Value Package Ideas

[Walt Kustra]

Hey everyone,
I wanted to pick your brains about an issue we are going to have to deal with in the upcoming months concerning our dealerships value package proposistion. Currenty, we work with Titan and are signed up with their lifetime warranty program. Its the headline item in our delerships value package we emphasize to all of our new online customers. With the new car business especially being so competitive we truly feel it gives us an edge to talk about things we can offer at our dealership that other dealers arent offering. Considering all things are the same, price on new cars, etc. Why would'nt you buy from the dealership offering something extra at no cost with such value? I think you can see where im going with this. Obviously, other than the warranty, we offer free car washes anytime, loaner car service, environmental package etc, but the lifetime warranty is the headline item. Problem is that our contract with this company is up in April and due to some concerns ownership is having with liability it is likely we won't be renewing our contract. My question to all of you is what else is out there. Without the branding of lifetime warranty, what else is out there that we can offer as a dealership that will make us stand out from the rest, and in turn give us the upper hand in our online dealings. I have seen other dealers do free maintanece,etc, but nothing seems quite as powerful as the lifetime powertrain. Any Ideas?

 

[Alex Snyder]

There are a lot of sides to a value added program. Lots of advantages and disadvantages. I'll just say that we had the "Winner's Edge" Value Added program which gave the customer quite a bit in freebies (oil changes, state inspections, services, etc.) and we got rid of it. Yeah, we lost a few deals because of it, but I guarantee you it was not due to not giving a bunch of freebies away.

With that said there is one thing that makes a value added program essential....is it your brand? Is your dealership name known more because of the program, or is your advertising/branding strong enough to sell your name without the freebies?

One of our competitors, the Priority Auto Group, would have a lot to lose if they gave up their "engines guaranteed for life" slogan. Customers don't know them by Priority, they know them by "guaranteed engines".

 

[Jeff Kershner]

Is your dealership name known more because of the program, or is your advertising/branding strong enough to sell your name without the freebies?

I've personally never been a fan of "Lifetime...." "Home of the Lifetime...." "Your Car Dealer for LIFE". I always felt as if it was hokey and that most people question it and know that it's not truly "FREE" but then again people are people, they still seem to go/believe just about anything.

I agree with Alex. Does your dealer have a "Brand" first and are these the extras that you provide when you do business OR are you only known as the Freebie Dealer?

I think there are other ways of branding your dealer and building a strong "why by from me" message. However, I do understand each area is different and the competition can be fierce. These little extras can be nice when in the close.

 

[Walt Kustra]

Thanks for the feedback guys! Bobby and I were both reading your responses yesterday before leaving our office. We feel we do a pretty good job of building our brand within the community and do our best to try and promote ourselves an our brand online as well. We are very pro active and have pages on our websites dedicated to some of our involvement, our blog, testimonials, etc. All in an effort to try and reach more people with the who we are what we do message. We are working on getting more video testimonials up every day! I checked out the priority auto group website and compared it to the checkered flag site as well. I definitely see what your getting at (thanks Alex!). I don't think we go as far as priority with our value added, (to where our customers don't recognize Preston and only lifetime warranty) but in our area its kind of hard not to have a value added. Heres why we think so... We are surrounded by some other dealers who are insistent on pricing their new vehicles so low that it almost doesn't make sense to sell them! With our value added we can sometimes justify having a little higher price and it gets peoples interest who's main concern isn't price only. If we do away with value added, there surely is a large number of people, like you say, who will buy from us just because of the Preston brand. On the other hand, when I'm trying to reach those new customers who are unfamiliar, and dealer B and C are into holdback and I'm a few hundred over with no value package, where do I stand? If im not going blow new cars out the door or offer the "freebie" what can I do as far as our own branding that is going to make Preston so strong that people wont care about anything else. I guess thats the real question! Also Jeff, If you don't mind, take a look at my site. Its www.prestonhonda.com when you said "Does your dealer have a "Brand" first and are these the extras that you provide when you do business OR are you only known as the Freebie Dealer?" Would you say that my value package is my "brand" and the lifetime warranty is the "freebie". That would help me differentiate between what we we may be able to do away with and what you would consider "our brand". Thanks again guys. We are working hard over here to be the most relevant dealer in our area and appreciate all the words of wisdom!

