Capitalize On Every Opportunity

Every dealership is trying to capitalize on every opportunity that drives into their service department, and I always ask myself if they are doing it the right way? What I mean is this; are there some dealerships that are overcharging for the parts and services they sell with the hopes of capitalizing on a few customers OR, are dealerships price shopping their competitors and advertising BEST PRICE or BEST VALUE SERVICING. I would rather have VOLUME in my department and make a respectable profit then struggle everyday to fill my shop.

There are a couple of ways to price shop your competitors. The first way is to utilize your BDC call center and have your BDC mystery shop your direct competitors. This usually means one or two other same brand dealers and at least two aftermarket independent shops. The second way to shop your competitors is to hire an outside firm to shop your competition for you. There are numerous firms that perform this service advertised on the web. The one I have used and experienced accuracy and prompt service was by a company called INTELICHEK. David Swan is the owner of InteliChek and can be reached at www.intelichek.com for more service information.

It is imperative that you have accurate tracking of your competitor’s prices for their service or product offered. I highly recommend outsourcing this critical component of your marketing strategy to a professional company that can get the job done competently and quickly. By outsourcing this procedure, it will allow you and your BDC to spend more time booking your current clients in for regular scheduled service as well as allowing you to concentrate on your declined services calls. I strongly recommend outsourcing to build you servicing pricing structure.

One dynamic way to increase your marketing initiatives is by retrieving as many email addresses as possible. Email marketing is the number one source of dealer marketing and it is growing by leaps and bounds monthly. With the prices of postal service and telemarketing skyrocketing out of control and impacting your marketing budgets, email is the most cost effective medium for your marketing initiatives today. Some handy tips on email collection are:

• Every communication point with your customers needs to start or end with the request of a current email address.

The best times to address the question of email collection processes in the dealership are during the following customer interaction scenarios:

• Sales lead in the showroom during deal write up
• F & I when closing the deal
• Service drive when writing up the RO
• Retail parts counter when selling the part
• Cashier during point of sale contact

If you request customers email addresses in all customer communication scenarios and provide reasons why the customer should release the information to you, the better chance you have of obtaining it. Some common areas to list the request for email addresses are:

• Within your direct mail pieces – provide written reasons why you require it.
• Stipulated on your web page.
• BDC call contact – ask for the email address.

Address the need and the reasons for customer email addresses on a poster in your dealership along with a statement that your business protects the privacy of its customers and does not sell email lists to second or third party companies.

Get collecting and get marketing!

David

Create Exciting Marketing Material

The idea behind service department marketing is to remind your customers to bring their vehicles in for service and repairs at your facility. By marketing to your customers it increases the opportunity to multiply the amount of vehicles coming in for service. Ultimately the more vehicles that come into your service department, the higher the numbers will be in your sales department.

The best way to increase the return on your marketing investment is through target marketing. This is done by sifting through your customer data stored in your DMS (Dealer Management System), specifying your campaign and content towards a particular demographic and sale. This type of marketing will help you to build your appeal not just too potential customers but also to your existing customers.

Some words are powerful and cause positive excitement in people to want to find out more. The right words will convince your customers to purchase products and services, while the wrong words may either offend them or, have absolutely no effect on them. Carefully selected words will attract the attention you desire and entice your customers to purchase your services and products. Some of the most powerful marketing words are:

Crucial         Easy       Effective              Free           Innovative                  New

Rewards      Novel       Limited-time        Yield           Last chance              Proven

Results        Tried        Revolutionary      Accurate      Results oriented       Groundbreaking

Don’t be afraid to talk about the areas that your service department does extremely well! Choose the words and the wording for your marketing carefully, and make sure you use plenty of power words to attract customers to buy what you're selling. If your dealership is great at what you’re doing, and your products, services or conveniences can make your clients' lives better in some way shape or form, than your marketing plan is the place to make it known. Because you state you are great at something doesn’t make you vain, it instills in your potential customers that you have confidence in what you do.

