16% is the NEW 10% - ILM Closing ratio

[Dan Sayer]

Great question! I should have clarified that the vehicle that was already sold was a 1998 Pontiac Trans Am. Ha. Not a lot of comps.

Another good question that I could have explained better. The leads that were repeats were not marked bad in the system and were left under "Internet," I just excluded them from the conversion rates, because they naturally converted higher.

Unfortunately, the problem is very clearly online. We only scheduled 5 visits. Three of them were the one that was sold, bad credit on a 2009 Pontiac G8, and a no-show. The other two were a customer that came even though we told them we didn't have the vehicle they wanted (so technically not even an appt), and the last I felt the salesperson did a phenomenal job, but the customer just didn't like anything we had (I'm pretty sure she was just appeasing the spouse because she wanted a Cadillac all along - which she bought).

Honestly, looking through the leads I only felt that there were three the department did a less than stellar job on. I know that it is easy for me to say this through a biased lens, but my entire goal when I started was to show myself and my team that we were (myself included because I built the templates, processes, etc.) doing a poor job. I did not set out to make myself feel better and find excuses. There are only two possibilities in my eyes at this point though:

1. The leads are junk: I hate to be that guy, but that's the feeling I was left with. It was so brutal to go through them that I felt bad for the department that they had to deal with them. I feel like I have good enough self-awareness that I wouldn't use that excuse lightly.

2. Our processes stink: While I think this area always has room for improvement, it seems our response rate and response times hint that our processes probably aren't terrible. I'm going to have to review our templates, retrain on follow up cadence just to make sure we are all on the same page, and listen to some outbound calls.

A less than 1% conversion rate still says there is a problem somewhere, but after reviewing our leads so intently I, like many here, am left to question how honest other dealers are with themselves when calculating their conversion rates. The only leads I excluded were the ones mentioned.

I think one key point that I made when displaying the data was that the data was generated by myself alone. I wonder how many times dealers are using the data that their staff and/or their vendors give them to make the numbers sound good for their own purposes.

Would you consider getting rid of templates?

I wrote out a Google Doc "Day 1 Theme Cheat Sheet" for the sales team (they just bookmark the URL) that provides an example and multiple variations and explanations for most of our common leads. I called it a theme instead of a template because they have to still write the emails while understanding the theme of each section. I found that this did a couple things. First, if you have a guy write out a crap-ton of emails everyday using appointment language, or at least engaging "next step" language, they get better on the phone (because everything is written in natural language). Pretty simple, they're training their brain to come up with the sentences quickly by writing over and over again. Secondly, a template is a check box, a task to complete as fast as possible. I'm no longer reviewing their time to respond as that race brings poor quality. I'm watching it, but not making it a trophy for them. I'm really pushing the "Task vs Engage" mindset and it seems to be working. I stole that from @Steve Roessler even though we are still on Vin . The only templates we still use are for ICO and Truecar/Partner leads at this point.

Video? What are you doing for video? This has been in exercise in psychology as much as process. Sales people either love it or hate it. The argument of "I don't like the way I look/sound on video" went away after a couple months of hearing me say "Well you look and sound that way in real life, so....". I'm still working on the full adoption here. I have 82 guys with Snapcell licenses but its like pulling teeth to get them to fully use video. We're at an 80/20 right now. 20% are shooting 80% of the videos.

Phone training? Like I mentioned above, writing out emails (in natural language) instead of using templates has a side benefit of brain training word tracks. We call all internet leads, that come in during business hours, first, then email, then text/video. We email all overnight leads sitting in the bucket in the morning first, then text/video, then call. There's a method that has worked for us in that regard but I'm assuming that heavy phone text/video is part of your process? By the way, the emails they write are short, to the point, contain no fluff, and could literally be read out loud and sound like a phone conversation.

If you would ever want another set of eyes on your leads and process, I would help you out. I'm not perfect and my people aren't but sometimes people just see items we miss. Happens to me every day.

 

[BillKVMotorCo]

I really appreciate you engaging on this. This is why I love this place.

I have always went back and forth on the template debate, but I am always willing to try something new (to a fault sometimes). When considering abandoning templates I have always come back to the same thing: If they don't have templates, what would I want them to say? Usually the answer I come up with is "Well, what is already in the templates." Ha. The key points during the lead process being:

1. Confirm availability
2. We will communicate with you however you would like.
3. We will actually answer any questions that you have.
4. Communicate a "why buy." (in this case, we are currently using at home test drives and delivery)
5. Seriously, we will let you do as much of this online as you would like.

I know that some people prefer including an offer, but we try not to be too sales-y in our lead responses.

Another thing that we do that some might question is that after 3 days with no response we start basically begging them to tell us to leave them alone so that we can move on and stop wasting our time. We obviously try to shape it in a way to make it look like it's about helping them and not about us.

I think what you are saying may help us accomplish the same goals as our templates though as it sounds like you still have an outline of what you want your people to communicate. It also fixes the problem of the lead response sounding how the lead responder actually talks. I also 100% agree that the templates allow for a "just get my tasks done" process rather than engaging. I would honestly just have to see what it looks like to see how it fits us.

