It's not easy to watch a Dealer who is the true sense of an Entrepreneur, look and feel defeated. It was painstaking to see.

Why was he feeling this way?

Because he was faced with the reality that his sales team was incapable of responding to internet leads.

I know what you are thinking. Incapable?

Equally as painstaking is watching people who simply do not use a computer for their personal lives let alone work. Just locating an area to type a document or retrieving an email or even making changes to an existing email template, was hard to wait for and watch.

Believe me, I was wondering the same thing you probably are...what world are these guys living in?

Salespeople that work internet leads today must be capable and willing to send over 25 emails and place over 25 calls per day in order to get the minimum amount of sales from the lead pool. But what would you do if you were in this situation? Fire em' all?

You see it's situations like these are reminders that every dealership will not and should not have the same business model at converting internet leads to showroom sales.

Allow me add the icing to the cake in this real story.

Between the two stores, this dealer will make over $3 million dollars selling Kia's this year. That does not include any internet sales. Most salespeople had never even sent an email to a customer in years of their employment here. With average grosses of $3300 a copy, your eyebrow may have just raised. On average, they see 30-50 people on a Saturday. Ups.

Does this bus still really exist?  Holy S@!*%, right? SO what is a dealer to do in this situation?  The stores aren't broken.  The lowest paid salesperson makes $60K/year. I saw 40 obvious deals waiting there.  What would 40 more deals a month do to this bottom line?

Does this dealer need them?  ..or does he want them?

I recommended a dealership BDC Department. A BDC with an objective to set appointments. Their role is to respond to internet leads, follow up by phone and email until they buy or die. BDC departments serve a real purpose for many dealerships. Yet I still see plenty of dealerships that have dedicated salespeople handling the internet prospects and converting at a much higher ratio than a BDC department.

It will always be a challenge to find an entire sales team that have the abilities, capabilities, desire and motivation to handle the most challenging prospect around, the internet prospect.

This poses a thereat to 21st century dealerships. Interviewing skills and approaches must change drastically..  The skill sets of today's salesman must include rockin' phone and email skills.

If you know this aspect is not your best skill set, I suggest you get out and make it your best skill set!  No one is born with this, remember, it is a learned quality.  You, just like me, can achieve anything with determination and desire.

Do your sales people have the ROCKIN' skill sets to be effective with today's consumer - from Internet Lead to Sale?

It doesn't seem like TrueCar is going to have such a Merry Christmas this year.

Since Jeff wrote about TrueCar and some of their tatics back in June - Edmunds TMV vs TrueCar – Dealers, wake up! , others are helping to bring this situation to the fore front. It's great to see our industry come together and express our concerns and opinions around this TrueCar debacle. I can't recall another time where dealers and industry goo-roos have reached and leverage so many channels of online news and social to not only express their opinions but also help amplify the message.

The automotive industry has been energized and polarized surrounding the TrueCar business model.  Since dealers are for and against the model, it is very important to follow the legal implications of the TrueCar process.

As promised, I told you that various State regulators and Dealer Associations were drafting letters to their constituents and members warning of potential legal concerns.

The Colorado Department of Revenue issued this letter on December 15, 2011 and I expect more similar letters to follow.   The TrueCar discussion is now moving into a legal discussion with dealers facing potential fines for participating on a model that regulators may deem as violating State laws.

Take a peek at this letter and share your thoughts.  I’ll have a few more letters to share in the coming weeks as they are drafted and published.



For a larger version of the letter view it on the Colorado Government site.

Addition by Jeff Kershner...

Another TrueCar UPDATE: Group 1, the nation's fourth-largest auto retailer, last week ordered all participating stores to cut ties with TrueCar.com - Click here to read the article. I had heard about this last friday and sent out a tweet that received several responses (follow @dealerrefresh on twitter). This apparently was brought to light during a meeting with their local Honda Representatives.

The year is 1932 and you’re working at the Hawthorne Factory, a dusty, smelly factory just outside Chicago. You’ve worked the same assembly line for 20 years and have lived through countless lame brain ideas from management to squeeze out more productivity: hire more workers, buy new machinery, work longer hours….yeah yeah yeah, big deal. Are the Cubbies playing today?

One day, just when you think you’ve heard them all, Bossman strolls onto the factory floor (cigar in mouth, no doubt) with a new plan to push productivity up a notch. He says he’s simply going to crank up the lights in the factory and by doing so, productivity should increase. So, he does just that but for the first time ever, he actually hires a gentleman to measure this whimsical experiment. This stiff looking guy stands there taking notes and when the results steam in, it was your best day ever. Bossman thinks he’s figured it out…crank the lights!!

When his findings are published, a couple of brainiacs step back and look through a different lens. They come to your factory and ask to take a different approach. They dim the lights, nearly dark. Again, the stiff looking guy takes notes about the lighting experiment and again, your factory has a banner day. So, what does Bossman have to say about that! Dimming lights also leads to productivity…dim the lights!!

What happened here?

Did we learn anything?

Remember the factory name? “Hawthorne Works”…Well, from this experiment, every organizational management course in colleges across the country has at least a couple days worth of curriculum: textbooks call this “The Hawthorne Effect.” So what does it mean?


The Hawthorne Effect says “the simple act of measuring something will affect performance.” At the Hawtorne Factory, lighting had nothing to do with the productivity increases. It was the stiff guy with the notepad! The mere fact that worker performance was being measured and monitored by this guy caused workers to work harder. So why do you care? While I certainly hope your dealership isn’t dusty OR smelly, the Hawthorne Factory is just like your dealership. Measuring and monitoring performance will positively affect the productivity of your dealership.

Vendors often get caught up in a pitch of 38 different features that will improve your life. Heck, it’s easy for any dealership to get caught up in those 38 features and we certainly recommend taking advantage of everything. But we also shouldn’t forget the basics: Are you listening to your sales team’s phone calls? Service calls? I don't have to tell you that improved phone skills translates to improved sales.

Measuring and monitoring that phone performance is as simple as using a tracking number and recording your dealership’s calls. You can then listen to your inbound and outbound phone calls (yes, I said outbound too). When they know you’re reviewing phone calls, you’ll be shocked at how much they improve. It’s not about “big brother” though and it should never be framed as such. It’s about investing time in your people and helping them improve.

How about taking a great phone session, hitting “Share this call,” and sending it to your sales team with notes as an example of a rock star job? Highlight the good, the bad, and the ugly and the Hawthorne Effect will rear it’s beautiful head.

How are you leveraging your call tracking and recording at the dealership to improve productivity and performance?