2. March 2010
Internet Sales:
A Darwinian Fight
for Survival
page 8
Put the Right
JOE
Content on
Your Site page 12
Technology Trends:
Making Profit with ORR
your IT Department Dick Hannah Honda
page 23
page 14
The Cruel Mistress
of Social Media
page 24
3. T ABLE OF CONTENTS
MARCH 2010
PRESIDENT AND CEO
MICHAEL ROSCOE
VICE PRESIDENT AND
FEATURES EDITORIAL DIRECTOR
CLIFF BANKS
Digital Dealer Cover Story cbanks@Dealer-communications.com
248-351-2620
14 Joe Orr
General Manager PUBLISHER
GREG NOONAN
Dick Hannah Honda 607-264-3359
gnoonan@Dealer-magazine.com
Digital Dealer Vendor Profile CONTENT COORDINATOR
20 ActivEngage: Over 3 Million Chats and Counting: MARIA BURKEL
mburkel@Dealer-communications.com
ActivEngage Shatters Online Communication
ART DIRECTOR
Boundaries with Personalized Live Chat and JOE BIRCH
Dealership Marketing Intelligence
PRODUCTION MANAGER
ELIZABETH BIRCH
COLUMNS PRINT PRODUCTION
NICK THOMAS
AAISP Notes
6 Profitability – A Dirty Word Today? COVER DESIGN
JOE BIRCH
Cliff Banks
CIRCULATION SUBSCRIPTION
RICH JARRETT
Internet Sales 314-432-7511
8 A Darwinian Fight for Survival rjarrett@Dealer-magazine.com
www.Dealer-magazine.com
Tom Mohr
NATIONAL ADVERTISING SALES
adsales@Dealer-magazine.com
10 Is Your Web Site Fully Optimized? 607-264-3359
George Nenni
12 Put the Right Content on Your Site Dealer magazine makes every attempt to ensure the
accuracy of all published works. However it cannot be
held responsible for opinions expressed or facts supplied
Brian Rabold herein. Nothing may be reproduced in whole or in part
without written permission from the publisher. All rights
reserved. The publisher encourages you to submit sug-
18 Quick Tips to Improve Online Pre-owned Sales gestions. Submitted materials become the property of
Horizon Communications, Inc. and will not be returned.
Send material for publication to 330 Franklin Rd., Suite
Rob Lange 135A, PMB 386, Brentwood, TN 37027. The editor re-
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Technology Trends rial. This publication is designed to provide accurate
and authoritative information in regard to the subject
23 Making Profit with your IT Department matter covered. It is presented with the understanding
that the publisher is not engaged in rendering legal,
Sandi Jerome accounting or other professional service. If legal advice
or other expert assistance is required, the services of a
competent professional person should be sought. From
a Declaration of Principles jointly adopted by a Commit-
24 The Cruel Mistress of Social Media tee of the American Bar Association and a Committee
of Publishers.
Joe Webb
A PUBLICATION OF
DEPARTMENTS
4 News ! " # # $ % & ! ' ( & " % )
DD 2 March 2010 DigitalDealer-magazine.com
5. D IGITAL DEALER TECH NEWS
“Adding Twitter to the Dealer Specialties must produce sales or ad money is being
distribution network was a seamless integra- wasted every month.
tion and an initiative that will provide cus- Can you currently verify which ad sources
tomers with an opportunity to further engage are producing your sales?
Dealer Specialties launches with their network while creating a new venue Dealer Lead Track provides factual real
Twitter posting tool for generating increased ROI from a relevant
consumer segment,” says Garvin. “Twitter
time advertising data so dealerships can cancel
advertisers that are not producing sales with
Dealer Specialties, a division of Dominion
is an online community of actively engaged confidence.
Dealer Solutions and the nation’s largest pro-
customers. It’s important to understand the www.dealerleadtrack.com
vider of comprehensive inventory manage-
audience, the purpose and ultimately establish
ment solutions, web sites and Internet mar-
keting tools, is excited to announce a tool that
rules for engagement. Once in place, it’s time Reynolds announces
to start tweeting.”
allows posting inventory on Twitter through
www.dealerspecialties.com collaboration with Polk
the company’s recently launched Inventory
Manager (IVM) 3.0.
for data cleansing services
Dealerships are embracing social media and The Reynolds and Reynolds Company
understand that being part of the online con- and R. L. Polk & Co. has announced an
sumer conversations is increasingly important. agreement for Reynolds to utilize Polk’s
Being involved in these conversations involves industry-leading automotive information and
listening. Once engaged, dealers know what data services. The agreement includes data
the needs are and are able to provide informa- enhancement services, list hygiene services,
tion accordingly. Dealer Lead Track and data suppression services (do not call
As a form of distribution, Twitter has been lists, for example).
integrated into Dealer Specialties recently provides dealerships “These services will help us serve our cus-
redesigned Inventory Manager (IVM) 3.0. real-time advertising data tomers more effectively and enable them to
IVM 3.0 was developed for scalability and operate with even more confidence in their
Dealer Lead Track utilizes advertising
made the quick-to-market launch of a dealership’s customer data,” said Trey Hiers,
information entered by sales staff determining
Twitter posting tool easy. Customers are now vice president of Corporate Marketing at
exactly which ad sources are producing sales
equipped through IVM 3.0 to expand their Reynolds and Reynolds. “Whether the dealer-
and which ad sources need to be eliminated,
vehicle specials, aged inventory and unique ship is using customer data for digital market-
saving thousands of dollars per month in
in-stock vehicles directly to an engaged and ing programs or service reminders, the ability
wasted ad spending.
relevant audience on Twitter. to target customers accurately, using reliable
Dealer Lead Track’s easy to use, stand
With an established Twitter account, deal- data that eliminates duplicate and out-of-date
alone web based lead management system
ers are empowered to select which vehicles to addresses, is a critical step.”
guides sales staff to capture which ad source
post on Twitter whether it’s their entire used Additionally, through the agreement,
is producing each lead in a drop down menu
vehicle inventory or specifically identified Reynolds will make available to its dealer-
asking “where the customer saw the vehicle
vehicles. “We recommend choosing vehicles ship customers the Polk Cross Sell reports,
advertised.” This advertiser drop down list
that consumers are talking about, vehicle which provide individual dealers with sell
is maintained by management so sales staff
specials and vehicles that are sought after by ratios compared to all dealers within a
selects from current advertisers.
a small interest group. Listing your whole given region.
Along with keeping advertising drop down
inventory in an effort to do an inventory blast “We are very excited to be working with
lists accurate, the total monthly ad budget is
is equivalent to spam,” says Glen Garvin, Reynolds and Reynolds to help their cus-
entered by management for each ad source.
