Hoblit CDJR and Hoblit Ford Auto Group Cultivates Sales & Service

Usually, when Americans think of California, they think of warm, sandy beaches and the bright lights of Hollywood. Possibly even the beautiful orange groves and wineries in Napa Valley. However, what most individuals fail to realize is that California is also rich and diverse in farmland that consists of rice fields, dairy farms and almond and walnut orchards.

Agricultural communities don’t usually lend themselves to successful automotive dealerships due to the low drive-by traffic, but one fourth-generation family dealership has plowed through the competition of massive auto malls and made a distinct name for itself in the Golden State.

In 1949, Chad Hoblit’s great-grandfather started the family’s Ford dealership in the small Northern California town of Colusa, where the current population has held at less than 6,000 people. In 1999, the generations
of Hoblit’s expanded their company by purchasing the Chrysler, Dodge, Jeep and
Ram (CDJR) dealership in Woodland, CA. Although this location was only 20 miles from downtown Sacramento, it still identifies itself as a rural community.

Today, Chad Hoblit runs the CDJR Woodland dealership, while his brother and semi-retired father run the Colusa location. In 2011, the family hired Gayland Schmitt as a partner and general manager. Since then, the Chrysler store has grown to 104 employees and the Ford store to 45 employees.

A Focus on Farmland

The rural landscape presents challenges and opportunities to both dealerships. While Woodland is a much larger city than Colusa, it is by no means a huge metropolis. The town currently boasts a total population of 60,000, and, according to Chad, they house a few restaurants as well as some mom-and-pop shops.

“The Sacramento River basically separates the whole Sacramento region from the rural, farming region,” Chad said. “Once you go over the river, and past the Sacramento Airport, it turns into nothing but farmland.”

Schmitt concurred. “This isn’t a destination store. No one comes out here to search for cars. They come out here because they are drawn in by our advertising and enticing website features.”

To surmount the locations’ disadvantages, the company has always made catering to the agricultural clientele an integral part of their family business and motto.

“By catering to the local community and farmers in the heart of Northern California farmland, we have really focused on selling and maintaining trucks,” Chad continued. “For me, growing up in such a small town and with all these farmers and friends, I’ve noticed that either you are in ag industry or somehow associated with it. Since they all drive trucks, and need them for work, our focal point has always been on big truck sales.”

By adhering to their target market and focusing their marketing efforts and business philosophies on serving these customers, the results certainly paid off. Some customers come as far as 200 miles away just to purchase a vehicle from their stores.

“When people come out here from Sacramento or the Bay Area, they’re used to the auto malls and brand-new facilities, Chad said. “When they come here, they’re very pleased. They really appreciate the old nostalgic throwback of a small-town and a family-grown atmosphere. It’s like going back to the ’50s or ’60s really.”

While the small-town atmosphere is welcoming, the reason customers know about the stores’ services is due to the company’s detailed attention to their marketing strategy and website presentation.

“We view our website as our virtual showroom,” Chad said. “It’s where people can browse, shop and conduct their whole transaction online without having to step foot in the dealership.”

Marketing Strategy Success

Gayland credits their employees, their marketing technology and the processes that they’ve put in place for the company’s success.

“I’ve been in the car business for over 25 years now and have managed to bring in a lot of good employees and managers,” Gayland said, later adding, “We’re hopefully going to sell 3,000 new cars this year.”

Marketing is a critical component to Hoblit’s success. Since pairing with Team Velocity, their YTD total sales have increased by over 16 percent and monthly service ROs are now up 55 percent.

“I just believed in their marketing,” Gayland said of Team Velocity. “What they’re doing for us is in our perfect market, which is probably like a 30-mile radius, is tremendous. They’ve increased our sales all while driving sales to our service department. They’ve helped us build a solid core for our business. Our nearest competitor used to be number one in the Sacramento region, and we’re beating them now! We’re the number one Ram truck dealer in California, and I’m hoping that this year we’ll become number two in the nation.”

Team Work

Reaching not only more people, but the right (buying) people is critical — and as part of the marketing with Team Velocity, Hoblit has redeveloped their branding message by highlighting their staff and hassle-free transactions.

