That's right - BUNK.  As in crap.  Before you start chasing after me with pitch forks, at least read the rest of this article.

What is a value-added program for a dealership?  It is a business to consumer incentive plan that gives a quid quo pro "bonus" when someone purchases something from the dealership.  For example:  customers receive free oil changes for life when they buy a car from your store. This is one of the most common value-added programs.

My experience with these programs dates back to 1999 when I started selling Volkswagens.  Our competitor gave free oil changes and state inspections for life.  They were one of 3 dealers in town doing anything like this.  At the time, I estimate roughly 40% of all customers mentioned their program and that was mainly due to them buying so much newspaper real estate to push it.  As a salesperson, 40% of the customers saying something about it translated into 100% of my customers asking for it.  It really is amazing how selective our memory can be isn't it?  I was all about our store offering the same or better.  What we were given was a program that only tackled 5 oil changes and state inspections for life.  It forced me to continue to be a better sales person by finding ways to sell around the other guys oil changes for life.

Since 1999, I saw more and more dealers bringing value-added programs into their mix.  They ranged from free tires to free manicures every week.  It got to a point where the focus of advertisements were no longer cars; advertisements were all about who could whore out the most free stuff in 30 seconds.  This went on until the economy crashed in late 2008.

During that 9 year period I received a promotion that took me to the executive side of the dealership, giving me a 10,000 foot view of the place.  It wasn't the new view that changed my perspective on these programs, it was the economy.  We were forced to dump a lot of expenses and one of those we killed was our value-added proposition.  Only a few others killed theirs, but we were the only big group to kill ours.  Our biggest competitors still have their programs going to this day.

In hindsight the value-added program was bad for business.  Yes, it probably did sell a few more cars here and there - nothing drastic.  Yes, it gave us some extra advertising ammunition (always a good thing).

BUT it maintained the laziness status quo that most dealerships are so plagued by.  Let's face it, America has become a society of excuse makers.  Instead of sucking it up and taking responsibility we get extremely creative in finding things to blame our mistakes on.  A value-added program is an excuse.  "How did they beat us last month?" - "Boss, I've been telling you for months we're getting killed because they have free oil changes" ....have you heard anything like that before?  Where are the flaws in that statement?  What about training?  What about stocking?  What about a happy service department who treats customers well?  A value-added program is not a silver bullet.

When we were on our value-added program we invited customers to ask for more.  We loudly advertised that we are solely here to give you free stuff.  To the public, who hates car dealers, that meant "let's see how much more free stuff we can pull out of those devils."  Our value-added program created an air of negotiation you couldn't shake.  It filled our service department with customer who had the mind-set that they didn't have to spend money, so our service departments couldn't up-sell anyone.  And we had to heavily rely on F&I to make the front-end profit because our sales people were virtually just order takers (lazy).  What happens when you whack the hell out of people in F&I?......charge backs and court cases.

When we got off the value added-program our front-end gross immediately went up.  PVR's were higher despite the fact that it left less room for F&I to go nuts.  Within a few months the service departments were selling again.  This also meant they weren't so ready to gauge the used car department all the time.  And the really crazy part:  our sales volume stayed relative to the market.

You now know where I stand on value-added programs.  What do you think?

This article was inspired by a discussion on the DealerRefresh forums:  The WOW factor at your dealership

Dallas, TX, June 15, 2010: Client~ConneXion, LLC has launched a new suite of Automotive Internet Marketing products and services that assists auto dealerships in capturing more business and customer interaction via online practices. Client~ConneXion’s base products include Chat~ConneXion – a Live Web Chat Application that assists sales and service departments with online interaction for internet customers as well as Response~ConneXion, an afterhours lead response management system for General Motors “Standards for Excellence” One Source leads.

The new market expansion includes the following:

• Constant~ConneXion - an eMarketing blitz program
• Social~ConneXion - Social Media Management Service
• Customer~ConneXion - Customer Survey and Rating Management
• SEO/SEM~ConneXion - an Internet Web Presence Consulting Service

This suite of products focuses on the online marketing aspect for auto dealerships in order to stay relevant in their local markets. Additionally, it maintains their social presence on popular media sites.