Dealer Specialties group general manager of tomers more effectively leverage their infor-
With this information Dealer Lead Track’s
product and development. mation to extend their reach though tradi-
advertising report computes exact figures on
Obtaining access to the Twitter tool tional and digital marketing campaigns,”
how much ad spending each lead and sale
requires a customer only to activate the set- said Andrew Price, vice president, Polk
is costing dealerships to generate along with
ting under settings in IVM and add their Automotive Retail Solutions. “List enhance-
conversion ratios for all ad sources.
Twitter profile information. ment, hygiene and data suppression services,
Monitor Dealer Lead Track’s advertising
The Twitter post listing includes vehicle along with the Polk Cross Sell reports allow
report daily, weekly, or monthly to gauge the
information such as the year, make and model Reynolds’ dealers to utilize the most compre-
effectiveness of each ad source and quickly
with a shortened URL that takes potential hensive information available to maximize
shift advertising dollars away from sources
customers to the vehicle details page on their market opportunities.”
that aren’t producing sales. Ad sources that
GetAuto.com. Marketing messages that www.reyrey.com
just produce leads are ineffective. Ad sources
describe vehicle uniqueness are encouraged. www.polk.com
DD 4 March 2010 DigitalDealer-magazine.com
7. D IGITAL Dealer AAISP NOTES
Cliff Banks
Profitability – A Dirty Word Today?
“The retail system transaction pricing available? Several years ago, There’s some truth to the idea that dealers
needs to be fixed.” I I sat in a room with all of Group 1’s general priced themselves out of the long term service
hear this statement managers and Internet managers and watched as market years ago.
often. It’s always in they skewered a representative from Edmunds. A second school of thought comes from the
the context of how Now TruCar is trying to promote a product old car guys who argue we need to get every
consumers are fed that tells customers what similar vehicles in bit of reasonable profit we can from each deal.
up with the automotive buying process. Last their market area sold for. Dealers are complain- Why leave money on the table, they ask?
summer and fall, so-called experts were cor- ing the data isn’t accurate and that it puts them I believe the truth lies somewhere in the
relating the sales decline to consumer anger. in a tough spot when someone comes in with middle. There’s no doubt the old days are gone.
Trying to push a new way of selling —perhaps a printout claiming to have that information. Pollak is right on several levels. The home run
one-price selling (which isn’t a bad thing if done A popular dealership trainer recently deals are going to be extinct. And yes, dealer-
correctly), software that helps you develop a remarked to me that vAuto’s inventory man- ships need to work harder and more creatively
relationship with your customers, social media, agement tool is the most dangerous product to get customers in the door. But in many
palatial facilities with all sorts of amenities – to hit dealerships in years because it erodes ways, we’ve lost focus of what is important,
numerous consultants are claiming we need to profitability on each deal. and instead have put way too much emphasis
change how we sell cars. Dale Pollak, vAuto’s founder, argues the on the wrong things.
I’m not saying their thinking is devoid of any Internet arms the customer with so much infor- Car sales still are negotiation-based, which
truth, but the fact is, the unbelievable plunge in mation, the dealer is forced to price vehicles means there will be a winner and a loser in the
sales in 2008 was because of credit or the lack accordingly, or they won’t even be in the game. process. Frankly, customers need to lose, yet
thereof. It had nothing to do with consumer The classic home run (or lay down) deal is think they’ve won. It’s the dirty little secret,
angst of over visiting a dealership. Just a few becoming more and more rare because of the but it’s true.
years ago, we sold 17.1 million new vehicles web. Dealers now need to focus on developing And dealerships need to find ways to increase
under the same system we have today. If people a more consistent level of profitability on each the profitability on each deal. You can sell a
don’t like the experience at your store, they’ll vehicle, Pollak says. In other words, fewer home ton of vehicles but not make much money.
find another dealership. runs, but more doubles and singles. I’ve talked to way too many Toyota dealers the
In the last year, two sharply different schools The manufacturers, at least over the last last few weeks who have relied on volume who
of thought have emerged about the future of 10 years, have forced dealers to invest mil- are sweating because they’re not sure how they
the automotive sales process. The one defi- lions in new, more customer-friendly facilities. will survive if sales continue at the level they
nitely is more customer-friendly. So friendly, Yes, dealerships should be clean and com- are now. They aren’t making enough money
in fact, it seems to advocate the sacrificing of fortable, but do we really need to have that on each deal.
gross margin to keep customers happy. That’s $500,000 service department floor imported What makes a dealership successful hasn’t
a gross simplification, but in essence, that’s the from Germany? changed in 50 years. Answer the phone prop-
bottom line. OEM facility strategy, as much as anything, erly, work the deals, constantly train the sales
The Internet is driving a lot of this customer has hurt dealership profitability the last few staff on the proper selling methods, follow up
friendly focus. But the war on dealership prof- years. I have yet to see a study that proves pala- on leads – these are the basic blocking and tack-
itability began when President Eisenhower tial – or just new – facilities leads to any kind ling areas that good dealers focus on. Do the
implemented the interstate system, which of sustained sales increases. Maybe they exist, “little” things right and profitability will follow.
resulted in giving car buyers easier access to but I haven’t seen one. I’ll take a dealer who worries more about
more dealerships, new vehicle profits have been Another element is that facilities with the these areas, yet is ignorant about the latest
on the decline. latest amenities, selling processes that are friend- flashy things, such as social media, reputa-
Of course, J.D. Power and Associates had a lier means happier customers which means tion management, web-based advertising
lot to do with this by convincing automakers you’ll keep them through the life cycle of the and even long term customer-relationship
they needed to measure customer satisfaction vehicle. They’ll keep coming back for service management.
at their dealerships. Funny thing is, for years long after the warranty is up. That’s a popular
Buick was one of the leaders in CSI scores, sentiment, but I think it’s hogwash. Dealers
yet, its sales kept dropping. Toyota, who con- can’t compete on service-related pricing once
sistently scored low, became a sales juggernaut. the warranty is over. New car dealerships get
The Internet has pushed profitability down a significant portion of their service revenue Cliff Banks
even further by giving customers instant access from warranty payments from the OEM. And
to information which they use against you in the dealers have a lot of say in determining the Vice President and
shopping process. Remember Edmunds making labor time rates paid by the manufacturers. Editorial Director
DD 6 March 2010 DigitalDealer-magazine.com
8.
9. D IGITAL Dealer INTERNET SALES
Tom Mohr
A Darwinian Fight for Survival
Winning dealers know customers want price and want it quick
H
ere is a stark but simple fact: for seek their favor. Consumers do this because circle. Why? Because so few dealers can pull
the past year, the marketplace has they prefer to engage prospective dealerships it off.
offered fewer active buyers than from a distance until they have gained more Here’s the opportunity: customers want
needed to sustain the dealer community. A information and have built trust. Second, an a quick, information-rich response. If con-
Darwinian fight for survival proceeded; over increasing percentage of customers extend sumers do not receive a quick response, they
the past year an alarming number of dealers their remote engagement further by sending will walk away. A rapid, relevant response
went out of business. Those that have survived their first expression of interest (a lead) over increases sales.
this first shakeout have proven they can deal the Internet, to multiple dealerships. Dealers Speed is key, but it’s not the only important
with adversity. Going forward, those that who thrive in the midst of the shakeout will factor. Evolutionary advantage is also tied to
thrive must gain and cultivate an operation- have figured out how to seize advantage in the the content of the dealer’s message. Customers
ally persistent competitive edge. domain of the Internet customer. want the dealer’s price! Dealers who hide it
The moment of truth, of course, is the hurt their prospects for a sale.