We are currently only using video for walk-arounds. To be honest, I have not engaged them about doing general video responses for the reason you mentioned which is that I fully expect them to hate the idea. Ha. I know video is definitely the way things are going though so we will have to get better at it one way or another.

I am definitely going to be looking deeper into how they are sounding on the phone when they call. In my initial review last night the biggest thing I found was a lack of energy in the VM. Again, they sounded like they were completing tasks rather than trying to sell engagement.

Our lead cadence might be a little lighter than the average dealer. Our target is to call within 15 minutes of receiving the lead or by 8:45 a.m. for after hours leads. We follow that up immediately with a text message. We text a reminder of the vehicle they inquired with a link to it approximately 4 hours after the first attempts at contact. We then call and text early in the day for 4 days after that and then leave a "last call" message on day 5. If the lead also had an email, we try an email after day 3 more so just to see if they even open it. It is typically the only email that we send if they provided a phone number unless they engage with said email. If they only provide an email, we send two emails the first day and then one in the morning for the next 4 days before sending a "last email" on day 5.

I am all about having another person review our lead processes when they are not a vendor trying to sell me something. Like everyone here probably I could talk about any part of the car business only all day every day. This business can be quite the obsession, can't it?

 

[ChrisR]

Would you consider getting rid of templates?

I wrote out a Google Doc "Day 1 Theme Cheat Sheet" for the sales team (they just bookmark the URL) that provides an example and multiple variations and explanations for most of our common leads. I called it a theme instead of a template because they have to still write the emails while understanding the theme of each section. I found that this did a couple things. First, if you have a guy write out a crap-ton of emails everyday using appointment language, or at least engaging "next step" language, they get better on the phone (because everything is written in natural language). Pretty simple, they're training their brain to come up with the sentences quickly by writing over and over again. Secondly, a template is a check box, a task to complete as fast as possible. I'm no longer reviewing their time to respond as that race brings poor quality. I'm watching it, but not making it a trophy for them. I'm really pushing the "Task vs Engage" mindset and it seems to be working. I stole that from @Steve Roessler even though we are still on Vin . The only templates we still use are for ICO and Truecar/Partner leads at this point.

Video? What are you doing for video? This has been in exercise in psychology as much as process. Sales people either love it or hate it. The argument of "I don't like the way I look/sound on video" went away after a couple months of hearing me say "Well you look and sound that way in real life, so....". I'm still working on the full adoption here. I have 82 guys with Snapcell licenses but its like pulling teeth to get them to fully use video. We're at an 80/20 right now. 20% are shooting 80% of the videos.

Phone training? Like I mentioned above, writing out emails (in natural language) instead of using templates has a side benefit of brain training word tracks. We call all internet leads, that come in during business hours, first, then email, then text/video. We email all overnight leads sitting in the bucket in the morning first, then text/video, then call. There's a method that has worked for us in that regard but I'm assuming that heavy phone text/video is part of your process? By the way, the emails they write are short, to the point, contain no fluff, and could literally be read out loud and sound like a phone conversation.

If you would ever want another set of eyes on your leads and process, I would help you out. I'm not perfect and my people aren't but sometimes people just see items we miss. Happens to me every day.

I am intrigued by the theme cheat sheet concept. Do you get graded by any OEM partners, for the FQR, that *must* contain certain elements, to pass any secret shops? Curious how well the team follows the themes, for engagement vs task mentality.

 

[ChrisR]

I really appreciate you engaging on this. This is why I love this place.

I have always went back and forth on the template debate, but I am always willing to try something new (to a fault sometimes). When considering abandoning templates I have always come back to the same thing: If they don't have templates, what would I want them to say? Usually the answer I come up with is "Well, what is already in the templates." Ha. The key points during the lead process being:

1. Confirm availability
2. We will communicate with you however you would like.
3. We will actually answer any questions that you have.
4. Communicate a "why buy." (in this case, we are currently using at home test drives and delivery)
5. Seriously, we will let you do as much of this online as you would like.

I know that some people prefer including an offer, but we try not to be too sales-y in our lead responses.

Another thing that we do that some might question is that after 3 days with no response we start basically begging them to tell us to leave them alone so that we can move on and stop wasting our time. We obviously try to shape it in a way to make it look like it's about helping them and not about us.

I think what you are saying may help us accomplish the same goals as our templates though as it sounds like you still have an outline of what you want your people to communicate. It also fixes the problem of the lead response sounding how the lead responder actually talks. I also 100% agree that the templates allow for a "just get my tasks done" process rather than engaging. I would honestly just have to see what it looks like to see how it fits us.

We are currently only using video for walk-arounds. To be honest, I have not engaged them about doing general video responses for the reason you mentioned which is that I fully expect them to hate the idea. Ha. I know video is definitely the way things are going though so we will have to get better at it one way or another.

I am definitely going to be looking deeper into how they are sounding on the phone when they call. In my initial review last night the biggest thing I found was a lack of energy in the VM. Again, they sounded like they were completing tasks rather than trying to sell engagement.