The Constant~ConneXion – an eMarketing Service includes monthly eNewsletters and an eMail marketing campaign that includes attention to both sales and service.
• Creates an ongoing dialogue with customers and prospects
• Drives customer loyalty and keeps your dealership top-of-mind
• Improves SEO driving traffic to your website
• Drives fixed ops revenue with coupons and promotions

Social~ConneXion offers a Social Media Management Service that maintains your social reputation while simultaneously interacting with fans, friends and customers.
• Customization of your Dealership Facebook Fan Page
• Assistance with Facebook postings
• Twitter Setup and Tweeting
• Contests and Promotions Management
• Blogging

Customer~ConneXion develops an auto dealership Survey and Testimonial Management system to capture reviews and ratings directly from satisfied customers.
• Pro-actively requests reviews and feedback from customers
• Directs customer feedback to viable sources, such as Yelp, Google Reviews, etc
• Increases Organic SEO presence

And lastly SEO/SEM~ConneXion is a consulting service that focuses on increased web presence for your auto dealerships.
• Target Information, shoppers, buyers differently using focused ads and keyword selection
• Dominate your local marketing on Google/Yahoo
• Linking Campaigns
• Social Bookmarking

Client~ConneXion’s introduction to these additional products and services offers a complete solution for Automotive Internet Marketing for auto dealerships nationwide. Brad Hornung of the Bob Moore Auto Group, a 10 store group with 17 brands, tells us that “Client~ConneXion is hands down the best vendor we’ve worked with. From the Chat~ConneXion to the SEO/SEM~ConneXion we’ve seen nothing but results. There are tons of other solutions out there but you get what you pay for and CCX is blowing the competition away. To sum it up: Client~ConneXion rocks!!!”

About: Client~ConneXion is a software solution firm based out of Dallas, TX that specializes in a Live Web Chat Application that pro-actively engages and “UP’s” every web visitor for auto dealerships throughout the country. For more information visit their website at www.ClientConneXion.com or call 877.888.5948.

Let’s talk about “LOST” and I am not talking about the widely popular television show that just recently concluded on ABC. I am talking about your lost customers. It all starts with that phone call to unsold customers.

“Hi Jeff this is Jerry with… oh you did, what did you buy?”

Click to expand...

How many times have we all heard that conversation? We then conclude with, “Well if you’re ever in the market again please give me a call…” and off to our CRM we go to mark that customer as “LOST!”

We’ve all heard our managers say over-an- over a thousand times, “keep selling until they buy or die.” Well the person who came up with that saying is an idiot! It should be, “keep selling until they die.” The average person will spend over $300K on automobiles in their lifetime. Big deal, you missed out on a sale this time around. A true salesperson will figure out how to win their business the next time around. If you treat them like a customer they may in fact become a customer.

So how are you going to win their business?

Well let’s start by uncovering your next opportunity. This is accomplished by asking your customer a few simple questions.

1. How many vehicles do you have in your household?
   
   • Identify total number of opportunities.
2. Of those three vehicles, which one will you be replacing next?
   
   • Identifies who in the family you should be speaking with.
3. Why that one?
   
   • Gives you a good idea why and a strategy.
4. When do you think that will be?
   
   • Identifies your timeline and you you might just find a sale right around the corner.

You now have a timeline for bringing this customer back to your dealership. It’s your job to keep your name in front of this customer so when that time comes they’ll remember you better than the person who sold them their last vehicle. Here are a few examples of how you can make that happen:

1. Try to get your “LOST” customer using your service department.
   
   • Develop a lost customer service special campaign using your CRM.
2. Send them a monthly newsletter.
   
   • This means you need to get an e-mail address for everyone.
3. Send them a friend invite on facebook.
   
   • Use your facebook page as a social CRM marketing tool.
4. Send them a birthday card and call them on their birthday.
   
   • You should have their birthday from when you scanned or copied their license.
5. Make sure you always have a follow-up date scheduled in your CRM and then execute when that date arrives
   
   • For long term customers there should be more than one follow-up date.

The average salesperson will talk to 50 customers per month. Over a 4 year period that equates to roughly 2400 customers you will have entered in your CRM. Figure two vehicles per household and you’re talking about 4800 potential opportunities sitting in your CRM that are assigned to you. If the average person buys a vehicle every 4.1 years; in any given year you’ll have 1170 customers who might be making a purchase that year. If you were to break that out by the month, you’re talking about roughly 100 customers who might be making an automobile purchase in any given month. How many of those customers do you think you might be able to sell if you were doing all the right things?

Every time you delete a customer or mark them as “LOST,” you’re depriving yourself from a future opportunity. If you’re not buying what I am sharing with you, then in four years from now you’ll still be looking out that window for a fresh customer’s selling your 8-10 cars per month. The country is littered with 10 year veterans who are doing just that. The people I meet who are selling 30 plus vehicles per month all have several things in common and here they are:

1. They don’t take fresh ups.
   
   • Closing ratios on appointments are 50% versus 20% for fresh customers. This is working smarter.
2. They have developed a solid book of business.
   
   • Using a CRM or a card and file system.
3. They follow-up with their customer base (sold & unsold).
   
   • This all starts with good phone and marketing skills.

Next time you’re about to mark that customer as “LOST” in your CRM, think about what I wrote and do what’s right for you and your dealership.