The Shift from Retailing Tools to a Transactional Platform

 

This Thursday, April 16th, I am hosting a webinar with Automotive News to discuss the future of digital retailing and its necessary evolution in the current customer experience landscape. At NADA, we launched our website platform, Apollo Sites. Since then, I have answered the questions below hundreds of times and thought it might be helpful to publish in advance of the Automotive News webinar.

Q: Why is Team Velocity adding primary websites to its Apollo platform?

A: Here are the top 5 reasons in no specific order:

  1. Most of our leadership team came from the automotive website space and carried lengthy non-competes. All our non-competes in the automotive website sector expired allowing us to re-enter the website space.
  2. Many clients asked us to integrate a primary website with a digital retailing application into Apollo using the same technology that generates and deploys all their other advertising. It’s a logical extension of Apollo and a space we know well having previously owned two of the largest privately held website companies.
  3. Our clients are focused on retention just as much as gaining new customers. They asked for a better-performing website that would provide relevant and personalized experiences for their current customers rather than treating existing customers the same as the public. They said, “integrate my DMS and make my website work like Amazon.” So that’s exactly what we did.
  4. A dealership’s website is the hub of their advertising efforts. Our clients need their ads on all other mediums – like Google, Bing, Facebook, YouTube, Email, Direct Mail, etc. – to identically match the sales and service offers on their website, 100% of the time. Dealers lose credibility and opportunities when their primary website is not a perfectly aligned extension of all their other advertising. So, we built a website platform that matches every offer, to the penny, on every single vehicle in stock, across every customer touchpoint, 24/7/365.
  5. Our clients are increasingly frustrated with the current mentality of most existing website providers. Significant traffic is driven to a dealer’s website, with the hope that the website will generate not just “leads” but an actual service or sales transaction. Unfortunately, many websites are solely focused on generating “forced” sales leads by requiring consumers to fill out a lead form just to get basic information. They also require expensive widgets and plug-ins, have poor performance ratings for speed and mobile friendliness, and can’t distinguish a current customer from a prospect. The “get e-price and unlock savings” is 20-year-old thinking and offers little in terms of useful information. We built a website that fulfills our vision: deliver a friction-less consumer experience, from the initial engagement to a final transaction. Using Apollo’s technology, we dynamically generate a personalized, customer-friendly, widget-free website that is highly rated, independently, for its performance. Our website platform is called, Apollo Sites.

Q: Do Apollo Sites have a digital retailing solution? If so, what’s different?

A: Yes. Apollo Sites has a digital retailing application called Transact. It’s unique from other digital retailing tools because it’s built natively into the entire website platform, making it easy for consumers to navigate. Our vision wasn’t to have just another digital retailing tool, but an entire transactional website platform. Transact is fast on mobile devices and uses the same UX as the website. Consumers never leave the dealership’s site and all the reporting is included in the analytics. Also, when current customers sign in, (using something as simple as their phone number or email), all their information is pre-populated, so they never waste time filling out forms, figuring out their trade value, equity, payoff, etc. Existing customers have a very fast and easy ability to complete another sales transaction with ‘one-touch’. This feature is critical for dealerships who have databases they need to retain. The existing digital retailing solutions are plug-ins to a dealer’s primary website with entirely different UX, reporting, etc. And, they treat every customer like the public. We think this is not only illogical but archaic by today’s standards.

Q: How about Service Scheduling? Does Apollo Site have that capability?

A: Yes. Apollo Sites was built with a complete service scheduling application that allows a customer to schedule service in about 45 seconds. Thus far, it’s generating 2-3x the number of online appointments as the leading providers in every implementation. An added benefit is that it automatically runs all service appointments through Apollo’s equity tools to alert the dealership when service customers are in a good position to upgrade, what specific upgrade options are available, and calculates to-the-penny payments for that particular customer. Everything is integrated, so there isn’t a need for any additional expensive equity mining software.

Q: Given the current challenges related to Covid-19, is there any technology to facilitate service and sales transactions outside the dealership?

A: Yes. Even prior to the Covid-19 outbreak, we were building virtual dealership applications to help our large metro dealers go to the customer versus the customer coming to them. What was once a nice benefit has now become a necessity. Every aspect of Apollo Sites allows customers to select options to have their vehicle picked up for service, sign up for test drives completed remotely, and, for vehicles purchased online, to have their new vehicle delivered offsite (if the dealership is capable). All of this is easily managed in Apollo’s appointment system or can be delivered to a dealership’s CRM.

Q: How are the OEMs reacting to the Apollo Sites?

A: Some of our best meetings have been with OEMs because this new technology solves many of the challenges they face. First, because the OEMs are hyper-focused on loyalty rates, the ability to offer existing owners a personalized, custom experience is ideal. Just a 1% gain or loss in retention is substantial for any OEM. Second, Apollo Sites creates a personal website for every customer, pre-establishing a “one to one” relationship. Dealers can immediately offer existing customers their best pricing without forcing a customer to “get e-price or unlock savings” on their website. OEMs love that feature, and some are starting to think about further personalizing incentives with this platform down to the customer level. Third, current website providers basically outsource Fixed Operations to 3rd parties. Service is an afterthought at best, but the OEMs all recognize the relationship between sales, retention and service. We built all service components into the website platform natively, with zero widgets required. Customers love how easy it is to schedule service, check their service history, get their own custom coupons, have their vehicle appraised while their car is in for service and the ability to check their vehicle’s value anytime. The first major OEM who reviewed the Apollo Sites website platform quickly added us to their list of approved providers, which was a very encouraging sign for our dealerships.

Q: What inspired the innovation behind Apollo Sites?

A: It’s just all new thinking. And RE-THINKING what we thought we knew. We were most inspired by the concept of Amazon Prime. Nothing in our industry, except perhaps Tesla and Carvana, have fully adapted to meet the consumer’s expectations. The current offerings lack the kind of thinking and features our clients expect from a website. And we are just getting started with this new integrated website platform. We are re-investing another $6M in 2020 to further improve the Apollo Sites website platform and plan to introduce many features that will be entirely new to our industry. We aim to set a new and very high standard of excellence for both consumer experience and for what dealerships should expect from their websites. Our focus is squarely on facilitating sales and service transactions for both existing and new customers.

Q: The evolution of Apollo to include websites seems like the final piece of the puzzle. Will there be another generation of Apollo?

A: The addition of Apollo Sites has certainly enhanced the entire Apollo platform but there will certainly be another evolution. Here’s a hint on what we are working on next…

What if a dealer’s website, not their CRM, dynamically generated beautiful, relevant, image-based, follow-up automatically? What if it was based solely on ALL the behavior and data collected on each customer and cross-referenced with the DMS? Just like Amazon, VRBO, etc., when customers complete a sales or service transaction, they automatically get new and relevant messaging. Our goal is to create a smart website that focuses on generating service and sales transactions, not just leads. Dealers have been in a stranglehold with outdated, text-based follow-up emails that don’t work well because ADF-XML technology is literally 20 years old. Yet, everyone still uses it. We consider it digital road-blocking and it kills progress. Think about it and stay tuned.

Want to learn more?

If you want to get a deeper dive on the changes we see coming, please watch the Automotive News Webinar recorded here.

David Boice
Team Velocity Co-Founder & CEO

Mitsubishi Offers Dealers Choice of New Digital Tools

Mitsubishi Motors isn’t like other mainstream automakers in the U.S. — it’s smaller. With sales of just over 121,000 vehicles last year across about 350 stores, resources are tighter at headquarters and on dealership lots compared with bigger rivals such as Toyota.

But Mitsubishi has big plans as it adds franchises every month, revamps its facilities program and works with alliance partner Nissan on new generations of its crossovers.

A critical part of rebuilding the brand is the new “Small Batch” marketing initiative designed to reach customers through digital-first advertising. And now, Mitsubishi is making it easier for dealers to access modern ad tools in their local markets and bring that more-for-less approach to chasing after customers online.

The Mi Digital Solutions program, or MiDS for short, was launched in November and allows dealers to choose from five curated providers offering prenegotiated rates and 100 percent reimbursement through Mitsubishi’s co-op ad program.

The goal is to strip away some of the vendor clutter and allow dealers to join the cutting edge of digital retailing in an affordable and manageable way.

“Prior to this program launching, we were really only focused on what I would call the traditional elements of the Tier 3 program, which are leads and websites. So, it was pretty basic,” Kimberley Gardiner, chief marketing officer for Mitsubishi Motors North America, told Automotive News.