                        "If you don’t have confidence, you’ll always find a way not to win."
                     Carl Lewis – American Track & Field Athlete, Olympic Gold Medalist

David

Marketing Objective

Where your marketing objective is specific, quantifiable and measurable, your marketing procedure is descriptive. The marketing procedure needs to describe how you will affect your target market’s buying decisions through the four P’s of marketing. The four P’s of marketing are as follows:

a) Product
b) Price
c) Promotion
d) place

a) Product – During the planning of your marketing procedure you will need to look at what you’re currently offering to your customers and rank them on their value to your service department. If you are currently offering a product or service that is not producing the revenue you need, a part of your marketing procedure might be to replace failing services with new ones.

b) Price – Each time you revisit your marketing plan you need to look at your pricing strategy and cost recovery for your products and services. You need to determine what pricing changes to make in order to reach your desired outcome.

Cost recovery is the method under which no gross profit is recognized until all the cost of the parts and services has been recovered. Once the cost has been recovered, the remaining collections are recognized as gross profit

c) Promotion – Encompasses all of the methods you will use you get the word out about your dealership is part of your promotional strategy. Advertising, direct marketing, events, public relations, and word of mouth are all types of marketing methods that can be used to get your dealership back on track.

d) Place – too many dealerships fail to understand the value of distribution channels. You should be seeking to have partners who will help you market, promote and sell your services. This alone can provide a valuable source of marketing. When you are expanding your services with partners, you bring value to your customers by offering them more comprehensive offerings or services. Examine your dealership, and you will most likely find the marketing voids. You need fill the marketing voids with other service participants that can help you develop new customers from the services or products they bring to your dealership. Such participants could range from your dent repair person, rim repair person, body-shop or oil supplier, you need to evaluate your service department and seek out new marketing alliances that benefit both parties.

Your marketing goals are definable steps or procedures that will lead you to your business goals within your dealership. Each goal should lead to profits otherwise you should refine it until it does. The word ample means extensive, therefore your goals need A.M.P.L.E planning, thought, research and specifics. In marketing AMPLE stands for:

Achievable – make sure your goals are achievable and realistic
Measurable – make sure your goals can be measured and quantified for tracking progress
Pertinent – Make sure your goals are pertinent to the target market you want to influence
Length of time – revisit your marketing quarterly
Exact – Your marketing needs to be exact in detail to achieve your goals

The purpose of your marketing objective is to focus all efforts in one direction within your service department, that objective is to facilitate new and repeat business and to always keep your dealerships name in front of your clients. The total overall objective is not giving your customers reasons to go anywhere else. Your marketing needs to make you stand out from your competition.

David

Developing A Marketing Strategy

Car dealership service departments are involved in one of the most ferociously competitive marketing businesses there is. Competition is fierce, and there needs to be a lot of service sales or hours generated in one year (from a limited and very transient pool of potential customers) in order to make projected profits and budgets. The most compelling factor in getting those service sales (hours generated) is giving people a reason to come through your doors, and this will require a concentrated marketing campaign.


The problem most people have in a dealership is the fact that the marketing is left to the heads of the departments who do not have formal training in marketing or advertising. Most often the service manager was a senior technician or shop foreman who was promoted through the ranks to become the department head. Therefore the service manager’s specialty is with production and procedures within the service department, not the marketing fundamentals of promoting the dealership service department to the public.

The second problem most dealerships face is the fact that most people involved in the dealership service department management team do not know the difference between advertising and marketing and most people confuse the two.

Advertising consists of the process of developing strategies such as ad placement, frequency, locations or advertising vehicles or mediums - such as print, internet, radio or television. Marketing is the detailed planning, implementation and management of a blend of business functions intended to bring together buyers and sellers, for the mutually beneficial exchange or movement of products and services.

Advertising only equals one piece of the orange in your marketing strategy. All of the aspects must not only work independently but they also must work interdependently to achieve the bigger goal. Marketing is a procedure that will take time and can involve hours of research for your marketing plan to be strategically effective. Marketing should be thought of as everything that an organization does to promote an exchange of goods or services between the dealership and its customers.

Because the automotive service industry is under unprecedented pressure to increase customer satisfaction, make sales and market to customers more efficiently, your marketing plan must have clarity, vision and a focus on what you need to accomplish. Due to the declining markets and rising industry competitiveness, customer incentive spending has been steadily climbing and this effect has been eroding profits at dealerships all over the country. Therefore a marketing plan which incorporates strategic pricing and is focused on building value to attract potential customers, and retain the customers you already have, is the key to future success.

