Prices on website... yes or no?

[abby.campbell]

Thanks, Ryan. I think artificial pricing, especially the "reconditioning" add-on fee makes for a bad dealership reputation. If we have to "recondition" a car, we will add it into the price of the vehicle. After all, we are living in a hustle bustle world, and customers don't have time to waste. They want to come to the dealership and buy. If they feel they are being jerked around, they will be tiffed and could harm the dealership's business by spreading awful messages to the community. That's just not good. It's always better to be upfront and honest. I couldn't deal in any other way, and it has helped my dealership and their reputation. I've had customers drive two hours to buy their first vehicle from us. Because they liked the way we did business, they came back for more even within the same year.

As far as what I'm doing to encourage my staff to be active in their personal sphere of influence... hmmmm... I would have to say that I encourage them to always be positive about their employer (the dealership). There is nothing worse than to meet a salesperson of any type business, and all they do is complain about the store, their salary, or whatever it may be. Their positive attitude should be reflected in their personal "off-time" as well. They may even want to casually promote their business if the opportunity permits. It doesn't have to be an outright "spam" about the business, but they could mention something like "Hey! We got this awesome new Mustang in the store. You should see it!" (Ryan, is this what you were asking for? )

With regards to social media policy, I would have to encourage staff to also be professional. I do believe that posting a bunch of drunkard, obscene, and nasty comments and pictures are no way protecting the company. However, it is difficult for the employer to check all employees on social media if the employees have their profiles privatized.

Finally, my dealership currently doesn't have a social media "policy." However, we do have accounts for certain social media where we promote. However, it has a lot of room to be worked on. I'm looking forward to reading more threads here on the best ways to do this.

 

[ddavis]

Uncle Joe Rule #121: "Dealers are like snowflakes, no two are the same"

this is what I would expect...

The dealer without prices would see

• --more email leads (fishing for price) BUT LESS EMAILS OVERALL?
• --more calls (fishing for price)
• --a poorer lead closing ratio
• --less return website visitors (the site didn't help the shopper)
• --less internet sales
• --less lot ups
• -- HIGHER BOUNCE RATE

Again, generally speaking, when a store has no prices on it's website, the business model they're building is set up for the highest gross PVR possible. This model is HIGHLY dependent on sales skills. A store's performance is squarely in the hands of the GM/GSM and like a pro sports team, management is 100% responsible for the sales team it has recruited, trained and supported.


To compare, let's go allll the way to the other end of the spectrum. Prices are posted, but they're priced low. Let's say it's a velocity dealer hitting on all cylinders, turning inventory 10-20 times a year.

The dealer with market leading prices would see

• --more email leads (leads fishing for availability)
• --More calls
• --a higher lead closing ratio
• --more return website visitors (the shopper gets it)
• --more internet sales
• --more lot ups

In this model, the stores financial performance is less dependent on sales people and more dependent on operations (aka Walmart).

There you have it, Neiman-Marcus vs Walmart. Both are successful. One with high gross, the other with high volume.

Isn't this biz great!

Really nice post Joe. I think you are right on. With pricing, you have to focus on other profit avenues like aftermarket adds, under allowance, switching to leases and maximizing F&I. When you go into the deal with your back against the wall, you have to work with what you have left. At the Nissan store, we out grossed the floor (total average gross) by $400/unit. My guys were well trained. We developed a compensation package that encouraged them to look beyond front gross into the areas that were left. Sadly, this store isn't doing half what we did when I was there. Mamu of the guys are in management at other dealerships. Now that I am back in Dallas, I do get to see many of them. I call on a couple of them that are Internet Directors at other stores.

 

[joe.pistell]

Doug,

You made a couple comments, you wrote: "--more email leads (fishing for price) BUT LESS EMAILS OVERALL?" and you wrote: "-- HIGHER BOUNCE RATE"

Less emails Overall? No*.
Why? The lead submitting audience is tiny. 97% of shoppers never submit a lead. Asked another way, how many less of "the 3%'ers" will not send in a lead vs how many more emails you'll have that are fishing for a price. IMO, net result = remove prices & email volume goes up while business goes down.


Higher Bounce Rate? Nope.
1st, let's talk bounce rate:

Definition


A bounce occurs when a web site visitor only views a single page on a website, that is, the visitor leaves a site without visiting any other pages before a specified session-timeout occurs. There is no industry standard minimum or maximum time by which a visitor must leave in order for a bounce to occur. Rather, this is determined by the session timeout of the analytics tracking software.
Bounce rate - Wikipedia, the free encyclopedia​

A bounce happens when a visitor lands on your site, sees only one page and leaves**. Pricing on the inventory isnt seen until you get inside the site. SEO*** produces very little search traffic that lands a shopper on a page with inventory, and no dealer in their right mind would have a PPC campaign that points a paid visitor to a page where "If you want a price... you'll have to call me".

