Case Study: How to not sell a car!


There's more being written every day by frustrated auto shoppers discussing their disappointing online interactions with dealerships while they were looking for a new or pre-owned vehicle, but it isn't often that auto industry experts share these experiences, when they enter the retail arena.  If you click HERE, you can read a very interesting article written by John McElroy, who is a well-respected auto industry pundit working for a variety of Detroit, and national media outlets.

Dealers and dealership managers should pay heed to the message John shares that buying a car SHOULD be fun.  Unfortunately, this outlook can be changed very quickly when a dealership process seems designed to frustrate a customer's purchase goals, rather than facilitate them.  Dealerships who want to survive need to willingly, and enthusiastically embrace a model of customer interaction that is focused on making things easy for the customer, not on making things easy for the dealership.  Today's buyers shop online.  That's the way it is, and it isn't going to change no matter how much sales managers who miss "the old days" want to go back to their towers and four squares.

Just like John, I had the opportunity to revel in the retail experience recently, although from a slightly different perspective.  I have a daughter who is a student in Texas, who needed to replace her well used car.  At her behest, I did some research and selected a new vehicle that would meet her basic requirements for size, gas mileage, and safety (OK, that was more my requirement than hers), and offered a very aggressive lease program for graduate students that promised a very affordable payment for us.

I went online and located three different dealerships in the general area where she lived, including one of the large national chains where a friend of mine happens to be a VP.  The first dealership I contacted was the large national chain.  I explained to them in my email that I was looking for my daughter, and that I was going to handle this from Michigan, and I warned them that I had been in the retail car business for over 25 years.  I asked them for a 24 month and 36 month lease payment on the model I was interested in under their grad student program, and with $2,500 out of pocket at signing.

The response I received did not provide any answers to my questions, and just thanked me for my inquiry and asked me to come in and test drive the vehicle.  I responded, again explaining that it wasn't too likely I would be coming down to Texas from Michigan, and that I needed to get this worked out via email before I sent my daughter in, at which time she would be taking delivery.  Their response to that email (I'm not making this up), was to ask when my daughter could come in.

Then I contacted a second dealership, a little further away, and sent them the same initial email looking for a 24 and 36 month payment.  I got back a very generic response promising me wonderful service and answers to all my questions.  They also called me, but I declined to answer because I wasn't ready to have a conversation about it, I just wanted a damned starting point to help me figure out how much cash I would need to get her to a payment she could probably handle.

The next day, I contacted the third dealership, again with the same initial email.  Within a few minutes I received a real response from a BDC Rep who acknowledged my request, shared that she was originally from Michigan, and promised to get me my numbers.  About 30 minutes later, she emailed me again with both payments I requested, and she also gave me a payment on a slightly more equipped version of the model I was interested in because it would lease out better, so the payment was slightly less, and it had more equipment.

The next day, I received an email from the GM at the dealership, thanking for my inquiry and offering to help me with anything I needed to get my daughter taken care of.  We exchanged a couple of emails about colors and with more and less due at signing and set up an appointment in two days for her to pick up the car.  She showed up, called me from the dealership and confirmed that everything was as described, and took delivery.  The entire process took place over about four days, from first email to delivery.

I did hear back from the other two dealerships a few times.  The second one never sent me anything other than obvious automatic emails, but the salesperson at the national chain store did send me a couple of personal follow-ups.  I took the time to respond to him and let him know that i had purchased from a different dealership and suggested that in the future they do a better job of working with people online if they wanted to convert them to buyers.  In his response to that, he defended his actions by saying he wanted to make sure he had all the information needed to get me the lowest possible payment, and that's why he wanted me to come in.  Of course, since his competitor had managed to accomplish all that and more online before they made the sale, his defense sounded rather ridiculous.

Unfortunately, I work with a lot of dealership managers who still cling to the old school mentality that if they give numbers to an online shopper, they will use them to whipsaw five different dealerships against each other and not buy from them.  Although I'm sure that does still happen occasionally, every study of customers who purchased cars after shopping online that I've ever read, as well as every buyer we've ever talked to at our focus groups, stressed the importance of convenience and transparency in the customer’s dealership selection, as opposed to price, which is fairly easy for shoppers to find out on their own anyway.

You don’t have to look very hard to find examples of businesses that failed to adapt to meet the needs of today’s Internet influenced shoppers.  Some very venerable retailers have gone away as a result of the modern consumer’s desire to leverage the convenience of the Internet into their shopping experience.  Dealers and dealership managers need to embrace this reality and understand and accept that today’s consumer does most of their research without involving a dealership until the very end of the process, and if they aren’t willing to meet their needs by answering their questions quickly, accurately, and enthusiastically, they are going to lose business.