The first steps that you need to have are Goals, objectives, and procedures, these are the most critical steps and are important to follow in growing your business. Therefore you need to:

1. Figure out where you want to take your business
2. Determine the length of time required for you to get there
3. Establish the procedures needed to achieve each step

As you are planning each of these steps, you need to contemplate your current marketing activities and pinpoint what worked and what didn’t work, and you will probably need to make some adjustments. By working through these steps, you will be better equipped to simplify the process and develop a marketing plan that makes sense for your service department.

The essence of your marketing plan is keeping your dealership in front of your customers and potential customers, the more frequently the public hears about your dealership service department, the better your chances are for achieving your brand recognition, integrity, and greater market share. Productive and effective marketing strategies are the result of exposing your target audience to your name and your selling (or value) points as often as possible, in as many ways as possible, and as cost-efficiently as possible.

Your marketing procedure and planning encompasses your plan of action to reach your marketing objectives. The difference between a marketing objective and a marketing procedure is that the objective states what you will do and a procedure states how you will do it.

I will have more over the next few days on marketing and some service initiatives to help drive some additional service traffic into your facility.

David

Repetitive Issues

Recently I spent some time speaking with a friend who is a middle manager for a medium size luxury car dealership. It came to my attention through our conversation that some dynamics within his dealership aren’t working the way they should and this has been stifling the productivity. For example; the sales people bring him deals in which the paperwork is not filled out or the required information such as driver license are missing from the file.

I asked the question, “Who makes these people accountable”? Well the surprising thing is that like most dealerships, the managers are so busy they don’t have any accountability measures in place to counteract this persistent problem. Usually the managers are so busy putting out fires due to the very items that require accountability measures in the first place.

Our conversation slowly gravitated towards the service department and centered on how that department cannot meet the needs of the sales department. New and used car inspections are being neglected and are not made to be a priority. This type of damaging scenario must be stopped at once from the management team as a collective before moving forward in a positive productive way. Considering the sales department is the service department’s best customer and the potential customers wanting to purchase a vehicle are the bread and butter of every single person employed at the dealership, you would think the issues would be resolved immediately.

I asked the question, why were the same issues repetitive and why did they keep coming back month-after-month consistently plaguing this dealership. The answer I received shocked me. The senior management had a meeting and tabled items like the ones outlined above including other issues such as the low CSI and parts obsolescence issues. Unfortunately some of the middle managers pointed fingers but didn’t roll up their sleeves and find out WHY certain issues were happening. It so happens that these middle managers also aren’t held accountable to a high enough standard to hold the employees beneath them to any sense of standards, as well the middle managers are not empowered to make accountability strategy decisions.

I truly believe that every item we discussed that evening can be rectified inside a two week period if the upper management would first hold the middle managers accountable by giving a strict outline of WHAT needs to be done WITHIN WHAT time frame. Step two is to give the senior managers the empowerment needed to hold their subordinates accountable in the same fashion. Unfortunately the top management at this dealership makes all decisions and all accountability rests within that position, nothing will change until this particular manager gives away some measure of control to the middle managers.

Meetings will do absolutely no good, until middle management takes responsibility to make decisions and hold their departments accountable on all levels. I believe that you should not emulate your boss to become them, I believe you must be yourself and make decisions that are right for your department, be responsible to the business and let that principle guide you.

Too many people try to be someone else, just be yourself and bring that quality to work with you each day. Most certainly we all have leaders that we envy and wish we could be more like them, practice the art of good judgment and good decision making and more leaders will envy you and want to be you.

In this particular case if I were the sales manager or the service manager I would be having a meeting with my entire team outlining where the issues were, what we were going to do and what is to be expected from every member of the team.

Accountability means nothing unless you follow through on your outlined list of consequences. Again, inspect what you expect! If you tell every one of your salespeople, “should a file come to the desk without the necessary required documentation you will be written up”, you better make sure you follow through on that threat! Once management writes a few people up, the message will have been sent and your problems will fast disappear. Put your money were your mouth is! Grab the bull by the horns and make good things happen, why wait for someone else to start the ball rolling. We as managers must be willing to do what is right for the business, customers and the employees who are doing it right. Bring passion and a desire to effect positive change in your department each and every day.

