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Craddle to Grave ISM Pay Plans?

Discussion in 'Online Dealership Marketing Best Practices' started by tomfohr, Dec 21, 2011.

  1. tomfohr

    tomfohr Getting Refreshed

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    The arguement that will never end.... Craddle to Grave or BDC/Appointment Setter.

    One of the biggest problems that I see with the Craddle to Grave mentality is that we expect the Internet Sales People not to be like typical sales people and take the path of least resistance and just cherry pick through the leads and only really work 100% on the leads that are the easy deals and not grind the rest of the leads, yet we have them on a typical sales person's pay plan.

    So, could we get the productivity and results from a craddle to grave Internet Sales Person without loosing the personal connection that it offers by just having the right pay plan?

    Finance Managers all over the country are paid based upon product penetration so what if we paid Internet Sales People based on conversion ratio? (Ex. > 10% conversion = 25% commision, 12% conversion = 30%, 15+% conversion = 35%, ect) Would we be getting more of the results we are looking for out of our Craddle to Grave guys and not have to make the switch to a BDC/Appointment Setter?

    Curious to hear others ideas for payplans for Craddle to Grave ISM's?
  2. ddavis

    ddavis Sr. Refresher

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    I assume that when you say conversion, you mean sales as a precentage of leads. I used cradle to grave. What would you pay my guys that averaged over 20%? Is that front and back? I'm in!

    The Internet Director controls most of this through marketing strategy and supervision. The key is having quality leads and that is the Director's responsibility. Excuse the vulgarity, but who's fault is it if you allow your ISMs to eat like elephants and shit like birds?
  3. ryanabbott

    ryanabbott Refresher

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    We have 4 rooftops in our organization and we use the "appointment setter" option. Each store has 2 ISM's and they handle every incoming phone call and lead. They are compensated with a weekly salary as well as a paid per Shown appointment bonus. Once the appointment enters the facility, they are turned over to a sales consultant who has been briefed on the situation. It has worked out well for us and we are focused more on selling the dealership rather than selling the vehicle over the phone. Obviously every opportunity is unique and you have to answer the questions that are asked, but our first act is to try to get that appointment.

    Our shown appointments have increased over 1,025 from last year to this year. What was supposed to be a down year b/c of the lack of import inventory, we have managed to have a better year than last. I'd like to think it is b/c of our process but only time will tell.
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  4. ddavis

    ddavis Sr. Refresher

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    Ryan, you call your appointment setters ISMs? I've worked in stores where the philosophy is: "you can't sell a car over the phone, get 'em in". The most common complaint, that I hear, about appointment setters, is that they will say anything to get a customer in.

    At my last store, I had nine cradle to grave ISMs. We had outgrown our facility. We didn't have enough drops, computers, phones and desks. I had the same problem at the previous store. With limited resources, it was imperative that we had the very best people utilizing them. Obviously, appointments are important but sales are the main objective. I would be interested to hear your closing ratio to leads, year over year.


    Ultimately, I would like to run a department where they were all ISMs and a Business Development Center focused on plus business.
  5. ryanabbott

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    I guess I would call them "Client Care Managers" rather than ISM's. When I began at Saturn 6 years ago, I was thrown in front of a computer and told "Get them in the door". I had to battle with managers for numbers and I did anything I could just to get them in and turn them over to a salesman. I got paid on the total gross profit for the store so as long as I thought I contributed to the sale I was happy. I did Myspace, Youtube, Facebook, Blogs, Twitter, Video specials, etc.. I was learning more and more everyday and the leads became an after thought after a while. This thinking lead me to my position I have today but didn't do the position of ISM justice. I think with the number of leads and the proper follow through, being appointment setters is all we can ask our ISM's to be. Then having someone like myself oversee them and do the misc. stuff is where it's at. If you are having your ISM's follow the lead all the way through to the sale then you are missing a lot of follow up b/c there isn't that many hours in a day!

    Ultimately, I would like to run a department where they were all ISMs and a Business Development Center focused on plus business.