How can a dealer leap into this point where the consumer has sent a lead to A Ford dealer in Dallas which uses an
evolutionary winner’s circle? 3-5 competing dealerships. The dealer who automated tool to achieve quick price quote
The answer to this life-or-death question is leaps in front of the pack and first initiates response recently received a note from a happy
hidden behind another: where do dealers have the courting ritual, then is gently persistent customer: “I am writing to you about my
the greatest opportunity to impact a buyer’s with insightful words and offers over time, recent purchase of a new truck at your dealer-
choice of dealership? This is key. If you know leaves his competitors clamoring in the dust. ship. Late one night I sent e-mails to several
the moment of truth—the moment when the Rapid response and effective follow-up are dealerships, the only e-mail I received that
customer is most open to a dealer’s courting the one-two punch that knocks out the other night was from your dealership. Not only was I
rituals—you gain a distinct advantage over guys. Experience shows that dealers who can surprised to get a reply that quickly, the e-mail
competitors. By closely observing the steps a deliver an immediate response with a price had several trucks with different options with
consumer goes through to buy a car, the point quote every time when a customer submits a prices on them. ….I will refer all my friends,
of maximum influence ability becomes clear. lead, and personalized follow-up every time family, and acquaintances to your dealership.”
Two incontrovertible facts guide us. First, when the customer doesn’t buy, will see at least A fast, relevant and transparent response
over 80% of car-buying customers use the a two percentage point increase in close rate is important in order to build customer
Internet to gain an information advantage on average. Get these two critical steps right confidence and trust. If delivered on every
as they prepare to interview dealers who and you’ve made the leap into the winner’s lead every time, a dealer will grow sales
significantly.
8TH Tom Mohr is CEO of ResponseLogix, and has
worked closely with auto dealers for 25 years.
Prior to ResponseLogix, Mohr was president of
Knight Ridder Digital, where he was on the
board of Cars.com.
CONFERENCE & EXPOSITION If you wish to discuss this article with
other dealers, or with the author,
Join us in Orlando!
please go to the “Discussion Forums”
at www.Dealer-communications.com
and enter the “Internet Sales” forum
or e-mail him at tmohr@Dealer-
www.DigitalDealerConference.com communications.com.
DD 8 March 2010 DigitalDealer-magazine.com
11. D IGITAL Dealer INTERNET SALES
George Nenni
Is Your Web Site Fully Optimized?
Effective SEO campaigns are more than just keywords and meta tags
I
t’s not news that search engine optimiza- of your web site reflect the brand of your Start with the basics, such as your contact
tion has been a hot topic in the automo- dealership. Remember, consistency is key. information, dealership history and inventory
tive industry for quite a while. You have Also, consider how your users will respond listings. Then take it a step further and include
probably spent a significant amount of time to the layout and functionality of your site. OEM-specific information and other details
throughout the last year learning SEO terms Will visitors notice your specials? Is searching that would interest customers such as parts
and best practices. You might have even come your inventory a quick and easy process? Do and services or credit components.
to the conclusion that creating a successful shoppers have the ability to compare several Shoppers also appreciate user reviews
SEO campaign can be somewhat overwhelm- vehicles at once, or the opportunity to build from existing customers. In fact, the New
ing—especially when you’re trying to beat their ideal car? Including useful tools that Autoshopper.com Study noted that about
everyone else to the top of search engine help shoppers find the cars that meet their 38% of online auto shoppers use these reviews
results pages. needs will make them more likely to make as a resource, and 87% of them believe the
Keep in mind that optimization isn’t simply their next vehicle purchase at your dealership. information was helpful during their shop-
about getting higher ranking or more traffic Another important piece of your online ping process.
to your web site. That’s just one piece of the presence is determining how you’re going Another sticky element you should always
puzzle. What good is a web site if shoppers to measure the web site’s success. As you are keep updated is your specials. According to
are leaving as soon as they get there? A site building your site, you need to set up an ana- Mintel’s Automotive Purchase Process, nearly
that is optimized well will not only attract lytics tool, such as Google Analytics, to get 80% of shoppers are online just to check
shoppers, but also keep them engaged in the insight into how users find your site and what vehicle prices. But, simply having a coupon
car search. Just as you can’t see the full image they do while there. Use this information to available on your web site won’t be enough
until all of the puzzle pieces are in place, your determine what keywords you should include generate leads. You have to make the specials
web site is not truly working for you unless in your page content. eye-catching, with a strong call to action.
you have tuned each part of it. Once you have collected and looked at the This web site content is important, but
One piece to think about when developing stats for your web site, evaluate the content. it becomes infinitely more useful when you
your web site is the design as it relates to your Make yourself the authority in the auto busi- optimize it. According to the most recent
dealership brand and what you have to offer ness by turning your web site into a one-stop Automotive Internet Shopper Study by J.D.
to car shoppers. Coordinate your design with shop for vehicle information, and consumers Power and Associates, 86% of auto shoppers
your logo and make sure the colors and layout will keep coming back to your web site. are going online to search for their next vehi-
cle. With so many people looking to dealer
websites for information, you need to make
yourself familiar with SEO basic best practices.
Go back to your analytics tool and see
which key words and phrases are driving
shoppers to your web site and adjust your
content to include that information. Avoid
stuffing your content with keywords as this
is frowned upon by search engines and will
lead to lower ranking for your site.
You can also create more indexable pages
for your site by optimizing your inventory
content. For example, you can insert alt text
on each of your images so search engines
will know more about the vehicles in the
pictures. You should also give your customers
continued to P-DD28
DD 10 March 2010 DigitalDealer-magazine.com
12. List It
Like You Mean It!
SEO Vehicle Display Pages
IOL Hosting now turns every Vehicle Display Page into a
content-rich, Search Engine Optimized (SEO) micro-website.
Dynamic, dealer inventory landing pages incorporate search
engine aggressive technology, so more buyers see your Leveraging Inventory
inventory and nd the car they’re looking for.
To Drive Sales
Video Online
HomeNet’s high quality Video Online can turn static
Title Sponsor
site-based ads intodynamic visual ads that generate
signi cantly greater emotional response while dramatically
increasing the optimization of your vehicle listings.