I purchased an on-line audio book titled Crush it by Gary Vanerchuk, I have had the pleasure of viewing some of Gary’s online videos and I have included one that kind of fits the theme be yourself at work and make good things happen, define who you are and make decisions that are right and just by using your own DNA.  Gary Vaynerchuk

Too many middle managers get stuck in a rut of playing follower to the manager above. Don’t get me wrong here, we all have to follow our managers, when the business is stagnating mix it up, try changing a few things on your own and see if they work. You will never know how great you or the business can be unless you try. Again, to make things happen, sometimes you need to grab the bull by the horns and beg for forgiveness later rather than ask for permission to promote positive change today. Change is ongoing, roll with it!

David

Employee Relations

Understand the fact that you cannot change your employees. You can only coax them to bring their talents to the surface. Do your employees know what you expect of them each and every day? Do your employees have the tools or materials required to effectively perform their duties or responsibilities? Do you as an owner or manager genuinely care about your employees? Do your employees see that you do care and are interested in them as valuable members of your team? Would your employees say that in the last week or two, you have given a thank you or some form of positive reinforcement for a job well done? Do you regularly encourage them in their professional and private lives? Have you made the investment of the time required, to actually know the people who ultimately represent you, and your business aspirations or visions?

You have to be willing to trust that your employees are acting in good faith, and in accordance with company policy, until such time as one of them has proved you wrong, then you can deal with situations on a case by case basis. If you penalize the entire staff for the fault of one individual, you could breed negativity into your organization which can lead to poor customer service, and poor productivity or performance.

You need to start thinking that a good customer service plan encompasses a good employee relations plan as well. A very wise older man once told me that you can achieve great customer service, simply by achieving organizational goals, structured around good employee relations combined with proper policies and procedures.

This is true, as long as the goals include customers and employees. You cannot have one without the other, as there is a certain synchronicity or correlation between the two. You cannot have one without the other. Therefore you need to take care of both aspects of good employee relations leading to good customer service.

“To improve is to change; to be perfect is to change often”  Winston Churchill – Prime Minister of England

David

Empowerment

Dealership owners and managers must learn to empower their employee’s to make decisions that are in the interests of good customer service, while stressing not to give away the farm. Managers need to monitor employees with regard to this function, and coach and counsel them.

Empowerment simply means giving your employees total responsibility for the job they were hired to do! Put another way, place responsibility and accountability where it belongs, vested in your employees. If your employees cannot make good decisions or judgment calls, they need more training or you may need to take a closer look to see if they are in fact qualified for the job.

Once you turn over the responsibility of fulfilling customer service within your policies and procedures framework, your employees will feel better about their jobs, and provide your customers with a higher degree or level of service. This has been proven at major corporations. Just because a dealership is a smaller sized business does not mean that this system will not work for you.

The best practices of empowerment are:

- Exacting responsibility to employees – make them responsible for their jobs.
- Provide the framework they are to work within – set policy and procedural goals.
- Consistently support and guide employees through your changes.
- Never, ever undermine the decisions an employee may make, unless it was disastrous to the business or the customer. Discuss different avenues the employee may have taken if decisions are not in line with policy, or if things could have been handled differently or easier.

Learn to support individuals no matter what the outcome. If at some point you disagree with a decision, investigate and discuss different ways to have handled it. Never challenge or chastise employees in front of other employees. Never humiliate or make disparaging comments or snide rude remarks to your employees or behind their backs to other employees. These types of managerial outbursts will negate all your efforts to achieve a team spirit of providing good customer service. Discourage and eliminate this damaging effect in all of your employees, and remember that following this rule is paramount to building an exceptional team atmosphere.

“Customer service is our way of life”

David

Think Like a Leader

Leadership isn’t something you are born with, it is something you acquire and it is a skill. Some people are born with the qualities to be a good leader however they still need to learn the skills. To excel at leadership a person must be committed to ongoing learning, personal growth and experience, and be willing to digest new communication skills. Being a good leader entails the ongoing commitment of learning and constantly striving to be better each day.

To be a leader you must think like a leader. To be a leader means you are pursuing excellence – always. To be a great leader means that you celebrate your goal achievements with your team making them the team’s achievements – take no credit.