Gardiner took over as Mitsubishi’s CMO in January of last year after high-level marketing jobs at Kia Motors America and Toyota Motor Sales USA. She rolled out the initial Small Batch campaign for the brand nationally in June, starting with digital ads before expanding to video and broadcast. That same challenger spirit led to the development of the MiDS program at the local level.

Retailers now have Mitsubishi-supported providers offering website management, digital chat, text, data mining, lead generation and other services that are tied together rather than spreading them out across multiple vendors, sometimes with little accountability.

“We really wanted to help our dealers take their digital marketing and digital programming to the next level and couple that with Small Batch thinking, which is: You can be a small organization or a small dealer, but the things we can do can have a big impact,” Gardiner said. “They realize they want to make a change but don’t know where to begin.”

Early Returns

Early results are positive. About two-thirds of the brand’s U.S. dealers have signed up, page views at dealer websites are up by 30 percent, and the conversion rate on digital advertising has risen from 0.9 percent to 1.5 percent. That latter number looks small but marks significant progress, Gardiner said.

Providers in the new program offer a variety of options — such as “good, better, best” tiers — which makes it work for smaller retailers. It’s relatively affordable for the industry, and easy to pay for through co-op dollars, Gardiner said.

The solutions are also tailored for Mitsubishi stores rather than just copying other automakers’ programs. The Mitsubishi National Advisory Board helped shape the program.

“Especially with a challenger brand like ours, we need to really work hard on consistency,” Gardiner said. “At any moment in time, a consumer can have a really great experience or have a less than great experience that could really make or break as to whether they would even consider our brand.”

Gardiner’s team vetted multiple providers and negotiated rates directly, so dealers don’t have to. Mitsubishi chose Dealer.com, Dealer eProcess, Dealer Inspire, DealerOn and Team Velocity to start. Gardiner said additional vendors could be added as needed.

One satisfied subscriber to the Mitsubishi program is David Baum Jr., general manager of Lewisville Autoplex near Dallas. Baum added a provider for his Mitsubishi store — Team Velocity — that has brought several new tools for consumer engagement.

Baum and his team can now see users interacting with the website in real time, and tailor engagement to drive a service visit or a vehicle sale. Customers are given individual accounts and can receive digital coupons they can load onto their smartphones.

“In the past, I always had service coupons on my website,” Baum said. “But I can think of only a handful that were ever presented.” With digital coupons pushed to customers through their accounts and through email, “just last month, we had 286 coupons redeemed from service customers, and those were all Mitsubishis.”

Having Team Velocity within the MiDS program made it easier for Baum to pull the trigger on more digital engagement. Part of the reason is the packaging of several services handled by one vendor, and payment through the Mitsubishi co-op program.

‘Point and click’

“I’m always being pitched from different digital marketing companies, but the pricing is always through the roof, so we don’t even consider it,” he said. With his new Team Velocity account through Mitsubishi, “it’s point and click, and they’re paid and we’re done.”

One of Gardiner’s goals as marketing head is to align advertising with media use by consumers, meaning that as people spend more time online, retailers should shift their mix. Digital also allows for visibility on what’s working and what isn’t by tracking engagement.

Toward that end, Mitsubishi added digital consultants for the first time as part of the MiDS program.

They interact directly with dealers, giving them a digital assessment and action plan on how best to use limited advertising dollars and troubleshoot problems.

“I think you’ll see more stories about efficiency, more stories about better meeting customer expectations, and certainly with those things will come more interest in terms of sales,” Gardiner said.

Original Source: Automotive News https://www.autonews.com/dealers/mitsubishi-offers-dealers-choice-new-digital-tools

Marketing Exec Says Dealers are Missing a Golden Opportunity

David Boice, CEO of marketing firm Team Velocity, says dealers are failing to tap a potentially rich source of business — and it’s right at their fingertips.

“A dealership is sitting on a gold mine of data,” Boice says. Speaking last month at a Shift conference in Las Vegas, he said customers already in the database don’t want to be treated like new leads when they visit dealerships’ websites. Instead, he says, they should be able to log in, just as they do on Amazon.

In an interview with reporter Sarah Kominek, Boice said dealerships’ returning customers should have online experiences that are relevant to their personal details and the cars they’re driving. Here are edited excerpts.

 

Q: Why do you think dealerships should use customers’ data to serve them online?

A: There are probably at least 50 very relevant pieces of data on you and your car that the dealership you do business with already knows. Every other company you do business with, you have a relationship with them online. They all know a massive amount about you because you are already their customer. Therefore, they treat you differently and personally online.

 

Q: What data do most dealerships have that they aren’t using?

A: These are very common data points that every franchised dealership has securely stored in their accounting systems: The customer’s name, address, phone number and email. Their vehicle’s year, make, model, trim, VIN and estimated mileage. Its service history, any recalls, services due, last service and recommended services. The customer’s sales info — the payment type, down payment, term, payoff, trade value, equity, likely upgrade options, next service visit, preferences and their shopping history. These data points are easily accessible to create a personal online experience for their customers.

 

Q: How should dealerships use this data when a customer goes to the website?

A: People want personalized service coupons that need to be specific to the car they’re driving. People really like to know their service history: Does the dealership have all the services that have been performed on record and are they accurate? People also expect you to give them a warning if their vehicle just went under recall. Without filling out any forms, they want to be able to schedule service and incorporate the coupons they’re entitled to. You know my name, you know my car and its VIN. I’m not going to fill out a form with the 14 pieces of information you normally ask me for, because I’ve signed in and I expect you to make scheduling a service appointment easy.

 

Q: What would the experience be like for a returning customer looking to purchase or lease another vehicle?

A: Now the customer has pretty high expectations because they have an expiration date. They’re going to ask, What upgrade options do I have? What would my payment be? What are the rebates and incentives that are currently available on the vehicle models I’m interested in buying? When you give a customer a personalized experience, people are naturally more comfortable because the service makes it easier for them to do what they need to do. What is best for the dealer’s customer is also best for the dealership. You have a five times’ greater chance of them completing the task if you treat customers with some relevancy, in a private and secure way.

 

 

 

Original Source: Automotive News https://www.autonews.com/shift/marketing-exec-says-dealers-are-missing-golden-opportunity

Mission Improbable: A Game of Technology Tag

Before I get to the heart of the article…you might rightfully point out that I missed a few large technology silos. You are correct. I ran out of room, so I included the most common and universal categories that apply to franchised dealerships’ most popular sales and service advertising strategies. And, you would also be correct that some excellent companies are missing all together. Agree, let me know who is missing. The companies included are all great at what they do, and I listed them alphabetically. However, adding more silos and logos only makes the reason I am writing this more relevant to the challenges faced by dealerships in the current 2020 ecosystem.

Now, if you are an entrepreneur, what an impressive list of companies that make up much of the technology ecosystem in the automotive industry for advertising. Some of them cover one silo perfectly while others dabble in 2-3 silos. A few of these companies are worth billions of dollars and many worth hundreds of millions. Not bad, right? But when I reviewed this graphic with my dealer friends, I discovered the average number of companies they work with to help sell and service cars was between 10 and 12 from these main ad categories alone — but way more vendors are required. This is just the tip of the iceberg.

I call this “Mission Improbable”, meaning it’s highly improbable this siloed model is going to succeed. Here are some comments from good, really good, retailers who passionately want to create a frictionless customer journey for their new and existing customers and do it in a way their internal teams can efficiently and profitably execute.

“A world-class customer journey isn’t possible with this many companies and competing technologies involved. It’s too hard, so we settle for mediocrity.”

“It’s like a game of Technology Tag and I am always it. Nothing quite works together like we are all promised.”

“We have 8 offer management platforms just to price out cars and create compliant offers. None of them are consistent. It’s no wonder customers lack trust in our process.”

“I have 4 franchises; my OEMs all use different certified vendors in their Co-Op programs. It compounds our challenge by 4x. It’s getting worse every year.”

“It’s too expensive and the real costs are all the people we need to hire, train and re-train in order to use these technologies that were never designed to work together.”

“All these companies are all chasing the exact same people. I only have two types of people to sell or service…my existing customers and prospective new customers in my market. Is it really that hard?”

“We have all been so focused on the customer journey, we all forgot about the dealer journey through all of these independent platforms.”

 

Technology Tag

So, the problem for dealers is logical and well-said by the growing frustration of dealerships who are spending more for technology and getting less of a return, if any.

What’s the solution?

With every big challenge comes a great opportunity to solve it. As we enter the new decade in 2020, I would propose some or all the below suggestions to help combat Mission Improbable.

Here are my Big 5.

