magazine january 2009

Just as you are trying to keep your store(s) on the cutting edge, we are doing the very same thing as we venture into a new frontier in the publishing biz.

We can get this digital version in your hands 2-3 weeks faster than the print version, giving you the freshest information possible. You can click on links at the end of each article to email the author of such. And you can click on the ads to link to that advertiser’s website (and you’d REALLY be helping us out by doing just that).

It’s quite intuitive…I don’t think that someone who uses the Internet to make a living will have any trouble easily figuring it out.

Please let me know what you think about it… [email protected]

Welcome to the digital editionof Digital Dealer magazine!

Michael Roscoe Editor-in-Chief

Just as you are trying to keep your store(s) on the cutting edge, we are doing the very same thing as we venture into a new frontier in the publishing biz.

We can get this digital version in your hands 2-3 weeks faster than the print version, giving you the freshest information possible. You can click on links at the end of each article to email the author of such. And you can click on the ads to link to that advertiser’s website (and you’d REALLY be helping us out by doing just that).

It’s quite intuitive…I don’t think that someone who uses the Internet to make a living will have any trouble easily figuring it out.

Please let me know what you think about it… [email protected]

Welcome to the digital editionof Digital Dealer magazine!

Michael Roscoe Editor-in-Chief

Just as you are trying to keep your store(s) on the cutting edge, we are doing the very same thing as we venture into a new frontier in the publishing biz.

We can get this digital version in your hands 2-3 weeks faster than the print version, giving you the freshest information possible. You can click on links at the end of each article to email the author of such. And you can click on the ads to link to that advertiser’s website (and you’d REALLY be helping us out by doing just that).

It’s quite intuitive…I don’t think that someone who uses the Internet to make a living will have any trouble easily figuring it out.

Please let me know what you think about it… [email protected]

Welcome to the digital editionof Digital Dealer magazine!

Michael Roscoe Editor-in-Chief

The Technology Magazine for Dealers & Managers

January 2009

Association of Automotive

Association of Automotive

Internet Sales Professionals

Internet Sales Professionals

www.AAISPonline.org

www.AAISPonline.org

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FFICIAL

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Association of Automotive

Association of Automotive

Internet Sales Professionals

Internet Sales Professionals

www.AAISPonline.org

www.AAISPonline.orgAssociation of Automotive

Internet Sales Professionals

www.AAISPonline.org

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DIANAWEAVER

Internet Marketing &CRM Manager

Tom Wood Automotivepage 26

Internet Sales:Dealers Who Dared to Change page 12

Store Management’s Keysto Building Internet Sales page 18

Technology Trends:If Space is Cheap – HowMuch can you Keep?page 30

DMS Workshop:Profit is Opinion,Cash Flow is Fact page 36

Internet Sales:Dealers Who Dared to Change page 12

Store Management’s Keysto Building Internet Sales page 18

Technology Trends:If Space is Cheap – HowMuch can you Keep?page 30

DMS Workshop:Profit is Opinion,Cash Flow is Fact page 36

Do Your Customers Get the Point?Go to www.autopointsite.com

or call 866-348-9717

OWNERSHIP LIFECYCLE MANAGEMENT

“Dahl Ford has increased vehicle sales andservice revenue PLUS reduced our overall expenses using

Ownership Lifecycle Management from Auto Point.We highly recommend it."

Call Auto Point - or call us.

KV Dahl III, GMDahl FordDavenport, IA

Tim ThompsonGeneral Sales Manager

Amy LarsonBDC/Public Relations

Randy OlerParts & Service Director

Dan WichService Department Manager

DD 4 January 2009 DigitalDealer-magazine.com

FEATURE

Digital Dealer Cover Story26 Diana Weaver

Internet Marketing & CRM ManagerTom Wood Automotive

COLUMNSAAISP Notes

10 Mike Roscoe

Internet Sales12 Dealers Who Dared to Change

Phil Sura

16 Making Every Lead CountPaige Presley

18 Store Management’s Keys to Building Internet SalesDaryl Sanders

20 A Jolly Good FellowJoe Webb

24 360º Market Navigation: The Secret to Winning in a Down MarketPat Ryan Jr.

Technology Trends30 If Space is Cheap – How Much can you Keep?

Sandi Jerome

BDC/CRM32 Don’t Settle for Less

Chuck Barker

36 DMS WorkshopProfit is Opinion, Cash Flow is FactJim Skeans

DEPARTMENTS6 Industry & Tech News8 Digital Dealer E-mail

TABLE OF CONTENTSAssociation of Automotive

Association of Automotive

Internet Sales Professionals

Internet Sales Professionals

www.AAISPonline.org

www.AAISPonline.org

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Association of Automotive

Association of Automotive

Internet Sales Professionals

Internet Sales Professionals

www.AAISPonline.org

www.AAISPonline.orgAssociation of Automotive

Internet Sales Professionals

www.AAISPonline.org

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A PUBLICATION OF

JANUARY 2009

MANAGING EDITORLINDA DI PIETRO

[email protected]

PUBLISHERGREG NOONAN

[email protected]

ART DIRECTORJOE BIRCH

[email protected]

PRODUCTION MANAGERELIZABETH BIRCH

PRINT PRODUCTIONDAVID MANTHEY

DESIGN CONSULTINGPUBLICATION DESIGN, INC.

COVER DESIGNJOE BIRCH

[email protected]

COVER PHOTOGRAPHYFRANK MCGRATH

CIRCULATION SUBSCRIPTIONRICH JARRETT314-432-7511

[email protected]

NATIONAL ADVERTISING [email protected]

607-264-3359Dealer magazine makes every attempt toensure the accuracy of all published works.However it cannot be held responsible foropinions expressed or facts supplied herein.Nothing may be reproduced in whole or in partwithout written permission from the publisher.All rights reserved. The publisher encouragesyou to submit suggestions. Submitted materialsbecome the property of Horizon Communications,Inc. and will not be returned. Send material forpublication to 330 Franklin Rd., Suite 135A,PMB 386, Brentwood, TN 37027. The editorreserves the right to edit material; submissionof material constitutes permission to edit andpublish that material. This publication isdesigned to provide accurate and authoritativeinformation in regard to the subject mattercovered. It is presented with the understandingthat the publisher is not engaged in renderinglegal, accounting or other professional service.If legal advice or other expert assistance isrequired, the services of a competent profes-sional person should be sought. From aDeclaration of Principles jointly adopted by aCommittee of the American Bar Associationand a Committee of Publishers.

The Technology Magazine for Dealers & Managers

Diana WeaverTom WoodAutomotive

DD 4 January 2009 DigitalDealer-magazine.com

FEATURE

Digital Dealer Cover Story26 Diana Weaver

Internet Marketing & CRM ManagerTom Wood Automotive

COLUMNS

AAISP Notes10 Mike Roscoe

Internet Sales12 Dealers Who Dared to Change

Phil Sura

16 Making Every Lead CountPaige Presley

18 Store Management’s Keys to Building Internet Sales Daryl Sanders

20 A Jolly Good FellowJoe Webb

24 360º Market Navigation: The Secret to Winning in a Down MarketPat Ryan Jr.

Technology Trends30 If Space is Cheap – How Much can you Keep?

Sandi Jerome

BDC/CRM32 Don’t Settle for Less

Chuck Barker

36 DMS WorkshopProfit is Opinion, Cash Flow is FactJim Skeans

DEPARTMENTS6 Industry & Tech News8 Digital Dealer E-mail

TABLE OF CONTENTSAssociation of Automotive

Association of Automotive

Internet Sales Professionals

Internet Sales Professionals

www.AAISPonline.org

www.AAISPonline.org

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FFICIAL

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FFICIAL

Association of Automotive

Association of Automotive

Internet Sales Professionals

Internet Sales Professionals

www.AAISPonline.org

www.AAISPonline.orgAssociation of Automotive

Internet Sales Professionals

www.AAISPonline.org

PUBLICATIO

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PUBLICATIO

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A PUBLICATION OF

JANUARY 2009

MANAGING EDITORLINDA DI PIETRO

[email protected]

PUBLISHERGREG NOONAN

[email protected]

ART DIRECTORJOE BIRCH

[email protected]

PRODUCTION MANAGERELIZABETH BIRCH

PRINT PRODUCTIONDAVID MANTHEY

DESIGN CONSULTINGPUBLICATION DESIGN, INC.

COVER DESIGNJOE BIRCH

[email protected]

COVER PHOTOGRAPHYFRANK MCGRATH

CIRCULATION SUBSCRIPTIONRICH JARRETT314-432-7511

[email protected]

NATIONAL ADVERTISING [email protected]

607-264-3359Dealer magazine makes every attempt toensure the accuracy of all published works.However it cannot be held responsible foropinions expressed or facts supplied herein.Nothing may be reproduced in whole or in partwithout written permission from the publisher.All rights reserved. The publisher encouragesyou to submit suggestions. Submitted materialsbecome the property of Horizon Communications,Inc. and will not be returned. Send material forpublication to 330 Franklin Rd., Suite 135A,PMB 386, Brentwood, TN 37027. The editorreserves the right to edit material; submissionof material constitutes permission to edit andpublish that material. This publication isdesigned to provide accurate and authoritativeinformation in regard to the subject mattercovered. It is presented with the understandingthat the publisher is not engaged in renderinglegal, accounting or other professional service.If legal advice or other expert assistance isrequired, the services of a competent profes-sional person should be sought. From aDeclaration of Principles jointly adopted by aCommittee of the American Bar Associationand a Committee of Publishers.

The Technology Magazine for Dealers & Managers

Diana WeaverTom WoodAutomotive

DD 6 January 2009 DigitalDealer-magazine.com

D IGITAL Dealer INDUSTRY & TECH NEWS

printers. AMPS is available as both acost-effective in-house and ASP solution.

www.automate.com

!

AutoUSA setsEdmunds.com

enrollment benchmarkAutoUSA, an industry leading

provider of the highest quality Internet-generated consumer leads to autodealers nationwide, has announced thatin October, the company enrolled its600th dealer in the Edmunds.comPremier Dealer Program, setting a newbenchmark in program sign-ups by anEdmunds.com PDP partner.

The Edmunds.com Premier DealerProgram was developed to help drivemore in-market auto buyers to a dealer’sweb site with increased visibility andpositioning on the Edmunds.com website. Dealers receive exclusive lead terri-tories, top placement in Edmunds’Dealer Locator, dealer-branded adver-tisements throughout Edmunds.com,custom-designed dealer PDP programweb pages and Edmunds.com dealerendorsement messages.

AutoUSA was the first Edmunds.compartner to offer the Premier DealerProgram, which was launched in 2006.Since then, AutoUSA’s program partici-pants have consistently reported increasesin lead quality and closing ratios as a resultof the additional Edmunds.com web siteexposure, and the portal’s popularity as atrusted source for vehicle reports, research,articles and comparisons.

For more information on theEdmunds.com Premier Dealer Program,call AutoUSA at 800-243-9935.

www.AutoUSA.com

!

ActivEngage offersmultiple languages

for live chat ActivEngage has announced the

launch of multiple language translationfor live chat on auto dealership websites. Now dealers can engage web sitevisitors in their preferred language,without having to employ multi-lingual staff members. The newtechnology offers dealers a huge com-petitive advantage through increasedpersonalization for their web site visi-tors’ communication preferences.

