Is Building Value Still Relevant Online?


 What would you think if I told you there was a “brand new” way to sell cars, and make customers happy? It goes like this: 

When customers come on your lot you must stay hidden inside the store, lock the doors, and send no one outside. The customer will wander your lot for a bit, and sometimes they find something they want. Make sure not to interrupt this process! Do NOT attempt to give the customer(s) a reason to decide on driving your particular vehicle, other than the vehicle itself. If the customer selects your vehicle they eventually come inside and pay more for the vehicle then you'd ever hope.  

What would you say to that?

 I think most managers with some time behind the desk would not buy into this story, no matter who was telling it. A lot of things have changed about our industry, and about our customers. There is however, ONE thing that will never change in our business: If you don’t slow the customer down and build value in yourself, your store, your methods, and your vehicles… if you ever do sell that vehicle, it likely will not be a very profitable sale for your company. 

This is one of the fundamental truths of the car business, and it will never change. But in our industry a lot of other things have changed in the last ten years alone. Our customers are all online and many dealers are falling behind trying to understand all these changes, rather than just applying the simple fundamental truth of our business to these new virtual storefronts and opportunities. The principles the auto industry was built upon, will be the same principles successful dealers will use to dominate in the new online marketplace. 

If your store is currently experiencing more prospects walking on your actual lot in a day than you have on your website in a day – then you either have one terrible website, or one heck of a store! For most dealers, they have at least 10 times as many prospects experiencing their products online in day than they have in the store. Many dealers spend an average cost of $500+ on each customer that drives onto their lot. They account for this hefty investment in just a single opportunity by training their staff, and by designing all elements of their business to build value in everything they do for the customer. They never let the car’s inherent value alone dictate the price of the deal, they go on service walks – and they sell, sell, sell the dealership. . Most successful stores understand that in fact building value is what they actually “do” for a living. And they do it so well that they can afford to pay $500 per opportunity and still make a profit! (think about it)  

Studies show 80% of prospects will visit a company’s web site before going into a dealership for a test drive. Dealer’s main websites are literally packed with prospects that are virtually being turned away. In terms of building value adding content for their “virtual store“, (the one packed with opportunities) most dealers currently invest literally nothing in content like this. Industry leaders have addressed the need to build value at this point in the process, but many of them also stop short of explaining exactly “how” to do that.

If stores have found a way to convert a $500 investment in each opportunity on the lot, surely there is already a way to apply these fundamentals online and build value for these hundreds of extra opportunities, right? Surely as managers we have already committed to spending at least $5 dollars per hit on our websites – putting the content THERE for them to access, content that will build value in the rest of our processes. I mean there is no way we are just letting the customers wander our “virtual” lots and pick out their own cars online, right? Sadly, in most markets this is exactly the case. Dealers are not unleashing the value of their store until after the customer has picked their dealership, or not at all if the customer picks the competition’s dealership instead. Why is that? 

For many dealers, they are experiencing hundreds if not literally thousands of hits already on their website every month. Those hits are not accidents, or a random number – they are missed opportunities. That number, minus your set appointments is the number of prospects that were not impressed with your presentation online. That should alarm you. It would be hard to overstate how wasted that traffic typically is… I have seen desk managers levitate from their seats, and explode at the site of a missed prospect driving away on the lot. (at $500 it is hard to blame them) Yet these massive numbers of missed opportunities seem to stun no one, they seem to bother no one. The answer to every problem online for dealers – is the same answer as it is on the lot. Build More Value! 

Video is the way to do this! With the power of well messaged videos, your managers can be everywhere all the time online. They can be there, sitting in every car you advertise on the internet ready to help your store SELL whenever a customer takes an interest in that car! They will always be available – and available in a great mood, wearing their favorite tie, giving their best presentation to the customer, perfectly! This will affect not only the 80% of your customers that already swing you website by before deciding on an appointment with you company – but also for every customer that searches for a car that is in your inventory. Every single car your store advertises for should return the favor, and be out advertising on behalf of your store, even if that unit is sold already. 

The question is WHY hasn’t this happened everywhere already? It surely seems like an obvious thing to do for dealers. The problem is that production companies that produce automotive videos are usually very expensive, they charge per-video (content piece), and the videos are not very well messaged. Many video companies are great at making videos, but they are NOT salespeople at heart and they don’t understand which messages the dealer needs to convey to be effective with the potential customer. When it comes to video, ”the quality of your videos, directly reflect the quality of your brand or business”. Many dealers have recently tried low budget ways to produce content and drive sales. Compared with not making videos, this can be very effective. However compared with quality videos, that actually enhance brand value and are delivered at the “zero moment of truth” – truly amateur videos hardly scratch the surface of the potential effect of video on customers. In some cases, they may actually even hurt dealerships when the quality of the videos is poor. 

If your videos are two star, what does that say about your store??

The opportunity in your market is huge! If you still don’t believe me go ask your internet manager how many hits, actual hits you get on the website every month. Ask yourself, “What would setting appointments on even an additional 2% of those opportunities do for your monthly outlook?” For most of us, it would be more business then what we are currently doing in the main store. If we don’t build proper value in our products we can’t expect someone else not to sell them also, for less money as we are seeing currently from dealer-competitive vendors like TrueCar. We CAN build gross online, you can to!

 

 Andrew Myers 

COO - What's Next Media

ABOUT WHAT'S NEXT MEDIA: WNM is an auto-exclusive video company based out of Seattle, WA. We combine car people with video talent, and our pantented CGI processes, creating one-of-a-kind branded dealer automotive video. 3908 Aurora Ave, Seattle, WA | 206.478.8721 

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