Re: Internet Manager Best Practices (Aaron Harris Question) - Sean V. Bradley & Joe Cala
Your website provider should be able to provide you with a monthly report that lists the number of hits your site has garnered, the sources of those hits, how long the average visitor spends on your site and what they are visiting on your page.
Most dealerships now have an Internet department. Some stores have gone full speed by appointing an Internet manager, hiring representatives to follow up on leads and creating an advertising budget. Other stores have approached the digital age more cautiously, just dipping their toes into the vast pool of online media.
I visit dealerships across the country, and there seems to be no similarity at all in how Internet sales are handled and accounted for. Some dealers think they are maximizing their online sales revenue just by answering every e-mail and chat request.
There is a lot more to it. It just depends on how much money, time and resources you are willing to commit to the project. Full speed or not, from an accounting standpoint, it may make sense to set up a separate department to manage the income and expenses you derive from online sales. Here’s a six-step plan:
1. Hack Your DMS
It should be very simple to set up a new department on your dealer management system (DMS). Assign your new department a number and name, set up income and expense accounts and assign them a factory financial statement line number so they show up on your monthly financial statements. This step forces you to decide how you are going to track your Internet sales, as most factory charts of accounts don’t have separate accounts set up for Internet sales, cost of sales and expenses.
2. Track Your Sales
To properly track your Internet sales, you must set up separate sales and cost-of-sales accounts for each model of new vehicles you sell. Do this for your used inventory as well. If you don’t track these sales, cost of sales and gross profits separately — whether on a spreadsheet or in your accounting software — so you can subtract them from your financial statements, you will probably not have a clue if the money you are spending for this department is worth it.
3. Establish Your Structure
Decide whether your Internet personnel should handle the lead all the way to the finish line or hand the lead over to one of your regular salespeople. If it changes hands, you have to decide how you want to record the deal on your books. If not, note each Internet sale on the deal jacket so accounting knows which sales account to record it in, where to post the commission and where to list other costs associated with the sale.
4. Separate Your YTD Expenses
Once you have the department and the general ledger accounts set up, you can move the year-to-date (YTD) expenses from the accounts you have posted transactions to all year to the new accounts. That will allow you to start your department analysis in the current month.
Once you begin posting the sales and cost-of-sales accounts separately, you can easily see whether your Internet department is profitable. Make sure you allocate the correct payroll costs for the personnel working in this department. It should be based on the percentage of time they are spending there. Now you can calculate the average gross profit per unit sold, the commission or cost to sell it, and the variable expenses associated with it — the same as you would with your new- and used-vehicle departments.
Make sure you have set up accounts for Internet-centric expenses such as website design, in-store Internet usage, monthly web hosting maintenance fees, search engine optimization and lead-management software costs, not to mention your manager and sales representatives’ salaries and commissions.
5. Separate Your Fixed Expenses
If you really want to do it right, you should be allocating some of your semi-fixed and fixed expenses to the Internet department. How much is up to you. This can be a real pain to analyze and allocate, so you may want to have the department up and running for a while before you take this step. Your office manager or accounts payable expert can probably tell you which expenses pertain to your new department.
For the most part, your largest expenses are going to be personnel and electronic media software and usage fees for each click, etc. These are the ones you need to pay the most attention to, as they are variable and controllable costs. If the cost of each sale is larger than the revenue you are generating, you will need to decide how to drive more people to your site that may buy, or start reducing some expenses so the department is not a drain on your dealership’s profits.
6. Order Your Reports
The profitability of any department depends on performance. Your Internet manager should track how long it takes to respond to a lead and how many leads are closing as actual sales. Your website provider should be able to provide him or her with a monthly report that lists the number of hits, the source (e.g., Google search terms), how long the average visitor spends on your site and whether they are visiting different departments.
With the right information at hand, you should be able to compute your cost for each lead and unit sale. Better yet, you can make intelligent decisions on how to improve your website, your inventory mix and your process for handling Internet leads.
Once you have set up new accounts for the income and expenses generated by your Internet department, you can determine whether the department is profitable. If it isn’t, you need to act fast. Look at your site from the perspective of a potential customer and ask yourself the following questions:
- Is your site graphically appealing and easy to navigate?