  1. OEMs. I would encourage you to do this ‘silo’ exercise with your current and future programs. Some technologies are setup to share data and integrate with other companies through secure API’s. Some are not structured to integrate and never will. The current universal method of sharing data is through ADF-XML which is 20 years old. This was originally designed for getting lead forms with very basic data into a CRM. The entire world has changed, and data integration has exploded. You have the power and position to force real integration across silos to dramatically improve the customer journey while reducing the burden on your retailers.
  2. In 2020, you will see companies (like ours) continue to develop and rollout technology that already integrates and connects the silos. We won’t be alone, but the customer journey now touches everything from targeted communications like email and mail, to all the major digital media companies to websites. Integrating all those offers and experiences is the best way to ensure a positive customer journey. Just look at the most successful digital retailers like Tesla, Carvana, Amazon Prime, etc. Less technology silos, less friction, less expense, and more of what you want…transactions.
  3.  We must rethink 20-year-old technology as the primary manner to share basic data amongst companies and platforms. I am hopeful, but doubtful, that the current landscape is ripe for this type of cooperation.
  4.  Consolidation and/or real integration. Some of the companies should get together and start creating “Reese’s Chocolate Peanut Butter Cups” with their ingredients. Dealers want less solutions that do more and are easier to use. I can see some solid partnerships forming in 2020 that offer dealers and/or OEMs fully integrated solutions that were intentionally designed to work together.
  5.  Go Direct. Digital advertising is perhaps the most siloed, crowded and fragmented of them all. Starting with the public groups and the large privates…dealerships are going to start to bypass traditional digital vendors and OEM programs all together. By either creating a solution themselves, or by endorsing a few existing tech platforms, the big media companies have everything to gain (and so do their advertisers) enabling dealers to advertise their inventory and services directly without the need for an agency. Think about it, what value does a travel agent offer its passengers these days? Very little. Google, Microsoft, YouTube and Facebook will have to look at this in 2020. There is too much at stake not too. And while standalone franchises might be able to muscle through the myriad of companies in these silos, large groups have to scale and be more efficient. Dealers will develop direct relationships with the major digital media companies that the vast majority of their money is already flowing into. It only makes sense for them.

I am going to be at NADA this year with Team Velocity at Booth #4288C in the main hall. If you want to talk more about this, or set up a time to see how we are solving the game of Technology Tag, please send me a private message.

David Boice
Team Velocity Co-Founder & CEO

AutoSuccess: The Top 10 Companies to Watch in 2020

Team Velocity is an automotive agency with artificial intelligence technology that is revolutionizing the industry — and how dealers sell and service cars. Their proprietary technology platform, Apollo, is made by dealers for dealers. It analyzes sales and service data to predict who will buy, what they will buy and when they are ready to service. Apollo  generates dynamic, offer-based campaigns across all channels, including search, display, social, pre-roll, email, text, direct mail, personal websites and landing pages. Eliminate the risk of traditional marketing when you market with Team Velocity and Apollo, which provides the ultimate consumer experience across every touchpoint — both on desktop and mobile. Team Velocity and Apollo’s site of capabilities successfully increases revenue and efficiencies for both dealerships and original equipment manufacturers. Predict, track, sell and service more customers with Team Velocity’s human-fueled creativity combined with the innovative, fully automated AI platform of Apollo.

 

Learn more about Team Velocity and the other 9 companies to watch in 2020:

Read Full Article

 

Digital Retailing or Digital Roadblocking?

Digital retailing continues to be one of the hottest topics in our industry, but almost everyone I talk to has a different explanation for what they consider digital retailing to be. So, on a recent cross-country flight, I Googled What is digital retailing? I thought the following definition was most logical:

Digital Retailing, at its most basic level, is a series of experiences that allow consumers to easily maneuver and engage with your website at different stages of their purchase journey.

Personally, I believe that every dealership attempts to have a great digital retailing solution. Who doesn’t want to execute the above definition for their current and prospective customers? But, in reality, are we? Consider your most important customer, the one your dealership already has…your existing customers. They make up a vast majority of your sales and service transactions. But how easy is it for them to maneuver and engage with your website at different stages of their purchase or service journey? Most likely it is not easy, regardless of the dealership’s brand, size, or location. Although I love Audi, my personal experience with my dealership is a good example of what consumers experience every day.

 

Here’s how it started:

I received a nice personal email from my dealership with a lease offer on an A6 Premium for $469/month for 36 months with $2,999 down, driving 7,500 miles annually. (The disclaimer listed some nice rebates, but it is doubtful a typical customer would read the fine print.) So far, so good. Interested, I clicked the link that directed me to their website/VDP.

 

Once there, I hit my first roadblock:

  • The dealership links me to a full MSRP VDP with a price of $57,895 and zero lease payments – not even close to the offer advertised in the email. Confused, I click again – this time on the CTA labeled Make Your Deal – in the hopes of being redirected to the advertised $469 lease payment.

 

 And, I am met with a second roadblock:

  • The dealership is asking me to give them my information. Considering they just emailed me a personalized offer that included my name, email, and phone number, don’t they already have my contact? This was supposed to be an easy process as an existing customer, and too much time later, I’m still jumping through hoops.

 

Invested in time and now just curious, I resubmit my information and click for a third time and – unsurprisingly – am not taken to my personalized offer. I spend more wasted time configuring a lease on their digital retailing widget, careful to make sure I replicate every term listed in their original email to me. And finally, my offer!

 

Just kidding, I hit roadblock #3:

  • The best offer I am given is $667 per month – which is approximately $200/month above the $469/month lease payment the email promised to me as well as the rest of their customers.

 

Surely, I’ve just made an error and can still get the offered lease payment? Just in case, I Google Audi A6 Premium lease payment, and…

 

Roadblock #4 appears:

  • My dealership is advertising payments as low as $399. Now I’ve been given three completely different payment terms for the same model. Consumers are more frustrated than ever. Why is this process so difficult and time-consuming? At this point, most dealerships would have lost any previously interested existing customers.

 

About an hour later, a nice young lady from Audi calls me, and I ask her about the personalized email offer I received earlier in the day, and politely explained I was unable to find it on their website or in any of their advertisements.

 

Roadblock #5 is presented in the form of her explanation:

  • “Unfortunately, it’s inconsistent, and it makes it hard for us depending on what you received or looked at online because none of it is usually realistic. But if you can come down, I am sure we can work out a great deal for you.” I thanked her, but thought why do we roadblock customers online?

 

This made me wonder, as I often do, if the dealership leaders spend any time walking through exactly what their customers experience? It sounds simple, but I am guilty of not doing this at my own company.  It’s like calling our main phone numbers versus dialing our employees’ mobile phones directly. The phone systems and processes are so bad, slow, and cumbersome that we just go around them now. The bottom line is that it’s a painful process even for your best repeat customers to get realistic and accurate information to purchase their next car or schedule their next service online, and it shouldn’t be.

 

Some people reading this will correctly state that the dealer is not allowed to share their best prices until a one-on-one relationship is established. However, how much more established can it get from a current customer who purchased an Audi and services it at that same dealership? Technology, as advanced as it is, should be able to distinguish between an existing customer and a prospective new customer. In fact, automotive dealers are in the rare group of businesses that don’t separate customers online experience from their prospects. If you think about the businesses you interact with almost daily – Amazon, your bank, insurance, credit cards, online entertainment, every major hotel and airline – they already know who you are and treat you as such. Customers are roadblocked because they are treated like a “lead” instead of as an existing customer.

 

You would also be correct to point out that the company who emailed the customer also has no control over the website company, which has no control of the retailing widget to configure payments, and the website company has no control of the company that does the Google Ads. This is true, and part of the issue that makes Digital Retailing feel way more like Digital Roadblocking for customers.

 

The solution is in the palm of your hand! Consider Apple: they created a platform that integrates and interacts seamlessly with consumers and their lives. Conversely, look at dealerships: consumers are forced to jump through hoops when it comes to dealership technology. They are forced to juggle a brick flip-phone, an original iPod, a digital camera, all of their credit cards, cash, and a clunky GPS system just to keep track of their journey and reach their destination  – when all they need to be given is a single smartphone (i.e., Apple). Consequently, the lack of consistency kills a dealership’s credibility.

 

Realistically, Digital Retailing is only going to happen in our industry with integrated technology platforms that provide a series of experiences that allow consumers to easily maneuver and engage with dealership websites at all stages of their purchase journey, not just the one that particular vendor executes.

Mission Improbable 2.0

 

As I have both previously said and written, it is improbable that most dealers can truly be successful with so many different companies and technology platforms being utilized to operate their businesses. Most dealerships are up to 10-15 different ad/technology companies even before you start counting all their 3rd-party widgets/plug-ins. How can any business create an excellent customer experience for sales or service with so many independent software applications that were never designed to integrate with each other? It’s the definition of Mission Improbable.

