"Here’s a Good Indication of How Much People Hate Car Dealerships"

"If it were possible and practical, most people would never set foot in a car dealership when purchasing a vehicle."

The title of this post, along with the introduction were quotes from a recent article that appeared in Money. The survey and results were conducted by Accenture. Complete article available here.

It's no surprise that consumers aren't excited about visiting dealerships for sales and service. Why not listen to what consumers are telling the industry, and provide consumers with what they want?

It seems the entire industry is racing towards "online sales", and or the ability to transact some or all aspects of a car purchase online. Unfortunately, that's going to have minimal impact upon service. It doesn't matter if we're speaking to customer pay, warranty or recalls, online fulfillment will have little to no impact upon fixed operations.

The solution is very simple; Concierge Service. Technology exist today that enables dealers to provide their customers with an Uber like experience; providing consumers the ability to transact business with the dealer without having to leave their home or office. The technology schedules, dispatches, tracks, monitors and provides analytics throughout the process.

Imagine your product specialist conducting a test drive at the consumer's home, or your customer's vehicle being picked up and delivered to the dealership for service, warranty and or recall, all while the customer is provided a loaner. That's powerful!

Customer retention and service retention will become an eyesore of the past through convenience driven models. Even with online fulfillment coming soon to our industry, consumers will still want to test drive the vehicle and service their vehicle without being inconvenienced by going to the dealership. The industry is too focused upon an hour transaction at the dealership, versus making the sales and service process as customer convenient as possible. Speed of transaction doesn't necessarily translate into convenience.

Your customers are very busy, traditionally both spouses are working, shuttling kids to school and sports, and living life...no wonder they don't have time to visit your dealership.

Ken Hite is Senior Vice President at RedCap. Ken has 25 years experience within the automotive industry, inclusive of retail, OEM, after-market and start-ups. The auto industry must learn to exceed customer expectations and implement business processes based upon customer convenience.

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Comment by Ken Hite on August 11, 2016 at 9:53am: Tom, I agree that "person2person" relationships are invaluable. Consumers, I included, want to purchase goods and services from people we like. RedCap's platform was designed to accommodate consumer pain points associated with servicing and purchasing a vehicle, while enabling dealership personnel to provide consumers a personal one- on-one relationship.

Comment by steven chessin on August 8, 2016 at 11:37am: Thanks Tom - The autonews article was very meaningful to me because I have specialized in long-distance eBay sales for years - but - dealers have considered the techniques to be blasphemy. Internet sales is like speed-dating via Skype - there is no "relationship" - just instant LIKE or NOT. So the human trust factor takes special techniques to establish which most dealers still reject. --- One of these techniques is "Pick Your Salesman" where customers watch quick videos to select who they prefer to work with.

Dave said it all with this : "The 800 pound gorilla in the room is the fact that dealers don't make enough money to pay to attract and keep quality sales people." Amen to that. I worked at a store for a couple weeks paying 10% commission against their definition of gross with no minimum. Three salesmen quit on the spot. day. And can you imagine a low-volume premium brand paying $75 per sale and minimum wage ?!

Comment by Tom Wiegand on August 8, 2016 at 10:43am: The Accenture "article" does not offer constructive solutions(s). "There's no big mystery as to why car dealerships and automakers are reluctant to make online vehicle purchasing more practical and readily available. Doing so would put car staffers out of jobs and likely result in lower profits for automakers and dealerships." This is outright hogwash! TrueCar was founded to accomplish this, and they had to do an about-face!

Read this article from today's Automotive News: http://www.autonews.com/article/20160808/RETAIL07/160809858

Pay particular attention to the paragraph titled: "The Human Element" which confirms WHY PERSON2PERSON RELATIONSHIPS are the missing ingredient in providing customers the emotional wants they desire most.

I'm not subscribing to the conclusion Cox Automotive has it all correct, yet their direction toward Person2Person Relationship is 100% spot-on to far improve customer experiences.

And then comes this blog post with the proclamation in bold: "The Solution is very simple; Concierge Service." This is a classic "False/Positive." "Concierge" is a personal service for personal service. Yet, reading the paragraph after the bold heading, this so-called "Concierge" service is another management measured technology system that offers zero about Person2Person Relationships within the true meaning of "Concierge."

The statistics Cox offers up in "The Human Element" paragraph point directly to Person2Person Relationships between Personal Brands (YOU) of business and customers is the leading customer emotional want today [and will only grow from here].

Defend this! DEFEND THIS, or else! If you do not see the writing on the wall where and each and every one of you in the retail auto dealership MUST stand up and accept Person2Person Relationship-First responsibility to earn every customers trust, respect and loyalty to YOU first, then expect others will continually attempt to PUSH YOU DOWN to where you feel undervalued and under-appreciated, leaving you un-needed. The Automotive News article PROVES your worth, so step-it-up and defend and hold high your Personal Brand value!

Customers hate regurgitating non-relational processes that cause distrust. Relationship-First Processes that earns trust exceeding customer experience expectations Person2Person represents the best of all solutions. Celebrate this truth and live it!

Comment by David Ruggles on August 5, 2016 at 5:02pm: Well, its been racing toward online sales for a couple of decades and has made little progress. Yet, people keep writing about it. Auto Retail isn't a grocery store. It isn't a clothing store. It isn't an appliance store. It isn't an online source for gadgets. Vehicles are large ticket items where the price is negotiated. There are complex issues involved like insurance, sales tax, titling, license plated, inspections, financing, negative equity, a variety of consumer credit scores, and a LOT of information available from many sources. Consumers know less today than they did when I got in the business about 45 years ago. They have more information, but know less. The info is like drinking from a fire hose for them. The fact is, consumers answer survey questions differently than they behave in real life. When they say they hate to visit a dealership they are really saying, "I know I have to play the game and I want to be guaranteed I will win. When they go out to buy a house, they have to play that game to. And the real estate business isn't going to change because of a few crank complaints.

I suggest auto retail work on smoothing out its kinks. Many suggest dealers go to a No Haggle/One Price system, which is laughable. There are so many things wrong with that I'll wait for another post to elaborate. Suffice to say I know MANY dealers who would gladly pay the fee for the One Price training company to come install One Price at their competitors store.

The 800 pound gorilla in the room is the fact that dealers don't make enough money to pay to attract and keep quality sales people. Consumers are meeting their sales person for the first time. It didn't used to be that way. They think disposable sales people "save" them money. The closing percentage of consumers buying a car from someone they already know, either through repeat sale or referral, is three times what it is when the consumer is meeting the sales person for the first time.

Auto Retail doesn't run on car sales. It runs on gross profit.