Sales people tend to think that they are at the mercy of day to day traffic and the luck of the draw in the line up. However, many of us forget one simple rule that can be the key to success as a sales person in the dealership. Follow up! The fact is you can earn significantly more money if you focus on this key element of your sales process. Let’s look at some reasons why. The average closing ratio for a first time customer is between 8% and 16%. Your be back closing ratio can be as high as 50%. In most stores you have to have 4 or 5 contacts with a customer before they can effect a decision. That is, you need to speak to them 4 to 5 times before they either buy an RV or tell you no thanks.
What constitutes follow up? The contact can be a card, letter or even an email but the most effective follow up is going to be a phone call. However it can't be just any phone call. Just a phone call asking the customer, “have you bought an RV yet” is not enough. Your follow up needs a few key elements to be effective. One, continue building report based on some of the information that you received from the customer in earlier interactions. Two, your call needs to include a value proposition. Your customer needs a compelling reason to do business why and now, whether it's a sale you're having, new finance terms, incentives, or just something special that sets your dealer apart from the rest of the crowd.
So maximize your time, get on the phone and work those customers that close 50% of the time.
Monday, April 4, 2011
Wednesday, March 23, 2011
CUSTOMER LOYALTY, PRODUCT AND THE SERVICE DRIVE
RV dealers have been offering Extended Service Plans and Road Hazard protection for a long time. These are great products that an experienced finance manager can build value for the customer and profit for their dealership. Products such as these benefit the dealer in many ways, not only with initial profit but also in customer loyalty. Whenever a customer is given or purchases a product that they perceive as valuable, they have the opportunity to realize that value. When they redeem that value, they appreciate your service and in turn become a more loyal customer. In summary, the more products and perceived benefit that a customer buys/receives from the dealership, the more loyalty they will have to that dealership.
Finance is a great place to offer customer benefits and it's extremely important that your finance managers are doing a good job presenting the products at the time of vehicle sale. However as sales have decreased in the last couple years, dealerships have had less opportunities to sell product. Remember, by selling product you are not only creating income but increasing customer loyalty. You need to find more opportunities to sell product and that's why dealers have turned their focus to service. Selling a product through service allows you to increase dealership profit and loyalty by giving finance opportunities to sell product. Service is a great time to talk to the customer about the costs of owning an RV. The customer is in tune to the cost of RV repairs and do not want to deal with the cost of repairs in the future.
Road Hazard protection and extended service contracts are both products that sell well to service customers. The key to a successful service drive program is getting service writers to mention the benefits of the product and then turn them over to finance for the final sale and contracting. We have a script and process for each product that works seamlessly with the inspection of the customers RV. A program needs to be created to reward service managers for each service customer that purchases a service plan, (a flat fee taken from finance profit works best). 12 or 18 month financing is available to help make the cost more manageable for people that don't have cash to spend upfront. In closing, product sales created from service customers allows your dealership to profit and gives those customers one more reason to come back.
Finance is a great place to offer customer benefits and it's extremely important that your finance managers are doing a good job presenting the products at the time of vehicle sale. However as sales have decreased in the last couple years, dealerships have had less opportunities to sell product. Remember, by selling product you are not only creating income but increasing customer loyalty. You need to find more opportunities to sell product and that's why dealers have turned their focus to service. Selling a product through service allows you to increase dealership profit and loyalty by giving finance opportunities to sell product. Service is a great time to talk to the customer about the costs of owning an RV. The customer is in tune to the cost of RV repairs and do not want to deal with the cost of repairs in the future.
Road Hazard protection and extended service contracts are both products that sell well to service customers. The key to a successful service drive program is getting service writers to mention the benefits of the product and then turn them over to finance for the final sale and contracting. We have a script and process for each product that works seamlessly with the inspection of the customers RV. A program needs to be created to reward service managers for each service customer that purchases a service plan, (a flat fee taken from finance profit works best). 12 or 18 month financing is available to help make the cost more manageable for people that don't have cash to spend upfront. In closing, product sales created from service customers allows your dealership to profit and gives those customers one more reason to come back.
Tuesday, March 8, 2011
CAN IDENTITY THEFT PROTECTION DRIVE RV SALES?
We started offering ID theft protection in RV dealers because so many people have been victimized by some sort of identity theft. It takes a long time and is a huge hassle to restore your identity in the event that it is stolen. The product is especially applicable to the customer buying RV's right now.
We promote the product by training dealership sales people to educate your customers on the risks of identity theft. A lot of times, the customer has had experience with identity theft or knows someone else that has.
Right now we are seeing dealers sell Identity theft protection to as many as 70 percent of their customers. It varies by store but we have capped the price at $469 for five years of protection.
