Have BDC's Outgrown the Dealership?

[Tarry Shebesta]

Has anyone had any experience with Detroit Trading's BDC services?

Automotive BDC Services by Detroit Trading Company

Detroit Trading's BDC is a top-rated Automotive BDC for Dealerships and Marketing Agencies. We service thousands of automotive leads every month.

www.detroittrading.com

 

[Alex Snyder]

I see a few scenarios that lead to asking this question in the first place.

1. the Internet or BDC manager has cut her teeth on a process that proved to work. She blasted through all the hardships of working against a sales tower and found success. There is NO WAY she is going to change and start that difficult journey all over again.
2. the sales tower is full of desk monkeys who have no interest in anything that isn't on the floor, so the sales agents are not interested in working leads. This creates the need for a BDC that has to figure out workarounds to not have to work with the sales desk as often. This also leads to terrible lead response because everything is a workaround.
3. when good BDC or Internet managers quit, the dealership has no way to train the next person and things get worse. AI becomes a sought alternative, but AI is truly a workaround engine. Lead response gets worse.

These are all reasons why lead closing rates are dropping across the nation. And they're actually spurned off of a single problem: people. Finding and retaining good people is hard.

 

[Vin Micciche]

I think you might misunderstand my perspective on AI. AI is a tool, like the telephone and the internet, with a usefulness that fills a certain space. Will AI replace humans? I think in every space that is repetitive, mundane and time consuming-- yes... or, at least, mostly. If you have a BDC that is well trained enough to warm leads, answer questions about smoke in cars, and handle objections about trade and credit, you have a BDC full of knowledgeable and skillful salespeople. Maybe our dealership is incredibly ill-advanced, because outside of a handful of a high-performers, most of our actual sales people couldn't perform all of those tasks on demand for the majority of the 150 used vehicles on the used portion of our lot.

If you can get trained quality people to work a BDC, meet or exceed key KPIs, and do it for a cost that returns a clear and provable ROI, keep on doing it. I'd love to hear more details from dealers that are using BDCs well, because everyone that I have spoken to about it seems underwhelmed by the value they provide-- something I recognize about the difficulty of putting together and managing an BDC in the most effective way for each dealership or dealer group. I have yet to talk to anyone that has a BDC that works the way that I suspect one should.

Nearly everyone that I have talked to about BDCs seem to fall into one of two versions: a bank of phone jockeys that can do little more that follow a script and say, "I'll have to have my Internet Manager get back to you on that." or a hybrid BDC that basically takes the tasks of a BDC and distributes it to salespeople, which from what I gather, isn't very efficient and is very difficult to manage, especially when things are busy and salespeople have real people in front of their faces-- that's the reality that causes us to constantly discuss new options that don't require hiring, training and managing a new workforce or hiring a virtual BDC which can be little more that door warmers and information gatherers-- something that AI is largely capable of doing, even at this point in its evolution.

I spoke to a GM recently who told me the biggest bang they have ever gotten was choosing a product called Conversica which uses AI to help warm doors and get leads engaged, something that exhausts the average salesperson who only targets the lowest hanging fruit and is one of the biggest time-sucks of the sales BDC. That GM dumped their sales BDC and threw all that budget at technology that does all of the irritating and repetitive tasks that no one likes to do and uses the sales people to do all the difficult appointment closing and selling.

I don't think that doing something like that has to require the complete elimination of BDCs, I think as a resource, a BDC can serve an important business purpose. However, I think that the more tools and technology can remove the time consuming and repetitive tasks from the BDC team, the more they can hone the specific skills of getting the appointment and focusing purely on doing that with leads and customers that have been cultivated by AI-powered technology.

All that to say, I don't think AI can be a 1:1 replacement for the functions of the BDC, but I think technologies powered by AI will likely change how the BDC spends it's time and focuses on it's skills-development, making it more efficient.

I think you're painting quite a broad brush when you say every dealer you speak to, bank of phone jockeys?? What you are saying and what this post was about is the lack of training. You mentioned high performers. High performers train. Why go to school or college, why have any training if we can just train a robot to do everything??

The biggest issue in the industry are lead providers. They call anything a lead these days but very few examine what it takes and the labor involved with chasing poor quality leads. Not to mention motivating staff to follow up for very low to no ROI.

Unfortunately, most, not all, dealers are lead junkies. They're addicted to leads. Our technology shows some of the largest, go to, lead providers produce leads with little to no engagement, causing a mountain of tasks to follow up on. This leads to fatigue for your staff, turn over and more. Is there a place for AI, YES!! We have answers for this but haven't fixed it completely. My problem with your comments are that you take an elitist approach and make it all seem like dealers are wasting their time with BDC and its just not that easy. I for one want a trained person to speak to an engaged customer. Not a robot. I could go on and on about why but my thumbs hurt from typing and I've had a long day.