People tend to perform as well as they think they can perform, it takes the keen eye of a good manager to see that someone has more potential then they currently demonstrate. Create new possibilities and different ways for these employees to think about and relate to their jobs, you will be able to get more from them and out of them. In essence the employees who know they are producing and are being rewarded for it, will be happier and more fulfilled which will motivate them to continue to reach the future goals and targets you set. Reward means acknowledgement, it doesn’t always need to be a monetary reward.

Too many managers get caught in the trap and worry about how they are perceived by their employees. This trap breeds fear and insecurity and leads to low self esteem. Managers need to stay focused on watching observing and listening to the people they lead. Too many managers speak to often without thinking and formulating a plan of action.

Everyone has the potential to perform better and they need the motivation from you that you will support them. When you support your employees they respect you and will follow you. To keep the respect that you as a manager have earned means fulfilling the promises that you make to your employees. No matter how small or trivial the matter is, always keep your word. Practice what you preach! Nothing is more damaging to the respect you have gained, then forgetting or putting off that which you promised to do.

In management – keep it simple. If you find things are getting to complicated, then change and try again. The best things in life are kept simple and the results are priceless. Studies show, the higher people rise up the corporate ladder within any organization, the more likely they are to develop disconnects from the front lines and make poor decisions. Stay in communication with your employees, staying in tune with your people will help foster your department’s growth. Effective communication ensures you have the ability to stay focused on the bigger picture and facilitate necessary changes quicker.

A good manager knows how each job position facilitates and supports the dealerships key objectives. A good manager uses objective evaluation based upon known good performers or industry standards to see the performance in each particular job category. You need to use the data that is at your fingertips to extrapolate your top performers from your non performers. You need to make sure that your compensation is competitive within the market place and that you are paying for performance.  Performance based compensation plans ensure your employee's will be empowered to be the master of their own destiny or their own demise.

David

Perception is Reality

Have you ever taken the time to look up in the dictionary the definition of the word client? A client is one that is under the protection of another: DEPENDENT, a person who engages the professional advice or service of another. The client therefore is dependent upon you for accessing parts and service, and you are dependent upon the clients to sustain your business and prosper. This is a mutual business relationship that benefits both parties so long as the client feels they have been fairly treated, and not overcharged.


The word service has an interesting meaning as well. Service is the occupation or function of serving in active service b: employment as a servant, entered his service, 2a: the work performed by one that serves, good service b: glad to be of service c: contribution to the welfare of others d: disposal for use – I’m entirely at your service, e: useful labor that does not produce a tangible commodity.

The definition of the word customer is: one that purchases a commodity or service. In the word customer is another word. CUSTOM – a usage or practice common to many, or to a particular place or class b: long established practice considered as unwritten law c: repeated practice d: conventions that regulate social life.

What is interesting is the relevance each word has when we make a statement such as “We give good customer service!” To sum up this phrase would say, “Good customer service equals a long established practice or unwritten law, to be at the service of those who seek you out for a commodity, product, service or advice, and to provide a custom tailored experience based upon the product or commodity offered”.

Every single person at your dealership that has contact with a customer is perceived by the customer as the overall perception of the dealership, and the customer service that you provide. The mantra of good customer service starts with the GM and dealer principal, and filters down to the porters, drivers and lot attendants. Everyone needs to be on the same page, “All the world is a stage – even at your dealership”! Perception is reality in most cases.

Preferably senior management or the dealer principal needs to set guidelines or policies on conduct, and set the standard for your customer service policies. Good customer service works best with the trickle- down effect, or top down management policies. If upper management is unwilling to invest the time, energy and resources necessary to enact good customer service policies, the business may get by albeit in stagnation.
At best some dealerships are being run in today’s fast paced market, driven by CSI and by owners that micromanage their employee’s and the dealerships they have invested into heavily. Owners, GM’s, Service Directors or Managers that micromanage employee’s, and or the businesses practices to create good CSI are doing a disservice to their own financial wellbeing. I know that some dealer owners and managers may feel that customer service is secondary if they are recording profits. If the powers that be keep operating with the mindset that “we can’t give too much to our clients”, that company will never truly be successful. It is not about lip service, it is about good service!

“If you’re not offering exceptional service – someone else is, and it’s hurting you!”

David