“We have a great team, and we approach it a little differently,” Gayland said. “We really pride ourselves on being family owned. We’re not an auto mall. We’re in a small town. We get people from LA, Arizona and all over the place.”

“We have an outstanding and experienced staff here,” Chad said, “We don’t like to waste our customer’s time, and our targeted process is really where we try to keep it simple.”

“We’ve been marketing toward the consumer who wants to go online, find the vehicles they’re looking for, have the vast selection and if we don’t have it, we’ll get it at no extra charge,” Chad continued. “With this process we’re able to get customers pre-approved, work the trade-in numbers and pretty much work the whole deal before they come in. Our goal is and has always been to create a frictionless and seamless sales process. They’re in and out, hopefully within an hour, maybe two. The goal is an hour, but when we’re backed up, it’s hard. We don’t spend
a lot of time negotiating the deal, but unfortunately, even with only four finance managers, it takes a little while to get people out of here sometimes, but that is the idea.”

Chad and Gayland both agree that the company’s emphasis of keeping family-friendly environment really helps fight off the nearby auto mall competition.

“People hate the car-buying process, so we try to transform that into a more pleasurable and enjoyable experience.”

Service Solutions

With customers traveling long distances to purchase vehicles, there’s often a struggle to retain them for service. Hoblit relies on the work of Team Velocity to keep the service department business growing.

“We’re retaining a lot of our customers through our service department,” Gayland said. “The ones who are 200 miles away are definitely a little harder to retain, but with Team Velocity, they’ve helped us attract more customers in our appropriate market. Thanks to them our service depart has grown immensely.”

The company has added an offsite facility with 14 lifts in it for truck and large commercial vehicle service. In addition to the agricultural vehicles, Chad said there are many
businesses in Sacramento and the East Bay area that don’t have a convenient place
to have their vehicles serviced.

“We’ve been able to double — and almost triple — our capacity,” Chad said.

“Now, I’m looking for a third facility to do even more service,” Gayland said.

The company also has a great success rate with Team Velocity’s vehicle upgrade program. Their program successfully matches customers with their next top upgrade model and provides them with relevant, payment-based offers.

“I have one full-time gal who actually makes calls every day, calling customers about the upgrade program,” Gayland said. “We do so well with it, I’m actually interviewing a couple more people to help get more deals out of it.” The company’s success has led to the purchase of more lots, including a Ram Truck Center, and they’re looking to expand even further — all while keeping the family, small-town atmosphere in-tact.

They are also looking forward to the year ahead with celebrations for a 70th anniversary for the Ford store and a 20th anniversary for the CJDR store.

Like the surrounding farmland, the Hoblit dealerships are poised for years of continued growth in the California sun.

This article is dedicated to the memory of Wayne Hoblit, Founder, Owner and loving parent.

Hoblit Auto Group uses Team Velocity’s 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.

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Historic Manly Honda Has Fresh Ideas for Long-Term Growth

When a company has a long, storied history and has experienced high levels of success, the temptation is to go conservative, rely on what’s worked in the past and double down on tradition. Those are the companies that play defense and try to hold on to past glories. Those are the companies that cease innovating and stop growing.

Manly Honda is not one of those companies.

Despite a declining market, Manly Honda has steadily increased their annual Customer Pay Repair Orders by 13 percent over the last year, giving a large boost to the Fixed Operations bottom line. This proves that a clear, well-defined strategy, along with the right people, processes and tools to increase service revenue, is a critical component to today’s automotive growth and success.

THE CHALLENGE

The forecast is predicting inclement conditions for retailers. Reports indicate consumers will spend $2 billion less on new cars, and the new vehicle retail pace is expected to reach the lowest mark since 2012, dipping 8.9 percent from the previous year.

With the deflated SAAR (seasonally adjusted annualized rate), decision makers are looking for new ways to maximize Fixed Operations to boost revenue.