HTH
Joe

*Actually, the answer is... it all depends*. We'll assume that we've got an avg dealer with an avg franchise in the suburbs (not city center, not rural) and assuming the dealer does an avg job of pricing and merchandising,

**The internet is the new phone book. Car Dealers get a bunch of traffic that just wants a phone number (parts & service). IMO, unless your site is junk, Bounce rate is a poor measurement for site performance. I've never done a study, but, I'd bet the LARGER the service business, the higher the bounce rate.

***SEO for car dealers has an industry wide problem where google has given up on trying to figure out car dealers for long tail product searches (best price on a used ford f150 near albany ny) and "hard wire" in classified sites like AutoTrader, CarGurus, local newspaper sites and Cars.com


​

 

[Robert DeForge]

Great topic, and went the way I expected. ABout 4-years ago, under a new Sales Manager, he wanted to try and take pricing off of the website just to run about a 3-month test.....we still had all of the vehicles tagged on the lot. I have always been a price on the web guy, but was shocked by the increase of contacts to our dealership......on the tracking, about a 33% increase in contacts. A small percentage would ask why there was no pricing, and I would let them know stright up because it would give us the opportunity to talk with the customer, and be able to offer other vehicles that may work for them as well, or maybe something not even listed that would be traded in in the coming days......most understood...made sense to them. I let them know this was not done to play with the numbers like old shool car sales, as all of our vehicles are tagged on the lot, and we give you that same price on your contact. I am sure as listed in another post, that many stop in, see no pricing, and just move on. On the flip side...how many stop in on the web, look at the vehicles, get all of the information they are looking for, and move on....never contacting the dealer because frankly, they do not have to...they have received all of the info. We had customers contact us, because they would see a nice car, and just had to know the price....so made the call....thinking they felt like they might be missing a deal if they do not call. So now as a dealer, you get scared, and price below your competitor dealers, because you think price is the driving point of the sale, so you keep trying to price lower then dealer B for an advantage, and the gross is slipping away before you even get an opportunity. Easier to qualify your price on a contact then to hope it qualifys to the customer on their view. After this 3-month test, we ran the internet program this way for about 3-years I believe, and our contact and selling numbers both increased.........I would have told anyone they were crazy if they suggested it ahead of time....kind of did in a way We have since hired a new Sales Manger 7-8 months ago, and repriced the inventory so it would show on line, and our contacts and closing ratios have gone down on a steady pace from the internet....really hard to fathom...but it has happened to the point we have to adjust our internet process, as what was working before is not cutting it right now, so need to get this thing working with pricing the vehicles on the web....I know others are successful, we just have to adjust our process.

I know my post is against all others on here, and in fact telling the new Sales Manager of the findings of having pricing off the web, he just looked at us with crazy eyes LOL. I know pricing off of the web is seen as a bad thing, but dang........it worked well during that stretch.....it was just different then what the 'group' was doing.....we kind of stepped back into an old box, then jumping out of the box LOL

 

[NHHarleyguy]

Robert, thanks for your post. This is very interesting to me. As you said, it is contrary to 99% of the posts on this thread. How has the close ratio changed from when the prices were not displayed to now? There are fewer leads but are a higher percentage buying now as opposed to when the price was not displayed?

 

[ryan.leslie]

ABout 4-years ago...

No disrespect intended at all Robert, but if dogs get 7 years of credit for every year they stick around, what should internet trends, fads, and norms get? 4 years is a lot of time for consumer behavior to be influenced by certain norms on the web. I think you'd see very different results today.

I love this stuff because it is a reminder of the pace of the culture we live in. I find it really interesting...

In August 2008, Facebook had 100 million users, today they have 1.15 BILLION. Do you remember the first time you "liked" something on the web? Feels like it has always been a part of our shared experience since the beginning of the world wide web, right? The term is pervasive in our culture and we've been conditioned to believe that our "like" gives value to others. This may shock you... The infamous "Like" button didn't come on the scene until Feb. 2009! A lot can change in just 4 short years...

Instagram, Foursquare, G+, and Pinterest didn't yet exist when President Obama was elected in 2008. But the biggest game-changer of all, the most prized possession of millennials and the bane of most car salesman's existence was just barely birthed in 2008. Today, you turn around and drive home if you forget it, the aforementioned millennial would choose it as a marker of personal freedom above a car, and its meteoric rise in our culture is without parallel. It is hard to imagine that in 2008 there were just 2 on the market...the iPhone was launched in June 2007 and the first consumer Android device, the HTC Dream, didn't go on sale until late October 2008!