Right now, we are seeing the program help dealers sell RV's. We do this by having the dealer give each customer one year of protection free for buying their RV. They are then eligible to upgrade to a family membership that covers grandparents and children under 25 living in one household. The identity recovery plan is offered through Safeguard products international.
We promote the product by training dealership sales people to educate your customers on the risks of identity theft. A lot of times, the customer has had experience with identity theft or knows someone else that has.
Right now we are seeing dealers sell Identity theft protection to as many as 70 percent of their customers. It varies by store but we have capped the price at $469 for five years of protection.
Right now, we are seeing the program help dealers sell RV's. We do this by having the dealer give each customer one year of protection free for buying their RV. They are then eligible to upgrade to a family membership that covers grandparents and children under 25 living in one household. The identity recovery plan is offered through Safeguard products international.
WHY DO WE MISS THE MARK IN RV FINANCE?
Most dealers say that their finance and insurance departments use a menu to sell service contracts and other aftermarket products. Dealers also say that customers are presented 100 percent of products 100 percent of the time, but is that the case? Finance managers that offer the right combination of products and follow the menu sales process are averaging 2.3 products per unit sold.
Below are the top reasons that dealerships miss the mark when using the menu.
1. Skipping the menu. The menu is an effective visual aid for the customer and helps the finance manager make a complete presentation of what the store has to offer.
2. Single-product focus. The finance manager pushes just one product -- typically service contracts. Service plans should be the number 1 seller, but not the only one sold. Service contracts provide a real benefit to customers and draw people back to the dealerhsip for service, but ancillary products will take the business to the next level.
3. Too many products on the menu. Focus on the basics. Narrow the number of items on the menu to five products that have a 20 percent sales penetration or better. Some dealerships get distracted trying to sell too many products. Finance manager can only present a handful of products well and customers want the process to go quickly.
4. Too much a la carte. We recommend packaging tire and wheel, interior exterior and roadside assistance at a slight discount - 15 percent off the price of the products sold seperately. Dealerships tend to sell more products because finance managers are more likely to present all three items when they're grouped together.
5. There are no warm and fuzzies from finance. Salespeople are trained to meet and greet customers and establish common ground. But dealerships often drop the ball in the finance office. Finance managers fail to connect with customers. As a result, they are unfamiliar with customers' needs and try to sell people products they don't want.
6. Neglect the customer interview. Safeguard estimates that as many as 70 percent of finance managers in the RV dealership skip the customer interview. Finance managers often claim that they don't have time. This is the most important part of a finance managers job and should only take 5 minutes.
7. Unplanned introductions. Finance managers should approach customers with a planned greeting and stock questions. If managers try to wing it, the process will take too long.
8. Failure to lave the desk. Finance managers need to meet customers on their turf. Get acquanted with customers in the showroom or while they're in the salesperson's office -- not when they're ready to go home.
9. Asking Yes and No questions. Get the customer to open up with open ended questions that can not be answered with a simple yes or no.
February Automotive News
Below are the top reasons that dealerships miss the mark when using the menu.
1. Skipping the menu. The menu is an effective visual aid for the customer and helps the finance manager make a complete presentation of what the store has to offer.
2. Single-product focus. The finance manager pushes just one product -- typically service contracts. Service plans should be the number 1 seller, but not the only one sold. Service contracts provide a real benefit to customers and draw people back to the dealerhsip for service, but ancillary products will take the business to the next level.
3. Too many products on the menu. Focus on the basics. Narrow the number of items on the menu to five products that have a 20 percent sales penetration or better. Some dealerships get distracted trying to sell too many products. Finance manager can only present a handful of products well and customers want the process to go quickly.
4. Too much a la carte. We recommend packaging tire and wheel, interior exterior and roadside assistance at a slight discount - 15 percent off the price of the products sold seperately. Dealerships tend to sell more products because finance managers are more likely to present all three items when they're grouped together.
5. There are no warm and fuzzies from finance. Salespeople are trained to meet and greet customers and establish common ground. But dealerships often drop the ball in the finance office. Finance managers fail to connect with customers. As a result, they are unfamiliar with customers' needs and try to sell people products they don't want.
6. Neglect the customer interview. Safeguard estimates that as many as 70 percent of finance managers in the RV dealership skip the customer interview. Finance managers often claim that they don't have time. This is the most important part of a finance managers job and should only take 5 minutes.
7. Unplanned introductions. Finance managers should approach customers with a planned greeting and stock questions. If managers try to wing it, the process will take too long.
8. Failure to lave the desk. Finance managers need to meet customers on their turf. Get acquanted with customers in the showroom or while they're in the salesperson's office -- not when they're ready to go home.
9. Asking Yes and No questions. Get the customer to open up with open ended questions that can not be answered with a simple yes or no.
February Automotive News
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