I generally spend more time with friends not in the business on these longer holiday weekends. And since they know what I do, I get to hear about their car-buying experiences, which I love. Below is a quick summary, from a friend’s POV, of a Labor Day Event email designed to upgrade his 2017 Audi Q7 to another Q7 or the new Q8 over the long Labor Day weekend.

I told him what the dealer does behind the scenes to execute even the most basic shotgun email marketing, much less something more complex like digital advertising, which could involve another 4-5 additional companies:

  1. Dealer hires Company A to design the Labor Day email blast, and they have offers for their lowest priced models. None of it really looks “Audi,” but whatever, it’s a one-time blast to everyone.
  2. Company A sends the designed email template to Company B, which selects the audience and provides some small customizations like “Joe, you’re eligible to upgrade your 2017 Q7 during our Labor Day Sales Event.”
  3. Company B deploys the email and sends the customers off to a landing page (no matter what they are driving) somewhere on Company C’s website.
  4. My friend pecks his way around Company C’s website and finds a few logical vehicles he wants to consider leasing. He claims to spend more time closing “popups” asking his name (ironic since the email included his name) than doing anything else.
  5. He hits the “Buy Now” link on Company C’s website, which opens up a different digital retail solution from Company D.
  6. Company D promptly requires Joe to provide his name and phone number in order to send him a special code to continue or get an “e-price,” a term he is unfamiliar with.
  7. Wait… what?
  8. Joe is the current customer driving a Q7 that Company B emailed, and Company C and D force him to submit a lead form to continue? Yes, this is real.

Before I tell you the ending, I asked him for his opinion on what he thought about the process:

“Awful. Absolutely nothing makes sense. How can they know my name and my current vehicle but send me a blast with an Audi A3 and A4 offer? I drive a Q7; do customers downgrade that often? Why didn’t they link me to the vehicles I would logically be most likely to buy? Finally, when I did find the vehicle and wanted to get more information, I clicked the link to ‘Buy Now’ and a new experience opened up, and they asked me for my name and phone number to continue. Why would the dealership send me an email then ask me to provide them with information they already know? How much more difficult can they make it? The button should have said ‘Don’t Buy Now.’ And the capper – even after I did all that, they called me and didn’t even know I was already a customer.”

I was shaking my head and thinking Companies A, C, and D don’t have any idea who you are, what your relationship is to the dealership, or the car you drive… so to them you are Joe Public. Company B knows more, but it doesn’t matter because they are sending you to Company C’s public website with a retailing widget from Company D. It’s just broken. Mission Improbable.

He continued, “They don’t treat their customers like the public – they treat us worse than the public because they make me provide them with data, like my name, car, trade value, that surely they have since I am already their customer. After all, they emailed me, right? And the more places I shopped online, the less consistent my experience became. It ended up being just as hard to buy somewhere else.”

I explained that dealerships get stuck with so many platforms that don’t integrate, that his “awful” online experience would have been pretty similar at 95% of dealerships. His online experience, however, was (to him) a direct negative reflection of how he perceived this dealership’s operation – four independent companies involved in a basic Labor Day email that ended with Company D asking a current customer to fill out a form before he could have the privilege of upgrading his vehicle.

And we are so numb to this poor experience that we celebrate the 1% of consumers who tolerate this “upgrade” experience as a victory. Company D didn’t generate a lead; they simply gave the dealer back very basic information of a current customer the dealership already had.

I firmly believe we can do so much better, but not without new integrated technology platforms or the adoption of new modern standards of integration, which seems quite unlikely given today’s climate.

My wholehearted belief is that one fully integrated platform should be used for the majority of a dealership’s marketing and advertising, as well as technology that clearly distinguishes between existing customers and new customers. I am hoping that OEMs will take a strong look in the future at how they endorse or include stand-alone “silo” solutions that will never integrate with each other versus broader platforms that are already integrated by design.

The goal should be to provide consumers with a consistent and relevant experience with single platforms that can easily be managed by Tier 1, 2, and 3 advertisers.

Just Text Me

 

Text is now the preferred method of communications for U.S. adults. It has a 99% open rate compared to email’s 20% (at best), making it a far more effective form of communication. However, most dealerships’ websites still have countless clever – and annoying – ways to attempt to get a consumer to fill out a lead form. I get it, but it’s time to think like customers living on mobile devices in 2019. Ask yourself: when was the last time you filled out a form or chatted with a company from your mobile device? Now — when was the last time you sent a text?

Some dealers have a basic widget on their site allowing customers to text their major departments. That’s a start, but it’s an overlay or pop-up that often interferes with the user experience and must be closed in order to navigate. Like most things in our industry, these widgets stand alone and don’t integrate with a dealership’s customer database. For text to really work, it must integrate with your most important database and be prolific in ALL your advertising.

Heeding these new stats, we recently developed a new texting platform for consumers and dealers within the Apollo platform, aptly named Apollo Text. This is a quick overview of how it works and why it is performing better for our dealerships than the 3rd party widgets they used before.

If you want to substantially increase engagement from your marketing as well, I suggest following these five winning principles of text:

 

  1. Integration. Integrate a “text us” option throughout all your advertising mediums. Give your consumers the option to text your dealership(s) everywhere – search ads, video, email, direct mail, Google Business Listings, and all the major areas of your website. This way, your customers know it’s a legitimate and even preferred option for them to engage with your dealership. You will immediately receive more texts from in-market consumers that have not yet visited your website but have engaged with your marketing. See below for examples.
  2. Customer Identification. This is key. Make sure you have a texting application that cross-references the inbound text number with your customer database. Most consumers only have one mobile device, so chances are, if they have ever done business with you, their mobile number is already in your database.  Today, about 50 percent of all inbound texts are from customers that can be easily identified by cross-referencing their phone number. By instantly identifying the customer your team can review all available and relevant data before formulating a response.  This is what makes text so much more powerful than any other engagement or method of communication.  From a simple inbound text, you can learn everything about the consumer before you respond. For example, vehicle history, trade value, equity position and more.
  3. Customization. Customize your inbound text options with custom and/or pre-populated responses to match what’s most important to your customers – current offers and promotions. For example, if you are offering a $39.95 oil change or Free Pick Up and Delivery, make that an option for your service texts. Or, if you have a promotion for $500 in Bonus Cash, make those readily available options as well. Your platform should be flexible enough to be updated instantly.
  4. Automation. Text is about quickly giving the customer the information they need. Make sure you have pre-populated all the typical and most common responses ahead of time so you can rapidly respond to their inquiry. See below for some examples.
  5. Attribution. Attribution is the very best part of text. Retrieving a mobile number during any engagement (sales or service) makes it easy to attribute your marketing to a transaction and determine an ROI. A reliable mobile number is one datapoint a dealership almost always receives during the sales or R.O. (repair order) process. Your platform should automatically provide you with a match report that enables you to see which marketing initiative your customers are responding to (Google, Microsoft, VDP, Email, Mail, POS, TV, etc.).

 

 

So, not only do many customers prefer to begin and end their engagements with text, it’s also the best datapoint your dealership can gather. The ability to cross-reference consumers unique mobile numbers against your sales and service transactions make text the most reliable way to attribute an ROI to all your marketing and advertising efforts.

No matter who you work with, if you follow these five principles for text, I guarantee you will see an increase in qualified leads, response-rate, and ROI attribution.

 

#NoMoreCoreModels

#NoMoreCoreModels

Remember the good old days. “Hey Mr. GM, the incentives just came out and I was hoping you could email us the very best offers on your top core models? From there, I can forward them to our (human team) and have them create your ads as quickly as they can. Next, we can rush these ads to your OEM compliance group and after 48 hours of back and forth, our team will send the compliant ads back to you for final, final, final approval. By then you can make sure the offers are still correct. Now it’s somewhere between the 10th and 15th of the month and we can start marketing for about 15-20 days. As soon as the new incentives are released next month, we can start this circus all over again.” Sound familiar?

Ask yourself, are those really the good old days? Not really. If you are still doing this with multiple vendors every month, it’s a colossal waste of your time, highly inefficient and has your dealership on the advertising sidelines for far too long. If your vendor suggests you utilize a “tool” so that you can figure all this out yourself, it’s even worse. Don’t forget, your job is to sell and service cars and ensure your customers are taken care of 24-7. It’s their job to handle all your marketing and advertising initiatives.