ActivEngage’s new service translateslive chat text to and from web site visi-tors in real time. When a visitor starts achat session, ActivEngage detects thevisitor’s preferred language from theirbrowser settings. The chat operatorthen asks the visitor if they would liketo chat in that language. The expandedservice includes the 15 most frequentlyspoken languages by non-nativeEnglish speakers in the U.S., includingSpanish, French, Russian, Chinese andKorean. In addition, the new servicecan distinguish between a language as itis spoken in different countries, forexample French Canadian versus theFrench spoken in France, or Spanish asit is spoken in Mexico versus Spain.

Chat operators can enable or disabletranslation for a portion of the chatsession or the entire session, based onthe site visitor’s preference. Both theoriginal and translated chat text areshown to the visitor and the operator,and the entire chat is stored in the data-base for future reference. Further,operators can chat with multiple visi-tors at the same time, using differentlanguages.

www.ActivEngage.com

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Auto/Mate receivesfirst-place STAR Award for DTS implementation

Auto/Mate Dealership Systems, aleading provider for cost-effective retailautomotive management solutions, hasannounced it is the 2008 first placeImplementation Award winner forData Transfer Specifications (DTS),an annual award presented by NADA’sStandards for Technology inAutomotive Retail (STAR). Auto/Matewas honored for adopting more STARDTS standards and using them in thedevelopment of more OEM interfacesthan any other dealership managementsystem (DMS) provider.

“OEM dealer communication system(DCS) integration has been a strongfocus for us because we know how muchtime and money dealers save when theseprocesses can be streamlined,” said MikeEsposito, president and CEO ofAuto/Mate. “We’ve always been strongsupporters of STAR’s work in developingvoluntary standards for this area, and arehonored to be recognized by them for ouraccomplishments this past year.”

Formed in 2001, the STAR organiza-tion is the voluntary informationtechnology (IT) standards body for theretail automotive industry. The organiza-tion acts as a catalyst in fulfilling thebusiness information needs of dealers andmanufacturers with voluntary standardsthat reduce the time and effort requiredto support dealership IT activities.

Auto/Mate’s Automotive ManagementProductivity Suite (AMPS) is an easy-to-use comprehensive dealershipmanagement system with over 20 inte-grated modules to help dealers moreefficiently and effectively manage theirbusiness. It supports an unlimitednumber of users, workstations and

DD 8 January 2009 DigitalDealer-magazine.com

D IGITAL Dealer E-MAIL

Jim Skeans,Please forward to me the instructions

for the create-once system to analyzeimportant ratios (November 2008Digital Dealer magazine, “LeverageMore Information from yourFinancial Statement/DOC.” I wouldalso like the list of your favorite ratios.

As an AutoMate user, I would like toclarify the instructions given by PraveenTamvada. There are no reports set up inthe OfficeMate product. You have todesign and set such reports in themodule. In addition, the download isnot as simple as stated and once the datais imported to Excel, it is my experiencethat a significant amount of clean up hasto take place in order to display a mean-ingful report. AutoMate also did notexplain that certain reports designed inOfficeMate have to be sorted each timethe report is run. DMS providers tendto over simplify the effort. We atBleecker are probably one of AutoMate’sbest users of the system and I have beena model for them regarding theOfficeMate reporting capabilities.

John RileyControllerBleecker Auto GroupDunn, [email protected]

Hi John,The ratios and formulas are included

in the spreadsheet “Key FinancialRatios” available for downloading fromthe “Free Tools” page on my web site,www.jimskeans.com. The spreadsheetalso illustrates how to link the elementsof the formulas to your financial state-ment or accounting report download forcomplete automaton from your one-time setup efforts. While you are thereplease take a look at the other manage-ment tools, available for free from ourweb site.

According to AutoMate the issues youhaving with downloading to Excel andadvanced reporting have been resolvedwith the latest version of their software,which, they tell me is free to you butmay require that you upgrade somehardware.

Good luck and if you need any help orfurther clarification just let me know.

Jim Skeans

Mr. Skeans,I was given your article from the

November 2008 issue of DigitalDealer magazine, “Leverage MoreInformation from your FinancialStatement/DOC.” I would appreciateyour list of favorite ratios with the for-

mulas that generate them if youwouldn’t mind. Thank you and happyholidays!

Tammy G. JolleyJerry Duncan Ford, Lincoln, Mercury, Inc.Harriman, TN [email protected]

See Jim’s response to previous letter.

Daryl Sanders,I read your article in the November

2008 Digital Dealer magazine,“Internet Sales Phone Calling is the Keyto Overall Success.” I work at an Acuradealership is Covina, CA. I am in theInternet department and I am experi-encing a unique problem.

I have adjusted my work hours to11am to 8pm. I did this to hopefullyhave better success in contacting cus-tomers later in the day. I average over600 calls a month, and my problem isconstant voice mail messages with noreturn calls. I also send e-mails andchange up the hours and days – stillwith the same results. I will call imme-diately after leads are received, and still,voice mail after voice mail.

Do you have any suggestions?Mike SchroederInternet SalesThomas AcuraCovina, [email protected]

Mike,After speaking with you and learning

a little more, there are a few issues we canaddress.

1) You currently have over 230 leadsper month. 2) You have not been sendingquotes first. 3) Your CRM tool forces anext step, which is creating a follow upnightmare.

That number of leads is way too manyto follow at once and I would suggest youquote first every lead. Call each lead atleast three times in the first week. Send allleads an e-mail weekly (that is a broadcaste-mail) for four weeks. By doing this, youshould generate more sales success. Let meknow how it works out.

Daryl Sanders

Digital Dealer welcomes your letters andafter verification will run them signed orunsigned. Letters may be edited for spaceand clarity. Send letters [email protected].

DD 10 January 2009 DigitalDealer-magazine.com

Got my hair cut yesterday.

I know what you’re thinking… “Whocares, Roscoe?” Well, you might…if youread on.

When’s the last time you went to a bar-bershop for a haircut? (This question ismore for the guys than the gals…but Ithink you’ll see the point, ladies.) I don’tmean a salon. I don’t mean one of thoseFabulous Sam’s or sports-cuts franchises.And I certainly don’t mean a place that’sgot one of those cutesy names like “CutLoose” or “A Cut Above” or “Hair WeGo.” I mean a real barbershop.

Well, that’s what I did…I went to abarbershop. The lady who usually cutsmy hair at a salon is off due to the bless-ing of pregnancy. So I went to the nextnearest place, which is a barbershop.

Now this isn’t a place with an old-fash-ioned barbershop rotating sign. It doesn’tsmell like grandpa’s hair oil inside. Itdoesn’t have rickety, hard wooden chairsand year-old hunting and fishing maga-zines to read. And there isn’t an old guyhunched over clipping away at the fewcustomers who wander in.

This barbershop is modern. It’s spot-less. There is no smell in the place. Thereis a waiting area with comfortable chairsand the latest men’s magazines (non-pornographic…although I’m not surewhat does or doesn’t qualify for thatdescription nowadays). Oh, and threebig screen HD plasmas on the wallsshowing sports programming. This isnot a place for a woman to get herhair “done.”

This barbershop is thoroughly modernexcept for the services they offer and the

high level of service they provide. Doesyour hair salon offer shaves? Does yourhair salon put a hot towel on your face?Does your salon shine shoes? Does yourbarber…I mean, stylist, shave your neckwith a straight razor? Does your hair salonoffer an annual program wherein you payone fee and can get your hair cut as fre-quently as you like?

I thought barbershops were almostextinct. The only places I ever see themanymore are in small towns. Yet here inthe middle of a high-end strip center, inthe 14th wealthiest county in the country,resides a modernized barbershop.

“Roscoe…what the heck does this haveto do with selling vehicles with theInternet?!”

It’s got everything to do with sellingvehicles using the Internet. See, if thisbarbershop were just like the old ones, Inever would have set foot in there. Butonce I did…they sold me with the serv-ices they provide…services that were onceavailable but for some reason are hard tofind today.

Now do you get it? Now do you seewhat I’m saying? No? OK, let meexplain it.

It’s just like selling cars with theInternet. People like the different waysthey can purchase a vehicle today…justlike I like the chairs, the TVs and theannual payment program at my barber-shop. But the reason I “bought” fromthe barbershop (and why I will keepgoing back) is because of the old-fash-ioned service I got. IOW, the way youcommunicate with customers andprospects has changed…but the way yousell them has not.

I’m not talking about throwing keys onthe roof or doing the desking dance. I’mtalking about the fundamentals of selling.The steps of the sale…attention, interest,conviction, desire, close. Getting them tosay “yes” a number of times before askinga closing question. Overcoming objec-tions and smoking out the hiddenobjections. The fundamentals of sellinghave not changed!

People like to be sold. Professionalsalespeople don’t push. They sell…professionally.

If you have been taught the fundamen-tals of selling, now is the time to makesure that you’re doing it by the book. Ifyou haven’t been taught the fundamen-tals of selling, teach yourself if yourdealership won’t. If they don’t havevideos/tapes /CDs, etc., buy them your-self. Or start reading books on sales (Irecommend the first book I ever read re:selling, Tom Hopkins’ “How to Masterthe Art of Selling”).

Remember, selling is not talking peopleinto something they don’t want. Selling isarousing emotions so that people willcome to the inevitable conclusion that theywant (or need) what you have to offer.

And no amount of technology can everdo that.

Mike RoscoeD IIGGIITTAALL DDeeaalleerr AAISP NOTES

If you wish to discuss this article withother dealers, or with the author,please go to the “Discussion Forums”at www.DigitalDealer-magazine.comand enter the “AAISP” forum or e-mail him at [email protected].

DD 12 January 2009 DigitalDealer-magazine.com

WHEN YOU THINK OF PEOPLEWITH VISION, whom do you think of?Possibly politicians like Ronald Reaganand President-Elect Obama. Perhapsyou think of great business leaders likeBill Gates and Walt Disney, or sportspersonalities like Vince Lombardi, orgreat minds like Einstein and Edison.In all cases these visionaries had theability to recognize opportunity andturn ideas into reality. So what is yourvision and how are you applying thatvision at the dealership? Here are a fewdealers who dared to change.

Saturn of St. Paul is a national leader;winning multiple Summit Awards foroutstanding market share and CSIrankings with their four store locations.Richard Herod is the director of e-com-merce. The dealership has increased theInternet sales count from 20 monthlysales in 2007 to a level of 85 units inSeptember 2008. Prior to being the e-commerce director, Richard proved hissales abilities for Saturn of St. Paul byselling and then managing one of theindividual dealerships. In his collegedays, Richard had supported himself bybuilding web sites, so he did have someorientation to the Internet but he willadmit that he is not a technical wizard.A major part of the success enjoyed bySaturn of St. Paul goes to managementstyle of Dave Roen, president of thecompany. Dave recognized that heneeded to take a more aggressive posi-tion with his online strategy early 2007.Dave took some of the following stepsto change:

• Dave believes in the adage, “Thespeed of the team is determined by thespeed of the leader.” Dave took thetime to study and understand thebasics associated with the metrics andthe key focuses associated with settingup an online strategy. If you don’tunderstand and track the basics likeunique visitor count, average stay onsite count (and why this is important),conversion rate, bounce rate, closingratios and ROI for each source, youwill not grow. It is no longer acceptablefor a president, dealer or generalmanager to use the excuse that he/shedoesn’t understand or believe in theInternet or say, “I hired Tommy to takecare of that end of the business”.