One of the most significant challenges dealers face is with retaining the customer after the OEM warranty expires. Statistics show that customer loyalty decreases alongside a substantial reduction in communication with the customer after the initial few years. As contact with the customer begins to decrease with the expiration of the factory warranty, there exists a pivotal juncture where the cost of repairs to the vehicle become significantly higher. A loss of communication with the customer equals a loss of major Service revenue.

THE RIGHT PEOPLE

Fortunately, the Manly family has a long history of ingenuity, beginning with Manly Honda founders, Bill and Lori. While on a business trip to Japan, Bill convinced Mr. Honda to ship a Honda 600s to San Francisco. After hitchhiking to the port upon its arrival, Bill drove the car back to the dealership and sold the first Honda ever in the continental United States! Being the pioneers that they were, Manly Honda quickly became one of the largest and best-reviewed dealerships in the state.

Manly Honda maintains their growth and positive public image by not forgetting why they were able to grow in the first place. A focus on customer satisfaction as well as innovation runs through the veins at Manly Honda as the legacy continues with the next-generation owner, Brian Manly. At his right hand is General Manager Jeff Dantzler, who affirms, “The Manly family has always regarded themselves as a customer service business that just happens to sell and maintain vehicles. From the original founders to today, our customers are members of the Manly family, and it shows in everything we do.”

The dealership is stepping confidently into the future because the team isn’t afraid of what’s to come. Instead, they actively seek out new technology and ideas to better serve their customer base. Nowhere is this as apparent as in the Manly Service Department. While sales may make the potential client a customer, it’s service that keeps that customer coming back.

“There are so many Service Departments who just turn the lights on, sit back, and expect people to come in,” adds Luke Ammann, service manager at Manly Honda. “Those are the people who are falling far behind on technology and innovation. The way I look at it is, I need to focus on outperforming the underperformers.”

CUSTOMER SERVICE, LOYALTY AND GROWTH

With the recent report of decreasing retail sales and projections that consumers will spend less on new car purchases this year, Manly execs are focusing heavily on Fixed Operations. To support this effort, they needed an intuitive, aggressive and comprehensive approach to continue to reap success and growth in a stagnant industry.

To stay on top, Manly Honda decided to partner with industry leader Team Velocity, known for their cutting-edge technology, Apollo, and their ability to target consumers with “hyper-personalized” offers throughout all marketing mediums for both sales and service customers.

“Communication has been a key feature of our strategy,” Ammann said, “whether it’s through mail, digital, texting, email or other methods. We’re trying to get ahead of our competition, so that they say, ‘Wow, they’re doing it. They’re still doing it. They made it work. I wonder what they’re doing?’ We want to have them outside looking in trying to figure out what we’re doing that they can’t do.”

Like most dealers, one of the challenges Manly Honda faced was knowing when and how to communicate with service customers who haven’t visited the dealership recently. $340 billion is spent on car repairs in the U.S. each year, yet dealers only capture 20 percent of their service market potential. On top of that, most dealers are seeing 50 percent of their customers service their vehicles away from the dealership…that’s a big missed opportunity. To overcome this challenge, Manly Honda implemented a new service marketing program run through Team Velocity’s technology platform, Apollo, called DrivingLoyalty.

DrivingLoyalty helps dealers build customer loyalty and boost retention from day one. Most dealers have a service marketing strategy that is loosely based on the last time a customer serviced at the dealership and their estimated mileage. This means, by the time a dealer deems a customer “lost” it could be 12 months or more. With DrivingLoyalty, Manly Honda knows when their customers service elsewhere, what services were completed, and more, enabling them to make better and smarter decisions about how and when to engage customers.

DrivingLoyalty allows Apollo to send out hyper-personalized and relevant messaging to its customers based on the exact vehicle services they need, at the exact time they need them. Apollo also creates personalized websites for every customer, where they can claim service offers and schedule service appointments at their dealership.

By understanding the unique needs of every customer, Manly Honda is able to present more directed, attractive marketing to them. The marketing budget is also made more efficient through ownership verification — offers are not wasted on customers who no longer own that specific vehicle. By using constantly updated consumer data, waste is drastically reduced or eliminated. This level of sophistication allows Manly Honda to deliver real-time relevant messages to the right customer at the right time.

