What does your PRICING have to do with your REVIEWS?

[joe.pistell]

I'd never disagree with you Uncle Joe - I know I'd be wrong more often than not. While I agree the 800 pound gorilla in a market often gets to bypass the Google Places step of a shopper's process, I don't think they get to bypass the ATC/Cars.com step - at least not always. With retail customers spending 18 to 19 hours, on average, doing research before setting foot into a dealership, I think it's likely that they would compare pricing on one of the classified sites - even if only to keep the gorilla "honest".

With the classified sites integrating reviews, the 800 pound gorilla's free ride may be over. Seeing reviews used to be limited to the Google step. Now it's being integrated into the pricing comparison step.

Ed,

The 800lb gorilla can move a shopper away from the AT/Cars step (thats the GOAL of the Gorilla!). The in-market shopper is in a multi-week journey and are vunerable especially when they're on the UPSLOPE!

Charting The Internet Car Shopper Experience | DealerRefresh



Another way to say the same thing would be... if the local market has no 800lb gorilla the Google>>Cars>>AT path is used more often.

Case in point. 2 questions from my post sale survey (6000 surveys completed in 2010).

Question 14.
Do you consider yourself a frequent internet user (more than 10 hours per week)?
....Yes = 75.44%
....No = 24.56%

Not bad. Sounds about like the normal demo. Ok, then look at Question#15

Question 15.
Did you shop online at: (check all that apply)
.... KellyBlueBook.com
....Cars.com
....AutoTrader.com
....craigslist
....Other
....None of these

Guess the rank of these and the percent each site took.(ie craigslist 9%) C'mon Guess! (answers at bottom)




The 800lbGorilla won't suck much traffic from Cars or AT. BUT! The Gorilla has a recognized brand that an AT/Cars shopper recognizes. This "Dealer brand comfort" or "brand history" can be seen in a higher CTR (see my CTR comment above). I'd love to see an interview of local shoppers. List 25-100 dealers (that are on AT/Cars). Ask them to circle the names they know. Answer? Most all dealers are unknown except the largest gorillas (hence the critical importance of Dealer Reviews!) All I am saying is a 800lb gorilla with a great message can see more clicks from AT and Cars shoppers (its just human nature).


Now... to come full circle. IF the Cars/AT reviews are placed in a very visible position in the SRPs, that'll wack the Gorillas CTR (and everyone else with a low score). That'll tip the scales favorably for shopper AND for pro-active dealer.

I have not seen the final Review presentation as seen by shoppers for Cars/AT. I can't imagine AT/Cars ignoring a way to strike some balance to bring quality reviews to the platform, yet not piss off its advertisers (with "sloppy operations"

All I am trying to say is not everyone buys a car traveling down the same path. The 800lb gorilla will always get his share of bananas.

 

[joe.pistell]

We're saying two different things Joe. I'm simply saying that reviews are not hurting or directly increasing profit enough TODAY to be taken as seriously as they should be tomorrow. If the 800lb gorilla were being hurt by the reviews they'd be paying attention to their reviews.

Amen and Amen!

We're both on the same page. WHEN will the damage from sloppy operations (aka poor reviews) awaken the 800lb Gorilla? As long as the ad costs PVR remain in check, I see the DP Gorilla in denial.

What makes this interesting is when the Gorilla awakens, and decides to fix the problem, they'll realize THEY are the problem... and that's hard to fix! (Gorillas love to throw money at things to make them go away

 

[joe.pistell]

Question 15.
Did you shop online at: (check all that apply)
KellyBlueBook.com = 22%
Cars.com = 17%
AutoTrader.com = 14%
craigslist = 1%
Other = <1%
None of these = 53%

Not a scientific result, but, it is what it is. It's peoples best guess at point of delivery.

 

[joe.pistell]

Ed,

The 800lb gorilla can move a shopper away from the AT/Cars step (thats the GOAL of the Gorilla!). The in-market shopper is in a multi-week journey and are vunerable especially when they're on the UPSLOPE!

Charting The Internet Car Shopper Experience | DealerRefresh

Ed,

Sorry to blabber, but, you ask great questions, it forces me to challenge/test my beliefs (which fuel my decisions). Writing it all down helps me tie the loose ends together. TY ED!

The AT/Polk survey tells us the shopper is shopping for MANY hours, but, shoppers don't hunker down and string hours together to create clean research threads. It's a very busy world we live in, the research is made up of fragmented hours, not consecutive hours and it's spread out over weeks & months. This journey is not linear nor totally logical. The shoppers juggle a LOT of variables. For example, In one (of many) sittings, they can start off with a high mile Lexus and find themselves looking at an almost new Kia.

I see the frustration of the shoppers in our makeover survey question below:

Question #4).
Please tell us why you were not able to fully complete the purpose of your visit today?

• "out of time"
• 'too busy"
• "not enough time to look at"
• "did not have enough time to search

This reality hits on so many levels.

• It's why a "3day money back guarantee" works (insurance against a rushed decision)
• Its why the 800lb gorilla model is alive
• Every SRP and VDP needs an optimized message for this shopper
• Its why Chat works

 

[ed.brooks]

Ed,

Sorry to blabber, but, you ask great questions, it forces me to challenge/test my beliefs (which fuel my decisions). Writing it all down helps me tie the loose ends together. TY ED!