- Does it look as nice as your competitors’ sites?
- Is your inventory easy to find?
- Are your vehicles listed with good photos, videos and descriptions?
- Are your online prices competitive for your market?
- Do you know how many of the same vehicles are for sale in your market area?
- Do you make it easy for customers to contact you?
Hi, my name is Johnny Dealer. I spend my mornings listening to incoming sales calls from the previous day. I then, go into a deep depression. I guess I am like most dealers, but today, I'm going to do something about it. I am going to create a system that will eliminate missing all of these opportunities. I am about to create a Lean, Mean, Lead-Handling Machine.
Here is how I'm going to do it.
First, I'm going to TOTALLY commit to my new lead department. I am going to commit finances, facilities, training, equipment, and most importantly, PEOPLE. I am going to hire a real-life Manager to run this department and I'm going to pay this person just like the rest of my managers. After all, this department is every bit as important as the others in my dealership. I know that the future of this department is wholly dependant on MY buy in. I AM IN!
What am I going to call this department. BDC? Internet Department? I think I am going to call it the Appointment Department. That is the most accurate name I can think of, plus, calling it the Internet Department only makes me feel more techno-ignorant. I want these employees to know that the appointment is the objective. We'll hand them of to specialists when they get here.
I want to make this Lean, Mean, Lead-Handling Machine to run smoothly and most importantly, be reliable. I can't have it breaking down at inopportune times. I think I'll begin with my people. I'm going to take my time and only hire the best and pay them well. Training? Of course. I think I'll do this in two stages. First, I'll get my hands on the best phone scripts and email templates in the industry. We will train them relentlessly until they can recite them in their sleep. After that, I will teach them our incoming lead concepts. 1. We got what you want. 2. You got what we want. 3. You're special, we're special. (see my article, "Incoming Calls are as Easy as 1,2,3.) I want my people to not only memorize the word tracks, but I want them to UNDERSTAND the content and CONVEY the motivation to the customer.
This machine is beginning to take shape.
Now, I must set up a process that works for everyone. Everyone in my store needs to know this process, inside and out. When a lead comes in, who takes it? At what time do they turn it to a Manager? Can they discuss price? If not, who then? How about follow up? When and how often do they get back with a customer? Do they do it by phone, email, video, or in person? When do they stop trying? I will make sure that ALL of these questions are answered in my process.....my WRITTEN process. How can I expect my people to perform if they are not clear on my vision.
I spend a fortune on tools in my service department. Every time I turn around, my manufacturer has generously shipped and billed a new piece of equipment that is now needed to work on the new models. In my new Appointment Department, I'm not going to cut corners on their tools. They are going to need their own area, with fast computers, great phones with headsets, and a great CRM. The equipment and resources they have are a reflection on my commitment to this department.
How can I make this machine consistent? If I dump a specific number of leads into my machine, how can I be sure of exactly how many car deals will come out the other side? This will boil down to tracking and expectations. I have learned over the last 30 years, that if you want to see numbers increase, simply track them. What are my expectations? I guess I will leave that to the experts. I want to set appointments with 60% of my fresh leads and 40% of my leads that are a week old or more. 50% of them will show. I want to sell 45% of the appointments that show up. I know everyone has different numbers that work for them, but these work for me.....for now. That leads me to "expectations". I know that my people will perform to their expectations. It is MY job to not just manage people, but manage their expectations. I promise make my expectations so clear that they become their expectations.
When my machine is built and running effectively, I vow to soup it up. You know, like a turbocharger. I can start getting innovative with video appointment confirmations, fancy .pdf proposals, bringing in trainers, hiring phone coaches, data mining, lead screening, video search optimization, email marketing, social media promotions, and the like. Heck, my new machine will even be able to handle service leads!
If is a big two-letter word. But...
- IF I manage this department with the same vigor that I manage my Finance Department, Sales Department, or Service and Parts Departments, it will succeed.
- IF I dump 300 fresh leads into my new Lean, Mean, Lead-Handling Machine, then, it will produce 180 appointments, 90 of them will show up, and 40 of them will buy. This does not even include re-hashing my lost opportunities from the last several months!