Since implementing DrivingLoyalty, Manly Honda has generated outstanding results:

• Customer Pay Repair Orders are up 13% over last year
• Fixed Operations grossed an additional $127,000 last month on 644 customers that were servicing away from the dealership
• Averaged 84 new active customers per month
• Increased lost customer conversions by 25%
• Averaged 56% new Conquest VINs per month to their active database

This relationship between the service department and its customers has also helped Manly Honda take advantage of opportunities to sell vehicles out of the service lane. Since 2011, the dealership has used Team Velocity’s Apollo platform to target in-market customers before they begin the shopping process. Apollo uses Upgrade Matrix, a piece of technology that enables Manly Honda to target customers in equity positions that would allow them to leave with newer vehicles for the same or even lower monthly payments. In fact, Manly Honda regularly sells 40 to 55 cars a month out of the service lane. In May, 60 percent of the vehicles Manly Honda sold were generated from Apollo’s Opportunity Dashboard and sales from the service drive. Increasing vehicles in operation out of the service lane is just one great way Manly has found to maintain and grow its customer base.

THE RIGHT QUESTIONS, THE RIGHT ANSWERS

“What we try to do is ask the right questions as opposed to having the right answers because we feel the right question will lead us to those answers,” Dantzler said. “Team Velocity asks the right questions when they develop new applications for Apollo, like DrivingLoyalty. They think, ‘What would consumers want? Would customers benefit from pickup and delivery? What do our customers need? How can we engage customers sooner? How can we improve the customer experience?’ These are great questions that we ask as opposed to thinking that we have all the answers. I really think it starts with the right questions.”

Manly soon learned that one major concern their customers have is transportation while their vehicle is being serviced. To solve this problem, the dealership recently eliminated its shuttle service and found another, more efficient method to keep people moving while their car is in the shop. “We’ve switched to Uber Business for one-on-one pickup for customers,” Ammann said. “We call it the Manly Valet Service.”

The dealership also offers loaner vehicles when that option makes more sense for the customer’s specific situation. “Honda has a trademark — ‘Providing service at the speed of life.’ When I first heard it, I took it as truth,” Ammann said. “We provide service at the speed of life and if you do that, you can’t stop what a mom of three is doing to have her car serviced. We’ll come to you and say, ‘Here’s a five-passenger vehicle. You continue on. Transfer your car seats over and go to the game, go shopping or do whatever it is you need to do. When you’re ready to be home or come back, your car will be ready for you.’”

THE RIGHT TEAM AND THE RIGHT ATMOSPHERE

Both Ammann and Dantzler realize that, no matter how intelligent the marketing is or what programs the dealership offers, if their team isn’t on board, all the other work will be for nothing.

“We have a very tight team,” Ammann said. “We are extremely tight, not only as coworkers but as friends outside of the dealership. People here help people move, buy their first home… some of our people had a fire issue during the recent firestorm who needed a helping hand. It all builds employee satisfaction. But I think the direct relationship from (Manly President) Brian Manly to his managers trickles down to all of our employees, and this dealership still has that family-owned feeling, and not the corporate-owned dealerships like a lot of businesses do now.”

“It’s all about purpose,” Dantzler said. “That’s why we’re here, both for the people who work here and for the people in our community. When you attach purpose to what you do and how you’re doing it, when you see how your success can lead to the success of others, it begins to be a lot easier and a lot more exciting to wake up in the morning. You can’t wait to get to work because you’ve got a purpose to it.”

“Our efforts are all aimed at making service easy for our customer,” Ammann said. “We call it the ‘Manly Advantage.’ Having the pickup and delivery, having loaner cars, having choices that are easy… we provide our customers with what is recommended and what is needed, and there’s no pressure to have them make a decision. When they’re ready, we’re ready.”

That feeling has paid off with great reviews and positive word of mouth from the dealership’s customers. “We’re one of the most reviewed dealers in California,” Dantzler said. “And any way you look at it, we’re in the top three. We’re definitely on the podium in the entire state of California when it comes to online reviews. We think it’s really important to know what our customers know. We’ve said it a lot, but it’s not really about what we say; it’s about what the customers say, especially today.”

