Can You Handle the BEST Price For a Used Car Question?

Awhile back I wrote an article on 4 Ways to Handle the "I Want Your best Price" Question on new vehicles. Well this month we’re going to examine how to handle the same question on pre-owned vehicles.

I randomly mystery shopped five different dealerships across the country to see if anyone was delivering a powerful message when asked, “What is the best price on this pre-owned vehicle?” I used AutoTrader for my search engine. For each market I used a 25 mile radius search on a 2010 or 2011 pre-owned Camry. I then chose the dealer who had the most expensive Toyota Camry at the top of the list.

Call one was to a D.C. area Toyota dealer. On this call I got a salesperson who had limited skills when it came to handling phone-ups. When asked the best price question he offered me a couple hundred dollars off. He did take my name and number and offered to call me back. About 30 minutes later I got a phone call from another person at the dealership who was presumably his manager. He did give me a very good explanation on their pricing policy, but failed to ask for the appointment when finished.

Listen to call one here:

Call two was to a Boston area Toyota dealer. This salesperson was about as poor as it gets when handling a phone-up. When I asked the “best price” question I was told that the price advertised was the lowest. He never asked for my information by the end of the call, nor had he offered his information. I did get a call back from a sales manager about 30 minutes later and he played the range game with me.

Listen to call two here:

Call three was to a Detroit area Toyota dealer. This salesperson had some phone training, but the problem was that it wasn't delivered properly and he was confrontational with me when I would not give him my phone number. Had he given me a reason to give a number, I would have provided it. He was very close to saying the right things, but could have explained the dealership process a little better.

Listen to call three here:

Call four was to a Dallas area Toyota dealer. This call did not go well for the dealership or the salesperson. When asked the best price question I was told they would consider any reasonable offer. I told him his price was high in comparison to another dealer on AutoTrader, and at that point he gave up without trying to get my information or offer his.

Listen to call four here:

Call five was to a San Francisco area Toyota dealer. The number listed on Autotrader directed me to a salespersons cell phone which is one of the worst mistakes a dealership can make. My initial call was off-lined since the salesperson was out of the dealership. He offered to call me back, but I told him I would call him back ten minutes later. When I called back he offered to take $600 of the asking price yet he never even asked me to come in. When I mentioned I might stop by he just told me to ask for him and never attempted to get my information or set the appointment.

Listen to call five here:

How should the “best price” question be handled?

1. Ask about the trade! Just like with a new car we need to bring the trade into the equation.  Not one person asked me if I was going to trade in a vehicle.  When the customer tells you they have a trade, I encourage you to ask questions to indicate your interest in their trade.  Never tell a customer “oh that’s a wholesale piece.” What you should say is, “I am confident we can get you top dollar for your trade.  When is the last time you had your vehicle professionally appraised?  Not only will we get you the lowest price on this Camry, but we’ll also get you as much money as possible for your trade.  When are you available, now or later today?”
   
2. Invite the customer to the dealership! Don’t get hung up on giving a price out over the phone.  I personally wouldn’t buy a pre-owned lawn mower without first laying eyes on the product, why should a car be any different?  I suggest saying something like this:  “(Customer first name), all of our vehicles are priced at or below book value.  If they weren’t, we wouldn’t be the largest dealer in our market!  The best thing for you to do is come on down to the dealership and look this vehicle over.  If you like the car, we won’t let price stand in the way of you making a fair purchase.  You are going to love this Camry and it really is a nice one!   When would be the best time for you to come in, now or later today?”
   
3. Sell the dealership and warranty! Be prepared to tell the customer about your dealership’s advantages and warranty policies on pre-owned vehicles.  If your vehicle is certified it can often command a higher price and you will need to explain the value of certified to your potential customer.
   
4. Give a price as a last resort. “(Customer first name), I am not authorized to give out final pricing and I’ll need to check with my manager.  I can tell you that he/she normally gives better pricing when customers are here at the dealership.  As you know your presence is your leverage.  Would you like a price over the phone, or would you like to come in and get a better price in person?”  Go for the appointment!  If they want the price over the phone, this will be a rare occasion where you’ll have to off-line the caller and call back with a price.
   
