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The Future of Car Sales – Compressed: Episode 7

The Future of Car Sales – Compressed: Episode 7

Dealers have lost the upper hand. With today’s extreme transparency, car buyers
have more information than ever before and they aren’t shy about using it. Dale makes it clear that dealers must embrace
this new retail reality and give car buyers what they want; a transparent and hassle-free
buying experience, if they want to thrive. I have three words to help make the point. A-Ma-Zon. Dale points out that with a few
clicks you can find anything you want at the price you expected to pay. You can see what others rated the product
and the experience with the seller. The retailers that will win in the future
are those who can meet or exceed the new preferences and expectations of the consumer. The gauntlet has been laid and there is no
way out but forward. The research tells us buyers now visit less
than 2 dealerships before they make a purchase. The vast majority want to spend less time
in the dealership and more than half begin working the deal online. About half want to remain anonymous. Trust and responsiveness trump price. Most say they would buy again from a dealer
that provided an enjoyable experience and a majority of buyers still want to negotiate
the purchase. In summary, today’s buyers want minimal friction
and maximum transparency. Dale gives three steps to extend a giving
hand to your customers. First, give customers more information while
requiring less to get it. Research shows that increasing interaction
on the VDP reduces bailout rates and increases trust. Customers also tend to be more honest on credit
scores and trade-in conditions when they’re at ease. Trust goes both ways. Step two. Dale encourages dealers to make every interaction
about making it easier to buy the car, not getting them in the door. Have the answers ready and value their time. Finally, automate what you can…ESPECIALLY
F&I transactions. This saves them time and actually makes dealers
more efficient. Everybody wins. In chapter 5, Dale paints a not-too-distant
customer experience in a franchise dealership somewhere in America a little before 10am. A vehicle drives into the dealership lot and
parks at the door. A man enters the showroom and a sales associate
approaches… Morning, Bill. I’m Sam, the guy who’s been working with you
on your new car purchase. Did you see it outside? Uh…no, I didn’t see it, but I’m just curious,
how did you know it was me? I saw your picture online and we do have a
technology here that sends me a message when my customers arrive. Something to make your life easier. If I could have your keys, I’ll give them
to my colleague Chris and he’ll evaluate the trade. Here are the keys. That’s interesting about the technology. Is there an app like that for parents? Yeah, well you do have the geo-tracking app
that you selected online. We’ll talk about that in a second. Why don’t you have a seat here? Could I get you some coffee? Cream? Sugar? Yeah, please. Black is fine. Ok Bill, now I promised we’d have you out
of here in 45 minutes with your new vehicle, so let’s review everything we did online. Ok? Ok. Am I still getting $5,000 for my trade and
the new car for $43,780? It’ll be up to Chris to verify the trade-in
offer. That’s really the only variable since he has
to physically examine the car. He should be done in a few minutes. Everything else is exactly as we agreed. Purchase price is $43,780, a $2,000 downpayment,
financed for 5 years which is $481 a month at a 5% interest rate, the platinum service
package you requested which include lifetime oil changes and the free washes, and finally,
that geo-tracking technology. It’s all here on the iPad. Why don’t you take a few minutes to review
it and I’ll text Chris about the status of your vehicle. This all looks good to me. I just heard back from Chris and he said everything
checks out, except for the tires. They were a little more worn than we thought
they would be, so he has to adjust the offer to $4,600. If you want to come outside with me, I’ll
be able to show you what we found. Nah. No need. I wasn’t too sure about saying the tires were
in “good” condition. $4,600 is fine. Let me adjust the trade allowance here. Should we add the difference of the tires
to your downpayment or include it as part of the loan? Let’s add it to the downpayment. Ok, this will just take a moment. Ok. You’ll see here is where I updated the deal
terms. See, there’s the new trade allowance of $4,600
and the downpayment is now $2,400. Everything else is exactly the same. Does that look ok? Looks good to me. Great. Well, it is 10:20, now the fun part. Why don’t we go outside and check out the
car, make sure everything’s ok, and then we’ll come back inside and sign some paperwork. Wow! You really are going to have me out of here
in 45 minutes! I told you, Bill, we’re straight-shooters
here. When you said “I want to be out in 45 minutes”,
I told you that’s what we’re going to do. Let’s go soak up some new car smell. Let’s do it. And I was only kidding about the 45 minutes. It’s just that this is so different than my
last experience buying a car. It’s actually kind of fun. Dale asks: “Does this scenario strike you
as a bit far-fetched?” It shouldn’t. This is the exact scenario most large dealership
groups are working toward. The faster, more-transparent experience customers
desire. Sure, there’s been plenty of pushback. There’s a lot of legacy invested in the old
way, but online buying, one-price selling, and streamlined interaction will be the new
way. Dale cites groups like Autonation and Sonic
ever expanding their efforts in this area calling them “essential steps” in their reinvention. Over time, Dale believes holding on to the
old way will be an increasing barrier to dealers future success. So, where do you stand in this reinvention? And what is your next step?

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