While proud of its past, Manly Honda isn’t afraid of the future. “Our people understand the vision,” Ammann said. “If we fail, we fail, but we won’t know that unless we try.”

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Turning in the Right Direction

Les Nunez and Lou Bachrodt Mazda plot a course for future success and growth.

Sometimes, to make a difference and turn things around, a leader must throw out the old playbook and write a new one.

That is exactly what General Sales Manager Les Nunez did two years ago when he arrived at Lou Bachrodt Mazda, located in Coconut Creek, Florida. Fast forward to today, and those changes are showing up on the bottom line.

“Before I came in, they kind of ran it like an old-school store,” Nunez said. “The customer came in, they started negotiating and you just grinded and grinded until you made the transaction. Don’t get me wrong; there’s nothing wrong with that approach. It’s just not the proper approach for the clientele we have here.”

Nunez, who has worked for 21 years at various dealerships in manager and general sales manager positions, specializes in taking struggling dealerships and turning them around. “I bring it back to specs and make it profitable again,” he said. “That’s kind of my niche.”

Part of Nunez’s new playbook was making the customer’s visit more of a boutique experience at the dealership. “The complete culture of the store has changed,” Nunez said. “We’ve made it a more family-oriented business. Customers come in and our friendly, helpful staff shows them the vehicle. Once they like the vehicle, we go over numbers. We’re pretty much a one-price store. We don’t negotiate too much. We advertise the lowest price possible and we give the lowest lease possible up front so the customer doesn’t feel pressured once they get here. When they come in, they pretty much know what they’re paying for the vehicle — we just have to tell them the reason to do business with us.”

Nunez said that he believes the auto industry can learn a lot from other industries. “When you go into the Apple store to buy an iPhone, do you negotiate the price on it? You pretty much know what the price is. You just must meet a salesperson or staff member who will show you the features and benefits on the phone and explain to you why you should pay the $599, $699 or $1099 for the phone. They made the experience tailored to the way you wanted it because your price expectation was already there. I’ve taken that philosophy into the car business and it works well, especially for a Mazda customer, because they’re kind of a niche buyer.”

GETTING BUY-IN FROM THE TEAM

Part of the change in philosophy Nunez initiated was to change the pay plan on the sales floor. “The car industry, for many years, was on a strictly commission basis,” he said, “so for the longest time, the whole idea was to try to get as much out of the customer — to put as much money in your pocket as possible. I changed it up. My team, regardless of what the transaction pays the store, gets a flat pay. This means that, no matter what happens, they just have to treat my customers right, show them all the features and benefits of the car, and they’re still going to get their money. This isn’t an industry first — I brought it from my other store — but it was something new to this place.

Along with making the shopping experience better, this change was well-received by the staff as well. Nunez has retained 95 percent of his team in the two years after taking over at the store.

“Once you get the buy-in of the staff, they pretty much just follow the beat,” Nunez said. “They know to treat the customer right, do the right steps and show them all the right vehicles, because they know they’re going to get a paycheck no matter what. So, they just must do it. They present everything properly. It’s pretty easy. Believe me, the problem with this business is that we just overthink everything. It’s basic — treat the customer right and put them in the right car. They know the price. They know the payment. Move forward. That’s all you need to do.”

The numbers coming in show that Nunez’s approach is working. “We’ve taken this store from selling 60 units a month, new and pre-owned, to more than 150,” he said. “Our Mazda store closes at an average of 62 percent with walk-in traffic, so most of the people who make it in the door leave with a car.”

GETTING THE WORD OUT

While the closing rate for incoming customers is impressive — and proves the new sales approach works — it’s crucial that those new customers keep showing up. And, while the dealership’s location has advantages, there are also challenges.