The AT/Polk survey tells us the shopper is shopping for MANY hours, but, shoppers don't hunker down and string hours together to create clean research threads. It's a very busy world we live in, the research is made up of fragmented hours, not consecutive hours and it's spread out over weeks & months. This journey is not linear nor totally logical. The shoppers juggle a LOT of variables. For example, In one (of many) sittings, they can start off with a high mile Lexus and find themselves looking at an almost new Kia.

I see the frustration of the shoppers...
[/LIST]

Thanks Joe! I think you really nailed it - shopping for a car is not a linear track.

As for the 800 pound gorilla and his reliance on traditional media; it's going to be tougher and tougher to maintain as traditional media continues to loose ground.

Back to the original question; Do you think dealers that advertise a market price and reduce negotiations - in effect giving the discount in the ad, not in the negotiation - have an inherently better process to building a happier customer base?

 

[joe.pistell]

Thanks Joe! ...Back to the original question; Do you think dealers that advertise a market price and reduce negotiations - in effect giving the discount in the ad, not in the negotiation - have an inherently better process to building a happier customer base?

Ed,


Lots of upside to those that dare to move away from negotiation. FEW DO IT. Why? Management that dares to sell without negotiation are brave souls because it completely changes everything. No negotiations means that business operations now drive financial performance.


Moving to non-negotiations squarely puts more responsibility onto managers shoulders and it requires new management skills to pull this off... and... we all know, learning new skills is not exactly our strong suit !


Changing RESPONSIBILITY for how profits are created is a tough nut to crack. Owners & Management LOVES the safety net that commission makes because it pushes risk AND overhead down to the rep (read: commission). It's a simple management system, "if you suck you don't get paid". Funny part is, if the inventory and facilities and policies and marketing are all wrong... your reps will suck!


Management hangs on to the belief that commissioned sales reps put out more effort to create the deals they make. From my travels, employees that fit this model are exceptions, not the rule. Most car sales reps that I have run into over the years are closer to sales CLERKS, not sales representatives. Hell.. they don't even answer the phones right. (disclaimer: I totally respect the art of selling, it's not for everyone!!)


DON'T FORGET! Management chooses to remain in this cycle of negotiation because customers expect it (see: Negotiating the Car Deal - Consumers Are Out For Blood | DealerRefresh)


Noteworthy non-negotiating players I watch do it (and are doing it right) are: AuctionDirectUSA.com & SuzukiofWitchita.com. You can't commit to the NEW system without a GREAT marketing and merchandising package to support it.


So this means, the brave manager/owner that dares go to non-negotiating has TWO culture bombs to un-wire & re-educate. Shopper and sales staff. GULP!! Re-educating the shopper can be done, but for it to work, IMO, there needs to be a total buy in, from top to bottom! It'll require a wholesale change in staff, marketing and merchandising and that my friend is what "a change is culture" is all about.

</uncleJoe ramble...>

 

[ed.brooks]

Ed,


Lots of upside to those that dare to move away from negotiation. FEW DO IT. Why? Management that dares to sell without negotiation are brave souls because it completely changes everything. No negotiations means that business operations now drive financial performance.


Moving to non-negotiations squarely puts more responsibility onto managers shoulders and it requires new management skills to pull this off... and... we all know, learning new skills is not exactly our strong suit !

...and that my friend is what "a change is culture" is all about.

</uncleJoe ramble...>

Joe, as always, you nailed it! There certainly does need to be culture change to make this successful. But it doesn't need to be a move to NO negotiation, simply LESS negotiation. In effect, giving away the discount in the Ad, not in the negotiation. The obvious benefit is greatly increased traffic.

A great example is featured in one of our new Print Ads, your neighbor in Buffalo, the West-Herr Group. They made the move to reduced negotiation by implementing RealDeal. The numbers speak pretty clearly for themselves; 311% increase in used inventory retail turns while holding negotiated discount to a impressively low average of $170.

To top it all off, they are showing outstanding ratings on a Google search I just did. The only problem I see is that need to be asking more customers to rate them because, while they don't have a ton of reviews, the ones they have are raves!

 

[ed.brooks]

Joe, Not sure if you had a chance to attend Dale Pollak's webinar "Documentation Replaces Negotiation: 4 Easy and Effective Strategies to Improving Gross Profit" back in October and November. While I believe RealDeal is the most elegant way to implement the strategy, Dale shows how most dealers could do it without spending a dime, simply with the tools they already have. Here's the link to the recorded webinar.

 

[Jeff Kershner]

Thanks for sharing Ed. I encourage everyone to watch this.

 

[thecarshack]

I strongly dont believe in consumer reviews due to the fact that they take advantage of the situation and strongly believe they can ruin a car dealership reputation. Atleast down here in Miami, FL most of the customers we get are highly educated and actually do visit review websites for feedback. As "MullerToyota" pointed out pricing does certainly have alot to do with your reviews. Unfortunately aswell those who are not making any purchase.