So maybe you car dealers aren't so bad after all, according to an intriguing study. (See story on page 35.)
The study, conducted by Pied Piper Management, measured how well prospects, that is, shoppers that did not buy a vehicle, viewed their dealership experience.
I'll be honest, when the public relations people called to pitch the story, I yawned — really, does the industry need another customer satisfaction study?
Fran O'Hagan, president of Pied Piper, says his study is different. Customer satisfaction studies survey people who have voted with their wallets. Chances are they liked the sales process.
But what do the shoppers who come into the store and leave without buying say? For most dealerships, that's about 90% of the shoppers. Maybe having this type of intelligence will help dealerships fix areas that turn prospective customers away.
That is what O'Hagan wanted to learn in doing the study. Over a 3-month period, he dispatched surveyors to stand outside 1,592 dealerships and ask shoppers a series of “yes” and “no” questions as they left the premises.
The questions were based on the top 55 of 233 dealership sales processes identified by Pied Piper. Dealer principals and general managers agreed to allow the study to be conducted. Sales people did not know about the study.
O'Hagan says it took him several months to determine the right recipe to convince dealers to participate. Pied Piper representatives stopped getting thrown out stores when he figured out he needed to promise the results to dealers free of charge.
So what does the study show us? For one, you guys aren't as bad as the media likes to portray. The typical stereotype of the overzealous salesperson does not ring true in the study.
According to O'Hagan, the treatment shoppers received generally was very good and professional. Less than 5% of people surveyed say they were oversold while at the dealership.
Ironically, you may be losing business because your sales staff is not pushy enough — more than 20% believe the salesperson undersold them.
Along the same lines, 51% of the prospects said the salesperson provided a compelling reason to buy from the dealership. Still, there's room for improvement. Dealerships that fared poorly lacked consistent sales processes. In those stores, sales people have free reign in how they sell to customers.
The temptation is to implement some sales training, believing that will cure the problems. According to the study, sales training creates an immediate spike in behavior, but then that improvement tapers off over time.
O'Hagan says the study shows dealers dramatically can improve behavior by developing a sales process that is measured consistently.
If you want to know what your shoppers say about your dealership, O'Hagan will send surveyors to your store and sell you the results. A word of caution: he's a seasoned OEM hand, having held positions with Jaguar, BMW and Mercedes.
While he's willing to survey your dealership, he is more focused on conducting studies for OEMs. Which means another tool for your manufacturer to “help” you improve your store's performance — just what you need, right?