Great question and one that is highly debatable and sometimes touches a nerve. I have studied this issue for some time now, done a variety of tests and would like to share what I know through that research.

First dealer group I had this issue with was, believe it or not, a "One Price" dealer. Why this was an issue was because we would mark vehicles up an honestly modest amount on the lot and once there, the ambience of the dealership did the rest.

We did not negotiate period on lot ups. So we would apply the same thing online, received a lot of leads, but everyone wanted a "deal" or to make one. We literally applied the same lot philosophy and would let people walk over a few hundred dollars.

Even though these vehicles were very competitively priced, it would turn the Internet customer off. We couldn't sell our ambience through the Internet and the fact that we wouldn't negotiate turned a ton of people off. Plus, by putting ONE PRICE, NON-NEGOTIABLE in the comments field as per the Managers, it dramatically reduced our traffic.

The second stint is with another dealer group (I am with now) that had an entirely different philosophy. They made all the money and the asked for even more.

45 Pontiac G6s is a 30 mile radius, with average median asking price of $15,900 and we were asking $18,781. Yeah we offer a free warranty, but still, we are way off base on pricing typically.

So I pleaded with the owners to allow me to price all the vehicles online. They allowed me to price their inventory online and while I still ask for the money, per their request, it is not so dramatic.

Now the reason I tell you all this is because at the end of the day, I am selling the same amount of vehicles as the previous price driven dealer that is in the same market as I am.

This blew me away as well. Two totally different models and I was always preaching price and still do to some extent. Taking prices off does NOT work. Do NOT do it, trust me, your perceived traffic will go up with junk leads.

So how did I adjust to handle being the highest priced dealer in the DMA?

1. We put killer pictures online and try to give a virtual "walk around".
2. We price everything and don't apologize for it.
3. We put custom comments on most vehicles, and include things like, one owner, four new matching tires, timing belt replaced...
4. Our goal is to make the online experience killer; fast responses, fun stuff on website (see Alex's site) and cool tech stuff (see Brian's AI dealer).

O.k., we have all heard this stuff before..

Alright, here is some of my secret formula:

On the third party sites, put your web site in the comments FIRST. They might frown on it a bit, but most track the dealer site click throughs and you can cross reference it with your referring sites software for your site.

I use things like go to my URL to see specials and receive $200 off this price, just for visiting.

Get a Internet coupon! Big props to DealerImpact, but most site builders have some type of coupon, but make sure they have to fill out applicable fields to receive it.

Now later in the custom comments, I say see my ISM (insert name here) and DOUBLE your Internet coupon!

78% of my Internet sales per month and 37% of the total group's sales hit the coupon. I get the name, phone number, and e-mail address 93% of the time. Simply incredible.

It gives me the trackability I desire and funnels the leads.

Now, why is this relevant to this thread?

Well, we now use the same pricing as they will sell it for on the lot. It simplifies things a ton. So instead of different online pricing matrixes, we use one. The only difference is the coupon that is highly trackable, has to presented at time of sale (no issues) and is physical proof of an Internet deal.

Not only that, the thing that baffles me the most, is that people fill them out, buy the car and never use it!

One last thing and sorry to be so long winded. I do not indicate that the price is not negotiable. In my experience, that will kill you. It is more of an assumptive thing, "Ohh, you got the Internet coupon and you saw me, so now it gets doubled, congrats!

Sign here and press firmly.

I have struggled with this as well! Great topic by the way!
Why can't the internet price be considered a coupon?
If you go to Red lobster without your $5.00 off coupon they don't give it to you.....so why can't we do that?
Consumers should do their research before their purchase...not after.
Online advertising is cheaper vs physical lot displays that cost millions.
Why does sprint charge me $5.00 to make my payment by phone but nothing if I pay online?
Because less expense is involved....correct?

Amada
"many dealerships and trainers have been promoting the benefits of special internet pricing"

I think the answer to your question has more to do with dealers and trainers focusing on conversion ratio and turning those stealth people out there into real live people you can actually contact.
"Special Internet pricing" or "Get your E Price" or "One shot Internet pricing" all serve the same purpose. It's to draw people in, get their information and build your database of possible clients. My question to you would be, what are you trying to accomplish? Are you trying to generate more leads, or do you believe having "special internet pricing" will help close the leads you do have? These are two different issues, and depending on the answer to your questions lies your answer.
Even if you do have "special internet pricing" I would say it's safe to say that customers are still going to use that number as the starting point of negotiation no matter what brand you sell, unless your dealership has branded itself as a "one price no hassel" type operation.

Amanda, there are states where it is illegal to advertise a lower price online (or in any media actually) than exists on the physical lot. Colorado for sure is like that... but back to your question.

