WTF (Writing This Friday) topic: Does low gross equal Customer Centric?
Recently I was engaged in a dialogue about what it means to be 'Customer Centric' and a 40+ year automotive veteran made the following comment:
"If you're making gross profit, then you might not be customer centric. If you aren't completely transparent, down to disclosing your bare costs and negotiating the margin, you might not be customer centric."
Before I share my opinions with you I'm curious what the AIS minds would say about what it means to be 'Customer Centric'.
Does it mean being transparent to the point of disclosing bare bones?
If you had to define a 'Customer Centric' Dealership in a few sentences, what would you say? (BTW - Share responses by video too, it makes this way more fun).
Looking forward to the responses,
Mat Koenig
CEO
KonigCo & iCarMedia.com
Comments
Finding the customers needs, listening and showing the value in their purchase. That is the key to customer centric. If you have to disclose every single ounce of profit to make a sale you haven't earned their trust or shown value. Generally these are customers you will never make happy now or in the long run.
Great dialogue gang, I appreciate the comments. Please share this post with your Dealers and let's see what they have to say too.
Customer centric has nothing to do with disclosure of costs or payments. It is the way you approach the transaction and think about your prospects. Making the transaction as easy as possible is customer centric. Considering their needs first and foremost and then finding the vehicle and financing that will best serve those needs is customer centric. Customers don't remember how much you made on the deal. They remember whether you made their life easier or harder when they got their car from you.
David-
Here is what I know from the last 13 years of personal experience as a finance/leasing company and working direct-to-consumer through our LeaseCompare.com website.
In a lot of cases our customers actually paid more for the actual purchase price than they could have gotten at a local dealer. Our payments were lower (rate/residual or combination). Sometimes our payments were a little higher than what the shopper may have been quoted somewhere else. They ended up going through us because we disclosed (transparency) every part of the deal.
Dealers that work in this manner will engage more shoppers and close more deals because they are giving the shopper what they need to make a final decision to buy, in an environment that is non-threatening.
I have personally proven this over the last 13 years and dealers that we license our technology to are seeing the same results.
Focusing on the payment by disclosing real rates the shopper qualifies for while on your website gives them what they need while enabling you to hold higher front/back end gross.
Stop racing to the bottom with price when most buyers are not paying cash.
Getting to the real payment faster is the key.