- IF I continue to commit to my new department, every time I dump 100 new leads into my machine, I will get 13 more sales.
My mission is simple now......Find more leads to feed the machine!
Who's Your Danny?
PS - My apologies if your name is, in fact, Johnny Dealer. Any negative references to this name is strictly coincidental, especially if you actually live on 123 Elm Street, Anytown, USA. or work at ABC Motors.
Sean V. Bradley has 15 years Automotive Internet Sales experience selling over 110 INTERNET units per month when he was an Internet Director at Pine Belt Automotive in NJ
Joe Cala was the Internet Sales Manager at Nelson Mazda in Tulsa Oklahoma that took their department from 7 units - 80 units per month online. Joe then went on to Gateway Toyota, a Penske store to become the Internet Director for 6 years. Joe was delivering 150 INTERNET units per month. Cala also worked for Autotrader.com for a year.
Both Cala and Bradley have extensive Automotive Internet Sales experience and have created a 5 part Internet Director responsibilities series.
If you would like more information please go to www.automotivedigitaltraining.com or call them at 856-546-2440
Internet Deptartment and Management: Getting on the Same Page - Automotive Sales - Car Sales
One of the things I tend to see most when training with Internet Coordinators or BDC Reps all across the country, is that not many of them take the time to identify who they are and what they do at the dealership. Before I continue, lets go over a few statistics that might help to shed a little light on the importance of implementing this strategy.
- 92-99% of People Go Online before stepping foot into your dealership.
- People are shopping on Average 5-8 other dealerships besides yours.
- This means there are 5-8 other dealerships trying to contact that very same person you are.
- Sales People, especially in the Automotive world tend to have a "Negative Stereotype".
Why Identify yourself on a call you ask? If I was to call you and say, Hello! May I speak to "Mr. Johnson" ? This is Anthony calling on behalf of Autobytel and ABC Motors....Did I catch you at a good time? What would you assume my job to be within the dealership if I didn't verbalize it to you during the phone call? Most likely a Sales Person, Wouldn't you agree? When a prospect believes that he/she is on the phone with a typical "Sales Person", their Defensive Mechanisms are triggered that much easier, which will result in a very low success rate as it relates to setting appointments. This is where letting the prospect know what you do is vital to increasing the odds in setting an appointment and at the same time, builds value into why it is so great they are talking to you...the "Internet Coordinator". I would say something like the following to get the prospect to Like, Trust and Believe in me.....
Mr./Mr.s Customer, I'm actually not a Sales Person. I'm what you call an Internet Coordinator, you can think of me as like your personal "Car Concierge" or sort of like your "Liaison" to the Sale. You must have went online to get your research done and thats actually what I specialize in and do for customers just like yourself on a daily basis. I will provide you with all the relevant information about the vehicle or vehicles of your interest, send you some emails with videos of the entire vehicle inside & Out and any other information you may need to help you make the best informed decision. This way,when you feel comfortable, I would like to Set you an Exclusive V.I.P. appointment with my Internet Manager as opposed to a Sales Person. This will save you a tremendous amount of time inside the dealership, your vehicle of interest will be ready and waiting for you to test drive and their will be someone waiting for you to show up, saving you at least 45 minutes in the dealership.
Always Remember...there are at least 5-8 other dealerships that this prospect has looked at besides yours, that means there are 5-8 other people calling that same prospect. It makes perfect sense to tell this person exactly who you are, what you do and most importantly, what makes you so much better than the 5-8 other people calling! "Price is only relevant with the absence of value"......Start by building VALUE in yourself....the INTERNET COORDINATOR!
If you have any questions or concerns, please email me at email@example.com or conatct me directly via my cell phone at 732-456-0753.
"If you want the things most people do not have, you must be willing to do the things most people are not willing to do to get them"
How Many Leads Can An Automotive Internet Sales Coordinator, BDC Rep Or Car Salesman Handle?