5. You are your own little business within a business, invest in this process and watch it work. Would you spend $20 bucks to make a few hundred?  Then keep a few gas cards in your possession and offer them as a way to bring customers in.  “When you come to our dealership you’re going to be happy with the deal we give you.  If I can’t earn your business, I’ll give you a $20 gas card for your time.  That sounds reasonable, right?  Are you available today or tomorrow?”
   
6. Use Video! If you are unable to secure an appointment, make a video of the vehicle of interest and sell, sell, sell!  Include videos of other like vehicles as well.  Make sure you secure the customers e-mail address so you’ll know where to send the videos.  Once delivered, make sure you make a follow-up call and ask for the appointment.

I would like to address all the managers reading this article.  We need to lead by example.  It’s easy to tell an employee what to say, but a good leader will pick up the phone and teach their employees how it’s done.  Often managers won’t do this for fear of failure themselves.  I often get managers on the phone when shopping dealerships and they struggle right along with the sales team.

I also suggest that used car managers take the time for regular meetings to introduce new units to the dealership.  Once or twice a week the sales team can walk the lot to learn about the inventory.  The salesperson who took the trade in can give the briefing on the new arrivals.  Vehicles bought at auction can be introduced by the used car manager.  Knowing your inventory will help increase sales.

Do you have a unique way of handling price objections on pre-owned vehicles?

WALTHAM, MA – May 9, 2011 – DealerRater today announced that it will extend its reach into Canada, making the company the predominant car dealer review web site throughout North America. As part of its expansion initiative, DealerRater welcomed a new Regional Account Manager, who will work exclusively with car dealerships throughout Canada to manage their online reputation, reach in-market customers and promote quality customer service.

“We are excited to expand our community and reach out to more Canadian dealerships,” said Chip Grueter, President of DealerRater. “As auto consumers increasingly rely on online dealer reviews when selecting a car dealer, building third-party reviews and defining a proven strategy to manage these reviews is critical for today’s successful car dealerships.”

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As the first review web site dedicated solely to automotive dealerships, DealerRater has demonstrated unprecedented growth in the past two years in both the number of user reviews and web site visitors. In addition, a record number of dealers have embraced DealerRater as a third-party review site that is critical to their online reputation management efforts. The company maintains over 3,500 dealer partners through its Certification Program.

The DealerRater Certified Dealer Program is a certification program and reputation management tool offered to qualified car dealers. The program is designed to help car dealerships reach DealerRater community members while demonstrating an utmost commitment to quality service.

About DealerRater

DealerRater was founded in 2002 as the first car dealer review website worldwide. With more than 400,000 people joining the DealerRater user community each month, DealerRater is fast becoming the world’s #1 online resource for anyone seeking third-party information on automobile dealerships. DealerRater features more than 38,000 U.S. and International car dealers, 300,000 user reviews and over 1,000,000 classified ads. DealerRater attracts more than 5 million consumers every year who visit the site to search for car dealerships, read current reviews, write their own descriptive reviews, and find car deals – all for free. Car dealers are rated on the criteria of customer service, quality of work, friendliness, price and overall experience. In addition, DealerRater offers qualified car dealers a Certified Dealer Program as a reputation management tool to help them grow their online presence and achieve higher SEO rankings across the Web. Today, over 3,500 dealers are members of DealerRater’s Certification Program. For more information, visit www.DealerRater.com or call 800-266-9455.

TrueCar, Inc. Agreement Incorporates Black Book Used Car Values to Enhance New ClearBook.com Consumer Website.

SANTA MONICA, Calif., May 9, 2011 --TrueCar, which provides consumers with reliable, trustworthy car pricing information, has reached an agreement with National Auto Research, a division of Hearst Business Media, to license Black Book used car values.  This allows TrueCar to provide richer information and further enhance its recently launched used car pricing website, ClearBook.com, with extensive information supplied by Black Book, a valued automotive industry resource for more than 60 years.

