I think it all comes down to getting upper management to see the value in the position. Once they see the value they won't mind structuring a good solid pay plan for the person in that position.
I couldn't agree more. That said; I would like to offer some tips based on my successes and failures to not only get paid fair, but to provide tangible value to the dealership and/or upper management. I also hope some of the decision makers on this position read this as well...
Disclaimer: Being that there are single point, mega groups and director level positions, please take this as a guide, not the gospel. Your mileage may vary, but the key points hold true in my opinion. I will also try to be detailed, as I don't want things taken out of context, but it may be a long read.
Step 1: Define
Before even talking about pay, you need to understand what they (meaning the dealer or executive management) think the position entails. Even if you already have this position, you need to make time to address these questions, if you haven't done so already:
- Do you have an existing CRM/ILM? If so, does it give you the tools to succeed? If not, can you be a part of the process to bring one in?
- Do you have the ability to bring on third party vendors, and/or purchase leads? If so, what is the budget to do so?
- Is the Internet considered advertising for ROI purposes?
- Is an Internet sale one that comes from e-mail only, or do phone calls count, walk ins count. I could spend a day on this alone, but the bottom line is that if you don't measure success the same way, you are doomed to fail.
- Are you considered Sales, Marketing or a hybrid with a dash of IT thrown in?
To the last point especially; most dealers don't know. They know they need the position, but typically haven't thought about these questions, or how to pay you. You have to get buy-in and a commitment that isn't the "let's just put our toes in the water" approach or the "we will automatically sell X amount of vehicles with you here" philosophy.
Step 2: Define current state
Before you take the Internet/e-commerce/whatever position over, I urge you to do your homework. Every time I come into a dealer group as a Internet Director/Operations Manager I immediately try to determine the following:
- How much is currently being spent on advertising and the results (historical ROI)?
- What % of your advertising budget is going to current Internet advertising and what are the results, including but not limited to; round deal gross, conversion ratio, lead response times and personnel costs?
- At director level I would definitely look at inventory turns, old age inventory, parts sales and even CSI. Also, how much is being spent on CRM, ILM, Websites, etc.
If you don't define current state, you can't and more importantly they can't appreciate successes or opportunities. You and your new boss HAVE to agree on current state before talking about pay or expectations. You can't know where you are going unless you know where you have been.
Step 3: Manage expectations
Take the information above and determine the lowest hanging fruit. If you have no idea, then do your research or come to a place like DR for help. Typically, it is overall advertising ROI and/or the allocation of those funds. Some dealers will tell you this is none of your business. If Internet is advertising (see above) it IS your business! Try to determine how many resources you have at your disposal to get the desired expectations without discussing specific results. The whole purpose of this step is to allow you to break down preconceived, ill founded notions and replace them with a willingness to accept current, tangible and realistic data.
Caution: If you allow your employer to have unrealistic expectations with no concept of what a good job looks like, you won't be happy with your pay plan 
Step 4: Discuss value
Once you are confident with "current state" condense it into a one page (yes, one page) sheet that you review in person with your employer. Show/highlight areas you feel you can effect, what the difference in revenue would be and what it would take to do so. By talking bottom line, you speak their language. Again, this doesn't apply to everyone or every situation, but I will give you some examples:
- If we reduced overall advertising expense by 10-20% and produced the same results, what would that do to the bottom line?
- If we increased your existing Internet sales from x to y with a per copy average of Z, but with an increase of expenses of (insert letter here) how much would that do to the bottom line?
- If we increased volume to get to retro monies, or higher tier retro monies, what would that do to the dealership?
- You get the idea.
Now discuss non-revenue producing things that you need to do in order to make this happen. Maintaining a website with specials, SEO, photo teams etc is a lot of work that produces "debatable" results. I saw that someone else mentioned existing and prior customers and whether or not they should be counted; this to is "debatable".
Stay away from opinions or grey area as much as possible. Arm yourself with data and speak to things as a whole, not individual pieces. By hiring me for this position, you will see improvement in these areas overall. You would be surprised at how much revenue you helped produce that doesn't get factored in.
Step 5: Payplan
Now that they know based on current state and realistic forecasting what you can do for them they should be able to provide you with an incentive based payplan. Your potential pay should equal a % of the profit generated after expenses similar to finance or a GM's net/net pay plan commission. Depending on other non-revenue producing responsibilities, this may or may not include the base pay.
Examples:
If you can generate and/or save the company $20k per month based on your findings you should expect pay around $3000 a month total.
If you are selling an additional 50 vehicles per month at $2500 round deal, you are putting up $125k per month. If it costed you $60k to do this, including personnel, you should make around $10k per month.
The bottom line is that you need to both be speaking the same language. Identify once and for all what defines a lead and a sale. On some things you may have to agree to disagree, but once you understand the expectations, you must be able to show and prove (which means a lot of continual measuring) that you are getting the desired results. A good CRM will make life a lot easier!
Good luck and please let me know if I can help!
Chris Hawley
Christopher Hawley | LinkedIn