• Dave also insisted that his entiremanagement team (sales and fixed)learn the basics. The team had work-shops where different reps were invited

in to discuss strategies associated withhow to leverage the Internet to drivebusiness.

• Dave was also a strong supporter ofshifting his dealer ad association dollarsinto an online focus. I have witnessedother dealers, like Tom Kerry with FrostCadillac push for similar measures withtheir associations. Why wouldn’t youwant to invest all of your marketingdollars into a strategy that will drivebetter results? A number of dealers talkabout the “broken advertising funnel”.

For years the idea has been to have theOEM, dealer association and the indi-vidual dealer to all focus on differentcomponents of advertising. This strat-egy should be challenged because of theinfluence of the Internet and ineffec-tiveness of traditional advertising. Thiswill continue to be a political discussionbecause of the influence and power ofthe ad agencies that may not always beevolving with the times.

• Once the foundation of basicunderstanding was in place with theentire management team, a championwas selected to draft a strategy thatwould take the operation to the nextlevel. Dave considered a national searchto identify an “expert” to drive theonline focus, but in the end Daveappointed a trusted key employee,Richard Herod III to head up e-com-merce initiatives. Dave empowered andturned Richard loose with this new roleand he didn’t micromanage his choices.A budget was given with some generalguidelines to keep Richard headed inthe right direction. As long as Dave saw

D IIGGIITTAALL DDeeaalleerr INTERNET SALESPhil Sura

“So what is your

vision and how are you

applying that vision

at the dealership?”—Phil Sura

Dealers WhoDared to Change

continued on P-DD14

DD 14 January 2009 DigitalDealer-magazine.com

the tangible measured results, Richardwas permitted to run the entire show.

• Richard developed a strategy tofocus on driving the eyeballs to the sight(SEO and SEM), driving the time onthe site with a video strategy, a focuswith Google including adding videocontent through YouTube (tagging eachvideo with key search words) and aprocess to effectively handle leads on atimely basis. If leads go beyond onehour, the closing ratios are dramaticallyimpacted negatively. Richard’s videostrategy with his web site includedadding video content to the followingareas: testimonials, new car model spe-cific videos with dealer brandedmessages, and videos of each of the pre-owned units with different dealerbranded messages. The used car videosare also linked to the third-party sites(Auto Trader and Car Soup). Videoadded to the third-party sites allows fora stronger click rate (cars with video getmore play than cars without video) andit allows the dealer to brand his messageon these third-party sites. (“We have thelargest selection of certified pre-ownedSaturns in the entire state.”)

• The key metric is the number ofsold units. As mentioned above thisdealer who dared to change made amajor impact on the number of unitsbeing sold. Dave’s vision is to make it aseasy as possible for the customer to buyor service a car at his operation.

Another dealer who dared to changewas highlighted in a Digital Dealer

article in May 2008 called, “Whatabout the Smaller Dealer?”http://www.dealer-magazine.com/index.asp?article=1904

Forrie Spangler is a single pointSubaru dealer in Johnstown,Pennsylvania. He dared to change byfollowing a number of the same stepsthat Dave Roen took. His team isfocused on driving customers throughan online focus. Forrie has migrated hisad dollars from traditional media to anonline strategy in a community wheredealers are not web focused. Whenthings get tough, it is natural to want tomove back to old habits (full page ads inthe local paper) but Forrie is staying thecourse. Forrie measures his uniquevisitor count to determine his ROI withthe dollars that he has invested to drivehis online strategy. Forrie has alsoplaced video content with YouTube thatis being picked up with the organicsearch. Forrie also has a video strategypromoting video with the three keyareas on his web site: new cars, usedcars, and monthly specials. The idea isto have more relevant and emotionallyengaging content by placing video ineach of these areas.

I was in a dealership in Atlanta visit-ing with an Internet director whoindicated his SEM rep didn’t believethat the search was influenced by videocontent. Dealers engaged with videoadded to YouTube, Meta Café, Yahoo,Blinkx, AOL and MSN would stronglyargue this, unless you happen to be adealer in their immediate area.eMarketer, February 2008 reported that

there were 137.5 million U.S. onlinevideo viewers in 2008 and this numberis expected to grow to 154.2 million in2009. An online video viewer is aviewer who downloads or streams videoat least once a month. YouTube is nowthe second most used search engine,only behind Google. The influence ofvideo will only get stronger. The dealerswho are actively engaged with videohave a tremendous advantage over themajority of the dealers.

A third dealer who dared to change isa Toyota dealer in Pueblo, Colorado.Kris Aragon is the Internet director.Kris has been focused on driving theorganic search and leveraging video todrive the time on the site and conver-sion of leads. Kris has driven hisconversion rate numbers as high as 17percent when you count both phoneups and e-mail leads. Kris sent me theCobalt charts for confirmation. Thechart for 2007 and 2008 track thepercent of e-mail leads against visitorcount on one side, and percent ofphone ups against visitor count on theother. With the typical conversion ratehovering at 3-5 percent for dealers, thisis an outstanding job. (See chart below.)I have visited with some dealers who aretracking a percent conversion rate.Imagine what their bottom line wouldlook like if they could drive results likeKris. Seventeen percent didn’t happenby accident. Kris is very focused on themetrics and he is very process-oriented.He is also willing to invest time andenergy into understanding new con-cepts and converting those ideas intoreality. Kris’s general manager has alsoempowered Kris to make thingshappen. Kris has a budget to workwithin, but he makes the calls on howto spend this money.

For Dave Roen, Forrie Spangler,Richard Herod III, Tom Kerry and KrisAragon, I applaud you for being vision-aries and those who dared to change.

Phil Sura is a VP of the AutomotiveDivision of UnityWorks Media.

Month % of Visits % of Visitors Generating Leads Generating leads

Sep-07 5.71% 8.22%Oct-07 4.96% 8.74%Nov-07 3.37% 6.81%Dec-07 4.61% 8.81%Jan-08 4.86% 9.31%Feb-08 5.60% 9.42%Mar-08 5.85% 10.65%Apr-08 5.18% 9.44%May-08 5.05% 8.73%Jun-08 5.84% 9.49%Jul-08 6.00% 9.97%Aug-08 1.88% 3.00%

If you wish to discuss this article withother dealers, or with the author,please go to the “Discussion Forums”at www.DigitalDealer-magazine.comand enter the “Internet Sales” forum or e-mail him at [email protected].

Internet Sales, Sura (continued from P-DD12)

DD 16 January 2009 DigitalDealer-magazine.com

WITH THE ECONOMY CREAT-ING A SLIMMER LIST OF POTENTIALBUYERS, it has become more and moreimportant to follow up and maintaincommunication with each and every leadthat comes through your web site.

Consumers have become much morecomputer and Internet-savvy, and nowmany are spending weeks, if not monthsdoing research online before buying prod-ucts, particularly in the automotive industry.Because of this, your salespeople are gettingless face time with your potential customers,so they don’t have the opportunity to begina relationship with the individual.

The 2008 New Autoshopper.comStudy by J.D. Power and Associateslooked into the habits of auto shoppersand showed that 75 percent of buyersresearch vehicles online weeks before theymake a purchase. It also said that the totalamount of time potential buyers spend onInternet research has risen by nearly sevenhours in the past year.

Most customers begin looking onlinefor information about 11 weeks beforethey purchase a vehicle, according to ourresearch, and many of those shoppersdon’t contact a dealer until about sixweeks out.

So now, more than ever, it is crucial foryou to turn to your Customer RelationshipManagement (CRM) or Internet LeadManagement (ILM) tools for help on con-verting those leads into appointments.Having a good CRM or ILM tool canallow your dealership to thrive from youronline presence and assist in managing thecommunication process between your staffand potential customers.

Many of these tools are systems-based,which means the information is lessportable, the communication process isnot as easy to monitor and the sales

process is less customizable.For example, let’s say you set up a three-

week, eight-step sales process in yoursystems-based ILM, and one of your sales-people stops at step five. That lead thencompletely disappears from the system,and you have no idea where to pick up inthe communication process.

Back when the economy was booming,this was not as big of an issue due to thelarge volume of leads coming through.Now that leads are fewer and furtherbetween, it’s important to maintain theconversation with each and every one,and a systems-based ILM may not serveyour needs as well as you’d like.

With web-based CRMs and ILMs,however, this is not as much of an issue.You’re able to access the information fromany computer with an Internet connec-tion, receive custom reports on theprogress of each lead and customize yoursales process to include as many steps asnecessary for interaction between yourstaff and your customers.

This means that with a web-basedprogram, you can set up a five, 10 or 20-step process. If your salesperson stopscommunication early, you’ll see that lead

show up on an exception report, givingyou clear visibility into a potential processfailure and allowing you to step in beforethat lead moves to another store.

With the web-based CRM or ILM,your can extend your relationship withyour customers throughout their buyingprocesses, from the time they contact youto the time they’re purchasing a vehicle atyour dealership.

Whether you’re using a systems-basedor web-based lead management tool, youneed to utilize it as much as possible tostart developing sales processes unique toyour own staff, allowing them to initiatecommunication during the customer’s

online research phase, and then maintainthat relationship until that customer isready to purchase a vehicle.

Staying on top of each Internet leadwill get your dealership noticed, keeppotential customers from visiting otherdealerships and, ultimately, help you driveyour numbers up.

Paige Presley is the marketinganalyst/writer for Dealerskins in Nashville,TN. She enjoys mixing her passions for allthings technology and for following con-sumer trends by staying involved in marketresearch for the auto industry.

Making EveryLead Count

D IIGGIITTAALL DDeeaalleerr INTERNET SALESPaige Presley

“Now that leads are

fewer and further

between, it’s important

to maintain the

conversation with

each and every one…”—Paige Presley

If you wish to discuss this article withother dealers, or with the author,please go to the “Discussion Forums”at www.DigitalDealer-magazine.comand enter the “Internet Sales” forum or e-mail her at [email protected].

DD 18 January 2009 DigitalDealer-magazine.com

PERHAPS THE WEAKEST LINK INGROWING INTERNET SALES DEPARTMENTSis the lack of management understandingor support. There seems to be a growingreluctance with the sales pressures we arefacing now in the automotive business tobe transparent and forthcoming aboutpricing and availability. Yet it is thesequalities that are vital to successfulInternet sales.

For some reason we keep thinking thatwe should not divulge information untilwe can get the prospect into the store.This turns off Internet prospects. Thefunny thing is that we worry aboutleaving money on the table, so we thinkwe have to hide the facts and figures. TheInternet sales reality is, if we will be trans-parent, give information freely, actprofessionally, be responsive and act in atimely fashion, our chances of winningthe sale grow considerably.

But let’s back up. I heard of a storerecently that hired an Internet salespersonand did not even provide him with hisown phone, let alone his own computer.He lasted two weeks. Store managementneeds to consider how to facilitatemaximum Internet sales based on ourgoals and local opportunities.

The first thing we need to consider ishiring the right people. Hiring someonewho has not succeeded on the floor but is"pretty good with computers" does notwork. We need someone who is disci-plined and organized. We need someonewho loves making phone calls. We needsomeone with patience and will work theprocess. We need someone who is likable

and engaging with people who can drawprospects to the showroom appointmentand close the sale.