IOL 2Go
Create emotional ads faster, distribute them sooner, and save your dealership
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877-738-3313
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salesteam@homenetinc.com
13. D IGITAL Dealer INTERNET SALES
Brian Rabold
Put the Right Content on Your Site
Proven and emerging web site content to attract traffic and drive sales
I
n today’s market, before a buyer ever content like full-motion vehicle video and is also a hot topic right now. Analysts estimate
steps into your store you can bet they’ve third-party ratings and reviews. that smartphones will outnumber PCs by
checked out your dealership online. A Detailed content has the added benefit of 2011, meaning consumers are increasingly
recent Zogby International survey commis- being keyword rich, which is essential to a likely to use their phones to research your
sioned by Chrome Systems found that 86% solid search engine optimization (SEO) strat- dealership. Just remember that most shop-
of vehicle buyers research their vehicle online egy. The Chrome survey found that 54% of pers turn to their mobile phone when they
before purchasing or leasing. respondents use search engines as an integral are further along in their research and want
Once on a dealer’s site, the top three things part of their automotive shopping experi- specific information; they typically don’t want
that most influenced a consumer to buy or ence, and robust content can help push your to peruse your entire site. The Chrome survey
lease were: price with preferred equipment inventory to the top of search engine results. found that of those who use their phones in
selections (56%); the ability to find a vehicle Microsites created to appeal to a niche market the shopping process, the majority (55%) use
that matched needs in inventory (57%); and or to promote a special are also a great way them to locate a nearby dealer, 54% search for
that the vehicle looked best in side-by-side to boost SEO, and they are relatively quick available makes and models and 37% search
comparisons (41%). Obviously, research- to build. vehicle inventory.
orientated content is king online. You can One last opportunity is social media sites.
compete online by creating a web site that Emerging web site trends Primarily brand builders, sites like Twitter and
meets consumer demand with proven and and opportunities Facebook are an effective way to connect with
emerging content. There are several emerging trends and current and future customers. Remember
opportunities that can also drive addi- that if you start, you have to be committed
Proven content that drives tional leads and sales. Consider needs-based to continuing. If you let your social media
leads and sales searches. Traditional year, make, model efforts wither on the vine, they can ultimately
Your success begins with complete vehicle searches are car-centric, forcing consum- hurt your dealership brand.
descriptions. While this may sound like a ers to have some familiarity with a vehicle. Taking advantage of strong content and
no-brainer, compelling descriptions contain Needs-based searches are consumer-centric, recognizing the value of emerging trends
much more than just a price and equipment allowing shoppers to search based on their can help you compete online by meeting
list. Look beyond simple year, make, model, needs and wants. Whether in the form of a the demands of today’s Internet-savvy and
and trim listings and instead deliver detailed set of questions or a series of criteria, these well-informed consumers. Get started today
information like full descriptions of optional searches can showcase inventory a consumer and stay ahead of your competition.
and standard equipment, safety features and may not have considered before, and build
ratings, dimensions, specifications, warranty engagement with your site. If you’re mindful As senior Internet product marketing strategist
information, and aftermarket designations. of your site, you can also capture analytics to for Chrome, Brian Rabold helps dealerships of
You may not think consumers want this determine the most common searches and all sizes identify and implement new online
level of detail, but remember, the Internet build customer profiles. technology and enhancements to increase brand
can make anyone a vehicle expert. Estimated to be over a $32 billion industry, awareness, generate leads, and drive sales.
With 41% of consumers looking to accessories are emerging as the new profit
comparisons to help them make a vehicle center. Tap into your customers’ desire for If you wish to discuss this article with
purchase, you have to link your inventory personalization by featuring accessories on other dealers, or with the author,
to your configuration and comparison tool. your web site. Integrated into your configura- please go to the “Discussion Forums”
Comparisons can highlight your brand tion tool for easy consumer access and view- at www.Dealer-communications.com
advantage, and you can decide how much or ing, accessories can add hundreds of dollars and enter the “Internet Sales” forum
how little vehicle detail to return. Round out to every deal. or e-mail him at brabold@Dealer-
a comprehensive description with on-demand Mobile optimization of dealership web sites communications.com.
DD 12 March 2010 DigitalDealer-magazine.com
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15. COVER STORY
Joe Orr
General Manager
Dick Hannah Honda
DD 14 March 2010 DigitalDealer-magazine.com
16. With more than 20 years in the dealership business, Joe Orr, of Dick
Hannah Honda, is redefining the role of general manager in the 21st century.
He’s a freak about the numbers and holds his vendors accountable. He knows
where the traffic is coming from but he’s also a master at finding new ways to
generate sales. Once a skeptic of online reviews, Orr changed his tune and is
using reviews to create hundreds of sales. He’s also willing to share his secrets.
We sat down with him recently to learn more about his success.
The Dick Hannah Group is one of the price and miles of every competitive car just them to have all of that information, we are
largest groups in the Northwest. like it within 100 miles. So we are trying to practicing transparency.
Orr: Dick Hannah has been around since give the customers exactly what they are look-
1949 and is now a third generation dealership. ing for. A one-stop shopping place so they can How much do you do with the Internet
There was Bill Hannah, then Dick Hannah, actually trust us. We got the vAuto cutout of and social media with those two stores?
and now Jason and Jennifer Hannah. every one of the cars so they can see, when Orr: Well what’s interesting is that at the
last Digital Dealer conference, I met Mike
I’ve been here 20 years. I have always been Fitzpatrick with Dealer Trend. They build
“Once in a while I will do
at the Honda store, I managed most of the microsites, they do WordPress, they can
stores here at one time or another but have a TV campaign, where I let send a specific piece of inventory through a
always had the Honda store. WordPress news blog so it actually becomes
the customers talk about SEO relevant.
Right now I am the general manager of the
Honda store and two used car superstores. their experiences and the We have been working with him since
They’re called “Dick Says Yes Stores.” They the show and have created seven microsites:
were big into special finance but now we are online reviews about our three for the Honda store and two for the
trying to move away from that. We focused Vancouver Used Car Superstore and two for
on it when special finance was high. pricing model and how our Albany Used Car Superstore.
we differentiate ourselves
I was the first one who came up with that The goal, the sole focus is to get these
name and then it seemed like the whole coun- from other car dealers.” microsites on the first page of the most traf-
try came out with something that says “Yes.” ficked automotive searches in Oregon and
It was all over the place. —Joe Orr Washington. And I think we are one of the
first dealerships in the country to actually use
But now we are trying to repurpose the this technology. I really got excited about it
word “Yes,” to a campaign about transpar- they walk onto our lot, if they are looking at a at Digital Dealer.
ency. We show the customers, “Yes” to over 2008 Accord LX, they can see on the window
500 used cars, “Yes” to not showing you only there are nine within 100 miles, see the miles How does that work? Every piece of inven-
the price and miles of our car, but also the and the price of all of those vehicles. We want tory has its own WordPress blog?