ClearBook is the first used vehicle pricing website, free to consumers, that analyzes listing and transaction prices for the used car marketplace.  With ClearBook, used car purchasers obtain objective, unbiased price guidance for a car based on year, make, model, mileage and condition.  With the addition of Black Book's values, the industry's most relied upon source for trade-in prices, consumers will now know the real value of their trade-in before they walk into the dealership, helping to facilitate a fair transaction between buyer and seller.

Scott Painter, CEO and Founder of TrueCar and ClearBook, said, "Black Book's data is an invaluable tool in generating a fair value for the sale or trade-in price of a used vehicle. Consumers in the market for a used car will benefit greatly from this relationship."

The next ClearBook upgrade will combine trade-in value, target sales price, and list price to give buyers and sellers the most transparent view into vehicle pricing, whether that vehicle is a trade-in or sold privately.

Tom Cross, President of Black Book, said, "Pricing transparency helps consumers and dealers make the car buying and selling processes easier.  Black Book's retail trade-in pricing provides consumers with very accurate and up to date insight into the used car trade-in market and nicely rounds out the ClearBook.com experience.  We are delighted to be working with the TrueCar team, and are excited about the value that this new tool brings to automotive consumers."

Painter went on to say, "Black Book's commitment to comprehensive, unbiased pricing information is in lock-step with the goals we have set to create a fair, trustworthy and informed marketplace. Black Book partnering with us is a ringing endorsement of the value proposition ClearBook and TrueCar both offer consumers."

About Hearst Business Media
Hearst Business Media, a division of Hearst Corporation, operates more than 20 business-to-business information services, electronic databases and publications. The group has holdings in the automotive, electronic, medical/pharmaceutical and finance industries.

About Black Book
Best known in the Automotive Industry for providing timely, independent, and accurate vehicle pricing data, the Black Book® family of vehicle appraisal guides (www.BlackBookUSA.com) is published by National Auto Research, a division of Hearst Business Media.  New and used car dealers, lenders, manufacturers, fleet remarketers, and government agencies have relied on Black Book since 1955.  Black Book provides values for both new and used vehicles, including cars and light trucks produced since 1946, collectible and exotic vehicles, motorcycles, ATVs, snowmobiles, personal watercraft, and heavy duty commercial trucks and trailers.  Black Book data is published daily in multiple electronic formats including data feeds, Internet-based applications, hand held PDAs, web enabled cell phones, Pocket PCs, iPhone, iPad, iTouch, Droid, BlackBerry and Palm devices, SmartPhones, Micro Browsers, online trade appraisal services, and in a variety of other custom products.  Printed versions are also available on a weekly basis.  Whether you're buying, selling, or lending, Black Book's mission is to provide the Automotive Industry with timely, independent, and accurate information to help make the right decisions.

About TrueCar, Inc.
TrueCar, Inc. is an automotive solutions provider focused on changing how cars are sold by providing a significantly better customer experience while helping qualified dealer partners to gain incremental market share and reduce costs. TrueCar.com is a transparent, visual publisher of new car transaction data. TrueCar.com price reports help both dealers and consumers to agree on the parameters of a fair deal by providing an accurate, comprehensive and simple understanding of what others actually paid for the identically equipped new car over the last 30 days both locally and nationally. TrueCar, Inc. works with a national network of nearly 5,000 Certified Dealers that provide up-front, no-haggle, competitive pricing to assist some of the nation's largest and most well respected membership and service organizations to meet the auto buying needs of their members and customers. These partnerships include American Express, AAA, USAA and more than 60 others. Collectively these audiences represent over 1M in-market customers each month. TrueCar, Inc. is headquartered in Santa Monica, CA and has offices in San Francisco. The company was founded in 2005 and has been profitable since 2009. With nearly 200 percent year-over-year growth TrueCar has driven nearly 300,000 sales and is developing a suite of transaction oriented products and services centered on transparency and radical clarity as a result of comprehensively analyzing market data and information. You can follow TrueCar on Twitter and become a fan of TrueCar on Facebook.