The second thing we need to do is builda successful sales process. This processincludes scheduling of quote responses,phone call attempts, well thought out e-mails and a schedule for their distributionbased on prospect response.

The third thing we need to do isprovide a work station that is off the"beaten path" in the store. It is importantfor the Internet sales person to not be dis-tracted when making all the daily phonecalls it takes to work the Internet data-base. This station requires a computerthat is not shared, a phone that can makethe long distance calls, and depending onhow large the staff, an Internet depart-ment signage and clearly marked space.

The fourth thing we need is to supportour Internet sales department’s access toinformation: inventory, pricing, incomingavailability of vehicles, and dealer trade

availability. We often think these thingsneed to be guarded like the crown jewels.But the truth is the more easily we makethis available to our staff the more easilythey can be responsive and professionalwith our Internet prospects.

A key place where Internet sales needmanagement support is in the pricingstrategy for Internet prospects. It isimportant to offer a price in our firstresponse because someone has gone to aweb site and "clicked here for a pricequote." When we then withhold a quotethey get mad and generally will notrespond to subsequent attempts to sellthem a car. I recommend picking out avehicle in stock (if at all possible) andsending them an Internet price withoutsending them the MSRP. I also send theman Internet price on a less expensivevehicle if possible. In addition, I recom-mend sending the price on a usedcertified. It makes no sense to requiregetting these prices for every lead thatcomes in from the sales manager.Management needs to support theInternet sales with easy quoting prices.

We can’t just stop the discussion there.While I advocate upfront pricing I don’tadvocate e-mail or phone negotiation. Ourupfront price should not be our final price!It should be close but we need a littlewiggle room so that in securing anappointment we can promise there is roomto move if they will come into the store.

Management support needs to be mani-fested in careful and committed budgeting.More and more dealers are now planningto not spend additional ad dollars on theInternet department but are rather taking aportion of the ad budget and allocating apercentage to the Internet. Most successfulInternet sales departments are achieving 15to 30 percent and more of new car sales.West coast import dealers are achievingeven higher percentages. Dealers that aretracking sources and costs are finding alower cost per unit via the Internet thantraditional ad results. Internet costs per saleshould be under $300 per unit. And thisfigure should actually decrease over time asthe database builds and is able to generatesales over an extended period of time fromleads that have been in the database for sixto 12 months.

Store Management’sKeys to Building

Internet Sales

D IIGGIITTAALL DDeeaalleerr INTERNET SALESDaryl Sanders

continued on P-DD37

DD 20 January 2009 DigitalDealer-magazine.com

HIP, HIP HOORAY! Good for you!You deserve a pat on the back! Great job!I couldn’t have done it without you! Thesesayings go unheard far too often in dealer-ships nationwide and I think I know why.

Although I have recently left my role ata dealership and am on the consultingside now, I am friendly with the dealer-ship’s owners and co-workers and I stillactively engage with the vendor represen-tatives for the dealer. The time I served atthe dealership in a multitude of titles andduties has prepared me for my currentventure. I still have a lot to learn though,and recently proved this to myself.

I was sitting down for tea with LoriBerkson, the Chicago sales manager forVisible Customer, and we were discussingcustomer retention. To put it far toosimply, Visible Customer’s program is allabout retaining customers for dealerships,something I hold near and dear to myheart. I wanted to learn as much as Icould about this new company. Whiletalking, I inquired about her “pitch.” Shebegan asking a question. “What is themost valuable commodity to a dealer-ship?” Lori has faith in my knowledge soshe assumed I knew the correct answer.Unexpectedly, we offered our answers atthe same time and I, apparently, waswrong. She said the correct answer was“the dealership’s customer base.” It makesperfect sense. I had said, “the employees.”This is just one example that the staff inyour store is often overlooked.

I still hold true that Lori was right andI was wrong. I don’t think that I’m wrongoften, unless it is any debate I’ve ever hadwith my wife. In that regard, I am theworld’s most losing arguer. (I’ve been told

I am not alone in this regard.) The dealer-ship’s customer base is the most importantcommodity. However, I do not believethere would be much of a customer baseif it weren’t for good employees. Fromservice to parts to sales, the stronger a staffyou have, the larger (and better) your cus-tomer base becomes.

Dealerships should celebrate theiremployees. They should find new ways toencourage their sales force and thankthem for their continued hard work.Reward them for their efforts and nourishtheir needs. Not enough dealers do this.

The key to a store’s survival in this eco-nomic climate will be directly related tothe people who are representing the storeon site. Any owner will tell you howmuch it costs to lose a service customerfor life. Think of the reciprocal dollars forservice and future sales. Realize you arenot just losing the gross profit from onecar deal, but potentially all of theirfamily’s sales, service, and parts needs. Ifone service writer, parts counterperson,sales manager, Internet coordinator, or

salesperson was costing you these valuablecustomers, you would fire them. Theopposite should hold true. If a loyal, hard-working employee is producing for you,recognize him. Reward him with praise.Here are a few ways to do this and acouple of things to think about.

Did your top salesperson last monthget recognized in your weekly salesmeeting? Did you encourage others toclap for him? Did you reward him with aplaque? What about a gift? (Gifts do nothave to be monetary. Two days off in arow, for instance, has value to some.)

Do you recognize your employees inyour advertising? Do you display picturesof them in newspapers (for those of youclinging to that sinking ship)? If you’rebroadcasting on the radio, consider high-lighting their accomplishments. Make anannouncement about a great moment inan employee’s life. “XYZ Motors, locatedon Yellow Brick Road, would like to con-gratulate sales professional PhilMcPhillipsens for becoming a first-timefather last week. When you are visitingour dealership for service or sales, don’tforget to wish Phil the best.” What is thecost to you? If a top salesperson fromanother dealer heard that, do you thinkthey may be interested in learning moreabout your store’s philosophy of caring foryour employees?

You may offer “value cards” to yourcustomers declaring the benefits of pur-chasing from your store, but do notoverlook the value of praising your staffin front of customers. When I wouldtake a T.O, I’d always say, “I’m glad youare working with (insert name here),(s)he is one of our finest sales consult-ants.” Even if I disliked the salesperson,I’d say it. Consumers like to believe theyare doing business with someone of theirown caliber. Considering car sales repstend to be wrongly viewed as second-class citizens to some, it is important toshow respect for the salesperson in frontof the customer.

Here is one that is self-serving. Thereshould not be a dealership web site in thenation that doesn’t have a picture and briefsidebar about each employee. At myformer dealership, every single manager,salesperson, Internet manager, and BDC

A Jolly Good Fellow

D IIGGIITTAALL DDeeaalleerr INTERNET SALESJoe Webb

continued on P-DD22

DD 22 January 2009 DigitalDealer-magazine.com

rep had a picture (sometimes entertaining)and paragraph write-up on the web site. Itdidn’t have much to do with car sales butmore to do with them as people. It high-lighted their families, hobbies, where theylived, and more. There was so muchcontent on that web page, sometimes itwould hit higher on search engines thanmy specials pages. Heck, I wrote so manywacky blurbs about my co-workers, some-times we’d show up in Google searches of“guitar playing.” Every salesperson lovesthat page because it speaks to the fact thatwe recognize they are all special.

Lastly, it is not just “For He’s a JollyGood Fellow.” It is also “For She’s a JollyGood Fellow.” If you are lucky enough tohave strong female employees, honorthem in every publication and site youhave. You’ve been on AskPatty.com. You’vevisited CarsDiva.com. The power of thefemale shopper and their influence overbuying decisions is underestimated (justask my wife). Showing support to thewomen on your team is essential for yourdealer’s reputation and will also gain youcredibility with that sought-after audience.

The Van Tuyl Group runs the largestprivately held auto group in the nation. Onits home page, they have a quote from

Cecil Van Tuyl. “The better the people yousurround yourself with, the better you’regoing to do, for yourself and the con-sumer.” I couldn’t agree more with him.

We know sales are expected to be downfor quite a while. This slow period willhave an effect on the psyche of the belea-guered salespeople. We must celebratethem and keep their spirits up. Neverforget what a positive remark, a kindword, and a pat of the back can bring.The more you sing the praises of youremployees, the more consumers will findyou. Do you really believe people come toyour dealership to buy a car because of thefree popcorn? Or do you think it could bethe quality of sales, service, and parts pro-fessionals you employ?

On my final day at the dealership,during my Saturday morning salesmeeting, I said my goodbye to my co-workers: my friends, my team. I askedthem to take away just one last thing. Isaid, “Each and every one of you is impor-tant. There is something amazing andspecial about every single person in thisroom. While we all share the same willing-ness and desire to wake up, come to work,and do the daily grind with customers,realize there is something unique about

everyone. Recognize what that somethingis. Embrace it. Share what makes youspecial with your customers. Let them seewhat makes you great. They’ll be thankfulyou did.”

I can only hope and dream that everydealer is willing to embrace this belief.Your second most important commoditymay be what makes you most special.

Joe Webb is the president of DealerKnows,LLC, specializing in automotive e-commerceconsulting and assisting dealers and vendorswith the advancement of their online efforts,solution successes, and processes throughhands-on training. He has worked in thedealership trenches and now shares hisknowledge of e-commerce, online advertis-ing, and Internet initiatives nationwide.

If you wish to discuss this article withother dealers, or with the author,please go to the “Discussion Forums”at www.DigitalDealer-magazine.comand enter the “Internet Sales” forum or e-mail him at [email protected].

Internet Sales, Webb (continued from P-DD20)

DD 24 January 2009 DigitalDealer-magazine.com

YOU’VE PROBABLY HEARD THISSTORY: Two guys are hiking in thewoods when they encounter a hungrybear. One guy starts putting on hisrunning shoes. The other guy looks athim and says, “Why are you doing that?You’ll never outrun that bear.” The manreplies, “I don’t have to outrun the bear,I just have to outrun you.”

With car sales down dramaticallymarket wide, it’s time to lace up yourrunning shoes. To survive and thrive inthis bear market you need to outrun yourcompetition. And there’s really only oneway of doing that. Take business awayfrom them. Even in this tough economythere are still people in your marketbuying cars and trucks. The question is:Are they buying them from you?

Let’s face it; no one wants to be caughtby the bear.

To outrun the bear in today’s pre-ownedmarket, you must be a disciplined opera-tor with a strong understanding of themarket and how consumers shop today.Most importantly, you can’t leave the fateof your dealership to “gut” or “guesswork.” Winning today requires decisive,“evidence-based” management.

The challenge in the age of the Internetis that the amateurs know more than thepros. In the old days, dealers knew farmore than consumers, giving dealers adramatic advantage in the transaction.The dawn of the Internet has empoweredconsumers with an incredible amount ofmarket knowledge including:

• How many similar vehicles are availablein the market?

• What are the advantages of one vehicleover another?

• How are your vehicles priced versus thecompetition?

• What is a “fair market” purchase pricefor this vehicle?

• What is my trade-in really worth?With the average consumer spending an

average of 6.5 hours researching onlinebefore they purchase (according to arecent J.D. Power study), consumers seemto almost always know more about themarket for a car than the pros at the deal-ership. To win, dealers need to become“evidence-based” retailers by ensuringtheir managers and sales teams know whata consumer knows as well as those factsthat are only available to dealers.