Gaining the Competitive Edge As A Member Of A 20 Group
Before I go into the “why”, let’s discuss the “what”. Specifically, what is a 20 group? A “20 Group” is a group of dealers in noncompeting markets that get together in exotic locations nationally and internationally, on a quarterly basis, to “synergize”. Although once required that a group consist of approximately 20 dealers (hence the name “20 Group”), this does not always hold true today. Some “20 groups” consist of 30 dealers while others may only consist of 15. Ultimately, the number of dealers in the group is not as relevant as the criteria by which the group itself is structured.
Today 20 Groups are structured a little differently, but it’s important to understand their origin in order to appreciate their evolution. Originally, the 20 group audience was composed of Dealer Principals, General Managers and/or senior executives of the dealership. It also originally focused on franchise dealerships. For example, in a “Toyota” 20 Group, you would find 20 different Toyota dealerships from 20 different markets, usually from all over the country. But even though the franchise was exactly the same, diversity still existed within the “Toyota” 20 group itself. For example, you could have dealerships that were small, large, part of a dealer group, part of a corporation, in a rural area, in the city, single point or part of a multi franchise point; all with different strengths, weaknesses, passions and fears. These dealers were intentionally diverse. This was imperative to the success of the 20 group to ensure impartial feedback.
Some of the most common areas of comparison, coverage and discussion in a traditional 20 group were:
- Financial Composite
- Break Down of Different Departments
- New Car Sales
- Used Car Sales
- Advertising / Marketing
- Vendors / Suppliers
- CSI / Customer Service
- Human Resources
- OEM Situations
- Accounting / Floor Plan
- And More…
How was the data collected? Each dealer within the 20 Group would be responsible for filling out their “input sheets”, which would become part of the overall 20 group composite. The input sheets worked as the core for analyzing all of the details, metrics and financials mentioned above. The sheer act of an individual dealership filling out an input sheet and tracking the proper metrics was worth the price of membership. Always remember, what isn’t being tracked, can’t be measured and what can’t be measured, cannot be improved upon. Surprisingly, a lot of dealerships today still simply “wing it”. The 20 group input sheets forces the dealers to hold themselves accountable because they have no choice but to fill them out. Lack of doing so could lead to the dealer being fined or worse yet, kicked out of the 20 group completely. After all, in order for the composite to hold its validity, the numbers must be true. Garbage in equates to garbage out. Now with those completed input sheets, the 20 group, led by the 20 Group “Moderator”, was able to take the dealers individual metrics and consolidate all 20 dealerships’ input sheets into the group’s composite. Upon consolidation of the metrics, the moderator and each dealer within the 20 group, is able to see the entire 20 Group in one view and see which dealers are excelling and which individual category they are excelling in. On the opposite spectrum, the group could see which dealers are struggling, where and why. From this data, the group could create “standards” or “benchmarks”. The group could see who is above, below or on track for 20 Group standards. But, this is only the beginning. Now that all of this “field intelligence” has been exposed, the real “SYNERGY” begins! Within each individual 20 Group session, dealers spend time discussing what is successful, what vendors are good and what strategies are successful. Also, what vendors are bad and what to do when bad things happen. In essence, the composite acts as a conversational starter. The true value is being part of a specific group of like minded people, at your level (or better) and the group works together for one sole goal…to evolve the entire group synergistically.
The core principals described above still remain constant and relevant for today’s 20 groups. People need cars today like they needed cars back then. That hasn’t changed. But what has changed, is the medium by which people are buying cars. With 97% of consumers going online prior to stepping foot into a dealership, the Internet Sales Department was created. As mentioned, 20 Groups originally were for franchised dealers and broken down by franchise. Soon after, Independent Dealership 20 Groups started popping up, followed by:
- Used Car 20 Groups
- Special Finance 20 Groups
- GM 20 Groups
- CFO 20 Groups
- Internet Sales 20 Groups
20 Groups are essential for success in today’s market. Shakespeare said “Show me your friends and I will tell you who you are”. If you are a Dealer Principal, GM, Internet Sales or BDC Director or any other senior executive within a dealership or dealer group, I suggest that you find a 20 Group that fits your dealership’s focus and needs.