Typically, this is the trend I tend to see. You’re still getting some of those “offer” calls or emails, but not from your digital partners. See… they just went way, way, way back to the ’80s. To the point where your ads probably look like the version below.

Ad Example

They are so generic they don’t even need to call you; they are near useless to the consumer and easily compliant because they have no relevant information that an OEM compliance department would even bother to check.

Your ads should be based on your inventory and the vehicles you have in stock to sell and deliver. You should spend time pricing your cars competitively and consistently on every digital medium you can. By the way… so should your pre-roll videos, display ads, TV commercials, emails, direct mail, etc. For example, your ads should look like the ones below and the rest will take care of itself.

consistency across every digital medium

You should be in “play” 24 x 7 x 365. Why? Because technology has changed so much that Google, Bing, YouTube, and Facebook all have technology platforms that allow your inventory to be uploaded and updated daily. Remember, your sales ads should always reflect your current inventory. Why advertise something you don’t have?

That being said, technology has changed but your consumers have not. They still want to know two things, “do you have it and how much is it?” What has changed is their ability to find out relevant information instantly… anytime and anywhere.

So, what does this mean? Stop generically advertising your models, none the less your “core models.” It does not work with today’s consumer. Eliminate the phrases so often associated with our business that instantly create distrust such as but not limited to:

  • Payments as lows as…
  • Savings up to…
  • Huge selection…
  • Great deals…
  • Limited time…
  • Quotes online…

Together, we can end generic advertising.

David Boice
Founder and CEO

Mission Improbable

Mission Improbable

 

There are so many excellent, innovative companies in this industry. I did not include our companies’ names because whether you feel we are leading in any of these areas isn’t relevant to this article. The point is, dealership managers are left to themselves to aggregate processes around at least 6 separate technology platforms. In our opinion, it’s Mission Improbable for most. Running a dealership is hard, it’s competitive, and it isn’t easy. Adding a technology integrator into the mix shouldn’t be part of the job description.

It doesn’t matter how great individual companies are or become in their respective swim lanes. There are just too many different technologies that will never integrate, strongly biased opinions, glowing reports and conflicting priorities for dealerships to make sense of it all. I applaud the effort (we are participating) in trying to develop a new integration standard (ADF-XML 2.0) across multiple platforms. But at best, it will only make a small dent in the real challenges dealerships face in today’s increasingly complex world of retailing.

Not even Fortune 500 companies have as many technology platforms to communicate with their customers and market themselves in an integrated fashion…as dealerships do. Every speech I hear has at least one reference to Amazon or Apple. They deliver world class experiences because they have a single, fully integrated platform that connects their marketing, their customers, their inventory and their logistical operations. They treat their existing customers (like me) very differently than new customers, by heavily factoring my purchase history and my relevant data across every touchpoint I have with them. That’s one of their most powerful advantages. 99% of dealerships can’t do that because their data lives in 6+ places, not including accounting, and each platform performs a set of narrow functions. Go to any dealership’s website and look for the ‘Sign In’ button or ‘Current Customers, click here’. You won’t find it! When someone who you already do business with visits your site to engage with you and the first thing you ask is for their name…well that says it all. Today’s consumers demand to KNOW ME BETTER, SERVE ME FASTER, and WOW ME EVERYWHERE. While that concept is simple to type, it’s hard to execute.

Even if a dealership kept it simple and only picked the largest company in the limited number of technology categories highlighted in the graphic, they would still be left trying to make it all work. These companies are hugely successful and best in class. But guess what? They also have the least desire to work together, are fiercely competitive and nobody can blame them for that.

When I started in the business, it was common for dealerships to use separate finance systems (like Coin) or service retailing systems. We walked many deal jackets upstairs to accounting for them to keypunch into the DMS, which sounds nuts by today’s standards. But, once dealerships got used to the integration…they couldn’t live without it and most of those independent companies were either purchased (like us) or they vanished. This certainly isn’t the case anymore as these companies are entering the space as fast as they can, typically with a singularly focused solution and a pocketful of investment cash.

I was fortunate enough to start my first company at 22. I worked in dealerships at nights and on the weekends while developing and selling some great software during the day. After 3-4 years I was able to just focus on building my first business. I asked lots of questions to anyone who was successful in an effort to learn. I knew nothing except for how to outhustle most people. I truly did not know what I did not know.

I heard a lot of inspiring thoughts, but the one piece of advice that was consistent was, “Do one thing and do it well. Do it better than everybody. Focus”. And ultimately, that’s what we did. It was good, sound advice, and I think most entrepreneurs in the automotive space subscribed to the advice I was given both then and now. That’s why all the leading and largest technology platforms are still singularly-focused and not integrated to this day. They stayed in their swim lanes….and a whole bunch of new platforms are on their way because Silicon Valley is betting and banking that these siloed tech platforms are the answer.

That strategy and advice no longer makes sense in an increasingly complex business environment like automotive retailing. In fact, I think the opposite, So much has changed, and today’s consumers’ expectations are now being established by companies like Apple, Amazon and Google. They are fully integrated across every touchpoint. The bar is high and personalizing the consumer experience is a necessity based on how consumers have been conditioned. I recently read an email from a current customer that asked the dealer a basic question. “I have purchased and serviced multiple cars from you, why don’t you fill all this paperwork out for me? Why do you not save me the 4 hours to buy from you again? Ugh.”

That’s why we have been on a long-term mission (aptly named Apollo) to build one fully integrated omni-channel technology platform that can facilitate every ounce of communicating, marketing, retailing and servicing a vehicle online or offline from one database. We couldn’t license or buy the technology, or piece-meal it together through a series of acquisitions. It had to be designed and constructed from the infrastructure level up. It’s been difficult, it’s been filled with setbacks and 5x as challenging and expensive to create as we thought. We are not done, but we have tackled the most difficult technical aspects of the mission. People always ask me, “why are you doing this?”. We are doing this because we firmly believe this is the only logical way for dealerships and OEM’s to facilitate the changes required to meet the demands of today’s consumers — by implementing one integrated omni-channel platform. The large aggregators have struggled to piece together integrated solutions through acquisitions and most start-ups don’t have enough capital, the know-how or the desire to compete in as many arenas.

Something as basic as making sure that every single medium a dealership is advertising in (from free to paid) consistently displays the exact same offers, payments and disclaimers for every single model, trim and for every piece of inventory in stock. Consistency equals credibility to consumers. When something changes like incentives, selling price, inventory, compliance or a state regulation, we are able to ensure everything is automatically updated in minutes across all the mediums and on all the major ad platforms. In addition, retaining current customers is so vital to a dealership’s business that it should be 75% easier and faster to transact in sales or service than it would be for a brand-new customer. That’s the reward for being a repeat customer. A dealership’s primary website should cater to their existing customers as much as it does to the public. By simply cross referencing a phone number from a customer who is speaking, texting or using Voice, you can find out hundreds of other pieces of critical data to make it easy to facilitate another profitable transaction in minutes with zero friction. But, there are so many competing technology platforms, it doesn’t happen…yet.

My gut is that we are not only going to continue to see further dealership consolidation, but we will see vendors consolidate, merge, get acquired or vanish completely because omni-channel technology integration is going to be the future. OEM’s are going to start looking at the logic and power of entire platforms for their retailers that connect Tier 1, 2 and 3 seamlessly. Today, they overload their dealers with individual technology platforms cherry-picked by an uninvested 3rd party to evaluate them, primarily based on obtaining the lowest price. The CO-OP programs have a purpose for sure, but dealers are left trying to make sense of all the separate technology platforms that will never work together. So, who wins? Not the dealership and certainly not the customer.

Last but certainly not least, the consumer experience itself won’t be frictionless because so many important touchpoints are inconsistent. They are also painfully SLOW on mobile devices because most dealership websites (not all) have become widget farms with too many 3rd party plug-ins.

Do this simple exercise for your dealership.

Take one common vehicle/trim that you have in stock (that you are advertising) and do the following:

  1. Search for that model in Google and jot down the payments and terms you are advertising, if any exist.
  2. Then go to the landing page, and jot those down.
  3. Do the same thing on YouTube and jot down any payment-based offers you see, if any.
  4. Then go to your primary website, jot those down.
  5. Then go into your Equity Mining Tool, jot those down.
  6. Then go into your CRM and see what those outbound emails have for payments.
  7. Then go to Facebook, jot those down.
  8. If you send your customers mail and/or email, jot those payments down.
  9. Then pull up your retailing plug in (if you have one) jot those down.
  10. Then go to the 3rd party sites and jot those down.
  11. Then call the store and ask about the payments for that same car you might purchase or lease.
  12. Then email your dealership and ask the same basic question.
  13. Now be the customer who simply wants to know “do you have a (?) and how much would it to be to Lease or Finance it per month? Many of them are exposed to all the above scenarios.