“Evidence-based” retailing maximizesyour Internet ads and pricing while

empowering your sales team and salesmanagers with the ability to effectively dif-ferentiate against the competition. As aresult, you can shift from selling “price” toselling “value,” thus allowing you to drivemore traffic, and close more customersmore profitably. My experience is thateven in today’s tough market, “evidence-based” retailers can outperform thecompetition in three key areas:

1. Retailing more cars2. Closing more appraisals 3. Stocking more of the “right” cars 360º market navigation means to know

what others don’t, so you can do whatothers can’t. How do you become an “evi-denced-based” retailer? First, ensure yourteam always has the facts that provide thebest evidence to make the best decision.There is no “silver bullet” piece of marketdata that can always give you the right factsfor each decision. Having the rightresource at the right time is the key.Gathering a true 360º perspective of yourmarket empowers your team with the“intelligence” they need to outmaneuverthe competition, and the facts they need tomake “evidence-based” business decisions.

With 360º market navigation you’llhave the right information available to youat the moment you need it:Retailing more cars – Know what con-sumers know and leverage it to drive moretraffic from the internet and empoweryour sales team to close more customersmore profitably. Here’s how:

• Know how your vehicle’s Internetpricing ranks against the competition.According to Cars.com, 82 percent ofconsumers compare prices when shop-ping online – If you are out of theballpark you won’t make the list of five to10 “semi-finalists” that consumers evalu-ate in deciding which dealer they want tobuy from.

• Conduct Internet mystery shoppingto ensure that your ad effectively high-lights your vehicle’s advantages against thecompetition so that you become the dealerthey choose to call, e-mail or visit. (Note:the Cars.com study revealed that 78percent of consumers focus on photos andyour “seller’s notes”/vehicle description indeciding which dealership to visit).Sharing this market intelligence with yoursales team will empower them to sell valueinstead of price.

360º MarketNavigation:

The Secret to Winningin a Down Market

How to thrive in a ‘bear market’

D IIGGIITTAALL DDeeaalleerr INTERNET SALESPat Ryan Jr.

DigitalDealer-magazine.com January 2009 DD 25

• Know what a consumer feels is a “fairretail purchase price” for your vehiclethrough Kelley Blue Book or NADA’s con-sumers site as well as Edmunds True MarketValue. Capitalize on this by advertisingpricing that is “$1,000 below book,” whichsignals to consumers your vehicles are fairlypriced. Your sales team will be empoweredto use it your advantage when the pricingworks in your favor, but will also be pre-pared to overcome the fatal “silentobjection” when it works against you.

• Know what other dealers are sellingsimilar vehicles for, how profitably andhow quickly through real sales data fromreal dealers with J.D. Power’s PowerInformation Network. This informationwill tell you when to hold gross or when tocut the deal.Closing more appraisals – In addition toknowing the “basics” every dealer alreadyhas access to such as wholesale bookvalues, auction data, vehicles historyreports (Carfax and Autocheck), and yourstore sales history, you can close moreappraisals and retail more conquest trade-ins by turning your appraisal into a “360ºappraisal.” To do this, you need to:

• Know similar vehicles current Internetprices.

• Conduct Internet mystery shoppingof similar vehicles ads to understand whatyou would be up against at retail if youtook the trade in.

• Overcome the “silent objections” byknowing what consumers consider a “fairtrade-in value” based on what they learnedonline at Kelley Blue Book or NADA’sconsumer site as well as Edmunds TrueMarket Value.

• Obtain real sales data from realdealers with J.D. Power’s PowerInformation Network, to learn what otherdealers in your market are selling similarvehicles for as well as their ACV. Stocking more of the “right” cars – It’salways easier to drive more traffic and sellmore cars when you have the cars that are“hot” with consumers. You can stock more“hot” vehicles at your dealership and inyour market if you:

• Know what the fastest and most prof-itable sellers are for your store.

• Know what the fastest and most prof-itable sellers are in your market throughreal sales data from real dealers with J.D.Power’s Power Information Network.

• Know what you are up against byknowing vehicles’ Internet market dayssupply in your market.

• Know what your customer’s neigh-bors are buying by reviewing DMV salesrecords for your core market.

You have the evidence…now make thedecision. Of course all of the informationyou need is out there, the question is howdo you manage it, hone it in and make itwork for you? If you are not managingfrom a 360° view, you are at risk of beingcaught by the bear. This means havingthe right market intelligence available atthe right time to make the right decisionso you can close the deal, and close thedeal profitably.

Pat Ryan Jr. is the co-founder and chiefexecutive officer of First Look by INCISENTTechnologies.

If you wish to discuss this article withother dealers, or with the author,please go to the “Discussion Forums”at www.DigitalDealer-magazine.comand enter the “Internet Sales” forum or e-mail him at [email protected].

DD 26 January 2009 DigitalDealer-magazine.com

D IGITAL Dealer COVER STORYIGITAL Dealer COVER STORY

Diana WeaverInternet Marketing & CRM Manager

Tom WoodAutomotive

Diana WeaverInternet Marketing & CRM Manager

Tom WoodAutomotive

DigitalDealer-magazine.com January 2009 DD 27

It isn’t every day that the word “Edsel” is brought up in conversation, but the highlysuccessful Tom Wood Automotive Group owes part of its existence to the famed vehiclefrom the late ‘50s. It was at a Mercury-Edsel dealership in Kalamazoo, Michigan, when a

new car salesman by the name of Tom Wood worked while attending college. After college,Wood continued selling cars and eventually bought his first dealership. In 1967, he bought

an even larger dealership when he purchased Hedges Pontiac in downtown Indianapolis.Today, Tom Wood Automotive consists of 17 franchises with several rooftop locations infour cities, spread out over three states, along with a full-scale quality leasing operation.

Current franchises include: Toyota/Scion, Kia, Nissan, Volkswagen, Subaru, Jaguar, Volvo,Land Rover, Porsche, Audi, Ford, Lexus and Honda.

As you’ll learn when you read the interview below, Wood built his auto group on thebelief that success is measured by the people associated with it. Internet Marketing andCRM Manager Diana Weaver, a lifelong resident of Indianapolis, is living proof of thistenet. Read on to find out how Weaver combines an engineer’s eye for detail with her

unabashed love of serving people when planning, overseeing, and refining the online mar-keting presence and customer retention efforts for Tom Wood Automotive.

PLEASE TELL ME ABOUT YOURBACKGROUND.

I always tell people I got into the carbusiness by a stroke of good luck. As youcan imagine, this gets a mix of differentreactions. But when you are in the carbusiness and you love it, you know exactlywhat I mean.

I have an engineering degree fromPurdue University, but quickly realized Iwas too much of a people person to stayin the engineering field. So, in 2000 Ianswered an ad for a BDC manager posi-tion at a standalone store, Pearson Ford,here in Indianapolis. I had no idea what aBDC was at the time and knew nothingabout cars. When I landed the job andlaunched my career as a “car guy,” I gotlucky, real lucky. I was with Pearson Fordfor seven years and completely developedits Internet and BDC departments.

After that, I spent a short time at a suc-cessful Honda store in Colorado Springs.But when I returned home toIndianapolis last February, I was thrilledto be hired with Tom Wood Automotive

Group as its director of e-Commerce.Tom Wood has such a great reputation inour area that it was truly an honor to getthe position.

How many people work in yourdepartment?

We have 12 Internet managers andsalespeople among all of the stores. But allof our sales managers are considered apart of our Internet teams, and are all veryinvolved. In some of the stores, leads areturned over to the sales floor, and in thosestores everyone is a part of the team.Because so many shoppers start theirresearch online, virtually every up is con-sidered an Internet customer. That makesevery employee part of the Internetdepartment. We firmly believe that goingforward our dealerships won’t have anInternet department, but rather will beInternet dealerships.

What percentage of your dealership’soverall sales is generated from theInternet?

We average 25 to 35 percent directlyresulting from leads submitted online,but it varies from store to store. Forinstance, our high-line stores run up to40 percent. We are doing a much betterjob of surveying customers about theirshopping and online search habits. Thesurvey results allow us to keep bettertrack of the ROI measurements we’reseeing from our lead provider and onlineadvertising dollars. We know that manymore sales are generated from theInternet than the number of people whoactually submit a lead; consequently, itrequires a great deal of discipline from allof our sales staff to survey our customersfor quality information.

What tools or lead generators have reallyworked on your site to pull in leads?

We have a great portal page(www.tomwood.com) that draws atremendous amount of traffic. But theindividual sites themselves remain ournumber one source for leads. In ourprimary market area we have the luxury

DD 28 January 2009 DigitalDealer-magazine.com

specials on all of our home pages based oncurrent incentives. Recently we startedadding service specials to this portion ofthe web site, which has helped pull inadditional service appointments.

Plus, we recently signed up withLiquid Motors as our inventory man-agement provider. We chose thembecause they offer plenty of robust toolsin one place. They will do our inventoryvideos with text-to-speech voice over, orwith a specific tool that will allow us torecord a personalized voice over to avideo and then e-mail the video to aspecific customer.

Do you help design/update yourdealership site? For example, updateinventory, create specials, addphotos, etc.

Absolutely. We work with a full-serviceadvertising agency that helps us with ourgraphics and they do a great job. But all ofthe new and used vehicle, finance, parts,and service specials are part of my respon-sibility. I work closely with all departmentmanagers to make sure these stay currentand in line with both manufacturers’offers as well as our own off-line advertis-ing. Many of our manufacturers requirethat in addition to our tomwood.comweb sites we also maintain factoryrequired web sites. That means I ammaintaining not only nine tomwood.comsites, but also nine other sites as well.

How do you use e-mail campaigns togenerate leads?

I run a monthly e-blast for each store,and make it as specific and targeted as Ican. If we have multiple offers running, Itarget each one to the prospect segmentthat makes the most sense keeping inmind crossover buyers.

I also include a service special in all ofour sales campaigns making them rele-vant to owners who may not be inmarket. We have been doing this longenough now that our customer baseexpects these offers and know they will berelevant. It certainly helps in keeping opt-out to a minimum and our domain offthe black lists.

A few of our stores run e-newsletterswith IMN Inc. These get a tremendousresponse and have robust back-end track-ing tools. Our opt-out rates on thesecampaigns run less than 2 percent. Plus,we can target readers with follow-up

based on the content people are mostinterested in. IMN has some pretty strongreports available that specifically say, forexample, that a particular customerclicked on an article about a particularvehicle and sent a copy of the article to hiswife. That’s pretty strong. If I wanted tosend a bonus, last-minute opportunity,say an e-coupon, to that particular cus-tomer, he wouldn’t know that he was theonly one to get that special offer. IMN islike any other tool, though. If you usewhat’s there, it can be quite successful.

What I find quite often is that vendorswill package a lot of tools together so it’sall shiny. People ooh and aah and saythey’ve got to have it. Only later, when it’sall shaken out, do they realize they’re onlyusing about 25 percent of the product.

Can you give me an example of a suc-cessful e-mail campaign that pulled ina good number of leads?

One of our biggest successes is withmonthly lease expiration reminders. Atthree months before lease expiration, allcustomers are notified via e-mail and weget an overwhelming response with thesee-mails. We have tried sending the e-mailssix months out, but found it was too early.