Remember to find the RIGHT 20 Group for your unique needs and situation. You do not want to join a CFO 20 Group if you are looking for BDC information and clarity. Just like you wouldn’t hire a Service Writer Trainer to train your Internet Sales Department, you do not want to join a “traditional” 20 Group if you need information, strategy and clarity for Internet Sales. I also suggest that you are careful with 20 Groups that claim to do “everything”. Dr Stephen Covey, author of The 7 Habits of Highly Effective People, says “Put First Things First”. Meaning, you want to identify which area of the dealership you want to perfect first and concentrate solely on that department. Once you solidify the success of that specific department, you can move on to the next focus. For example, if you want to compare and synergize with other Porsche Dealerships, then join a Porsche 20 Group. But if you are looking for clarity on your Internet Sales Department, BDC or Digital Marketing initiative, then find a 20 group that specializes in that area.
AutoSuccess Cover Story, Chris Carlson Will be A Speaker At Internet Sales 20 Group
Automotive Internet Sales Coordinator (BDC Rep) Sells 49 Units ONLINE & Tells Us How!
Automotive Internet Sales Coordinator / BDC Rep
/ Appointment Setter PAY PLAN!
*** This is a SALES POSITION!!! NOT Customer Service!!
They are SELLING THE APPOINTMENT!
- “Road to the Appointment” process… (Outbound / inbound phone call process)
- How Qualify a prospect
- Identify a prospect’s wants, wishes, needs and expectations!
- They will have 25-35 (Minimum) word tracks in their arsenal… “Objections & Rebuttals as well as “What Ifs…”
- A complete time management and organization strategy
- A complete FORECASTING strategy… “3 Minute Book”.
- They will NEED to have a thorough understanding of 3rd party providers, information sites like:
- They need to have THOROUGH knowledge of their products… they do not NEED to memorize everything, but they need to know where to access the information.
- Knowledge of the dealership’s website(s)
- EXTREME KNOWLEDGE of the Dealership’s CRM… this is one of the MOST important aspects to their job!!
$400 week salary X 4 weeks = $1,600 per month
What do I STILL need to earn in commissions to meet my $3,000 GOAL?
$1,400… The questions is HOW am I going to earn it???
Before you can really answer this… you need to know what your commission plan is…???
$1 for an appointment
$15 for an appointment that shows
$25 for a sold appointment
For a TOTAL possible commission earnings of $41…
100 – 50 – 25
$100 - $750 - $625 = $1,475
$1,475 + $1,600 = $3,075…
100 appointments = $3,000 per month
100 / 4 weeks = 25 appointments per week…
/ 5 working days = 5 appointments per day…
They NEED to make or take 120 calls per day…
Why…? B/C you will ONLY connect with about 11-14% on the phones.
So, 120 calls per day will result in 11-14% connections which = 4-6 appointments per day (5).
DID YOU AUTHORIZE YOUR INVENTORY TO BE POSTED ON ANTI-DEALER OR HOSTILE WEBSITES?
5:00 AM and the Alpha Dawg is on the Point. Actually been awake since 4:00 AM. Did you ever have so much on your mind you couldn't sleep because you were thinking so hard? Well, a lot of side issues that came out of this Cars.com battle that are bothering me and I intend to pursue them.
First of all many people reported on the blogs and on Facebook and in Private Chats and Messages. That your inventory was showing up on TrueCar and CarGurus.
Well, that is troubling. One participant in the blogs emailed a statement that ALL of our vendors, or at least most them, are brokering off our inventory to other websites you didn't subscribe to. OR, perhaps buying and selling your inventory to brokers and listing services where other websites pick up your cars and put them on their own sites. The example they used in the email to me was a listing site the sender claimed to me was brokering your inventory back and forth between these lead generator vendors buying and selling inventory to each other... your inventory, for $6.00 to $12.00 each. I have not investigated fully but I believe there's got to be some truth to that in essence.
I HAVE NO PROBLEM RIGHT NOW WITH TRUECAR
I think their model revisions are as in line with dealers' best interests as any of the others.
BUT, I have a severe problem with CarGurus. I believe they are anti-dealer and NOT good for us or the consumer... my opinion based on what I have seen.