If you are advertising or communicating payment-based offers (which works 2x better), you have a massive amount of work to do make sure everything is consistent. The fact is, most dealers give up, because it’s Mission Improbable. They go back to the generic ads that don’t include the single most important information that should be available to today’s consumer which is… “Do you have it, and how much is it?” This is especially important for your active customers and repeat buyers.

To my many dealership friends, do your best, don’t get frustrated, don’t switch vendors as frequently as you do. Start asking questions about how things work together. Demand consistency on every touch-point because your credibility depends on it. Shop yourselves everywhere. Most importantly, start looking for omni-channel platforms that do more for you with less log-ins. You can be as integrated as your phones, computers and the favorite companies you transact with. Licensing more single-channel technology platforms just overloads you with more technology and requires more of your time to learn it and implement it.

David Boice
Founder and CEO

 

How one car dealer shows what’s best for the customer is best for business

“The whole notion of having to come to a dealership for service is outdated,” says Brian Benstock, general manager and VP at Paragon Honda, the largest certified pre-owned Honda dealership in the world. “If a customer doesn’t want to set foot in the dealership, they shouldn’t have to.”

That’s a pretty bold statement for an auto dealer, but for any marketer in any industry it reflects a new reality when it comes to meeting customer expectations.

As they have in other sectors, digital and mobile technologies have totally transformed the relationship between drivers and dealerships. People can do practically everything online that they’d do at a dealership—including comparing models and scheduling service—which has led them to expect a fast, friction-free experience both before and after the sale. “Time is the new currency,” says Benstock. “You’ve got to move at the speed of the customer. … If we don’t disrupt ourselves, the customer will do it for us.”

To meet customer expectations, Paragon Honda set out to transform its customer assistance by removing friction from one of the biggest customer pain points: vehicle maintenance and service.

“Our customers want to live their lives. They don’t have the time to drive out to the dealership, drop off their car, and wait for it to be serviced. Technology has changed their expectations, and we knew we needed to change our approach to service and marketing in order to meet those,” says Benstock.

Paragon Honda, in partnership with Team Velocity, took a three-step approach to transform the way it assists customers. The broader concepts behind this approach can be applied to almost any marketer in any industry. It comes down to considering the customers’ needs every step of the way.

1. Remove the friction

Regular or reactive car maintenance is an inconvenience that’s amplified when it requires visiting a dealership during working hours. Knowing that today’s consumers expect to get things done immediately, Paragon Honda developed an app that lets customers request to have their vehicle picked up, serviced, and returned to their home within 24 hours—no dealership visit required. That’s especially convenient in Queens, N.Y., where Paragon is based. Paragon’s seen that customers who use the Paragon Direct app drive twice as many repair orders compared to customers who don’t use it.

2. Test new technology

To make it even simpler for its customers to schedule service and maintenance, Paragon became the first dealer to build an app for the Google Assistant. Drivers will soon be able to schedule service—such as routine maintenance, oil changes, and tire rotations—quickly and easily using just their voices.

3. Optimize marketing and measurement

Research shows that when drivers need information quickly, the first place they turn is search.1 To drive awareness of its 24-hour service online, Paragon ramped up its investment in search to be there in moments when people searched “honda oil change” and “honda maintenance” in the New York market. As a result, this strategy helped Paragon grow its service repair orders by 5X in the last 12 months, according to the dealership.

At the same time, when it comes to buying a car, search is the most commonly used among all sources, including word of mouth, television ads, and even dealer visits.2 For that reason, Paragon also used search ads to drive new and used vehicle sales, but needed a way to prove its impact. Instead of focusing solely on driving conversions through lead forms, Paragon used Google store visits to measure how search ads helped generate visits to its dealership. This helped the dealer better understand which keywords and campaigns were driving people to its dealership, and, according to Paragon, revealed that search was nearly 5X more cost-effective per vehicle sold compared to other media.

By sitting in the driver’s seat, Paragon was able to transform the way it assists its customers. “I think any time you do what’s best for the customer, that ends up being what’s best for the business,” Benstock concluded.

 

Original Article

 

Brian Benstock of Paragon Auto to speak at NADA 2018

Don’t miss this innovative workshop!

Saturday, March 24, 2018 • 10:30 – 11:30 AM

Double Retail Sales With Frictionless Transactions

As soon as your customers can get rid of you, they will, especially in today’s traditional dealership model to retain and gain customers, dealerships must create a frictionless transaction. In this workshop, Brian Benstock will walk you through how the car industry can innovate and disrupt the market before Silicon Valley beats us to it. As the traditional car buying model fades, the key for dealers is creating something new inside of something old. Brian Benstock explains the importance of creating a dealership without walls that cater to the consumer. A new business model that utilizes technology and a fresh customer experience to generate new sales while still sustaining current business operations. These are the same processes and concepts currently being used, refined and constantly improved upon to double sales at the Paragon Group over just 24 months.

Room: N103
Track: NADA Dealer/Executive

About Brian:

Brian Benstock is the general manager and vice president of Paragon Honda and Paragon Acura, the No. 1 certified Honda and Acura dealerships in the world, delivering an average of 950 cars per month and 32 cars per day. Benstock has been studying and working in the car business since 1982. His dealerships have received the American Honda Presidents Award, Council of Excellence Award for Finance, Certified Dealer of the Year Award and more. As a thought leader in the industry, Benstock has been a featured conference speaker and has appeared on Fox News and CNN as well as in Automotive News.

AutoSuccess Top 10 Companies to Watch in 2018

10 Innovative Technology Companies Who Help Dealers Dramatically Evolve and Emerge

The automotive industry continues to evolve around the way consumers research, buy and service vehicles. One thing remains the same in the highly competitive industry — dealers continue to implement marketing strategies and technologies to help drive new sales and service business while at the same time retain their existing customers.

Dealers have hundreds of companies to choose from that offer a range of services, from niche programs to full-service marketing companies. Researching and evaluating that many companies can be very time consuming and often confusing. Therefore, we are releasing the Top 10 Companies to Watch in 2018 to help identify companies that are leading the industry with innovative solutions.

In summary, the companies on this list are leading the industry and are helping achieve measurable results for some of the most demanding and successful dealerships, associations and OEMs
in the industry.

Read Article

AutoSuccess Story: Rocky Mount Toyota

Out of the Red and into the Black

Rocky Mount Toyota turns its future around after new leadership and fresh ideas return the store to profitability.

At first glance, the odds seemed stacked against Brent Mattingly’s dealership as he took over as general manager last year:

  • The underperforming store had been losing money and severely lacking in vision and leadership
  • The surrounding area is made up of a small, lower-income market
  • A renovation was in the future, but that meant working out of old and temporary buildings for more than a year

Despite these challenges, Mattingly and his team at Rocky Mount Toyota, located in Rocky Mount, North Carolina, have not only stopped the financial bleeding but are on track to be in the black to the tune of seven figures by the end of the year. The store, previously known as Bobby Murray Toyota, was purchased in August 2016 and became the 13th store in the Hudson Auto Group. Mattingly, who had been working as a GM in Southern Indiana, was brought on board. He knew he had some work ahead of him, but he also saw the potential.

Taking Stock of the Situation

“When we purchased the store, it was basically like being a dealership brand in 1983,” Mattingly said.

“The dealership was out of touch with what the market demanded. In a little under a year and a half’s amount of time we’ve been able to move it to the modern way of doing business.”

There were three areas Mattingly and his team knew they had to focus on to successfully modernize the dealership: leadership, processes and training. The new management team believed that the difficulties the dealership faced came from a lack of vision from the top rather than problems with the staff. With a plan set in place, everyone was able to keep their jobs in the transition.

“Everybody had just been so used to not having any leadership — any accountability measures or processes,” Mattingly said. “And the previous owners didn’t invest in the people or the facilities. They didn’t give them the training. They didn’t give them the tools they needed to have for them to be able to succeed individually, along with having the team succeed. So, when we purchased the store, that was our first initiative — to give people the skill sets that they need to be able to do their job to the level that was required by today’s market.”

The first step toward profitability was getting everyone on the same page of running a successful dealership on a day-to-day basis. “The biggest change occurred when we went in and installed processes, and made people accountable for those processes,” Mattingly said. “When we first took over the store, there were 50 employees, and there were 50 different processes. Everybody just kind of did what they saw fit and what they felt best suited them. We came in and streamlined everything and put everybody on the same processes. Everybody knew what they were expected to do each day.”