We also had great responses with ownerloyalty blasts, such as buy-back eventswith percentage of original MSRP guar-anteed for the trade-in. Our Nissan store,for example, sold eight units from 68leads in this campaign in October.Considering it was targeted to previouscustomers in a positive equity position,the message carried more weight and wasable to generate a better response.

If you could keep one tool from yourcurrent interactive tool chest to gener-ate leads, what would it be?

Definitely, I would keep ourtomwood.com portal page, which is onlyabout a year old—before that we didn’thave one. It is much easier to brand oneweb site and centralize all of our onlineand off-line advertising efforts. We drivecustomers to just that one web site andthen allow them to pick their manufac-turer. It works like a charm. Brandingour portal page in a market where we areso well known significantly reduces ourpay-per- click expenses because so muchof our traffic landed there either directlyor organically.

We can really concentrate efforts on

D IGITAL Dealer COVER STORY

of being a long-standing large dealergroup with a great reputation. Everyoneknows who we are, so 90 percent of thetraffic to our sites is either direct ororganic traffic.

Our individual web sites host pageswith luxury vehicles under $20K or vehi-cles under $10K, depending on thebrand. Not surprisingly, pages promotinglower priced vehicles have seen an increasein traffic over the last several months.

Manufacturer sites are also greatsources for quality leads. Especially thebrands that are hitting the Internet spacewith a lot of manufacturer ad dollars.Audi, Volkswagen and Volvo, forexample, are making huge commitmentsto the online arena, buying leads andincreasing co-op dollars dedicated toonline marketing.

We select our lead providers independ-ently from store to store. We have noticedthat some providers are better for certainbrands, so it is crucial to track ROI care-fully by store. Just because we are gettinga lot of leads from a particular sourcedoesn’t mean they close well; so I also lookat lead volume, close ratio and front- andback-end gross to determine our successrate. It’s not always apples to apples.

For instance, our Ford store draws atremendous response withAutotrader.com, which, on the otherhand, doesn’t do much for our Porschestore. We are lucky enough to be the onlyPorsche store around, so if you are an in-market shopper looking for a Porsche,you come straight to us—either directlyor from the Porsche manufacturer’s site.As a result, there is no reason for me towaste ad dollars on site promotions forthat segment of the market; it would beredundant. Instead, I could reallocatethose funds to increased SEM for Porschein surrounding demographic areas.

What interactive media resources doyou utilize? Please tell me what serv-ices they provide and why you decidedto go with them.

We are on Dealer.com web sites. Ouradvertising company manages our SEMcampaigns and works closely withDealer.com to ensure our sites and mes-sages are in sync. Our current televisioncommercials are always uploaded to thehome pages, to maintain branding andcontinuity to our on and off line advertis-ing. We also utilize rotating leaders’

DigitalDealer-magazine.com January 2009 DD 29

our cumulative inventories through thissite. We advertise over 2,000 vehicles atany given time. Being able to leverage thepower of our combined inventories on theVehicles Under $10K and LuxuryVehicles Under $20K pages is very strongfor our market.

From the fixed operations side, most ofour stores also utilize Time Highway forreal-time service scheduling. This tool isimperative. Not only does it help betterload our shops and dispatch work moreevenly, customers love the ease of use. Forme, it’s another way to capture e-mailaddresses and build our database forfollow-up.

Please take me through the processfrom when an Internet lead is received,to how it is eventually closed (via a saleor a long-term prospect).

Because our stores are set up differentlythe process varies some by location.Several stores work the leads soup to nuts;others handle things more like a BDC,passing appointments to the floor. Wehave tested different methods within eachstore. But because the environments anddynamics are so different, we havedecided not to rock the boat. It onlymakes sense that what works for ourLexus store would not necessarily work atFord, and what works at our Volvo store isnot a perfect fit at Volkswagen.

The similarities in processes are thebasics: the block and tackle. We keepresponse times to an absolute minimum,less than 10 minutes is our goal. Ofcourse, everyone is strapped to aBlackberry to ensure we can respondquickly. We have eliminated auto-respon-ders at a few dealerships to experimentwith perceived, personalized responsetime. Customers are responding well toour personalized responses, but to stay ontop of responding is a never-ending effort.

The key for me is to make sure weanswer the questions and assess the needsof our customers right away. After initialcontact we follow-up according to ourflexible and personalized schedules,making sure no one falls through thecracks. We literally practice the old sayingof following up until they buy or die.

How important is follow-up in closingInternet leads?

Very important. In fact, it’s absolutelyessential. One of the metrics I track is the

number of vehicles sold in a month whosefirst lead originated over 30, 60 and 90-days-plus. This is a great barometer forhow well we are doing with our follow-upefforts. Customers want to be wined anddined out there. They are shopping five-plus other stores besides us. Who is goingto still have top of mind presence whenthey are really ready to buy? The storesthey think of first are the ones still com-municating with them. We try to makesure we are not pre-qualifying our leads.Never leave any stone – or lead –unturned, and that means constant andconsistent follow-up for everyone.

There are a lot of new tools in the spacegetting attention – blogs, social net-works, SEO and SEM—do you use anyof them? If so, how have they worked?If not, do you have plans to use any ofthese tools?

Our sites have been well optimized byDealer.com and by additional link build-ing campaigns that we have set up. Plus,we change our content as often as possibleto keep search spiders happy.

Our advertising agency has justrevamped our SEM campaigns for geo-graphic and brand specific searches. SEMhas been a bit of a challenge for us becausewe have so many brands that also carrycrossovers on our pre-owned lots. Wehave had to be careful with our campaignsto make sure all of our stores are notbidding against one another and drivingup our own cost per click.

I have been here for less than a year, sowe are just now starting to get into blog-ging, user generated content sites, socialnetworking and video SEO. It’s obviousthat these things can make a huge differ-ence without costing us much, and we areexcited to get started with them soon.

What trends in automotive sales areyou noticing and how is Tom WoodAutomotive Group adapting tothose trends?

We are finding that as people becomemore comfortable with online car shop-ping and we, as an industry, continuemaking more robust tools available toonline shoppers, they are starting theirresearch earlier and conducting more of itonline. For us, that means providingquality answers while building trust and

Dealership partners in profit:Dealership name:Tom Wood AutomotiveGroup

Web site URLs:www.tomwood.com

Web site provider/hosting: Dealer.com

Web site vehicle photos: Done in-house

Vehicle marketing:Liquid Motors

DMS provider: Reynolds & Reynolds

CRM program: Reynolds & Reynolds

Vehicle video vendors: Liquid Motors

Vehicle valuation tools: Black Book

Online lead generatorsnot including the OEMsources:AOL AutosAutoUSACars.comCarsDirectCostcoDealixEdmunds.comKelley Blue BookMSN AutosYahoo!Autos

Vehicle history reports: Carfax

Third-party sites whereinventory is posted: AutoTrader.comAutoMart Craig’s ListCars.comCarSoupeBay MotorsKelley Blue BookVehix

continued on P-DD38

DD 30 January 2009 DigitalDealer-magazine.com

AS A NEW YEAR STARTS, we’re allbusy putting together file boxes to sendold records to storage. What about yourcomputer records? How much shouldyou save and how much should youretain on the system? With data storagebeing low-cost today, it is tempting to“keep it all” but sometimes storing toomuch data slows your system down.Let’s say that you want to store thedetails for every vehicle that you’ve eversold. That means that every time yousearch for a deal from yesterday, itmight mean looking through thousandsof records, including all the dealertrades and wholesale deals. That cantake a few more seconds or minutes,which is huge if the customer is on thephone waiting. Keeping your databasesclean and trim means your system runsfaster. This doesn’t mean that youshould delete everything that is amonth old; rather you need to make aretention policy depending on the typeof data. To make this simple, I separatecomputer data into three main cate-gories: accounting data, customer data,and operational data. There are variousregulations that govern what you’ll needto provide and when. But as a guide-line, you need your accounting data incase you’re audited by the IRS or a salestax audit. You need your customer databecause you might want to do a cam-paign or mailing to customers that havebeen deleted by DMS system. You needyour operational data to perform analy-sis and provide information about yoursales and service history. Here is a quickreference of what you need to store andhow often.

Accounting data: Each month youshould have a copy of your generalledger, detail general ledger, journals,and schedules saved to a CD in Excel,txt or a csv file off the premises. Do notdepend on your DMS system backup.You might not be on that system twoyears from now to read their backuptape when you get audited. Daily, youshould take home your prior day’sDMS system backup tape. Bring in theone from the day before.

Customer data: Once a month youneed to run a report on your full cus-

tomer database. Depending on yourDMS system you need to do an “extrac-tion” of the customer file. First youwrite a report to grab the customername, customer name, address, phonenumbers, vehicle information (year,make, model, VIN), date sold, last dateserviced, and payoff date. Save thisreport and set up a process to run thereport and save it to a csv (comma sep-arated value file). If you have less than65,000 records, use Excel to hold thedata. Otherwise, you’ll need somethinglarger like Access.

Operational data: After the month isclosed, save all your repair order detail,car deals, and parts tickets to a CD andmove off site. Be prepared daily in casethere is a fire, flood, hurricane ortornado. Daily, the service managershould e-mail himself a list of all openrepair orders. The parts manager can dothe same for open parts tickets, and thesales manager for all working prospects.The F&I manager should have a list ofall pending car deals. The dailyaccounting backup needs to be in a safeor offsite daily.

I realize that it might seem hard todecide what to keep and for how long,but if you start treating your computerdata the same as you do printed recordsand developing a storage and retentionpolicy, you’ll be assured that you havethe information that you need whenyou need it.

Sandi Jerome is a former controller,CFO, system administrator, F&I, assis-tant GM, and fixed operations managerwith over 20 years experience in the auto-motive industry. She is the owner of SandiJerome Computer Consulting.

D IGITAL Dealer TECHNOLOGY TRENDSSandi Jerome

If you wish to discuss this article withother dealers, or with the author,please go to the “Discussion Forums”at www.DigitalDealer-magazine.comand enter the “Technology” forum or e-mail her at [email protected].

If Space is Cheap –How Much can you Keep?

“Keeping your

databases clean and

trim means that your

system runs faster.”—Sandi Jerome

DD 32 January 2009 DigitalDealer-magazine.com

IT IS A NEW YEAR and what a great timeto take care of some lingering businessissues regarding your Internet department.In addressing the title statement “How doI impact my Internet business now?” youmay be suffering one of a multitude of dif-ferent drivers negatively affecting yourInternet department: Your people mightnot have the right training skills in place(phone and communications skills); theright personnel (technical versus sales)heading things up; or you may not be uti-lizing the most effective best practices; thetechnology that works for your traditionalsales staff might be limiting internet per-formance, or you simply might be missingthe total internet department vision(which was never unveiled to anyone).And these are just a few reasons whyInternet departments have not performedto higher expectations.

The good news is that it doesn’t matterwhat is causing your poor performance.What does matter is how you go aboutidentifying the problem and instituting awinning strategy to right the proverbiallisting ship. Throughout this article, I willprovide some insight to the problemsabove and then address how you canimplement solutions. Remember, this isan ongoing battle and you’re not alone;but if you don’t monitor and affect solidchange, soon you will be. Most people areliving in the “land of just good enough.”I continue to hear things from dealerslike: • “Yeah, but my people don’t know what

to do, they simply reply to inquiries.” • “We can’t get people in for appoint-

ments.” • “Nobody knows how to really manage

the Internet department to get theresults we need.”