    This is my main goal and I think we are a year or so away from it. We have a good team here and they each have their own special skill. If I can get them all together I think we could have a great team. All four stores under one building, it would be my own little Voltron!!
  6. ddavis

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    That is exactly why I limited the number of leads to a maximum of 85/month per ISM. I don't know anyone in this market that closed a higher percentage of leads. It really didn't matter because more phones wasn't an option.
  7. ryanabbott

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    That's the way to do it. 85 is where I would cap it also. I just wish I could employ 4/5 per store to be able to do that. Unfortunately we aren't there yet.
  8. ddavis

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    Allowing your ISMs to cherry pick the leads is a very expensive proposition. From another post, you are buying leads through TrueCar but you don't have enough ISMs to handle your existing leads?
  9. ryanabbott

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    We handle our leads based on priority. We can handle them all as I said above, we are appointment setters. If my team were going cradle to the grave then yes, 85 per would be our limit as well. Our website, etc. leads come first. With TruCar, we only pay for what we sell. It has given us more opportunity and we try to maximize every opportunity the best way we can. Our Internet Department has grown a lot this past year and just last month our Honda Internet Team resulted in 54% of the stores sales.
  10. danoneil

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    At my dealership we have 2 dedicated ISM's who handle all the leads. We make appointments and follow up until they have responded they are off the market. I get paid a salary plus a set fee for every car the department is involved with. When a customer comes in, whoever greets them, gets them. If we take a deposit, then the sales manager decides who gets the deal.

    We do not deliver or test drive customers. All we do is handle the leads and involved with marketing. 600 leads a month - 40% of sales come via internet & a 13 to 16% closing percentage on average.

    It's a simple plan. Salespeople are happy.
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  11. ddavis

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    At my previous store, a customer had to be an appointment or ask for an ISM before it was considered an internet deal. Our ISMs worked cradle to grave and accounted for 70% of the new and used car sales. They closed 20% and influenced far more.

    With a one in five chance of delivering a car, how hard do you think they worked that customer?

    The group owned 4 stores in the market. At quarterly sales meetings, they would recognize the top 10 salespeople. Six or seven would come from our department. My guys were very happy.

    Key to motivating ISMs, especially at a group store, is not leaving a mark.
    Last edited: Dec 23, 2011
  12. tomfohr

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    When I say conversion, I am talking total number of leads divided by total number of sales for that particular ISM. From everything I've seen, realistic expections is 12-15%... If you factor out your duplicate leads and what not then maybe closer to that 16-18%..... But I guess I should have gave a little bit of background first so much questions/logic make a little more sense...

    Our store sells apox. 100-120 units per month.... about 50/50 new vs used. We have two Craddle to Grave Internet Sales Managers and for explanation purpuses, I will use ISM #1 and ISM #2 (real clever!). Our lead sources are Autotrader (with Alpha package), Cars.com, CarQuotes, FordDirect, and our dealership website (DealerFire). Edmonds.com was also in there until last month when we canceled them do to terrible performance. I have it set up that any of the published internet phone numbers ring first to the ISM's desks for 5 rings and if unanswered go to the cashier and get paged as a regular sales call (We have about 12 floor salespeople... so what I am saying is if the ISM's don't get it on their direct ring, they aren't getting the call).

    Last month's lead numbers:
    ISM #1: 115 Email Leads, 33 Phone Ups, 2 Walkins
    ISM #2: 111 Email Leads, 22 Phone Ups, 9 Walkins

    Now as much as I would like to say those guys have 12-15% conversion ratios.... that is not that case.

    My questions:
    -Are my craddle to grave ISM's in over their heads with lead volume to convert the numbers I am looking for?
    -Are they simply just cherry picking the easy ones hense the low conversion ratios?
    -Is it possible that based on my lead sources, the lead quality might not be there?
    -For my store, is it inevitible that we will have to go to an appointment setter format?
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  13. tomwhitejr

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    My two cents:

    The absolute MAX leads a selling internet salesperson can handle is 120... 90 is optimum, but anywhere in that realm is realistic... Your guys/gals MIGHT have too many leads... I say, "might," because I don't know how many people they are seeing belly to belly everyday...