 

[Vin Micciche]

This is a great and relevant topic for me right now as we try and figure out how to help our dealers close more of our credit qualified Shop-by-Payment leads like this: https://shopbypayment.com/super-lead/

The options are:

1) Train the current sales staff or BDC center
2) Outsource it

We are trying to understand the best model for the credit qualified leads we generate.

Here is a direct quote from one of our dealer customers:

"We still like the product. It’s an internal problem here, not your product. Unfortunately, our BDC reps don’t dig into the lead as they should and have done a horrible job converting. We’ve tried to get managers involved in the leads internally and they haven’t done a good job. We are trying to simplify for the reps for now and hopefully, we can add the product back."

This absolutely drives me crazy!

I would love to set up some conversations at NADA to get this figured out for our dealer customers.

Hi Tarry, come by and visit us at NADA. Booth 5612N. or visit our site at www.strolid.com at the very least we'll be happy to help you and give you some ideas and advice for inhouse or working with us. Hope to see you there!

 

[Tarry Shebesta]

Hi Tarry, come by and visit us at NADA. Booth 5612N. or visit our site at www.strolid.com at the very least we'll be happy to help you and give you some ideas and advice for inhouse or working with us. Hope to see you there!

It's on our list! Thanks!

 

[Vin Micciche]

A couple of quotes on AI that make you think and in response to the posts about how great AI is. We need people and imperfections. Why? Creativity comes with increased communication with each other and trial and error to solve problems. Dreams, goals and the sensation one gets from breaking through is what make life tolerable. We need to stop worrying about what we don't know and enjoy the ride. Imagine a world where there are no problems to solve.

“The development of full artificial intelligence could spell the end of the human race….It would take off on its own, and re-design itself at an ever-increasing rate. Humans, who are limited by slow biological evolution, couldn't compete, and would be superseded.”— Stephen Hawking told the BBC

“I’m increasingly inclined to think that there should be some regulatory oversight, maybe at the national and international level, just to make sure that we don’t do something very foolish. I mean with artificial intelligence we’re summoning the demon.” —Elon Musk warned at MIT’s AeroAstro Centennial Symposium

 

[Alex Snyder]

“The development of full artificial intelligence could spell the end of the human race….It would take off on its own, and re-design itself at an ever-increasing rate. Humans, who are limited by slow biological evolution, couldn't compete, and would be superseded.”— Stephen Hawking told the BBC

“I’m increasingly inclined to think that there should be some regulatory oversight, maybe at the national and international level, just to make sure that we don’t do something very foolish. I mean with artificial intelligence we’re summoning the demon.” —Elon Musk warned at MIT’s AeroAstro Centennial Symposium

I tend to agree with Stephen and Elon. It is a logical conclusion that the best AI works better without human imperfections.

 

[Chris Cachor]

I think BDC's are important but just need to evolve. I had a situation where I was looking at a vehicle and submitted my information on a get ePrice form, only to never be contacted until I reached out to the dealer. Turns out - I only allow calls from people in my contacts list. If a BDC is primarily a call center - they're in trouble.

I think ultimately the software and best practices need to catch up here.

 

[Baron Ringler]

There is something very problematic I see with this thread that was touched on very briefly with the "old school Internet " comment, but not explored deeply.

The days of the car salesperson are finished, and have been for several years now. The people being hired in to the retail side are not ideal. For the most part they are in their early 20s, or even younger, with no real formal education and very limited work experience (mainly in fast food or other close to minimum wage job), or they are middle-aged ne'er-do wells who've skated by in life with no real success. Most of the real salespeople have either left the business (retirement, shifting industries, etc.) or become managers. In many places I've been to, the process is for the "salesperson" to show the car and test drive with the customer, and the manager comes out and works the money. They are completely incapable of working a deal, and even the test drive, trade walk, or needs analysis is beyond their capabilities, or they are too lazy to do them. This is also partly managements fault for not providing the proper training, motivation, structure, and process, but for many of the people being hired, no amount of training, structure, and process will make any difference because they have never had to consider those things before and don't know how to handle them.

Objectively look at the people being hired at your store, then try to truthfully tell me I am wrong. With almost no exceptions, you cant' do it.

The BDC was a catch-22 from the very beginning. They were begun because salespeople weren't doing their follow-up properly and weren't handling incoming phones the right way. Once begun, the BDC was an excuse by most salespeople to do even less with customer follow-up and mining. Then the Internet took off with all the leads, and customers, and more, and if salespeople weren't doing their jobs right BEFORE the Internet, it was a guarantee that they wouldn't do it afterwards.

So the question becomes not whether or not a BDC is needed, but what is the structure of the BDC going to be moving forward. How involved will the floor people be? The managers? What will the pricing be? How will it be presented to the customer? Do we suggest alternative choices right away, or not? How deep do we go on trades and financing? Do we try the Carvana method or do we avoid that owing to the number of dealer choices the customer has?

Those are the questions.

 

[Tarry Shebesta]

Interesting points for sure @Baron Ringler . We've begun discussing the BDC department with many of our dealers and outside experts like David Kain and John Sevier. DR solutions have also added to the complexity.