• “We haven’t had much luck sellingInternet shoppers; they only want bestprice.”It is time to forget the past and look

toward the future. We can’t change thepast anyway even if we wanted to. Butyou can do something about tomorrow,and the day after that. You need toimpress upon your professionals thethings that color their forward thinkingview of CRM as it relates to Internet busi-ness into a positive “new” growthpotential. Replace doubt with confidence,faith and discovering the awesome newways to excel within your Internet depart-ment. Get excited about these newopportunities because emotion creates

motion. Your thoughts are the softwaretelling the hardware what to do.Therefore, focus on the right stuff.

ProcessesYour Internet department isn’t a branch

of the military. For morale reasons itshouldn’t feel like it is, and as a result youremployees probably don’t follow everycommand while dotting every “i” andcrossing every “t”. And this isn’t bad; yourpeople who best connect with your cus-tomers are normally not detail-oriented.The challenge is helping your star peoplestay on the right track and stay focuseddoing the right things through effectiveprocesses. Below is a five-step progressionto continuously better your processes.

Step 1: Assess your current processesRetired GE chief executive Jack Welch,

in his book “Winning” writes, “Candor isimportant.” Using candor as you lookintrospectively at your processes is vital.And, to facilitate a clear view, you needthe right information. Don’t be fooled bymonthly sales numbers or total grossprofit because both are influenced heavilyby environmental factors. To find realvalue look deeper. Dive down into yourCRM software to find relative numbers,success ratios that are sub-divided into thesteps of the sale and compared againsttotal opportunities to do business.

Once you have the right information,focus on finding areas of improvement.Make a list of your highest failure points.For example, your highest failure pointmay be in e-mail response time and yoursecond highest failure point may be cus-tomer appointment show rate. Whateveryou find, be honest and prepare forchange to make it better.

Step 2: Compare process assessmentto industry averages and set goals

Step one is all about finding where tomake improvements and Step 2 involvesquantifying the level of improvementrequired in comparison to industrybenchmarks. Once you’ve developed anidea as to the level of improvement, setyour goals accordingly.

To improve the success rate of yourprocess improvement goals, utilize theSMART goal-setting method. Theacronym SMART stands for specific,

D IIGGIITTAALL DDeeaalleerr BDC/CRMChuck Barker

Don’t Settle for Less

How do I impact my

Internet business now?

continued on P-DD34

DD 34 January 2009 DigitalDealer-magazine.com

measurable, attainable, realistic, time-based goals. In practice, a goal simplystated as “decreasing e-mail responsetime” wouldn’t be as effective as a goal to“send initial e-mail reply within 20minutes to 95 percent of leads receivedduring operating hours by the start of thenext quarter.” The latter goal will giveyour employees an unambiguous objec-tive with a clear deadline, and if the goalis attainable and realistic, it will give youbasis for reprimand if the goal is not met.Now, take your areas of improvementfrom step one and develop a SMART goalapproach for each.

Step 3: Implement changes If you’re stuck in the limbo between

steps two and three, you are not alone.The term “analysis paralysis,” identifiesthe problem of defining goals and onlyplanning to implement change, butfailing to follow through. Please don’t dothis. Failing to break through analysisparalysis is one sure fire way to destroyyour Internet department.

Implementing process changes is thehardest step and it takes genuine leader-ship. You must rally your employees,deliver the new processes, support theirprogress, and lead by example. In a well-documented study, the Hawthorn effectdescribes the tendency for employees tobe more efficient when managerial atten-tion is applied. For your purposes, thisstudy reads, “To rally your troops youmust spend time on the floor and experi-ence the problems first hand.” Thenwhen you deliver your new processes,your goals will have a much greaterimpact due to the empathy you havegained from being on the front line. Youremployees will be excited about imple-menting new processes because youshowed leadership in understanding firsthand what they are experiencing andfinding solutions with them.

Once the new processes and your imple-mentation goals have been communicated,it’s not time to retreat to your office andlook at more numbers. It’s time for you tobe visibly engaged and offer any assistanceyou can. If an interim benchmark is suc-cessfully completed, buy lunch. Show thatyou appreciate the effort expended by yourpeople. Finally, you must lead by example.If the goal is to decrease e-mail responsetime, when a team member sends you an e-mail, respond as quickly as possible. Applythe new rule of leadership; do as I say andas I do.

Step 4: Monitor process adherence In step one I asked you to look at rela-

tive numbers, and I explained that units

sold and average gross profit are not goodindicators of healthy processes. Keep thatconcept front and center. Almost invari-ably dealers that institute solid processes,with the right people and technologies,will experience success to a greater degree.The problem is that when most dealer-ships experience success driven by solidprocesses, they forget the driver, theprocesses, and they start focusing on“more units and higher gross.” And guesswhat, the solid processes are abandonedand the increased success is gone shortlythereafter. This syndrome has plagued thecar business for years, but if you can keepyour people focused on utilizing the newprocesses and monitor their adherence tothose processes, your success will con-tinue. The key is to keep focused on thelittle numbers throughout the steps of thesale and your big numbers will continueto grow.

Step 5: Repeat This concept is simple. Continue to

look for opportunities to improve yourprocesses and then implement winningsolutions. It’s important to remember welive in a “good, better, best” world. Youwill always be able to find something newto improve. And don’t stop with industrybenchmarks, because for the most part,our industry is filled with poor perform-ers. Take this as an opportunity to pushbeyond average and move towards great-ness for all of your processes.

TechnologyDisclaimer: The right technologies can

enable your Internet department. Thewrong technologies can, in the best casescenario cost your dealership thousands ofextra dollars, and in the worst case sce-nario be so cumbersome, ineffective,and/or labor intensive that they under-mine the ability of your great people andsolid processes to be effective. Ourpurpose is to advise the best possible com-bination of technologies to enable yourpeople within the restraints of your storesize and budget. Our only interest is thesuccess of our clients.

Technology is your new storefront.While we’re not at a time where theaverage deal happens completely throughelectronic channels, it’s of great value tomake the comparison of your technolo-gies to your storefront. Customers arenow visiting your web site instead of yourlot, and they are e-mailing and nowbeginning to call again because e-mail isjust too slow for some. It’s incrediblyimportant that your web site looks greatand feels warm and inviting, just like your

lot and showroom, and that your e-mail isfunctional and always on, just like yourphones. But just like your showroom, lot,and phone system, technologies don’t sellvehicles; they simply enable great peopleand solid processes. This should help putthe overall purpose of technologies foryour Internet department in perspective.

I recently visited several dealer websites. The second place I visit (like moreand more prospects) after the home pageis “about us.” It frankly amazes me thatmost of these have nothing there to plantseeds for customer relationships. Theyhave a tired old slogan in paragraph form,places for staff photos but non- appearing,under construction, sales, service, partshours or directions and such. Not manyat all truly exhibit CRM as it should beintended. To give prospects a reason to dobusiness with you, get to know you betterand embrace the fact that you appreciatecustomers and are a part of your commu-nity. Take a look at your competitors aswell as your own site and ask yourself ifyou would feel comfortable with you ifyou were a prospect visiting for the firsttime. If your answer is no, then do some-thing about it. If you need somesuggestions e-mail me with your web siteand I will give you my two cents. Can’tbuy much with that but it is a new set ofeyes looking in from the outside just likeyour prospects and customers.

Key components:• People with superior sales and phone

skills• Lead management/CRM software• Web site• Technology extras• Third-party lead providers

Chuck Barker’s experience ranges from anexecutive with a Fortune 200 computer cor-poration to the automobile business. He hasheld positions as business developmentmanager, sales manager, acting GM, ADPexecutive regional manager specializing inCRM and his own current company, ImpactMarketing & Consulting Group, LLC,located in Virginia.

If you wish to discuss this article withother dealers, or with the author,please go to the “Discussion Forums”at www.DigitalDealer-magazine.comand enter the “BDC/CRM” forum or e-mail him at [email protected].

BDC/CRM, Barker (continued from P-DD32)

DD 36 January 2009 DigitalDealer-magazine.com

I AM THINKING IT MAY BE TIME TOUPDATE THE JSCG MOTTO, “Profit isopinion, cash is fact” to “Profit is opinion,cash flow is fact.” I like “flow” as it putsthe focus on the cycle of cash outflowsand inflows that in actuality, determineyour dealership’s solvency. Now, I knowyou know that. After all, these days profithas become an archaic word no longer inuse in the automotive industry and con-ceptually, cash flow is about as new asbreathing. I am just asking you to give ita little more attention at the process level.

Unless you have figured out how todeclare your dealership a “financial insti-tution” that qualifies for bailout money,you have no choice but to press on at thetop of your own, self-made, trickle downpyramid, with the proper process andautomaton utilization that helps consum-mate the transaction and get the moneyinto the dealership’s checking accountquickly and accurately.

Another thing that could stand someupdating is that old consultant’s axiom“There are only two valid types of dealer-ship employee: those who are directlyresponsible for the transaction and thosewho directly support them” and replacing“transaction” with “transaction andfunding of the transaction.” The reality isthat each one of your employees has somelevel of cash flow authority and responsi-bility. Most employees realize that fromfirst contact to finalizing the transactiontheir job is to turn all customers, with aslittle delay as possible, into paying cus-tomers. But, in their day-to- day work

employees. The thing is there is no “onething” that solves all problems. Givingemployees new computers and tools helpsand sometimes reassessing a person’s apti-tude for a given job or responsibilities willalso help. But, the best way to clear awaythe fog and confusion as to why you arenot getting the results you should begetting is to eliminate outdated processeswith better processes that are in harmonywith the automaton you have provided.Another thing is to provide employees theinformation they need in a real-time,actionable format that will keep themfocused and help drive performance.

What to doOne area that can easily go “cash flow –

wrong way” is the timing of the fundingof the car deal and of the floorplan payoff. If the payoff agreement with yourfloorplan source is based on days sincedelivery or contract funded date, youdon’t want to get out of compliance withthat agreement. Pay off too soon and yourdeal is negative cash flow; pay too late andwell, let’s just say, not good. In any casehaving a current, up-to-date floorplan payoff amount on your outstanding CITreport provides your staff with a big,usually the biggest factor in the deal, cashflow equation. Having this data front andcenter allows for quick and easy assess-ment of where you stand with your payoffagreement, as well as for reallocatingfunding efforts as needed to stay in com-pliance. Also, the report is very handy tohave at floorplan audit time. After all youdon’t want valuable auditor time andattention wasted putting together the out-standing CIT/floorplan list when theycould be admiring the deals on yourshowroom.

Please take a look at my July 2008Digital Dealer magazine DMS column fora more in-depth discussion of differencesin cash flow and profit.

As always if you have any questions orcomments just call or e-mail.

For ADP Elite usersUsing Reflections with columns set to

132 and from the accounting functionprompt, select the mini schedule withboth CITs and floorplan payoff and run it

Jim Skeans

lives the difference between customersand paying customers with the associatedfocus on cash flow can get a bit fuzzy.

