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Internet Sales Pay Plans: Back to the Drawing Board?

Mike - that sounds really familiar. Importing various things into Excel is a great idea though! I never thought about getting the call history from a cell phone for comparison purposes.

I am currently working with Dealer.com to do some database-meshing strictly for reporting purposes. This month-end-customer-comparing-waste-of-time has been the worst part of my job for about 8 years now (try it for an entire auto group). If we can pull off what DDC and I are trying to do, this report could reduce a lot of that wasted time and probably open some eyes on various reporting metrics. I think it will take us a few months to get it to a point where it is as robust and accurate as I'd like, and when it gets there I will definitely be talking about it on Dealer Refresh.

Internet Sales Pay Plans: Back to the Drawing Board?

Talk about feeling right at home! I am ripping my hair out just trying to figure out who I got in the door! We have a CRM in place, but the salesman never log their leads and the GM will not enforce it. I am the ISM at a dealership with on avg about 300 used cars in inventory. I take the pictures ( about 2o per car), I am responsible for comments on all of them. I answer all of the incoming Internet phone leads, and Email leads. I am building a new secondary website from the ground up- meaning I taught myself web design, and how to use Photoshop for the graphics. I set up a facebook page that is driving more click thru's to our website than Cars.com. Also I brought the amount of "trackable" deals from 5-10 a month to 50+! With all this in order to find out how many deals I got I have developed the most insane process.

First: I take pictures of our desk logs for the previous week.

second: I record all customer info into an excel file.

Third: I download my incoming call history from my cell phone provider into another excel file.

Fourth: I export my inbound internet leads (customer names and phone #'s) into another excel file.

Fifth: I then use a formula in excel to cross refrence all of this data to find out who ive communicated with.

Once I have a list of all the names I then stare at the sales board to find out if they sold.

This takes hours even now when I have it down to a science. Not to mention all the customers whos names are not recorded on the logs correctly (one letter off and they fall through the cracks), End up buying under a different name than the original lead name, or call me from a different phone than they record in F&I - if they give one at all! I am not complaining about how much I make because I do better than the other ISM's in my autogroup with similar pay plans, but how much time is wasted on this when I could be working on simply driving in more floor traffic?

Jason's pay structure just blew my mind! I am going to appoarch the GM tomorrow morning with this idea!

Internet Sales Pay Plans: Back to the Drawing Board?

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Internet Sales Pay Plans: Back to the Drawing Board?

reis: I guarantee you more then 50% of your true internet sales are going under the radar as drive-ups... simply having the customer themself fill out a simple multiple chioce survey in finance will reveal the truth (it did for us). Last month we sold 10 cars from autotrader - and 8 of them never called or emailed, they saw us online and just drove out. I had some initial resistance to the survey from the staff, but I simply asked "why are we afraid to know what marketing actually works"

Amazing - when we no longer relied on the sales staff to identify what was driving our floor traffic, but simply asked the customer, we went from 70% 'local - drive by', to just 5%!! LOL Oh, and the internet went from 5% to 70% of our prospects :)

Internet Sales Pay Plans: Back to the Drawing Board?

Joe: the url is http://www.libertyauto.com
nothing will really jump out at you with it, and the used car side just got written over by some old templates this weekend :( Basicly, I found a few things to try to set us apart from other dealers, and try to get it accross to the prospect without them having to read any copy (people were ignoring the copy and contextual links - maybe we have a lot of ADD shoppers!). The site is always in a state of flux, as I always test new things (example, i recently removed the chat feature, changed color schemes, etc). My goal with it is this: when someone comes to our site, I want them to think "hmm, I should go check these guys out".
Note: Against my recommendations, the owner and sales manager insisted on doing an invoice sale this month on our hottest product (wranglers). business is slow this month, and they're sweating it some I guess since we have 30 of them sitting here .. I pointed out that we still were on target with our wrangler sales this month, and that we didn't even have 60 days supply on hand..

alex: I think our set-up evolved this way because I was a hard-core techie and our staff had serious issues with the idea of hiring dedicated ISM's! Of course, none of them were willing to give up floor traffic, etc :) Since my father owns the place, I could have actually done the traditional ISM if I wanted too, but by then our internet sales had broke 30 a month and I thought it would be counter-productive.