The results? “From Day One, our staff instantly increased the volume and revenue of the store. Everybody’s made it a complete success.”

Mattingly also knew that investing in training his people would make a huge difference in both the store’s profitability and his team’s personal and professional development and enjoyment of their work. “We did a lot of in-house training,” he said. “Just a lot of daily, every-situation training — every deal, every service customer, everything. We did constant all-day-long training for months and months. And we got buy-in from our people once they saw that this was working and making their job not only easier but also making it more rewarding for them. That led to instant buy-in.”

One Message, One Goal

No matter how well the staff prepared, though, the dealership’s leaders knew that getting the word out to the surrounding market was crucial to building a successful business. Although the dealership was well known by customers in the area — at 30 years, it was one of the longest-running dealerships in the region — its marketing had lagged behind. Rocky Mount Toyota’s message needed to be refreshed and reimagined.

After searching for a marketing partner, Mattingly’s team chose Team Velocity to build their branding and advertising platform for the new era. “With Team Velocity, we’re doing our vehicle exchange program through them, along with direct mail, email blasts, social media marketing, search engine optimization, and other work to build a heavy digital presence,” Mattingly said. “It works well together because it’s such a consistent message over all the platforms. Once a customer’s seen the message digitally, they’re seeing it in their mailbox, they’re seeing it on signs at the dealership. Even the receptionist answers the phone, ‘Are you calling about the vehicle exchange program?’ It’s a consistent message through all points of contact.”

Not only has the marketing become more effective, but it’s allowed the leadership, sales and service staffs to concentrate on what they do best: serving their customers. “It’s really simplified the process, and it’s put everybody on the same page,” Mattingly said. “It’s a streamlined approach; instead of having all these vendors and all these different people doing their own thing, they’re doing everything for us, and we’re able to pull together with that consistent message, rather than changing the formula every month as some places do.”

And that marketing has to be effective if the dealership is going to survive and grow. Rocky Mount, located about 50 miles outside of Raleigh, North Carolina, is a small, lower-income area, where credit scores are often challenging to work with. “It’s a very tough market that a lot of people have given up on,” Mattingly said. “But it’s one that we’re growing in and should flourish in. We’ve had to be very aggressive. Southeast Toyota has some programs for loyalty and conquest customers, and we maximize every opportunity that comes in. We want to find a way to help every customer who comes in to buy a car. We analyze every customer and every situation individually.”

Service During Construction

In any modern dealership, the service department is essential for not only repairing and maintaining customer vehicles but for maintaining a future relationship with that customer as well. Rocky Mount Toyota is in the finishing stages of constructing a state-of-the-art facility, but that has led to its own set of challenges, especially for its service department.

“Service probably has one of the messiest situations in the dealership right now,” Mattingly said. The new facility is being built on the existing property, so things have had to be shifted around as space permits until construction is completed in February 2018. “Our service write-up department is currently in our showroom,” he said. “We have to shuttle the cars to a separate building to do service. We’ve been playing a shell game and moving stuff around consistently while construction goes on.”

What’s surprising? “We’re actually growing during this period of time,” Mattingly said. “We’ve been able to grow customer PROs, warranty ROs and complete all of our ROs, even as our competitors have really come after us through their own forms of marketing, trying to steal our customer base.”

One of the elements that Mattingly credits with keeping Rocky Mount’s service department afloat and thriving is Team Velocity’s marketing efforts. “They’ve helped us keep our customer base by constantly reaching out to a perfect target mix of customers within our community,” he said. “They’re going through conquest customers, they’re going through loyalty customers, they’re going through our marketing tendered customers. We’re able to bring them in, and if a customer hasn’t come in a while, they get a more aggressive offer than a customer who is routinely coming back to us.”

Rocky Mount Toyota uses Team Velocity Apollo Technology Platform® to manage integrated marketing campaigns for sales, service and equity mining. Apollo automatically generates and deploys campaigns across mail, email and digital advertising, offering consistent messaging and branding, and provides a Web-based dashboard to track results in real-time.

 

Once the customers are in, the processes that Mattingly’s team put in place come into effect to give each customer a complete service experience “We have a service manager T.O. every customer in the service department, presenting menus and presenting all their options,” he said. Add to this the vehicle exchange program put into place in the service department, and the dealership has maximized this valuable profit center.

New Facility, Fresh Vision

While servicing customers in a construction zone has its challenges, Mattingly knows it will all be worth it when it’s complete. “Moving into a state-of-the-art facility will simplify a lot of things,” he said. “We’ve been growing during construction, and we’ll have the newest, nicest facility in the community, so that should gain us more business, as well. We’re looking forward to the future, and we’re committed to serving our customers and maintaining and increasing our growth and our profitability.”

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Learn more about Rocky Mount Toyota and the strategies outlined in this article:

Contact Us Today

 

AutoSuccess Cover Story: Brian Benstock (Paragon Direct)

The future can be a frightening place, especially for those not able — or willing — to adapt to changing realities and market conditions. While the auto sales industry has enjoyed several years of growth, change is on the horizon. Those dealerships locked into past models and old methods of thinking might not find that future to be a hospitable — or survivable — space.

Brian Benstock, vice president and general manager of Paragon Honda and Paragon Acura of New York City, has spent time and effort trying to determine what that future has to offer, and one word sums up his findings: disruption.

The ways of the past

“The current dealer model is not a dying breed,” Benstock said. “It’s dead. It’s absolutely dead.”

The reason for his startling prediction is due in part to changing customer expectations of not only automotive shopping but the very act of shopping itself. Benstock believes that the convenience, growing acceptance, and ultimate expectation of online transactions — along with the transparency those transactions demand — run counter to the classic dealership model.

“The most successful businesses are the ones that best meet the needs of the customer,” Benstock said. “For years, the dealers have relied on antiquated business models — the franchised dealer agreements — to protect themselves. The second the customers are given an opportunity to go away from the standard business model of automobile dealers, they will. More and more, we’re seeing that they’re being given many different options by some of the largest retailers in the world.”

Several of the companies responsible for this disruption of the automotive industry are not even in automotive sales. “We’ve got companies like Amazon and Apple that are approaching a trillion dollars in valuation,” Benstock said. “They have incredible resources to take over and change any industry that they so choose.”

Current realities and potential opportunities

The reality of Benstock’s Paragon dealerships is one of the reasons he’s made it a point to anticipate future market conditions. Located in Queens, just outside of Manhattan, the Paragon dealerships are the No. 1 new and used car dealerships in the country. Because of their location, however, the dealerships have always had to think differently about the way they do business. “Real estate is at a premium,” he said. “Compared to some other dealers in other markets that have acres of land, we have a patchwork of properties. Customer parking and customer display can be one of the challenges, but that also leads to some great opportunities.”

One of those opportunities is the ability to continually re-think how they do business. “Does it make sense anymore to bring the customers to the dealership?” Benstock asked. One of the answers to that question was the creation of Paragon Direct, a new online platform where customers can do everything from arrange a test drive to purchase a vehicle. Benstock refers to this method of doing business as a “frictionless consumer experience,” which is something consumers are increasingly demanding. “We’re in the New York market competing against some of the best Honda and Acura dealers in the country, and we’ve proven we can hold our own. We’ve taken a look at some of the disruptors and business models that are coming in, though, and those are causing customers to take a different look at things.”

To meet this challenge head-on and serve consumers how they want to be served, Benstock and his team have taken a step back to see what sales methods would best meet their needs. “The customers basically want three things,” he said. “They want us to know them better, serve them faster, and ‘wow’ them everywhere. This is not special anymore. This is an expectation of today’s consumer.”

Marketing to today’s drivers

Part of meeting those needs is presenting a marketing message that connects the dealership with customers in a meaningful way. To do this, Paragon Honda and Paragon Acura have partnered with Team Velocity to present their marketing and direct mail, including using Apollo, a data-mining solution, to provide the right message to the right contact at the right time.

“[In addition] we’ve been utilizing a vehicle exchange program for several years and targeting customers with the highest likelihood of doing business with us now and in the future,” Benstock said. “That’s worked out for us.”

The availability of consumer data has never been higher, and that ability gives dealerships, like Paragon, tools to connect with consumers directly. “We’re taking a closer look at our CRM and data that’s available from our customers and making sure that, when we speak to our customers, we’re speaking from the knowledge that we should and do have about that customer,” Benstock said.

From an industry-wide perspective, Benstock knows this data has not been utilized to the same full potential other businesses have been successful with. “Why is it that many other retailers in other industries seem to be able to better target their customers than an automobile dealer when we’ve got incredible data on our customers? We know their buying patterns. We know their product selections and desire. We know their budgeting information. I don’t think we do a great job as an industry in effectively communicating with our customer in a personalized manner.”