DigitalDealer-magazine.com March 2010 DD 15
17. Orr: Yes. If I enter a piece of inventory can share the results of the study we’ve done My main concern as a general manager is
in today, like a 2007 Chevy S10 pickup, it with you. Here is my process, and this is from the overall performance for all my stores. I
goes through his technology and becomes a my perspective of how it works and here is focus on new technologies. True statement:
WordPress new release, but actually is just a my analytics, ROI and store benefits, and I every general manager in our corporation,
detailed inventory page. And it ties back into want to take from them their perspective of except one, worked here at the Honda store
my microsite for that store and should show how we could make it even better and then with myself and Marty Green (corporate
up if anyone is searching for it. People do also be on the receiving end of all their ideas GM). The Honda store is kind of the incu-
now search for a “Chevy S10 Oregon.” We that have real results tied to them. bator. It’s the mothership.
just released that just a few days ago and are
looking forward to the analytics. Imagine, if we had one top digital mind from From what I’ve read, your numbers are
every 250-mile radius, you would have a lot of astounding.
Are you doing any social media for your dealers who can share. We have our hands full Orr: The amount of traffic we get now is
used cars? as dealers, and if we build relationships with phenomenal from the Internet.
Orr: We are creating a blog that we have each other and share successes and failures, it
not done yet. It is called “Living in the couve” would be a huge step forward digitally for us all. I started doing search engine optimization
and is about living in Vancouver. It will be in 1999, before it was cool. I was impressed
automotive focused — spy photos, automo- How did you get into the business? with Google. I actually ended up getting a
tive press releases — we will be releasing that Orr: My grandfather sold cars and owned hold of the VP of Exteres Auto and told him
shortly, but right now we have our hands full. some dealerships. At 17 I started selling cars my store could be a test store for him if he
– I lied about my age. When I finished high could do for me what no other SEO company
How time consuming is it? school, I worked at the Volkswagen dealer had been able to.
Orr: The microsites are a lot of work. It is from 1 pm to 8 pm five nights a week to sell.
not simply pushing buttons anymore to get They found out how young I was and I only We focused on getting first place page
what you want, but is it worth it? had two months until I turned 18, so they placements on all search words/phrases for
let me stay on. “service” “parts” and “sales.” They created an
I have factual data that proves while I’ve cut algorithm to help us track it.
a lot of my expenses – and I do see all of the My first paycheck I made $3,500 — my
other dealerships financials in my area — I am dad never made over $2,500, 36 years on the In 2006 we averaged 321 Internet gener-
spending less and making more. We have also job. I cashed it and stuck it in my pocket. ated calls per month for sales, service and
moved up the ranks from fourth to second The next day I was buying everything for parts. That year, we were spending $5,500
in our district. everybody in school. I felt like I was Tom per month on PPC (pay-per-click) alone.
Cruise. Those were fun days. In 2007, I began getting on the first page of
With new we are number one, so we must search results. In January 2008, we reduced
be doing something right. Is it worth it? It is Did you go to college? our $6,000 to $500 and my calls went
hard when my team creates the data from our Orr: I went into the military. But after from 321 per month to (I am a freak about
built daily processes. It is much easier when seven months, I got kicked out for getting accountability and on every page of my web
I can hire someone else to do the data, and I into a fight with the same officer twice. Then site I have a separate tracker for sales, service
have done a lot of that too. That’s why I would they caught me with a fake ID —I was just a and parts. These are factual numbers) 565
like to see web-based 20 groups with the top hellion back then. And they kicked me out. per month in 2007, and then to 663 the next
Internet dealers in the country. I went right back into car sales. year, and over 800 in 2009.
Aren’t you worried about the competition As the general manager of the Honda store, These are just Internet-generated calls from
seeing your secrets? what kind of things do you do on the fixed the web site. That has nothing to do with my
Orr: We have so much to share, so many operations side using the Internet? other initiatives. Every year we reduce our
secrets and that’s what I am really going to Orr: I do the same as any general man- ad spend on radio, TV and newspapers – on
start talking about, why do we have secrets. ager. I have an advantage here, I have Gary which we do close to nothing anymore. Once
Why do we let others (mostly third parties) Schuler. He is the corporate fixed operations in a while I will do a TV campaign, where I let
tell us what does and doesn’t work, when we manager. He was actually a top notch fixed the customers talk about their experiences and
know, we have the real data, and we have the operations consultant prior to his employ- the online reviews about our pricing model
real life results? ment at the Hannah’s. So he has taken on a and how we differentiate ourselves from other
lot of responsibilities for a lot of our general car dealers.
Within our stores we have had big suc- managers here. Probably the most talented
cesses and failures. Let’s share both with each fixed operations trainer in the country. We So, you stop paying the $5,500 a month
other. There are a lot of things we can do. I have learned a lot from him. in PPC, and got it down to $550 a month
DD 16 March 2010 DigitalDealer-magazine.com
18. and your calls skyrocket? together a compilation of actual data that prepare for the digital revolution. I am watching
Orr: Correct. We realize people are at a we gathered over the entire year of 2009 prov- my dealer friends facing having to close their
point where they trust organic search results ing beyond a shadow of doubt the power of doors. I think it is time we joined efforts as a
more than the paid. online reviews and the fact that consumers professional family and help each other out.
trust each other way more than the dealer.
The SEO results are an accomplishment I am also going to hand out a step by step jorr@Dealer-communications.com
and we can prove it with the data. When we playbook on how to get these results and
started no one got the results we did. We watch the very culture of your store change
demanded the information and results from for the positive.
my SEO company and were not negotiable
DEALERSHIP
on our demands, and they never said any- This really drives home how dealerships PARTNERS IN PROFIT
thing was impossible (I liked that). Once can and should market in the 21st century.
we achieved our goals and reporting needs, Orr: Yes. In August 2009 we received
they could offer the SEO product to other unique 188 calls from the review sites. To
dealerships outside of my area – but we are track ROI, let’s say I spend $55 advertising Dealership name:
exclusive in our area. dollars per call so run the numbers — 188 Dick Hannah Honda
X $55 equals: $10,340.
What about dealership online reviews? You
seem to have had a lot success with them. The bottom line is, I pay nothing for Internet leadproviders:
Orr: I have to give props to my old Internet this. I get 188 unique calls from Internet
Dealix
manager (Merla Turner). She was beating me consumers who see we have 1000 reviews.
up about review sites. In January 2008, we We have a 4.9 ranking (five being the best). AutoTrader.com
had five reviews and a two star average. She They let the current customers tell them how Cars.com
said we have to change it. great we are. Some of them have driven 300
miles to buy cars from us. There is no better
After five to six months we spent hundreds advertising than word of mouth — and this F&I tools:
of hours getting on all of the directories and is the cheapest, most effective word of mouth
review sites and creating processes that actu- advertising available.