Our lead cadence might be a little lighter than the average dealer. Our target is to call within 15 minutes of receiving the lead or by 8:45 a.m. for after hours leads. We follow that up immediately with a text message. We text a reminder of the vehicle they inquired with a link to it approximately 4 hours after the first attempts at contact. We then call and text early in the day for 4 days after that and then leave a "last call" message on day 5. If the lead also had an email, we try an email after day 3 more so just to see if they even open it. It is typically the only email that we send if they provided a phone number unless they engage with said email. If they only provide an email, we send two emails the first day and then one in the morning for the next 4 days before sending a "last email" on day 5.

I am all about having another person review our lead processes when they are not a vendor trying to sell me something. Like everyone here probably I could talk about any part of the car business only all day every day. This business can be quite the obsession, can't it?

One thing I had some top performers do, with video, in the past was send a thank you video to unsold guests. It seemed to have increased engagement with those who decided not to buy on the first visit, as it was a 100% genuine, personal response to the shopper.

 

[joe.pistell]

@BillKVMotorCo , dude, your the 800lb gorilla in your market with great reviews!

Kirksville, MO pop 17k
https://www.kirksvillemotorcompany.com/ Franchises at one address:

1. TOYOTA
2. CHEVY
3. BUICK
4. GMC

Plus you have 180 units on the ground (I'm sure its way more before COVID) Your strong on the used car side. You've got a prime location in town.

Wow, Chevy & Toyota, this is a VERY RARE COMBO!

If I am a shopper, Why send an email?

QUESTION: What were last year's closing rates?

 

[Dan Sayer]

@BillKVMotorCo I can walk you through what we found to work with that "theme" idea. I'm hesitant to throw the detailed doc out in here as I know we have local competition lurking. Anyone can give me a text or ring on my cell 402.730.7632 and would be happy to talk to you offline (and on my Zoom). We're not perfect and I'm sure there are items that I can learn from you as well. Let me know. I have some time this afternoon.

 

[joe.pistell]

For internet leads in the period from March to August versus the prior six months before Covid, Internet Lead closing rate went up 65% (16.8% / 10.2%) despite response time going up 12.8% (246 / 218).

Hi @jon.berna! LTNTT!
Jon, pre-COVID, we all knew a shopper would often buy a different car than the email that brought them in. I wonder if the COVID craze has caused that to shift? IOW, Does VIN on email match VIN on sale? (i.e. how likely is the that VIN to sell?). That information could radically change the followups I send!

Talk to you soon!

p.s. What a 'sellers market' we're in!! You'll tell your grandkids about this one! GO TEAM!

 

[Dan Sayer]

If I am a shopper, Why send an email?

@joe.pistell Call, text, and email are all necessary channels to pursue and we can't afford to take a shortcut on any channel (that and it is one of the only channels that the manufacturer can track in order to know you replied). I hate email and I make sure that our sales team understands it is merely a channel that we pursue in order to gain trust and then the opportunity comes to move to a better channel like text (faster but still not great) or a phone call. My primary focus on email is that it's also a great tool to have sales people think about what they write which seems to also improve their speed with words on phone calls.
I know you have our backs but when I hear someone, who is not activity working in retail, throw out "Why send an email" or "get 'em in is old school" I have to sigh and understand the view outside of retail distorts quickly and there is much context missing from people offering assistance who are not in the weeds.

 

[BillKVMotorCo]

QUESTION: What were last year's closing rates?

Someone is watching the lot! How exciting!

We have historically run at 11% conversion.

Thanks for the kind words! We're definitely trying to be dominant. Never satisfied though! No one look at my site right now though. Gubagoo's script has thrown it for a loop. How embarrassing.

 

[GrantG]

@joe.pistell Call, text, and email are all necessary channels to pursue and we can't afford to take a shortcut on any channel (that and it is one of the only channels that the manufacturer can track in order to know you replied). I hate email and I make sure that our sales team understands it is merely a channel that we pursue in order to gain trust and then the opportunity comes to move to a better channel like text (faster but still not great) or a phone call. My primary focus on email is that it's also a great tool to have sales people think about what they write which seems to also improve their speed with words on phone calls.
I know you have our backs but when I hear someone, who is not activity working in retail, throw out "Why send an email" or "get 'em in is old school" I have to sigh and understand the view outside of retail distorts quickly and there is much context missing from people offering assistance who are not in the weeds.

Dan, I read Joe's comment to mean something different. I *THINK* he meant the shopper isn't sending as many emails to this location when they can find nearly everything they are shopping for under 1 rooftop. It's the retail superstore mindset. For example, shoppers have been conditioned by other retail industries to do their research in the shadows and show up at Best Buy, Target, Walmart to transact. While this isn't always the case in Auto, having 4 OEMs under one rooftop and a large Used Car Inventory could make this store more of a destination. COVID has changed the way people shop, we know that. They are using the internet more to research and some wish to limit shopping visits and exposure to potential viral catch-points.

4 OEMS and a large inventory presents a unique value prop that will generate foot traffic as shoppers can get more done in one place and spend less time doing so.

OP- what does your showroom count traffic look like YOY?