When I am performing an automatonutilization/process audit I often find thatmy main task is to get people away frombeing caught up in doing things that don’tdrive results and to help them re-assesswhere their focus should be, and ofcourse, how to measure their progress.This audit process is a real eye-opener andit always involves providing them withnew tools and training that not onlyallows them to do their jobs easier, butalso helps to prevent frustrations thatcome with getting bogged down in mean-ingless tasks that tend to diminish theireffectiveness, as well as job satisfaction.

Everything from preventing and elimi-nating frozen assets (unless you are a Benand Jerry’s store or an ice sculptor) tokeeping car deals’ cash flow positiveshould be a key focus for all dealership

Profit is Opinion, Cash Flow is Fact

DMS tools that help with

positive cash flow processes

D IIGGIITTAALL DDeeaalleerr DMS WORKSHOP

continued on P-DD37

DigitalDealer-magazine.com January 2009 DD 37

to the HOLDQ printer. From SPJ selectthe report, edit and list with logging onand log to disk instead of print. Open thedownloaded report with Excel and filterfor outstanding amounts in floorplanaccount. Submitted by Jim Skeans, JimSkeans Consulting Group, LLC

For ADP w.e.b Suite usersOn the Reports tab (on top menu bar)

select “Accounting Schedules” (sampleAGRS-1) then press the Browse button(or enter the schedule number) to selectthe schedule report desired (ExampleAGRS-1.5). The schedule report displaysin ADP grid report format (sampleAGRS-2). Press the Excel icon on the topmenu bar (sample AGRS-3) and enter thefile name to export to Excel. Press the “+”key on the left margin to expand the Excelspreadsheet sample AGRS-4). Submittedby Jim Skeans, Jim Skeans ConsultingGroup, LLC

For ARKONA usersFrom the General Ledger menu, take

the Option for Audit Reporting and clickAccount Comparison – Balance SheetAccounts. Select the Vehicle Receivablesreport. Add your flooring account if nec-essary and print. You can also print theAccepted Uncapped Deal Report from theUncapped Deals option on the BusinessOffice menu. This report shows the floor-ing balance and amount financed orcapitalized cost on deals that haven’t madeit through accounting yet. Submitted byJim Jensen, DealerTrack, Inc., LLC

For Auto/Mate usersFor dealers with both accounts on the

same schedule, go into Office/Mate andcreate a custom schedule report. Filter onthe specific schedule number and addany additional fields that they want (sold,sold date, etc.). Otherwise, inOffice/Mate use the “stack schedules”function by clicking on the pivot tableicon and pivot on control number andaccount (filtering on the appropriateschedules and sold vehicles). The infor-mation can then be exported to Excelwith one click of the “export to Excel”button. Our PivotTable is exactly likeExcel’s extremely powerful pivot tablefeature and are embedded within ourMate products. Submitted by PraveenTamvada, Auto/Mate, Inc.

For DealerStar usersFrom the Accounting Reports menu,

select Heat Sheet Download. This reportdisplays all Vehicle Receivables and

Contracts in Transit balances with thebank name, F&I manager’s name, sales-person’s name, and includes the floorplanbalance. Click on the Excel icon to bringthe report into Excel or the printer icon tosend to your Windows printer. Submittedby Sandi Jerome, DealerStar

For Dubuque Data Services usersFrom the Main Menu, select #8

General Ledger then select #2 ControlledAccounts, then #3 Print ControlSchedules and then # 2 Selected ControlSchedules. Input a Date Range or leave asis for all dates. Option of Summary orDetail on the report and input the printerto send the report. Lastly, enter theDealer Defined Schedule you wish toprint. In our example, it is schedule “50”.For help on setting up this schedule ifyou don’t currently have one, contactsupport for assistance. This report canhave up to five different accounts so theend user can include new and used onone report or if there are multiple con-tracts in transit or floorplan accounts,they can all be included as well.Submitted by Kim Francois, DubuqueData Services

For Reynolds & Reynolds ERAusers

Using ERALink and from the account-ing menu select the mini schedule withthe CIT and Floor plan accounts. Run thereport with the no-print option. When thereport is finished select the report wizardfrom the ERALink menu bar and fromthe Report Wizard dialog box select ourreport. After verifying the column parsing,choose Excel as the target program andselect finish. Submitted by Jim Skeans, JimSkeans Consulting Group, LLC

Jim Skeans is the president of Jim SkeansConsulting Group LLC and has been inthe automobile business for more than 25years. Jim is a former senior consultant foran international automotive consultinggroup and has served in all of the tradi-tional dealership management and staffpositions as well as director position witha large national dealership group.

I have watched dealers buy third-partyleads for 30 or 60 days and want to get ridof the expense as if they were not working.Now I believe third-party leads need to“prove their worth,” but it takes at least sixmonths to do that. If the close takes onaverage 60 days, obviously they need to bein our system and processed for six monthsto find out just what their quality is.

It has been proven that Internet sales arean effective means for selling new and usedvehicles. It still is a fact in most marketsthat the Internet delivers to the dealershipleads that just would not come to our store.In tracking this at some stores we experi-ence 65 percent of Internet sales fromprospects out of our market. It behoovesthe dealer to make a decision to enter intothis sales channel and find out how to sellcars and make money in doing it.

Now we often want to exercise controlbefore the sale. But doing this withInternet leads will lead to delays and com-plications that will result in slowing downthe sales process and undermining salessuccess. To achieve maximum Internetsales and profits I recommend that wefirst find out how to sell cars utilizing theInternet and then work on how to get themost profit per car. In the early days wesold cars and paid little attention to theback end. It seemed most people alreadyhad financing in place. But as this saleschannel matures we are finding ourInternet sales back end can be almost asprofitable as the floor sales. It is amazingto me as a consultant how few store man-agers see themselves as facilitators of sales.It seems most managers think they shouldcontrol every step before the step is taken.And in reality this bogs down the process,frustrates the customer, and hinders salessuccess. It may be a better idea to “release”the staff and the process and make correc-tions after the sale and not before the sale.

Daryl Sanders is the owner of InternetDealer Solutions, Ltd. He has installed hisevolving sales system in over 100 dealerships.He has a business degree in marketing fromOhio State University. As an offensive tackleat OSU, he was an NFL number one draftpick in 1963 for the Detroit Lions.

If you wish to discuss this article withother dealers, or with the author,please go to the “Discussion Forums”at www.DigitalDealer-magazine.comand enter the “DMS Workshop” forumor e-mail him at [email protected].

DMS Workshop, Skeans (continued from P-DD36) Internet Sales, Sanders (continued from P-20)

If you wish to discuss this article withother dealers, or with the author,please go to the “Discussion Forums”at www.DigitalDealer-magazine.comand enter the “Internet Sales” forum or e-mail him at [email protected].

DD 38 January 2009 DigitalDealer-magazine.com

nation. It’s scary to me how many still usegeneric, auto-responders, either from themanufacturer or their CRM tool. I alwaysask a question in the comments, say,about their CPO program, and the auto-responders never answer my question.Even if it takes a little longer to get backto a person, I find that getting back tothem with a real quality response thatanswers their question is much betterreceived than an auto-responder.

The technology trends are always fastand furious: blogging, video SEO,texting, social networking, etc. We areworking up to all of them but wouldrather make sure the technology is up tospeed before we jump in. Because we haveso many rooftops we are able to try differ-ent technologies at different locations tosee what works before we all jumponboard with “the next big thing.” It’s agreat incentive in negotiating withvendors. They will usually let us try outtheir product at one of our stores at areduced price. If it’s successful, we can getthe other stores to sign up.

As a sales professional, what do youlike most about the Internet?

The Internet is the way business is donenow—and will be done in the future. It isconvenient, reliable and secure. We live ina fast-paced world where information isso readily available at a keystroke. For ourindustry it’s a matter of learning a newway to communicate and taking advan-tage of new technology to provideanswers to, and build relationships with,our customers. Most of our Internet salesstaff started on the sales floor. I love thechallenge of teaching them how to com-municate with customers via the web.

Understanding people’s fears of ourindustry is a big obstacle to overcomewhen communicating over the Internet.Let’s face it; if you weren’t in the car busi-ness, would you want to wander onto acar lot unarmed without information toprotect your financial best interest?Approaching our customers with thisunderstanding helps us build trust rightfrom the beginning.

The ever-changing technology availableto us is fun to keep up with, but at the endof the day it’s about treating people withhonesty and integrity. That’s what creates aloyal customer base and that’s where youget the best return. Using the Internet toharness the power of your humanresources and, therefore, generate truly sat-isfied customers becomes the real reward.

Advertiser..........................pg #

ActivEngage..........................19

AutoListener ........................33

Auto Point ..............................3

AutoSoft Intl. ........................25

AutoUSA ..............................40

BZ Results/ADP........................5

cars.com ................................39

DealerPeak (Widestorm) ........8

Dealerskins............................13

Dealerspan............................23

eBay Motors ..........................7

Homenet ..............................17

IMN Loyalty Driver ..............31

National Auto Care ................2

NeoSynergy ..........................15

Panasonic ..............................11

Reynolds & Reynolds ..............9

TK Carsites ............................21

VinSolutions ........................22

Cover Story, Weaver (continued from P-DD29)

rapport over a period of time. So often customers are bombarded with

contact within the first few days and thenquickly forgotten. We have carefullydevised our follow-up schedules withtimely and consistent follow-up but havealso written in enough room for personal-ized flexibility. Customers don’t want stale,irrelevant templates; they want to feel as ifwe are truly working for their business.They know they have choices and theydon’t have to be at the mercy of a cardealer anymore. This is why we have goneaway from standard e-mail templates andreplaced them with personalized commu-nications. Since doing this, we have seen avery positive response from our customers.

I do many “secret shops” around the

If you could enhance the Internet, howwould you improve it?

As soon as technologies catch up withone another and providers allow more inte-gration across the board it will help. Forexample, the capability to send video to allmobile devices has arrived. Right now weare a bit stymied with certain technologiesbecause of the tremendous fluctuation inour customers’ ability to integrate.

The same could be said about our manychoices in vendors; what they offer, whatit does for us and its ability to integratewith our DMS and CRM. We’re waitingfor someone to put real time mobiledisplay units in the hands of our cus-tomers. If someone could streamline all ofthat, I would be truly grateful!

What sets your dealership apart fromothers in the market?

Tom Wood started this company in1967 and has grown it successfully intowhat and who we are today. Mr. Wood’sphilosophy is, “Success is not measuredby the number of franchises or locationsan organization has; it is measured bythe people associated with it.” It’s a verypowerful and honorable thing to beinvolved with this group. We are veryfortunate that by hiring and retainingthe right people throughout the years,that we have achieved this type inintrinsic success.

In the new age of the Internet, we arecontinuing to observe this philosophy.Our management teams are absolutelycommitted to excellence in the onlinearena. And this is a commitment thattrickles down from Mr. Wood to ourmanagement company to our GMs,sales managers and sales staff. I tell ourInternet sales teams every day that notools, no technology, and no increase inlead volume are ever going to make adifference if we don’t have the rightpeople in place, working the rightprocess and working hard for our cus-tomers. Anyone in the Indianapolis areacan tell you our old tag line from Mr.Wood, “If it’s got my name on it, you’vegot my word on it.”

That still holds true today becauseevery one of us in the Tom Wood familywork hard every day to maintain that rep-utation in our market. Online or off, TomWood customers come first. Always have,always will.

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