DealerTrack
ally got us results. Most of the directories have
now adopted the review sites. If you cannot Concerning our web site visitors, we are Web site provider:
beat them...join them! addicted to understanding where they come
from. Between Google analytics, your indi- DealerPeak
A lot of the information out there on the vidual trackable 800 numbers and your web
directories is wrong or is sloppy. We spent provider, it is just sitting down and doing the
hours putting our right information and math. It was eye-opening for me — 48% of
trackable 800 numbers, pictures, hours and our traffic comes from organic SEO. DMS provider:
service guarantees on these sites. Then we
Reynolds and Reynolds
began tracking the analytics and developed On 82% of what has been deemed the top
a process for managing it. service, parts and sales searches for my brand
(Honda) I am on the first page. That repre- Auctions:
Over time, the call volume start going up. sents over 1,000 searches when you add 10
We put different trackable 800 numbers on unique cities to all those top searches. My near- Manheim
each review site, including Google and city est competitor is at 13%. I am just crushing
search. We wanted to be on all of them. them. I also see my competitors SEO reports Adesa
every month, I know where they are; they don’t Black Book
In 2009, we had over 1,000 calls produced even know.
from the review sites alone. Once we fig- Livelane.com
ured out the management heavy successful You seem willing to share what you’ve
process and mapped it, Exteres automated learned.
it for us. Orr: I’ve made it my personal mission to learn CRM program:
from the top digital dealers that really under- Contact Manager
As we get more and more reviews, we get stand how this industry is changing and get
more calls from consumers. For the spring them into an Internet 20 group of sort and really
Digital Dealer conference, I am putting help each other transform our dealerships and
DigitalDealer-magazine.com March 2010 DD 17
19. D IGITAL Dealer INTERNET SALES
Rob Lange
Quick Tips to Improve Online
Pre-owned Sales
Creative merchandising of inventory improves sale chances
W
e’re well into the first quarter, but 1. Minimize, simplify vehicle capture competitive data immediately available.
it’s never too late to tweak our and updating time To maximize turn times and hold gross
annual goals. At the very least we Employ an upload process and make it a price, your vehicle must be competitive
all can use a reminder of the basics that got standard operating procedure for your dealer- to others in the market right from the
us to where we are today. ship. There are tools that make it easy to edit outset. There are several great tools avail-
Think back to your first days in the car vehicle data as well as integrate with your able providing you a quick snapshot or
business. You were constantly reminded not DMS polling to ensure accuracy. detailed information on similar vehicles
to cut corners in your dealership’s sales pro- currently available, such as, CDMdata’s
cess. You were drilled on the five to seven 2. Minimize time to market Market Pricing.
steps that need to occur with every customer Upload vehicles prior to reconditioning
to give yourself the greatest chance of selling so they’re immediately visible. Days that 6. Display the right quantity
a car. Sometimes we were amazed to witness are wasted waiting for cars to be frontline of high-quality photos
the quick success of new salespeople, while ready before posting them online equate to How many is enough? Customers
old timers struggled. But when we thought lost sales. tell us that 16 to 36 photos allow them
about it, the answer was simple. They didn’t enough visual information, raising com-
use shortcuts, instead, they followed the same 3. Maximize distribution fort levels, eliminating less desirable or
proven steps with each customer every time You must have your inventory posted on poorly advertised vehicles from consid-
and it worked. the most visited sites used by online shop- eration and making them more likely to
pers, your local sites, niche, second tier and move to one particular vehicle or dealer’s
classified sites. Select a solution that allows direction.
easy distribution to all of these types of sites,
“Sometimes we were including eBay and Craigslist. 7. Reinforce consumer trust with
amazed to witness the branded window stickers
4. Maximize content Customized window stickers for CPO
quick success of new There’s no such thing as too much informa- vehicles from your dealership or Kelley Blue
tion. Each listing should have accurate vehicle Book provide a level of professionalism and
salespeople, while old data on standard and optional features cross instills confidence in customers.
referenced against Kelley Blue Book, Chrome The first thing to do is shore up the dealer-
timers struggled.” and Polk. Also, dealers should provide access ship’s marketing foundation with these help-
to vehicle history reports, designation as a ful hints, and then use other creative ideas
—Rob Lange “one owner” vehicle when confirmed, per- to catch the eye of the discriminating online
sonalized seller’s notes to accentuate the posi- shopper to sell more cars.
tive and suggest mental ownership, a pricing
comparison between suggested retail and your Rob Lange is the national sales training director
selling price to show savings to the consumer. for Kelley Blue Book.
Well, the same holds true with online sales If there is one small thing that will make a
efforts. More than 80% of customers use the difference, it is making sure you have great, If you wish to discuss this article with
Internet to shop and last year more than 60% customized seller’s notes on each vehicle to other dealers, or with the author, please
actually found the car they purchased online strike a nerve with any customer’s hot buttons. go to the “Discussion Forums” at www.
first, rather than on a dealer’s lot. Because Dealer-communications.com and enter
that is the case, this is a good time to review 5. Price competitively the “Internet Sales” forum or e-mail him
what the most successful dealers do to present Although price is not the end all to at rlange@Dealer-communications.com.
inventory in a way that increases the chance most purchase decisions, customers are
for a sale. well informed and have access to a lot of
DD 18 March 2010 DigitalDealer-magazine.com
21. D IGITAL Dealer VENDOR PROFILE
Over 3 Million Chats and Counting:
ActivEngage Shatters Online Communication Boundaries with
Personalized Live Chat and Dealership Marketing Intelligence
Overview and history proactive live chat that uses business intelligence to offer shop-
Long gone are the days when just having a static dealership pers just the right message, at just the right time. Most dealers
web site was enough to provide automotive consumers an are also very pleasantly surprised to find that shoppers use chat
engaging online shopping experience. The dealership Web for more than just vehicle sales information. Consumers schedule
site should not be a billboard: lifeless, boring, unpersuasive. An service appointments, purchase parts, get F&I details and more.
online billboard may have been fine 10 years ago, or even five
years ago, but in today’s competitive automotive marketplace With all this in mind, automotive industry veterans and technol-
shoppers simply expect more. Consumers want a more inter- ogy experts Ted Rubin and Todd Smith, founded ActivEngage
active, dynamic experience and the ability to have questions in 2007 to support automotive consumers’ growing need for
answered instantly, while they are on the dealership Web site. more interactive experiences on dealership Web sites. In fact,
Further, while phone and e-mail still have their place in the Smith learned the power of live chat first-hand while he was
repertoire of sales channels, consumers increasingly demand a running his own Chevrolet dealership back in 2006. He began
faster way to ask questions and get more detailed information using chat on the dealership Web site and started generating
when shopping online. leads within minutes of use, and has his first car sale by the end
of the next day. However, as he learned more and became more
Online connectivity is the key as consumers seek information on proficient in the medium, he realized that the available chat
Facebook, Craigslist, eBay, newsletters, retail web sites, microsites software and services were not well suited for the unique needs
and more. The ability to connect and engage shoppers on any of auto dealerships. He was convinced that there had to be a
relevant online locations differentiates progressive dealerships better option, more in tune with automotive shoppers’ needs.