Internet Sales Pay Plans: Back to the Drawing Board?

I just want to let Jeff know he is not the only one who get's paid the way he does. I do have to say that I have a manager and owner that is probably more progressive than most and is willing to listen to the idea's I have and spend money on internet advertising. However I am only still paid on my direct sales and gross. As internet manager's across the nation i think know. Gross is not the best via internet sales. Maybe I'm wrong thinking that. IF so I would to know how the other manager's making large grosses are doing so. Anyway that is one of the biggest problems I have is getting shopped and having another dealer cut my legs off at the knee. I think that I have a fairly good pay plan going but there is really no recognition on how many customer's I personally am driving to the dealership doing exactly what Jeff has been saying, from taking pictures, maintaining the website, making contacts from not only autotrader and cars.com but many other sources. From all the research I've read that nearly 90% of customer's at least look online before visiting a dealership now and days, I have a tough time believing my 12-15 personal sales per mo is all our sites are bringing to the dealership. How do you convince the big man signing the paychecks to increase or realize the actual profit being brought to the dealership with no hard facts saying this many people came in from my hard work????? Any suggestions would be greatly appreciated

Internet Sales Pay Plans: Back to the Drawing Board?

What is the secret to a successful, sales producing Internet Department?

Delivering the online shopper from behind the computer to the dealerships doorsteps, in my opinion.

Sure there are many ingredients inbetween that assist; websites, SEO/SEM, CRM/ILM, and online advertisers. None of the above have I yet been able to fully maximize at a dealership I worked at because of the time consumption involved. For example...

I only get paid on the vehicles I sell via commission, taking the consumer from lead to delivery. Not for taking photos, writing the descriptions, or troubleshooting vehicle feeds for accurate information that benefits the entire dealer group, not just my "Internet Sales". We carry 10 manufacturers across 5 rooftops; 400 new and over 130 used cars in stock at all times.

If at any one time, the above ingredients lack, it directly affects my sales. But all that matters is 'What were my internet sales/gross' at the end of month, not taking into consideration other variables. I have offerred assistance/coached those between myself and owner that there are better proccess's to sell more cars from the Internet Department, but only get the deer in headlights look.

Adding to Alex's article on this subject: Are there many or just a few other's in the same position as myself; sales, IT, website maintenance that only get paid on performance?

Side note Joe Pistell, there is a company now that reveals shoppers true identity and/or corrects false lead information before arriving to the dealership ILM/CRM tool. Contact me through Mr. Kershner and I will get back to you.

Internet Sales Pay Plans: Back to the Drawing Board?

I have returned to my position as an ISM due to my families health insurance premiums tripling and the dealership I was working for having a profitable department turning into an shell. Two very different situations able to meet to fill mutual voids.

Of course the first thing we discussed was a pay plan and expectations and there was a lot of mutual give and take and a good compromise resulted, both parties were happy with the outcome.

Of course the biggest pitfalls to a "transactional payplan" when marketing the dealership online is that not every sale can be measured, but this can also be said about any other traditional advertising platform.

I believe your marketing efforts should be tied directly to how you are paid. If you are paid transactional you need to give your customers a reason to do business with you via the web and your marketing efforts should be to brand you and your service give them a substantially unique reason to contact the internet department head on.

I cringe when I see things like this:
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Basically the idea is that a happy Internet buyer, while good for the dealership, is bad for Internet Sales, because it's likely that customer will just come back to the SP as a previous, and send referrals directly to the store, when all those people could otherwise be potential Internet sales, submitting third party leads or searching Google for local Nissan dealers.
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That may possibly where dealerships, salespeople and managers will never have a true meeting of the mind, but that is where an internet department can shine and separate themselves and provide easily trackable results.

