I now understand why tire stores still are kicking our auto-dealership butts.
I needed tires for my car and decided to get on the phone and see what it was like to shop for tires (when I really needed them). What a surprise I got. If the calls I made are a true representation of our competitors in the tire business, we need to pick up our game.
Our competitors have responded to new-car dealerships getting into this business and they are not taking it lightly. They are heads and shoulders above auto dealerships when it comes to presenting tire information over the phone and adding value to the transaction.
I made calls to the big name operations first. Of those, 100% gave me a price out the door, installed with balance, tire stems, tax and disposal fees.
Of the car dealerships I called, 20% gave me total price out the door.
Forty percent sent me to the parts department when I asked the switchboard operator if they sold tires.
One dealership transferred me to a service advisor. When I asked the advisor if they sold tires, he transferred me to the parts department. Another store transferred me to the parts department, and when I asked if they sold tires, the reply was, “We can get them.”
The dealerships in my little survey fell way behind the competitors in professionalism of the phone opportunity. Not one of the dealerships sold me any type of urgency in the call. No selling of value and not one of the dealerships offered lifetime rotation and balance with the purchase (I must assume they didn’t offer it) compared to 57% of the competitors.
I advised all the people I spoke with that the car I was shopping tires for was a high mileage vehicle that I didn’t want top of the line tires for.
The competitors all presented me with an option for what they called private-label tires made and offered by the manufacturer of the tires which was a name brand.
The dealerships all gave me one price and not an attempt was made to sell value. All competitors advised me the mileage rating on their tires. Not one dealership offered this information.
The average dealership’s price was 23% more expensive than the competitors. To me, this is not a major difference in the actual price. It’s just that the dealerships all did a poor job of communicating the perception of value.
I was astonished when I called one dealership on a Saturday and their service department was closed. I guess the tone of my voice was total shock, and the person answering the phones was compelled to explain to me: “We tried it once and it didn’t work.”
So what do you need to do to make sure your house is in order and you don’t lose customers to the competitors?
Customer Retention
Tire sales are not about selling the tires. They are about customer retention! You need to be in this business – period. It just makes sense. But don’t do it as a past-time or an addition to your current business model. Get serious!
Train Receptionists
If I called your store and asked about purchasing a certain model vehicle, the operator would know exactly how to handle these calls. Why? They have been trained. But when I called dealerships and asked about buying tires, there was no reply. It was: “Let me transfer you” or “Hold please,” not, “Yes, we carry a large inventory of tires, let me transfer you to the person who can help you.”
If you don’t like that line, come up with your own. But load their lips with what to say other than “Hold please.” Train them on who should get these calls. I would assume it’s the service advisor. Maybe the operator should advise the customer of that before the transfer.
I called Sears and the woman answering the phone said, “Good morning, you picked a great day to call Sears.” This might be a little much, but it was refreshingly positive.
Phone Skills for Advisory Staff
Don’t you think they should be trained and coached weekly on phone skills? Your manager needs to set an expectation in performance which requires a phone- interaction process. If you would like a copy of one, drop me an e-mail and I will send you a sample.
Once your process document has been completed, your manager should start the training process. Sit the advisors down for an hour or more and review the entire process. Solicit feedback and make modifications as required.
During each advisor meeting, pick a section and review it. Your manager needs to role play with the advisors face to face and on the phone. Some other ideas to consider:
- Other means of communications should have a policy established. E-mailing, text messaging, social networking all need a policy spelled out to ensure we develop good habits.
- [Have a policy for placing customers on hold. I was not placed on hold at any of the competitors; the person answering the phone handled the entire conversation. When I called one dealership they laid the phone down on the desk or counter and I listened to someone in the background complain about a customer who was complaining to them. Not good!
- Have your manager call several local competitors and phone shop them for a set of tires with your advisory staff in the room. Let them hear how well these people do.
- Send each advisor to a local competitor to shop for tires.
- Your advisors needed to be phone shopped. Record the conversation and play it back with them to offer suggestions on improvement.
Listen to Customers
Your service advisors’ greatest selling assets are their two ears. Customers want and need someone to listen to them and offer solutions to their issues. Having a car serviced is something many customers are uncomfortable with. The advisors must make the customer feel at ease in the transaction and never apply pressure to buy from you. Having the answers to their questions is the ultimate goal.
Pricing
This continues to be a challenge for many managers. The service manager wants to protect that effective labor rate and the parts manager wants the gross profit higher because otherwise it might hurt his gross-to-sales percentage.
Unfortunately, these views are short-sighted. If you think you will hold high gross numbers and high effective rates on tire sales, you will not. They are almost courtesy items. But remember, they can and should lead to other sales and services.
Look at the opportunities. The car is in your shop. It’s on the lift. The technician has a reason to look the car over. An alignment is an easy sell.
Additional opportunities are available for road-hazard coverage sales, Lock the customer to your dealership with free lifetime rotations and balance, and you have a customer coming back as the car ages and requires more maintenance and repairs. Build in retention! Focus on hitting the singles, not the homerun!
Know Your Product
The advisors should be up to date on the tires you sell. The tire vendors will often provide you with free product training if you ask for it. Ask for it!
Inventory
You have two type of tire inventory. You have the actual inventory sitting in the rack and you have the “perceived” inventory. The perceived inventory is what the advisors and maybe the technicians believe you have in stock. Managing this inventory is in some cases more critical than the actual. The advisors must believe in the inventory. A daily summary needs to be forwarded to the advisors. When they receive tire inquiries, they must believe you have the type tires the customers are asking for. Each competitor I called told me they had the tires in stock, without putting me on hold to go and check.
Put Tires on Your Website
Of all the dealerships I contacted, none had a word about tires on its websites. Get in the game! It’s almost free advertising!
Drop me an e-mail and I’ll share more tire-selling ideas. Our competitors have raised their game to challenge your dealership for your customers. Develop new strategies to continue the fight.
Lee Harkins is president and CEO of M5™ Management Services Inc. You can contact him at 205-747-8305 and [email protected].
