Car Dealer Industry Averages?

Often times I read articles or posts where some sort of industry average is mentioned. Sometimes it's a closing %, cost per lead, cost per sale, etc. My question is is there any single place where this information is published or is it just reading the right article at the right time? I am putting a lot of effort into determining all of these different stats internally but would like to know how we stack up against the industry averages. My personal thought is we can always be better in stats like I mentioned regardless of industry averages. But inquiring minds need to know

Any thoughts or resources shared are greatly appreciated!

 

Re: Industry Averages?

Great question! I've often wondered this myself, and can honestly say I've never been able to find any answers. When I bring up what I think are areas of improvement to my GM, he usually askes what the numbers are supposed to look like, and I often can only say, "better". Like you, I understand that it's not about the average, but about improving what you're already doing. It would be great if there was some kind of standards chart listing key metrics that we could all strive to meet or exceed. I sure hope this post goes somewhere becuase I've really been looking for something like this myself...

 

Re: Industry Averages?

I am new to my position and can not contribute much, but I am also very interested in finding out some key averages. I read a post a couple of days ago that mentioned a poll here where everyone listed their trackable sales per 1000 website visitors(which I think was 6.5 sales per 1000 visits). I used that number to figure just a 10% close which would amount to about 65 leads a month. I used that number to show my boss just how poorly our website was performing. That convinced them to overhaul the site and look into methods of engaging customers.

It is useful numbers like this that can be compared and sway decision makers. Perhaps the moderators could setup several polls in one post with key stats everyone could share and make that post a "sticky" at the top of the forums?

 

Re: Industry Averages?

NADA State of the Industry Report is a good one to start with. A lot of other material comes from larger companies doing studies and publishing white papers. Cobalt has done some cool ones.

Todd Smith from Active Engage is a vessel of knowledge when it comes to this stuff. Perhaps his Google Alerts will prompt him to provide us with a reply.

 

Re: Industry Averages?

Jamie,

These are great questions and they may have changed since I last received the info a few years back.

Industry Averages:
Closing Ratio from website 13%
Closing Ration from 3rd party lead 6 - 8%
Average follow up from an email lead 5 -7 times (phone and email combined)
Average conversion rate for websites without chat 1 to 3%
Average conversion rate for websites with chat 3 to 5%
Cost per sale target was $300
Cost per lead 3rd party was $20
93% of every shopper goes online before visiting a store
97% of your site visitors NEVER intend to speak with you
Less than 1% of people click on the facebook icon on your website (100% of them never make it back to your website - just sayin)

I have some chat specific info but I don't believe that is what you are looking for. So I will leave most of that out. We can go into bounce rate, page views, etc.. but I believe we have beat that horse already.

As for a single place for these stats. Dataium would be a great place to start. They have a ton of data that would be able to give you probably everything you need. Dataium: The Data Utility Company ~ The Only Independent, Website Statistics and Analytics Tools in the Industry tracking millions of internet shopper behavioral events.

 

Re: Industry Averages?

The question I have, and have always had, about close ratios is weather or not you should count a phone lead and showroom traffic in your calculations. 6-8% seems low if you are including all deals that were generated from your third party sources, but 6-8% of form submitted leads makes sense. Along those same lines, what is really considered a conversion? If I have 6000 unique visitors and I can track 100 chat requests, 125 form submissions, and 280 tracked phone calls, that gives me an 8% conversion rate which far exceeds the standard, however if you omit the phone calls we're at 3.75% and barely getting it done. Combining these thoughts is even more confusing. If I should be closing 13% of my dealer website leads, that certainly has to be form style leads only, because if the average customer is visiting 18.2 internet sites before buying a car, the dealership is certainly going to be one of them. With that being the case I could track every sale back to the website, and that's clearly not the right answer. I would like to think of conversions as form leads only. How many unique visitors should I expect to submit their information, and of those submissions, how many should close? That would be an excellent poll if everyone would contribute.

 

Re: Industry Averages?

Mike,
Some great threads on DR forums regarding this. A few examples FYI

http://forum.dealerrefresh.com/f43/unique-visior-website-lead-ratio-1250.html
http://forum.dealerrefresh.com/f44/new-analytics-product-visicogn-1826.html
http://forum.dealerrefresh.com/f43/percentage-leads-website-vs-manufacturer-1815.html
http://forum.dealerrefresh.com/f43/web-visitors-vs-sales-survey-218.html
http://forum.dealerrefresh.com/f40/i-love-what-i-do-but-so-f-ing-stressful-2069.html


My rant on "Stop Dwelling on Conversions" http://forum.dealerrefresh.com/f43/uncle-joes-make-over-diary-1683.html#post13396


HTH

 

Re: Industry Averages?

These questions come up a lot here in the forums and over on the blog over the years. I hear a lot of dealers asking these questions when I attending conferences. At the same time - a lot of people / dealers are afraid to answer in fear of (what I think might be) of not having the right answer.

Over the years in doing this I have also found many times the math dealers use to back themselves to the calculations differ.

I would love for this thread to turn into the bible of Industry Averages.

Here are some of the averages I get asked about:

Online Lead Operation:
Lead to Show
Lead to Appt
Appt to Show
Show to Close

Overall Lead to Close (lead to sold - this is fluctuate depending on your lead mix)

Lead to Sold broken out by Lead Source:
3rd Party Leads
Website Leads
Website Plug-in Leads (trade appraisal like BlackBook, PureCar - these typically mirror your Website Leads % since they're of course on your website)

 

I just got some great info from my CRM rep. Not going to mention the specifics but if you've seen some of my other posts you'd know. You may know from their lingo as well. I found it very interesting but at the same time it is not an overall average but rather these are averages from their top performing dealers;

Appointment Process

Confirmation of Appointments 76.4%

Show Percentage (of set appointments) 73.6%

Appointment Sold Percentage 31.0%

Percent of Sold Deals with Appointment 54.7%

Activity per Lead
Phone Call per lead 5.4

Email sent per lead 1.5

Appointments made per lead 0.2

Store Visit Process

Fresh Up Closing Percentage 28.3%

Turn Percentage 80.4%

Close Date Updated Percentage 57.9%

Be Back/Store Visits 14.8%

Phone Up Process

Appointments per lead 34.6%

Show Percentage 76.0%

Appointment Sold Percentage 31.6%

Overall Closing Percentage 18.7%

Internet Process

Response Time Average (adj for business hours) 0.4

Response to 1st Email (not adjusted) 4.2

Appointments per Lead 22.1%

Show Percentage 73.4%

Appointment Sold Percentage 29.2%

Overall Closing Percentage 10.2%

 

Good work Jamie, Thnx!