    If they only see one person live on the floor everyday, they might be able to handle more than my max... However; followup becomes a bitch at this point - you can't look at this month ONLY because last month's leads require follow up as well. That is why I give the Tom White Jr MAX lead number... In reality, your ISM's are dealing with hundreds of leads that need followed up with on a daily/monthly basis... Assuming you subscribe to the "buy or die" mentality of lead follow up. So...

    At the end of the day, we both want conversions... 100 leads generates 80 contacts, generates 40 appointments, generates 20 shows, generates 10 sold... Those percentages have worked for me for 15 years... They are probably the only percentages that haven't changed in that time frame...

    There are ALOT more talented guys on this forum than I am, and many will probably have better results than what I just described, but my numbers work and are profitable... If you can set them as a baseline and do better... well then you have accomplished something...

    Just my two cents as always...

    TW
  14. CAORYAN

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    I am against a $10 an hour employee being my first point of contact. I believe in hiring proven sales people who are excellent on the phone. I also believe in a BDC for follow up if the ISM doesn't get them after the first two or three try's. I would also use the BDC for social media and blogging.

    Put your best sales people on the phone to "sell the appointment". No one can do that better than a well trained sales person. I am 100% convinced that a BDC is needed but not to sell appointments when I pay an ISM to do that same thing. BDC would be for retention calls for lease, social media, blogging, graphics, CSI follow up, etc....
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  15. JoePistell

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    Tom Fohr,

    I very much admire your process. That Ford store is very lucky to have you shoveling coal into the sales engine. You're asking the right questions, there's a mountain of experience in this forum. Keep it up!
  16. JoePistell

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    Here's what I've learned from my stores.

    In my travels (only), car sales reps SUCK at phones and emails.

    Phone sales skills (aka appointment setting) are VERY different than qualifying/demonstration/closing skills. Our best performing reps TOTALLY SUCK on the phone. In fact, almost all of our reps under perform when it comes to phone skills.

    Email sales skills are different from all of the above. Emails need to be personal and that takes time! The rep and management team need to create a sales process that'll separate the wheat from the chaff.

    So, just like every other business challenge, when you solve one problem, you create another. From all of my reading here at dealerrefresh, if I create a dedicated appointment setting team (answer phones and emails), then the new problem is the hand off from appointment setter to sales manager.
    Last edited: Dec 27, 2011
  17. ddavis

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    I agree with Tom, Ryan and Joe. I believe that 80 -85 is the max number of leads that an ISM can handle and do proper follow up. I had my phone system set up like yours. I was in the middle of the ISMs and heard every phone call and saw every email. You don't want me around if a phone rings five times without being answered. "How many ISMs do I need the make sure the damn phones are answered?" If ISMs are not with a customer, then they follow up. You have good tools. How many calls are they making? Being a vAuto client, do you use the same philosophy in marketing your new cars?
    What is the closing percentages of your guys? One much better than the other?
  18. ddavis

    ddavis Sr. Refresher

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    Joe, we have found an area where we don't agree. My guys didn't suck on the phones. I was proud of my department and they didn't suck in any area. If you can train a $10/hour employee to answer the phones, you can train an ISM that has skin in the game. I really don't like the hand-off. Customers like dealing with one guy to the end.

    Most dealer websites and third party websites encourage emails. I want mine to generate phone calls with a strong call to action.
  19. JoePistell

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    There it is DD, you nailed it... the key to success is MANAGEMENT buy in.


    Question.
    Who's training the managers to be leaders?

    http://forum.dealerrefresh.com/f40/black-hole-sales-training-1848.html

  20. JQuinn

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    I'm not a proponent for "Cradle to Grave," but if I were, I couldn't help but think this way, as far as pay goes:

    Why would Cradle to Grave people have a different pay plan than "regular" people? The goal is the same, right? Deliver cars.

    Do we pay "regular" people extra or more for answering the phone? Or should we have plans for those who answer email, another plan for those who answer the phone, and another who wait for the Up Bus?

    All this is tongue-in-cheek and reflective of my personal beliefs: pay people for specific skills that address desired behaviors/actions, and at the risk of inviting Doug back into this disagreement, and indicative of why I believe cradle-to-grave is, at best, a "premature" process in today's automotive landscape.

    But my best answer to this question: if you have this process, why pay for anything other than the ultimate desired action: deliveries.

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