Benstock believes that the auto industry has lagged behind this curve due to one glaring reason – if a consumer wanted to buy a new car, they had to go to a franchised car dealership. As a result, the auto sales industry has been slow to react to changes. That luxury, Benstock believes, is quickly coming to an end as the consumer’s very relationship to vehicles is evolving. “Take Uber, for example,” he said. “They are offering fractional ownership opportunities or fractional ride-share opportunities. When I say fractional, I don’t mean monthly. I can pay per ride. I can have the car I want, the size I need, delivered when I want, where I want. Many customers are finding this more efficient than owning their own automobile. Then add into that, the autonomous car that is going to be a part of our future. The driver is the biggest expense of Uber. So, Uber will then become even more of value as there will no longer be a need for a driver. That’s just one disruption.”

“Then you’ve got Elon Musk and the Tesla group, going outside of the traditional franchised dealer system saying, ‘We think we can do it better,’” Benstock said. “They’re offering different products in a different manner. It’s interesting to see the initial success they’re having. They’re doing quite well in the high-end luxury market and seem to have taken over a pretty good amount of the market share.”

Consumer behavior has also disrupted the marketing landscape. “We’re certainly looking at how easy is it for our customers to do business with us online,” Benstock said. “The Internet, for most of us, has gone from informational 10 or 15 years ago to transactional today. Fully transactional. I think auto retailers have not been quick to embrace that. More and more, we’re realizing as a group that we need to do a better job there.

New customers, new sales methods

This innovative insight into the sales process was the catalyst for Paragon Direct. “We’ve built it for speed,” Benstock said. “Not that our customers would need to conduct a transaction in under a minute, but pretty much they can get to a negotiated price by themselves in under a minute. If they have a trade involved, or there’s financing involved, it will take slightly longer, but customers can navigate on their cell phone or however they access the Internet [with ease].”

Before this new transaction model can be fully adopted, however, some psychological barriers need to be overcome — both on the customer’s and the dealership’s side. “From the consumer standpoint, there’s a natural distrust of automobile dealers,” Benstock said. “So, when you’re offering to do this transaction completely online, and you’re offering transparency, it’s not something that they’re used to getting from dealers. Also, they’re not 100 percent comfortable doing such a transaction online yet. They will be, but initially, we are finding many of our customers are getting 70 or 80 percent through and then electing to conclude the transaction in the dealership. The good thing is they save a lot of time by doing most of the transaction online.”

From the dealership’s side, while transparency might be a scary prospect, it’s one Benstock believes must be implemented. “Our philosophy is that transparency can and should improve revenue by making it easier for customers to have access to the information they want online,” he said. “Imagine if you wanted to buy an iPhone online and they told you, ‘Come on in, and we’ll give you the price.’ It’s preposterous, and yet in dealerships around the country, that’s exactly what happens.”

Holistic dealerships

In addition to changing the way dealerships interact with their customers, Benstock believes the way internal departments interact with each other needs to change as well. “Each department used to have to stand on its own independently,” he said. “Now, we need an interdependence of the departments. We have to look holistically at the profit centers at the dealership. For instance, you get the new car manager who doesn’t want to take a short deal when there’s a trade in. By not taking that deal, however, they’ve deprived the used car manager of a car and deprived the service department of a service RO. They didn’t look at that deal holistically. What gives any one manager the right to cut out those other departments? The managers of today need to have an excellent understanding of the complete business.”

The future

“I think the current state of customer satisfaction with the buying process makes our market ripe for disruption,” Benstock said. In addition, he believes that even the model of automobile ownership will soon change. “I think dealerships are going to see consumers paying a monthly payment and being able to drive [or] shift out of cars without long-term commitments,” he said, “very much like what we’re doing with cell phones today. Let’s call it ‘flexible drive ownership.’ It will be the ability to pay a fixed monthly payment and drive an SUV when you need an SUV, to drive a coupe when you need a coupe and a sports car when you want to drive a sports car.”

Benstock sees these changes as revolutionary for the auto sales business but believes dealers and GMs who consistently react instead of proactively meet this future will suffer. “I think you’re going to continue to see more decompression,” he said. “I think you’re going to see a reduction in the number of dealerships and a reduction in the number of people employed at dealerships. I think dealerships are going to be distributions points, and dealerships are going to have to be moving at the speed of the customer wherever the customer wants to be.”

Where some see a crisis, Benstock considers an opportunity for those willing to embrace it. “Change is going to come whether we like it or not,” he said. “The saying is ‘change or be changed.’ What our dads did, or our mentors did, our predecessors did, some of those basic business philosophies certainly hold true. Others need to be completely revisited. We have to adapt. We have to adapt and be very, very flexible in our beliefs.”

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Serent Capital Invests in CallRevu, Automotive’s Top Performing Call Management Solution

CallRevu, a leading provider of automotive dealer call management software that delivers dealership customers critical call performance data, has entered a partnership with Serent Capital, a San Francisco-based private equity firm focused on investing in high-growth technology and services businesses.

CallRevu’s solution is comprised of data-rich interfaces supported by sophisticated functionality and machine learning that helps dealership drive higher sales. Because today’s car buyer does most of his or her research online, the inbound phone call has become increasingly important for dealerships. Callers are typically high-value sales prospects, far along in their purchasing journey, and so answering these calls properly is paramount to a dealer’s success. Dealers who leverage CallRevu’s unique platform gain substantial insights into phone calls, both those that convert into sales and, as important, those that are mishandled, but can be recovered. CallRevu serves over 3,300 dealer locations and partners with twenty global automotive manufacturers.

“Since inception, CallRevu has focused on one thing – improving car buyers’ experience on the phone and in the dealership. CallRevu was first to market in this arena providing dealers unmatched services to improve the customer’s journey. Our call management solution has been critical to enhancing this experience, which ultimately allows automotive dealerships to maximize their conversion of valuable leads,” said Chip King, CEO of CallRevu.

He continued, “As we continue to scale, we wanted to bring on an investment partner who could offer the set of resources and expertise that will enable the next phase of our growth plan. We feel that the capability Serent Capital brings is perfectly suited to helping us capture the opportunities ahead, while maintaining a steadfast focus on delivering strong value and service to our customers.”

“We have spent several years looking for the right platform for investment in the automotive technology sector. CallRevu is a differentiated solution and leader in the call management space, and we are tremendously impressed by the business that Chip and his team have built. This success is demonstrated by stellar customer satisfaction, strong growth, and high retention rates,” said Kevin Frick, Partner at Serent Capital.

“We are thrilled to have the opportunity to collaborate with the CallRevu management team to drive continued product innovation and growth.”

CallRevu’s dedication to ensure that every call to and from a dealership is a notably different and positive experience for the customer during this powerful next phase is stronger than ever. Focusing on clients and providing top notch customer service to every dealer is CallRevu’s passion. With this investment, CallRevu will be able to take their passion to the next level.

CallRevu was founded by Chip King and David Boice, the CEO of Team Velocity Marketing, which incorporated CallRevu’s services into its marketing and Apollo Technology Platform®. This seamless integration and reporting has provided Team Velocity’s dealers the ability to generate leads and track attribution to the marketing. “Serent Capital is the right partner for CallRevu’s next chapter, and we are thrilled to continue working with CallRevu to provide their call technology to our dealer customers”, said David Boice.

Serent’s investment in CallRevu represents its second investment in the automotive market, including Tricolor Automotive Group. Presidio Technology Partners represented CallRevu in the process.

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About CallRevu

Founded in 2010, Baltimore, MD-based CallRevu offers dealerships a range of quality call tracking, monitoring, measuring and lead development services. CallRevu’s key focus is to help automobile dealers measure and improve the most common contact point with their customers: the phone. CallRevu’s solutions are developed by an incredible team of individuals, who offer a broad range of experiences and whose leadership comes from the automotive world, and have an unrivaled commitment to customer service and satisfaction. For more information, visit the company’s website at http://www.callrevu.com.

About Serent Capital

Serent Capital invests in growing businesses that have developed compelling solutions that address their customers’ needs. As those businesses grow and evolve, the opportunities and challenges that they face change with them. Principals at Serent Capital have firsthand experience at capturing those opportunities and navigating these difficulties through their experiences as CEOs, strategic advisors, and board members to successful growing businesses. By bringing its expertise and capital to bear, Serent helps growing businesses thrive. For more information on Serent Capital, visit http://www.serentcapital.com.