that actively reach consumers, from old school passive businesses He partnered with long-time colleague Rubin in early 2006 to
that merely watch as the world passes them by. It may be hard to develop advanced chat software specifically designed for deal-
believe, but e-mail is now considered too “slow” for a growing erships. They pooled their vast knowledge and experience to
percentage of the population participating in online shopping. create the ActivEngage live chat solution and conducted over a
In addition, many people are very reluctant to call dealerships year’s worth of development and “dogfooding” in dealerships
because they may have had an uncomfortable experience with of all sizes and types. When the software and services were
an overly aggressive sales person on the phone, or been routed perfected and outstanding results consistently achieved across
through an endless maze of automated phone menus only to all dealerships, Smith and Rubin made ActivEngage available
have no one respond to their calls. for dealerships in 2007.
Consumers want instant gratification online and progressive As live chat technology and best practices continue to develop,
dealers are now offering this at their dealership Web site, with ActivEngage continuously evolves with them. Today, the
DD 20 March 2010 DigitalDealer-magazine.com
22. company manages an average of 200,000 chats for dealers dealerships that already have well-developed chat teams, but
each month. This gives the service a competitive advantage that still want a back-up support system. Since chat abandonment
other suppliers cannot match because no other provider has the triples if it takes longer than 15 seconds to start a chat, it is
unique combination of industry specificity and high chat volume. crucial to greet site visitors quickly. If a dealership staff member
What began in a single dealership now provides dealerships can’t reach a customer within five seconds, an ActivEngage
across North America an interactive web site edge that increases representative will pick up the conversation and deliver the
both lead generation and sales. Shoppers consistently praise the results to the dealership. The service ensures that no ups are
service they receive on the dealers’ web sites and cite the fast, missed on the web site by always monitoring site visitors’ activity.
friendly service as a key reason for choosing dealerships. This
creates a powerful first impression and a “wow factor” that ActivSite helps dealerships begin online chat conversations
are simply not possible without the service. ActivEngage staff with a software solution built specifically for auto dealers. The
members continually train on general industry and product easy to use chat console lets the dealership begin engaging
knowledge, as well as each dealership’s individual store promo- automotive web site shoppers in the first day of use. ActivSite
tions and specials, to ensure a seamless chat experience for all pushes the web site to the next level by using the dealership’s
shoppers. The main goal is to push the technology and service best salespeople on the web site to greet every visitor. The
boundaries of online communication for dealerships. combination of ActivSite technology and the dealership sales
team gives dealers control of meeting and greeting online
shoppers. Taking virtual ups at the web site drives more traffic
Three powerful chat service levels to the showroom. Using ActivSite can easily double the amount
ActivConcierge is the industry’s premier proactive live chat ser- of leads generated from the existing dealership Web site.
vice. Within the first day of deploying ActivConcierge on the
dealership web site, additional leads are generated by turning
web site browsers into active sales leads. ActivEngage’s highly Leading features
trained virtual sales team proactively engages all web site visi- ActivTestDrive leverages ActivEngage’s chat services with a
tors. Proprietary business intelligence also guides the conver- unique virtual test drive experience that leads shoppers through
sation for optimum results. Further, ActivConcierge includes a powerful online sales experience, combining a chat conversa-
seamless integration of important shopper information, includ- tion with video and detailed product information. Using chat
ing the complete conversation transcript, with all CRMs and on the dealership web site is a powerful first step in engaging
ILMs. ActivConcierge impacts the dealership immediately by more web site visitors into a conversation. ActivTestDrive now
creating a conversational web site, multiplying the amount lets dealers move customers through the unique Virtual Sales
of leads the site generates, with no additional work required Process to turn information seekers into buyers, and includes
from the dealership. engaging custom videos for every make and model. Test drives
sell cars at the dealership and ActivTestDrive sells them online.
ActivGuardian offers dealerships that choose to manage chat
in-house additional support to ensure that all chats receive ActivProspect lets dealers identify web site shoppers with par-
fast, professional responses. ActivGuardian is the solution for ticular characteristics or behavior patterns. Dealer are able to
Todd L. Smith, President Ted Rubin, Executive Vice President
Todd is co-founder and president of ActivEngage, Ted Rubin, a co-founder of ActivEngage, Inc.,
Inc., the automotive industry’s leading live chat is a leading expert on business development,
service provider. Todd has spent the last 20 years Internet process and technology in the automo-
in the automotive industry and has worked in every tive industry. He began his career in the automo-
facet of dealership operations in numerous roles, including general tive industry and has held virtually every position available both
manager. He has also developed cutting edge eBusiness, BDC and in dealership sales and service departments. He has worked with
showroom sales solutions for a variety of clients including Ford, dealers, manufacturers and vendors to develop sales strategies,
Ford of Canada, AutoNation, Budget Car Sales, Maritz Inc, Mazda business development and training, including: Toyota Motor
North America, Toyota Motors Sales and ADP AutoTrader.com. Sales, Volkswagen, Renault, Reynolds & Reynolds, AutoNation,
He is a frequent speaker at national industry conferences and a Inc. and DealerUps.
regular contributor to industry trade journals.
DigitalDealer-magazine.com March 2010 DD 21
23. set parameters based number of visits, simultaneously viewing pages and videos, are most useful for the dealership. Dealers
pages viewed, order of page views, based on shoppers’ needs. Sending a link can see what works and what doesn’t, at
viewing time, specific pages, number of to a shopper using an instant messenger any given time.
pages, time spent on site, and more. Then, service is one thing, but controlled co-
dealers can send proactive custom mes- browsing is what makes ActivEngage’s
sages, based on this customer’s shopping enterprise chat software that much more Results and what dealers say about
behavior, enabling dealers to track and powerful. Shop With Me Technology lets ActivEngage
target the hottest prospects, spending dealers lead shoppers around their web “Everyone loves our live chat with
more time with shoppers who are most site, explain things as they go, and gives ActivEngage, both our staff and our site
likely to convert, and less time with casual the dealer a powerful online presenta- visitors,” stated Alex Snyder, eCommerce
browsers. Driving lots of traffic to the tion. This allows the dealer to create a director for Checkered Flag Automotive
dealership Web site can be great, but it true online sales process, with an interac- Group. “Like it or not, the reality is that
can also be a distraction if visitors are not tive experience similar to the showroom. people visit dealership web sites during
good prospects. ActivProspect helps deal- their work day; I think about 95% of our
ers focus their attention on site visitors Reporting includes over 75-plus reports, chats are from people who are at work.