“We serve Coconut Creek, Parkland, West Boca and Coral Springs, and it’s an extremely affluent area,” Nunez said. “The median income in areas like Boca & Parkland alone is about $180,000 for a family, and the houses are about $800,000. Also, I really don’t have direct competition next door; there are only two other Mazda stores within 20 miles of us.” In most industries, a lack of competition in an area is a good way to corner the market and maximize the bottom line. In auto sales, however, being the only game in town can have a downside. “It is and it isn’t (an advantage), and here’s why,” Nunez said. “It would be a little better if we had more stores because we’d have better access to inventory.”

To make the most of every opportunity, marketing is a key element of Lou Bachrodt Mazda’s plan. Recently, the manufacturer revamped its marketing co-op package, and the dealership had to adjust its strategies and make the most of its budget. “The game changed back in September,” said David Lowitz, Marketing Director of ValuInsight, the dealership’s in-house agency, “and we’ve had to change with it.” For the past six months, with the exception of a unique direct mail campaign, almost all marketing the dealership has done has been digital. “No radio, a bit of cable television and nothing else,” he said.

To assist them and to bolster those marketing efforts, the dealership brought in Team Velocity last year to assist with various types of digital marketing. “Team Velocity has been a huge part of our growth.” Lowitz said. “Their platform has allowed us to completely focus on reaching our best targets in the right geographic areas at the right time, then ‘capture’ those people and help us get more deals done. Team Velocity has become the focal point of our marketing.”

“What we’ve done with Dave’s help and with Team Velocity is expand our customer conquest map,” Nunez said. “We attract the customer with a good hook through a combination of direct mail, email and retargeting. Then we bring them into the store, show them the way we do business and it works.”

“I think we really hit our stride with Team Velocity in the beginning of the year, and I’ll give you some examples,” Lowitz said. “Q1 ’18 vs Q1 ’17 we’re up nearly 80 units. This March we did 100 new versus March of ’17 when we did 62.”

To be truly effective, Nunez said, marketing and the sales approach need to complement each other. “Here’s the thing; unless the customers know where you’re at, unless they know what you’re willing to do, they won’t come in the store,” he said. “The
days of people just going from store to store ended years ago. SEM, targeting, area targeting, customer targeting… it’s the business. That’s what it comes down to. That’s where we are today.”

“I think a big part of the store’s success has really been Les’s philosophy first and then the advertising second, specifically the marketing we’re doing with Team Velocity,” Lowitz said. “Without his philosophy, I don’t think it would’ve worked as well as it has.”

MAINTAINING AND BUILDING RELATIONSHIPS WITH SERVICE

In addition to marketing, service is the other way dealerships can keep customers coming in and building all-important relationships. As with the other elements of his strategy, Nunez and his team have taken an aggressive approach to making sure the customer has a great experience.

“Early in the year, we introduced a maintenance plan at a very discounted rate,” Nunez said, “and I’m talking an extremely discounted rate — almost as a gift to our customers so that they come back to us and service with us. Yes, the initial hit of selling the package costs the store a little bit of money, but if you look at it in the long run, we retain those customers.”

In addition to this service, Lou Bachrodt Mazda is also making efforts on the marketing side to bring existing customers back and bring new ones in. “We now are targeting customers in different ways using Team Velocity in intervals of 60 days, 90 days, 9 months and 12 months. We also signed up for a package where we try to target customers in our area, within a given radius of our location. We target various consumer types to bring them to the store for service. For instance, customers who have not been to our dealership for a long time will get a different offer and different coupons than someone who has been here recently.”

Lou Bachrodt Mazda uses Team Velocity Marketing’s Apollo Technology Planform® 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.

PRESENT SUCCESS AND FUTURE PLANS

While Lou Bachrodt Mazda is enjoying a surge in sales, Nunez knows that to maintain growth and keep the numbers moving in the right direction, he and his team must keep an eye on their efforts, plan for the future and make adjustments when necessary.

“If you want to be successful, you have to know what you’re fighting against and how you’re going get there,” he said. “You can’t just go blind. It’s fun though. I’ll be honest with you; when the car business stops being fun, it’ll be a different day for me. As long as it continues to be fun, though, we’ll keep doing it. There’s no a doubt about it.”

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