LAST THOUGHT: I joined the DealerRefresh Forums in April of 2009, just 2 months after the Like button debuted! This post is incomplete without a HUGE nod to Jeff and Alex for their ability to see into the future and create this thriving community. It's pretty incredible when you think about it.

 

[Robert DeForge]

Robert, thanks for your post. This is very interesting to me. As you said, it is contrary to 99% of the posts on this thread. How has the close ratio changed from when the prices were not displayed to now? There are fewer leads but are a higher percentage buying now as opposed to when the price was not displayed?

There are fewer leads coming in for sure....no debate there. More of the leads coming in seem to be of a higher quality, which makes sense....not as many customers 'fishing' for the price, but our close rate has dropped off as well. There can be a couple of factors here outside just of the pricing, new manager, new consultants, change of DMS, CRM and they way it is used etc etc.......always so many variables. In the old model, we had more contacts, thus it seemed more opportunity to do business. We always had with the 'chicken vs the egg' argument......how many looked at your site, no prices, and moved on....but how many stopped at your site gets the price and info, and moves on never to be seen or heard from as well....you can go around in circles with that In our old model, we are a smaller store, I would be the only one to handle the incoming calls/leads on the intial contact, so was able to have control of the process of business, then route the customers to individual consultants to continue with the lead. Since we have pricing, the time of visit to the website has gone up, which would suggest that more are sticking around to look at prices on other vehicles...that is a good sign....but what spurs them to contact? I did have to laugh one day when the new manager was talking about how crazy it was to not give the pricing info, but later that day getting on a consultant for providing to much information over the phone to a consumer, that they would have no reason to stop in......the same applys when they have all that info on the net I would think as well.

We started to wonder if a hybrid approach would work.....(have to remember we have all of our cars priced on the lot with hanging tags, so we are not messing with pricing), not pricing cars that are fresh trade-in's for 30-days on the web, and all of the others would include pricing which would keep them market based in price. The consumer would visit, and see pricing, but notice on some the price is not set yet......will that keep them around, and possibly contact the dealership for on eof these 'non-priced' units, as they feel comfortable that the others are priced.....maybe. We have never tried this so no results.

I am not campaigning for this sytle, just offering experiences we had the past years. This is always evolving. It does seem once we have added the pricing, we seem like we stepped into the box like like everyone else......kind of all looking the same with price driving the market.....not the individual vehicle. I am that same consumer that likes to see the price like everyone else, and that is the way it has to be....we just had more success at an older style model....and I was very surprised by that.

This is fun....because I am coming at a different angle......holding my shield to deflect incoming arrows

 

[BigCarPage]

I can promise you that all your efforts, expenses to market online are mute if you reject pricing cars (as well as your life expectancy as a business), but just imagine what your customers are thinking? (God, the price must be really high because they are afraid to post a price, let me find another one online, click, click... oh look, here's another... etc). Do you guys know that about 75-80% of YOUR online shoppers do their research, compare, then show up to a dealership WITHOUT calling or sending an email first? Yup (and that number keeps going up) ! Forget planning on all those people to call to get "the price" because they won't, neither would I, and neither would you. To make my point; our prices at my dealership are crazy, we are higher in our market for most of our cars than most of our competitors (vAuto says so), BUT guess what: we put prices every where, and we sell more used cars in our market than any of the other dealers in town, mostly all year round, you can't win them all, but we try. You must give the customer what they want, or they will find it somewhere else. Sometimes we post cars online before we've had a chance to price them, and you do get calls, but that's the exception rather than the rule. Like someone said it's all going to come down to VDP views, which is a direct pipeline to your showroom activity. I can't imagine a VDP without a price, I suggest 2 of them, suggested MSRP and our Internet Price. P.S. if your guys and gals are NOT closing, don't worry about the price, it'll never matter. Invest in better people!

 

[Dave Erickson]

Sorry I haven't had a chance to read through all of these yet, but wanted add to make sure that if you do a discounted internet price or savings that you also verify they also show on mobile too. On our Cobalt mobile site they show discounts, but earlier today I noticed on our dealer.com mobile site they currently don't. Hopefully I can get that fixed asap.

 

[Jason L. Laughlin]

Harleyguy, my stance on this topic has always been pretty firm. Think about it from a customer's perspective, "if there's no price listed, then they probably charge too much". My suggestion on that is to competitively shop your fellow dealers to see where they are pricing their vehicles at. That way you can see what is a fair price for your customer and when you talk to them on the phone, you can tell them that you know you have a competitive price because you know what your competitors are pricing their vehicles at.