Only one out of 10 auto dealers “are in the game” when it comes to using the Internet as a car-selling tool.
So says Mark Rikess of the Rikess Group, a dealership consulting firm specializing in Internet-inspired sales.
“Ten percent of dealers today are at a high level of Internet sophistication, 30% are struggling to get there and 60% are not interested, at least not until they see proof of returns,” says Mr. Rikess at an eAutoWorld conference in Detroit.
That leaves a lot of e-commerce opportunity for the minority of dealers who are using the Internet in big ways. Those include creating dedicated Internet sales managers, focusing on fast e-mail customer responses and transacting business with vendors and manufacturers.
Most dealers by now have their own web sites, notes Mr. Rikess. But many of them are merely “sales brochures,” providing basic information and little customer interaction.
On the other hand, sophisticated dealer web sites provide an array of information about inventory and pricing, and make it easy for a prospective customer to use e-mail to communicate with the sales staff.
Two dealers “in the game” according to Mr. Rikess’ criteria are Bill Marsh and Mike Price.
The Internet helps fill a dealer’s need for “an ever expanding range of behavior to respond to expanding customer expectations,” says Mr. Marsh of the Bill Marsh Auto Group which sells Pontiacs, GMCs, Saturns, Chryslers, Dodges and Jeeps in Traverse City, MI.
He says his web site focuses on “relevant information” – mainly “what do we have and what does it cost.”
There’s a per-vehicle listing of prices, incentives and, sometimes, monthly payments.
“We don’t have ‘about us’ web pages or links to the manufacturer because those don’t necessarily facilitate the purchase of a vehicle,” says Mr. Marsh.
He employs a dedicated Internet sales staff of three which monthly manage up to 60 leads a month and sell 20-40 vehicles.
But he says it is hard getting the dealership staff to recognize the growing importance of Internet sales.
He says a lot of the Internet sales staffers asked to be transferred to the traditional showroom, thinking they can sell more cars there.
He says his biggest e-dealer mistake was early on “not recognizing the need for training.” That’s changed this year, he adds.
Mr. Price says the speed of the transaction is how the Internet benefits his dealerships and his customers.
“Speed increases the likelihood of the sale, increases customer retention and increases the chances of a customer coming to us for service,” says Mr. Price whose dealership group sells eight brands of vehicles in four locations around Delaware.
He says in his region it takes his competitors three days on average to respond to a customer’s e-mail. It takes his dealership about five minutes, “and we are on the phone in 30 minutes.”
He sees the Internet and the phone as an effective one-two punch.
He explains, “We try to get every Internet lead on the phone, and not just to say ‘hello.’ It’s to market the car a customer is interested in. The goal is to get an appointment for a test drive or deliver the car.”
His Internet sales staffers undergo phone training, which includes role-playing.
Mr. Price has also focused on using the Internet to speed up the finance & insurance process because an
Internet customer is interested in speed and “you don’t want them to then spend an hour and a half getting pounded by the F&I manager.”
Both Mssrs. Marsh and Price use computer software to track Internet leads. Mr. Price says his biggest early mistake was not holding the Internet staff accountable for lead-tracking.
“We wasted a lot of leads and we did some damage to our on-line credibility,” he says.