Remember the road to the sale the last step is follow-up. That is where technology can outshine traditional methods. Make the web part of the follow up process and give people reasons to to initiate a new transaction and send referrals via the net. You have these customers on your list make the best use of it. Create a unique web delivered proposition or promotion. There is money in the list, but the fortune is in the follow up!!

While there may not a perfect answer to this problem keep in mind internet marketing is wholly transactional based. A good example are the books in left side bar here. Jeff will earn a commission if you purchase directly from amazon by clicking on one of them and looses it all if you buy it a local Barnes and Noble because you saw it on his blog. You win some and you lose some. Amazon wants you to buy from Jeff's link at amazon.com or even better buy from amazon because you typed in amazon.com in your browser and searched for it then bought it. They will make 4-8% more that way.

Seth Godin on the other hand could care less where you buy the book and is glad that Jeff is merchandising it for him. He will make money no matter where you buy your "Meatball Sundae" from.

The end result is a transaction....

Excellent book by the way and a must read if you are serious about selling anything online.

Internet Sales Pay Plans: Back to the Drawing Board?

Jason,

Awesome setup! I like how you've separated yourself from the traditional "Internet-guy" model. Of course, retail is retail, but every market is different - meaning, your exact setup probably wouldn't have the same success around the nation, but there is something to learn from it. I'm glad to hear there is a business model like yours thriving. I've felt for a long time the Internet department should be more of a creative marketing department than a one to one sales generating department. Thanks for sharing! Mind giving Joe and me a site to check out?

Internet Sales Pay Plans: Back to the Drawing Board?

I apologize for being so quiet over the last few days - I've been out of town.

Chris,

That is an excellent short-term solution if you have other areas making the profit. Profit is king, and I'd rather be a part of the profit center. There is a myth in this business that selling cars for invoice or less will keep a dealership healthy. Sell it for less than cost and volume you're way into a profit - isn't that how it works? What happens when your competition wakes up? What happens when the economy dips and volume isn't happening? Yes, there is a healthy balance between volume and gross, but how are you finding it? That's a whole other subject.

Chris - I'm probably being a little hard on you. I'm sure you're doing other things and it isn't all about who can sell the car the cheapest.

As for pay plans, I don't think there are a whole bunch of dealerships with never-ending pockets out there, so let's hop back on finding that fair balance for you (paycheck) and the dealer (profit).

Internet Sales Pay Plans: Back to the Drawing Board?

Chris:

My competitors are all buying leads and doing the 'under invoice' thing for thier internet sales, yet we're selling more then they are and keeping full grosse. Plus - they are WELL KNOWN and heavily marketed dealerships, where as we were relative nobodies a year ago and are located out in the country (we still do hardly any traditional advertising and the bulk of our customers never even heard of us prior to shopping for their new car).

In other words, hardly anybody outisde our rural area is predisposed to buying from us - yet we are pulling a lot of new customers away from the very well known and well entrenched metro dealers - even though they almost all use invoice-related fixed-price quotes well under our average gross.

Here's a quote from a friend of mine who now works as an ISM at one of those dealerships:
"We lost 6 deals to you guys last week!" - and they quoted $500 under invoice! He used to work for us so he knows we weren't undercutting them - even though his boss is convinced we are.

I would say we are not spinning our wheels by not getting into price wars. We just go after a different part of the market. I concentrate on getting people to my website, and then selling them on our dealership. That's what I consider the other 98% of the internet traffic - the ones who are not shopping for price quotes since they don't even know exactly what it is they want yet :)

Internet Sales Pay Plans: Back to the Drawing Board?

I've been ranting about just this topic for ever :) Jeff nailed everything.

1) Dealers will get what they reward.
2) It's not internet sales - it's internet marketing.