CarGurus is an alleged lead generation service that Tells The Consumer whether or Not Your Unit Pricing is a Good Deal or a Bad Deal (in their opinion?) During the course of all of this, one of my dealers discovered his Chevrolet Tahoes listed on CarGurus and labeled as a Bad Deal. The rub is He never gave any inventory listing to CarGurus. According to him, the only vendor he was aware of with his inventory was Cars.com. Have you checked, CarGurus to see if your cars are listed there when you don't do business with them????
I am not sure if Cars.com, AutoByTel, AutoTrader, or any of your vendors have the right contractually to do this. I am also researching that. They may be acting strictly within the rights you have signed away somewhere in the deep paragraphs buried in the text of your agreement with them. We will find out.
Here is the language in the Cars.com agreement you probably signed that authorizes them to do this to your dealership.
4. Content. Customer grants Cars.com a perpetual, irrevocable, royalty-free, transferable, license to access, edit, store, enhance, modify, adapt, translate, copy, reproduce, distribute, transmit, broadcast, publish, perform and display publicly, prepare derivative works of, and otherwise use Content, and to sublicense such rights through multiple tiers. Cars.com reserves the right to modify the Sites and Products, and to edit or reject any Content or portion thereof from use on the Sites or Products in its sole discretion and without notice."
You need to get with your dealer and have this re-negotiated out of the agreement.
What is a Lost Opportunity Coordinator or LOC?
A "lost opportunity coordinator" or LOC is simply a coordinator that does NOT handle fresh leads. They ONLY handle leads that have been "deaded" by the other coordinators and leads that are from day 31-90.
If you think of a conventional coordinator ONLY handling fresh leads, and their follow up protocol is email / phone call for EVERY day for the first 31 days. This limits the amount of leads they can handle due to the reality of the methodical follow up. A lost opportunity coordinator can handle 3-5 times the amount of leads. Specifically approximately 350 - 500 leads. This is possible because they do NOT have to follow up EVERY single day as does the conventional coordinator. After the first 31 days with an email and a phone call... the next 60 days of follow up can be every 3 days or even longer. depends how many leads are there versus how many LOCs.
The Lost Opportunity Coordinators work well with the conventional coordinators.
Usually a dealership has 4-5 conventional coordinators to 1 Lost opportunity coordinator.
So a LOC handles leads in the cycle of day 31-90 BUT... LOCs also handle ALL dead leads!
We know that on the showroom floor that we believe in 100% turnover "TO". Then that reality should remain for Internet leads. The problem is usually that dealerships get so many leads and there is so much going on in an Internet department or BDC that there usually is NOT a "TO" protocol for leads. Usually the coordinator or BDC rep decides on the spot if this lead is "dead", "bogus", "changed mind" etc... and usually it NEVER gets s second look from a manager or director. If you have an LOC at your dealership it truly helps fill the holes.
Lets say for an example that your Internet department has 4 or 5 coordinators... every single time a lead is "deaded" for ANY reason. That "dead" lead now becomes a "fresh" lead for the LOC. The LOC's main job in this scenario is to identify if this lead is actually "dead", if so WHY and can they "reactive" this lead to an opportunity.
Please let me know if you have any additional questions. It would be my pleasure to further assist you.
Why Are Dealership's Internet Sales Departments or BDCs Broken or NOT Profitable?
Tom Stuker, The Star Of The Hit Reality Show "Car Lot Rescue" Will Be A Speaker At The Internet Sales 20 Group
|How To Sell A Car|
Tom wasn't able to make the last Internet Sales 20 Group in Chicago but he called in and conducted a phone training session on the way to Cambodia (I am dead serious)
We are super excited to have Tom Stuker at the upcoming Internet Sales 20 Group. And Tom will be at the VIP Networking event at Eddie Deen's Ranch!
YOU DO NOT WANT TO MIS THIS EVENT!!!
This is a VINTAGE Sean V. Bradley / Dealer Synergy video. It might be an "oldie" but it still is a GOODIE!
Sean talks about What To Do If Someone Asks "Is That Vehicle Available" or "Do You Have..."
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