 

[Patrick80639]

You're already selling one of the few brands that many people believe is extremely reliable, not sure if a lifetime warranty is really all that necessary in your case. The only place I've worked that offered something similar was a domestic brand, thus such a thing was badly needed. A free maintenance package should have similar perceived value as a lifetime powertrain warranty for you customers.

With that said, I'd suggest building a sense of urgency on the warranty offer while it lasts.

 

[Walt Kustra]

Patrick,
Thanks for the input. I see where your coming from with the notion that Honda is already viewed as a reliable product (a point that many customers bring to my attention when my price may be a bit higher than my competition). We are going to take your advice and build some urgency with the warranty while it last, and do think that possibly maintenance may be something to look into. Especially since it should breed some service loyalty. Thanks for the reply.

 

[Mitchell Brenner]

Great post! I went to your website after reading the posts! As most are aware I love Dealer.Com and see your website is a Dealer.Com website so people will find you regardless of any "Gimmick". You read that right "Gimmick" and if your dealership has to rely on a gimmick to sell Honda then you're right to worry but I have a feeling you're talented Internet guys and you can sell value without a warranty.l Value is a perception and every dealer can offer some value in doing business in their dealership. However, not every dealership has YOU! This is the car business and nothing will ever change the fact that people buy from people and not from price! Is it really the "Value Package" that gets you the sale or is it your belief in your "value package" that comes across to the customer as a passion that gets them to like you and your dealership that gets you the sale. I believe it's the second one. Beleive in yourself, your dealership, your customer and the "value package" will no longer be what is important but your passion in other "value". I also think that if you believe in the "value package" without the warranty it will have the same effect and you won't even feel the loss of the "warranty for life"!

 

[Walt Kustra]

Mitchell,
Thanks for the great reply. Your post made me think of an encounter I recently had with a customer and wanted to share with you. The gentleman I'm speaking of (lets call him Eric) was an internet lead of mine that was organic through our dealer.com site that came accross back on the 22nd of October. At that time, in our inital conversation, he stated he was shopping several Honda dealers and wanted to know what we had to offer. After preaching our store up a bit as well as the value package, he decided to hold off till the new incentives came out in November. After contacting him with new incentives at the beginning of the month things started to cool down, but I still followed him closely. Just yesterday I got a call from Eric. He was upset about a bad expierence he had with a salesman at one of our competitiors stores. He was such a nice guy he went as far as to say he would have mentioned his disdain for this person to his superiors, but was worried that in the tough economic times were having he may cost him his job. He went on to say that after that experience he got a quote of 100 cheaper than I had offered from another store, but he wanted to do business with us because of the videos he saw of us on our website. He felt like he connected with us. Like we were good guys to do business with, and he would be happy to pay the small amount more to do business with us. Which brings me back to your post. YOUR ABSOLUTELY RIGHT. So many times we overlook our most valuable asset (ourselves) when selling. People will always buy from people, and in this arena of internet sales, people are making determinations about us without even meeting us, but by going online gathering information that ultimately gives them a real impression of who we are and what we do. Thanks to great vendors like dealer.com (who we are extremly happy with, shout out to our excellent account manager Elizabeth Hecker!) this process has become much easier for our customers. They can connect without ever setting foot on our lot, and they are buying from us for us.....not our free warranty! Thanks Mitchell! Hope you are having a great month!

 

[Jeff Kershner]

YOUR ABSOLUTELY RIGHT. So many times we overlook our most valuable asset (ourselves) when selling.

When on the floor I had to remind myself that I personally was the differentiating factor. I did what ever I could to separate myself from the competition. I knew if I did what I was supposed to do and "brand" myself, that there was always a great chance that the other salesperson was going to fail and I would prevail.

I think right now your strongest message is online word of mouth.