Your GM's are correct in that if the store embarrasses itself like that they are hurting their goodwill... but that doesn't exempt them from developing a consistent pricing policy that covers online and showroom sales. Otherwise what are they saying? The Internet department can't give prices? All sales conversations that include price must occur in the showroom?

So what to do without having to go "one-price?"

There are several things actually. No one says you have to post all of your prices online. Why not show MSRP (new cars) and NADA retail (used cars) with a call to action button that says "Find out more and get the price." Naturally, clicking the button opens a lead form for them to fill out.

In my company's shopping cart program that dealers use to sell vehicles and F+I products to online consumers, we certainly don't give prices (or credit or interest rates or trade values or rebates or accessories, etc.) until the consumer has created their account which includes their name, phone number and email address.

But after they've identified themselves we give them the price one of two ways... if only price, we just give it to them. If a negotiated profile flag, all cars start out at MSRP + we know the dealer's reserve price. The consumer can input whatever price they want, but if they go below the reserve, then it just comes back with the reserve. Because the dealer has a better / more convenient online experience, the prices online are always now a bit more than the consumer may be able to get in the showroom.

To quote one of the dealers that my company works with... "Just because we are retailing on the web, doesn't mean we should be putzs (and I don't mean you specifically) about sales."

No one from Best Buy will follow up with you if you abandon your shopping cart. There is enough gross in the car business to make it worth doing, so whether it is a lead or a shopping cart account like in my company's product, the only leverage you have to get the consumer to engage in communicating with you is price.

How and when to give up your price is an art, but give it up you must as you balance the necessary engagement - is the consumer at the point that they know exactly which vehicle they want or are they earlier in their decision making? Are they financing? What do they care about most? It is that conversation, not the price that will sell the car. If you listen the best, you sell. If you just fire prices no matter how you do it, you lose.

I hope that helped.

Alex,

Probably too much wine...

I've heard things

The Synergy Sessions was a great time, but it was more than that. There was so much useful information it could have been 3 or 4 days but I think at 2 days it was a little packed because of all the great speakers they had.

I think the expertise of these speakers and the ideas I was able to bring back to my dealership will help me make a real positive impact on my deparment in a very short time.

It was also very nice to meet many other professionals and get their first hand opinions on the trials they go through at the dealership level. Thanks for your insight!!!

Great Event all around, I am looking forward to the next one.

Eric

Maybe I'm running on too little sleep or maybe I had too much wine at dinner, but I'm scratching my head on some of the recent comments in this thread.

Chris K - there is so much stuff on Dealer Refresh for you to use. Things are listed categorically and chronologically. Typepad (the blogging engine this site is hosted on) got rid of their search function, which sucks, but you can still use Google to search any site. Here's an invaluable resource: Google "How to use Google" and learn how to really find what you're looking for.

Henry - I'm dumbfounded. I can't believe you'd call Jeff sleazy and you haven't even been out drinking with him!

Jeff, look who's calling car salepeople "typical sleazy"?

Look in the mirror!

Chris K,

Jeff is correct in saying there is alot of valuable information within DR. DR has consistently been a leader in the exchange of ideas for years. We advertisers sure don't want to muck it up for you.

Jeff,

I am a little surprised to see your comment "the advertisements are bad enough". For advertising is the ebodiment of capitalism and capitalism is fundemantal to our entire economy.

For if you bad mouth capitalism, isn't this an indictment of our entire system in general? I put it to you, Jeff, isn't this an indictment of our entire American society?

Well, say what you want to say, but I'm not going to sit here and listen to you badmouth the United States of America.

No really, your site is not a bill board for advertising and never has been. It provides a great forum for ideas and I'm sure the little bit of ads you have help to pay some of the overhead. Also, I normally sit on the sidelines because I am an advertiser but I had to comment here. Hope you enjoyed my Animal House rendition.

By the way, Jim said he had a great time in New Orleans. Keep up the good work on the site! We do appreciate it!

I was hoping to find a thread where we can get past semantics, social networking, beyond computers and vendors and talk about what really sells cars .. like actual email verbiage, follow up techniques, phone conversations and messages, tie ins... but I don't think this site appears to really focus on the really important stuff - to me at least.

I want to get past the advertisements folks....

Mike,
You and Dean deserved it, you could tell you all put quite a bit of time and effort into the presentation. Has Matt been contacted by any music agents yet?

Brian, thank you for the very kind words on our presentation. We're glad you enjoyed and we're looking forward to more synergy fun! - Mike DeCecco

oh....and one other thing........never ever forget to ask for the Sale!
Who knows you might win a trip to New Orleans

Brian,

Thank you very much for the Post. On behalf of Dealer Synergy, Synergy Sessions and AutoSuccess Magazine it was a pleasure having you and we are so very glad you had a great time.