who are ready to buy. letting dealers examine how shoppers Many companies monitor employee email
use their web site on a granular level, and often other people can hear phone
GeoTargeting enables dealers to identity including: total visits, new visits, return- conversations at work. Chat is generally
shoppers’ geographic locations, whether ing visits, prospects, individual shopper not monitored and it’s silent. Really, it’s
they are in their local area, across the click paths, keywords that convert to chat a perfect method for consumers to get
nation, or even a competitor checking conversations, missed chat requests, and information.” Within two months of
out their web site. GeoTargeting gives more. Easy to read, the reports allow the deploying the ActivEngage solution, chat
dealers insight into their online approach, dealer to run their Internet marketing to sales conversion increased by 150%.
especially if they are a dealership that will business more effectively and efficiently.
give more aggressive pricing to a shop- Referring web site information is also Jenkins Automotive Group eCommerce
per outside their local market. Dealers tracked with detailed information to director Jose Alonso commented, “Chat
can then create specific messages based determine the quality of traffic from dif- is the ‘missing link’ for our industry right
on the geographic location of potential ferent sources. Web sites tracked include, now and ActivEngage’s live chat is what
buyers. Google, AutoTrader, Cars.com, Bing, we’ve been waiting for; it’s interactive
Yahoo, AdWords or any other referring and instantaneous. Web site visitors just
Shop With Me Technology also allows sites, Further, all data can be monitored love it, regardless of the franchise or
dealers to create a more powerful, per- in real-time, with reporting available on- demographic. People are at your web
sonalized online sales experience by the-fly, based on the time parameters that site right now, hundreds of them, and
that is where dealers should be commu-
nicating with consumers. ActivEngage’s
service is outstanding and they offer all
5 Tips to Make Chat Work at your Dealership the advanced features that no other chat
1. Build rapport upfront with the shopper before you try to service provides.” Further, within the first
month of use of ActivEngage, the group
convert them to an appointment.
increased web traffic, web site lead gen-
eration and online sales by an average
2. Personalize the experience every place you can for the shopper. of 50%.
Todd Cole, Bill Dube Hyundai Internet
3. Walk the shopper through a step by step sales experience
director, added, “Customers on the web
similar to what you do on the showroom floor. site like the instant gratification that live
chat provides. Shoppers have questions
and want more information. It makes
4. Make it interactive by using video and chat together for a
a great first impression and begins the
powerful presentation. relationship before the shopper ever sets
foot in the dealership, or even makes a
phone call or sends an e-mail. It’s simply
5. Deliver at least one ‘wow’ moment for the shopper during
the best lead generating tool out there.”
the chat experience. Vehicle sales have doubled since Todd
began the serious Internet initiatives,
including ActivEngage, last year.
DD 22 March 2010 DigitalDealer-magazine.com
24. D IGITAL Dealer TECHNOLOGY TRENDS
Sandi Jerome
Making Profit with your IT Department
F
or many years, a major DMS provider many phone systems have a server! 2. Is the product user-friendly?
would sell their system on the claim For many years, I have recommended that 3. What type of customer service, training,
that if they switched to their system, a your IT department be more focused on and support does the DMS provider offer?”
dealership could reduce office staff by 50%. providing profit generating services, rather “The primary IT-related factor that requires
The latest claim that’s been going around has than supporting the DMS. You already consideration is the cost to install, maintain,
been if you get an ASP solution, you can get pay a pretty penny to your DMS provider and support the system. Maintenance and
rid of your IT department. monthly, so why would you also pay for an support can be an extremely costly endeavor.
Since DealerTrack is one of the most IT staff to answer and funnel support calls Depending on the DMS it chooses, the deal-
popular ASP solutions, I decided to ask through to the DMS provider? I can’t tell ership may need to purchase or upgrade its
DealerTrack’s Jon Reese about IT departments you how many times I’ve spoken to control- servers and computers, and employ additional
and their involvement in DMS services. ler groups that have told me that their IT IT staff. The IT department also needs to
When asked how involved should the IT department requires that all DMS support determine whether the system can integrate
department be in maintaining the DMS, goes through them. with other software solutions being used in
Jon responded, “Jim Collins, the author of their sales and service process. Unfortunately,
Good to Great, explains that good companies “Nobody knows there are several DMS providers that attempt
become great by focusing on what they do to eliminate integration with third party soft-
best. The same is true with a car dealership. your database as well ware providers, in support of their own soft-
Dealerships should focus on what they do ware offerings.”
best, selling cars, and not be required to spend as your IT staff.” I agree with Jon on the movement by some
time and resources supporting an IT infra- DMS providers to squeeze out third party
—Sandi Jerome
structure needed to host, maintain and update providers. There were over 100 technology
their DMS system. If a dealership focuses on companies exhibiting at NADA that depend
what they do best, selling cars, and employs What are profit generating services? on the data from your DMS database to pro-
the DealerTrack DMS to assist them in the Database mining and database cleaning is vide you with fantastic ways to stay to sell
management of their operation and work- profit generating. Nobody knows your data- and service more vehicles. At the 8th Digital
flow, they could potentially eliminate all of base as well as your IT staff. They should be Dealer conference this month in Orlando,
their IT department expenses. DealerTrack’s regularly finding ways to use that database to I’ll be discussing ways to use that database to
web-based DMS eliminates the need for serv- help employees sell and service more vehicles. make money with data mining, so consider
ers, expensive hardware, continuous software A good IT department can reduce outsourc- sending someone from your IT department
updates and that on-call guy needed to keep ing repair costs and find the best buys for to learn how to become more profit focused.
things running smoothly. All that is needed the software you need – including your next
are computers and Internet access.” DMS system. Sandi Jerome is a former controller, CFO, system
I agree with Jon, that a web-based solution When I asked Jon about the IT depart- administrator, F&I, assistant GM, and fixed
can remove many server headaches, espe- ment’s involvement in selection, he replied, operations manager with over 20 years experi-
cially if you’re involved in a flood, hurricane, “Users of the DMS and the dealership’s IT ence in the automotive industry. She is the owner
earthquake, fire, tornado, etc. But, before you department should both be involved in the of Sandi Jerome Computer Consulting.
start firing your IT department because you’re selection of the dealership’s DMS. However,
getting an ASP solution, consider the fact that it is imperative that users’ needs be considered If you wish to discuss this article with
we do need computers for more than just our first and foremost. Users are more aware of other dealers, or with the author, please
DMS. It also seems like every employee now the dealership’s business needs and are better go to the “Discussion Forums” at www.
needs a computer on their desk – which is a able to evaluate whether and how a DMS Dealer-communications.com and enter
tremendous load on your IT staff along with meets those requirements. They should ask: the “Technology” forum or e-mail her at
all the various software and servers for CRM, 1. Is the DMS robust enough to handle all sjerome@Dealer-communications.com.
leasing, credit bureaus, manufacturers – even of our unique requirements?
DigitalDealer-magazine.com March 2010 DD 23