The sales staff needs to get with the program. If they can't work an internet lead (whether phone or email), then they are going to become extinct. This reluctance to get with the times is why we ended up with a seperate 'internet guy' - everyone including management simply wanted to keep doing what they always did for the past 20 years and not accept the fundemental shift in their industry. So they sent someone off to a corner to 'do the internet thing', and it's grown from there.

I get a flat salary (since i do everything in house - web development, computer programming, sem, seo, etc), and a bonus at the end of the month. I also ended up doing a lot of our display ads in trader pubs, etc, using insight from what worked for us on the web. Heck - when a simple change of a single word in a PPC add can double it's click through, thats usefull to know!

I don't set appointments, I don't sell cars. I generate phone-ups, drive-ups, and 'email-ups' from people on the internet. And yes, have most employees wonder "what exactly does he do?" :)

My bonus is based on how many customers put a check mark next to "internet" when asked "what brought you in today?" when filling out our survey while in F&I.. I have an entirely seperate question that asks if they visited our site first before coming in - this identifies those who would have come in anyways (well, sort of). IE, they will checkmark 'referral' for what brought them in instead of 'internet', and checkmark 'yes' when asked if they visited or website before coming in. I don't usually lay claim to generating this sale. Now that we have a crm tool in place, I'm going to try and lay claim to repeat and referrals..

This approach seems to work for us - after a year of doing this, our total sales have doubled because of the internet. Unfortunately, I left the actual computation of that bonus discretionary, and once sales took off it quickly plummeted from the original agreement :(

Internet Sales Pay Plans: Back to the Drawing Board?

Hi everyone! I think it's fair to say the more you sell, the better your pay plan gets. Here's how I am crushing numbers and making more sales than my competition who get the same leads: QUOTING AND COMMITTING TO SELLING ALL INVENTORY FOR $100 UNDER INVOICE. Even if your savviest prospect shops your price (which you should give them - even if you never talk), they will see that $100 under REAL invoice is usually as good as it gets. If your dealer is not behind you 100% on this, then you are spinning your wheels and need to find a dealer that will be 100% behind the internet. Bottom line: Quote less than everyone else - see more people come in - make more sales - make more money - dealer notices - then everything falls into place.

Internet Sales Pay Plans: Back to the Drawing Board?

Brad knows:

Rule #1).
"what dosen't get measured, dosen't get paid".

Rule #2).
Brad also knows:
"...sales reps always check "walk in" grrr...

Rule #3).
Brad ALSO knows:
Shoppers will play every game in the book to remain anonymous (to improve their opportunities). It's important to not offend the already defensive shopper. Heck, I hate it when Home Depot asks me my zip code at check out!

Brad's p*ssed at the lack of value the BDC/ISM shows because he's caught in a vise. To make matters WORSE, most CRM's use a single choice as the cause for the shoppers purchase. How idiotic is that?

IT's Not Going to Change!
It is my opinion that WE'VE ARRIVED to that magical place where total dealership sales and the internet are 99.9% interconnected AND because Shoppers NEED to remain incognigto, shoppers won't stand up and be counted.

The onus is on the shoulders of the GM to recognize the current payplan is like a Web1.0 application. The web is moving and this communication/comission method is falling out of favor (and maybe costing them opportunities).

THE ISM BRINGS VALUE TO THE DEALERS INTERNET MARKETING PLATFORM THAT CANNOT BE MEASURED.

Does the Hilton Hotel count the number of ups the Concierge gets? No. Does the Concierge bring value to the HIGH PROFIT clientele? YES. The value is measured in client retention. Return visits. When are we going to realize that we're not selling to a up, but to a FAMILY that has 2.7 cars per household.

I say if someone were daring, they may find more ROI by out efforting his competition with personalized content and services.

For the sake of argument...
If you sell 200 units per month and you have 2,000 unique visitors per month, that means 1,800 BOUGHT somewhere else.

Mr. General Manager, can you tell me where the dry gun powder lies?

Sorry aboout the rant, I am in one of those moods!
Joe

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