The whole reason why we created this contest on Dealer Refresh was that we wanted to get as much feedback as we could from people on the front lines about what they wanted. And we had some great comments on this BLOG as well as from everyone that attended from the dealers, managers, speakers, exhibitors... everyone. We realize that there are so many things to do and conventions to attend. We want to provide a serious value to our attendees as well as create a great environment for them to have fun and meet others and create "Synergy".

I had so much fun there myself meeting all of the dealers and managers. We had dealers that came from over 18 different states to attend our Synergy Session in New Orleans!

I enjoy learning as much as I do teaching. So for me to see the awesome line up of speakers and educators was great.

I received a tremendous amount of positive feedback about the Franklin Covey presentation. For several reasons... First, its not the SAME recycled information or speaker that is at EVERY event This is the first time Franklin Covey has ever done anything like this in the Automotive industry. They other reason is that the information that DeVerl delivered was powerful, important and useful. It was truly and honor for me to be able to do a joint presentation with the Franklin Covey Organization. What is so funny is that I speak in front of large crowds of hundreds and hundreds of people, 20 group after 20 group... blah blah blah... but, I was nervous going after DeVerl. He is ONLY the #1 International trainer for the Franklin covey Organization and I had to give an hour presentation of my interpretation of the 7 habits of highly effective people for the automotive industry as it relates to Internet Sales departments But, I had fun doing it!

Great speakers, Great presentations, Great information, great Attendees!

The VIP party was off the hook! We had several limos on call for the night... Yes, one was a Hummer! I heard several times that night that the VIP Party was NADA caliber. We did NOT spare any expense as Brian mentioned before. We really wanted EVERYONE to have fun. The Band was truly amazing! They were this Creole, New Orleans Band... They had this guy that had a metal grate on his chest and he was playing it with, I think a spoon or something. He was truly off the hook! And Jeff Kershner says it was a little too loud? Jeff, Are you getting too old? Who are you kidding? I have seen your MySpace page

But, There was an after Party to the VIP party from the house of blues... There was about 15 or so "Troopers" from several different dealerships that jumped into one of the limos with me and my Fiancé... we headed to Bourbon Street of course. After having some fun... We headed back to the house of blues and I treated everyone to a Hard Rock Concert. A Band Called Super Suckers played and killed it. I had to turn in a little early but the group stayed and had a great night. I am proud to say EVERYONE made it (almost) on time the next morning for day 2 of the Synergy Sessions.

I know, I just spent a lot of time talking about having fun and VIP parties... I figured Brian gave you all the run down on the instructional design of Synergy Sessions. I wanted to give you the behind the scenes perspective

As far as the Video Production. Kaizen sent out a serious, mobile video production team to archive the entire event including the VIP party, all of the speakers and presentations PLUS a TON of Video Testimonials... It is going to take a couple of weeks to edit the OVER 40 hours of finished Video Content.

We will be releasing, teaser, testimonials and montages shortly.

We have decided to NOT do another Synergy Session until March 2009. It will be held in Atlantic City New Jersey. We want to take our time and really plan this event to even greater depths of perfection...

We are REALLY, REALLY going to try to blow everyone away with this event. So we are going to spend the next 2-3 months just getting the right mix of speakers, information, instruction design straight and then we have to outdo this last off the hook VIP party!! And we have gotten some great ideas for additional wow factors. So stay tuned on information for Synergy Sessions 2009.
If you have any questions, ideas, about the 2009 Synergy Sessions in Atlantic City, Please feel free to Contact me. I would LOVE to hear your ideas and suggestions.

Thank you again to everyone that was apart of the 2008 Synergy Sessions. And for those that missed out... I am truly sorry. But no worries the AC event will be here before you know it!

SVB-

Great posting Alex.

iPhone rocks!! It changed my life and I cannot imagine existing without it. I recommend it to all ISMs out there.

Since I love the iPhone, I decided to convert to the "other side" and
I just bought a Mac Book Pro laptop. My priority was to be 100% mobile.

The adjustment to Mac is interesting....there's no right click!!!...but it's easy to use and lightening fast.

I'm also the dealer group's I.T. manager, so I took my old PC and turned it into a server for storing website graphics, HomeNet IOL for data and inventory management, and virus protection. That frees up my laptop for everything else.

For car guys and gals like me that don't have an I.T. background, Mac is really easy to use...blogging, editing videos and audio files, podcasting, etc. There's a template for everything! Just drag and drop.

One negative - all of my emails from the past two years in Outlook have to be sacrificed because the Mac cannot read .pst files. Also, there are two programs that I need that require Java or IE. But I can access these with Boot Camp. A little bit of a pain, but benefits of MacBookPro far outweigh the cons.

Wow! I am surprised at the lack of MAC lovers in the comments. In my past lives, I built, re-engineered, and managed support centers focused on PC and Microsoft products because that is what Corporate America focused on. During those years, we worked with Dell, HP, Acer, Compaq and Toshiba. Dell was the best deal, but HP and Toshiba had their niche. Dell had a great business model and whenever a friend would ask, “What kind of PC should I buy?”, I would immediately say, DELL. However, times have changed. In the past year, I have come completely over to the dark side to become an Apple follower and a Steve Job's disciple. Not because I think that the PC is a piece of junk, no far from it; and not because Apple is the best either. But because I got extremely tired of the overhead with Windows and other MS products and the hoops you have to go through to get it to Really Work.
In truth, Apple found a way to give me just what I wanted: to WIN at what I am doing. I define Winning as the fast and efficient path to producing the output I desire. In other words I want an efficient tool. I don’t want to have to learn the tool, but want the tool to perform for me intuitively. Another way to say it is: If my job is to win the race, I am not focused on the Craftman tools, just winning the race.
Well Apple gives that to me.
Alex, you mentioned you are a heavy Photoshop user, but all my friends who are professional photographers and graphic artist (and I have a few) use Macs. And you don’t have to have the big box mac to get the job done. Hey, I am not saying you cannot run Photoshop on a PC, I am just saying it was designed for the Mac and the graphics folks are all in the Mac camp.
When it comes to building PCs, I have to ask the question… WHY? In the days of the 8088 (yes I was there when the first pc came out) you had to know how to fix them, build them, and to make them more robust. As the processors changed and the video changed, you best know how to upgrade or replace them. I went to the shows at the Hampton Coliseum and bought the parts to make PCs. But that is because I had fun doing it.
But when it comes to my job, that is not my job, to build PCs. I would even argue that it is a waste of time, valuable time to be building these machines even for a dealership who can lease them and then refresh them on a regular basis (but that is a different discussion).
So I appreciate your comments on PC building, but I wonder why a guy in the automotive business is not utilizing the tools available today to seamlessly move data and information to our finger tips (iPhone type stuff) but would prefer to discuss building PCs.

Wow! Most of this post was completely over my head, but I do know one thing Alex.. As internet managers our computers are the life of our operation, and if they don't work neither do we. The server was down at my dealership for a few hours one day and I felt helpless.. I thought, I just call a few people, oh wait can't do that all of the leads are on a web based lead management system and I cant get to the numbers .By the way I thought I did good when they bought me an extra monitor...

Building your own computer is great until something breaks and you are working a car deal(s) then have no time to fix it. I'd rather call Dell with my 4 hour hardware replacement warranty than be down for days whether on a home or work machine.

CASH = FPS and bragging rights
Why do we need a machine that can play Call of Duty 4 at 222 fps?
Just cause!

Looks like Chris K beat me to the punch, but my thoughts on this matter are that he's correct...the average ISM will be fine with an off-the-shelf $1000 machine. The people who KNOW they need all the bells and whistles probably need them. The people who may be reading this post, wondering what all this tech talk means, and wondering if they need a higher end machine probably don't need it, and that would be about 98% of the industry. Well, DR readers are a little different than the rest, so probably half of the DR readers.

Alex nice write up...

On the memory... XP will use Max 3GB... and your Motherboard chipset needs to support PAE for you to go even above 2GB.

For storage f you can afford it go for RAID5 and with external controller... don't be cheap and do Software RAID... 3Ware or Areca makes some nice controllers.

If anyone is interested I have a nice hot swappable 12 bay external NORCO DS-1220 USB storage array for sale... NO HDs.

Lau's links didn't come over, so here they are:




Everything you see here, from the documentation to the
code itself, was created by and for the community.
WordPress is an Open Source project, which means there
are hundreds of people all over the world working on
it. (More than most commercial platforms.) It also
means you are free to use it for anything from your
cat’s home page to a Fortune 5 web
(http://autoshows.ford.com/ site without paying anyone
a license fee.

You can see what is possible with this link:

B-Man: The dual 22" is very nice. I have it at both home and work and won't be going back to one ever. From a productivity perspective, I think the screen real estate can give an ISM the best benefit. I usually have 20+ programs open at once and spead out across the screens. I can track, analyze, create so much more at a faster rate. Of course, you'll need the video card to support it, and then a cpu, memory, power and motherboard to support all that. So, basically, a complete system upgrade is in order.

I'm a total geek, and now can proudly admit it. (I always say to myself, "Bill gates is a geek") I used to suppress it, but this tech sh#t just keeps getting better and better. It'll only become more pervasive, and at a faster rate. Its nearly impossible to not be engaged with it all.

So where are the Amazon links to all these computer parts Jeff?