What do consumers really want in a car buying experience?

[Joe Pistell]

Tim,
This GolfSmith/Dealership is an excellent model to help us illustrate that the shopper & seller interaction varies in each vertical AND is highly complex. I challenge you, not to get you to dig into your current position; my reply to you is to give you more data to reflect on.

I am here to tell you that you can't draw comparisons from the GolfSmith experience and a NEW car dealer, but, USED CAR DEALER??? Now you can draw a million parallels and that my friend is TOTALLY a different story.

re: NEW CAR DEALERSHIP EXPERIENCES.
Example: Loss Leaders, Transparency & Our Industry.
Have you ever been a merchandise buyer? I have. Buyers fill merchandising slots. Merchandising slots are extensions of marketing campaigns. Marketing brings them in, merchandising completes the buying process. Pretty simple stuff, you see an ad for a Driver, visit GolfSmith, find that promo item, find it in depth, you also find it with different lofts and shafts. ALSO, you find a sea of other brands and a zillion golf balls, rows and rows of accessories and lots of high margin clothing too! Yumm!!

This is a typical "Catagory Killer" experience. These mega stores exist in industries where demand is high but sales outlets are fragmented (aka: mom and pops). The depth of presentation is so overwhelming that why go anywhere else?

I ask you, did you go anywhere else to shop? Did you grind the commissioned reps for a better price? Probably not. The other outlets are so trivial compared to this goliath AND we’re only talking a few hundred dollars… Why Shop?

Tim, can you see the entire picture that I am drawing?

Let’s talk Business Mechanics.
Try for a moment and duplicate this "category killer's" inventory selection in the auto industry (on the new car side). The cash required to stock every option, in every color and do it with depth (more than one in stock) is... not possible in most brands.

Tim, How could you have not factored this in to your analysis? I know why, because you think that dealers are making consumers into victims and this GolfSmith analysis fits your preconceptions. Heed my intellectual challenge, don't fall prey to seeing victims and preditors.

And lets talk about that "THOROUGH product presentation and demonstration/"test-drive," by a commissioned salesperson".

Amazing things happen when you’re a commissioned sales person working in a category killer that operates in an industry that is as fragmented as Golf is. GolfSmith knows that they are a destination location and that one "loss leader" sale will result in a dozen more vists IN A FEW WEEKS to buy balls, bags, shoes, umbrellas, rain gear, tees, training aids, grips, gloves, training, clothing and on and on.

Lastly, How many times a year do you see your car buying customers?

I rest my case.
Joe
p.s. don't be mad at me, I just enjoy marketing/merchandising so much that I can't help myself sometimes!

 

[Tim Morris]

Maybe a little on my personal background is in order. I grew up in the car business, literally. My family (both sides actually) have been in the car business, quite literally, since there was a car business. My father is still a dealer, though not as an extension of his father's business (not even in the same market). I began taking an interest in marketing/merchandising as it relates to the auto industry around my sophomore year in High School. I used to sit at my father's desk (when I wasn't too busy sweeping up cigarette butts etc. on his lot) and help spec out cars, evaluate advertising opportunities, and study his interactions, as a very "hands-on" dealer, with his staff. I attended Northwood University on golf and academic scholarships, and graduated with a BBA in Automotive Marketing (an odd degree, I know...NU is the only school in the USA that offers it). I have worked in various capacities in the retail auto industry, most outside of my family's stores. I have worked for one of the largest dealer groups, as well as single points in small towns.

Point is, I don't have any "preconceptions" about the car business that just happen to conveniently fit into my side of this discussion. Any of my conceptions regarding the car business come from a lot of years of experience and formal education. The word preconceptions makes it sound as though you believe I form my opinions, then look for an argument to support them. This is simply not the case.

I feel the need to reiterate that it was you who first compared the car business to a sporting good store (think Golfsmith), by defending the practice of loss leader ads. I simply wanted to highlight what I see as a crucial difference in that comparison. I totally agree with you that they employ a quite different business model, and therefore may not be worth the comparison.

As far as your "intellectual challenge" goes, I'm in. I don't see the business as "victims and predators." Though I believe you do. Here is why: in your first post on this thread, you said "The days of old are gone. Consumers have all of the information tools needed to chart their own course, they can take control of their own fate. What of the personal responsibility to understand what rolling over negative equity means down the road? That falls into the realm of education does it not? We're here to move iron, not be mini Dr Phils." In other words, you believe in the theory of survival of the fittest. If the customers are too weak (read: stupid) to take advantage of all the tools available to them, then we should prey upon their weaknesses in order to move the iron, and they get eaten, right? You made the argument for the very definition of the predator/prey relationship.

I simply see a lot of room for improvement in the business with regard to how we "talk" to our customers. I think that we can do better by setting proper expectations...do you really still wonder why customers "beat us up" for better prices and not salespeople in other verticals?

My only point on this thread so far has been that there are better ways to market our products and services to the car buying public. We need not resort to pricing tricks, numbers juggling, and hard-sells. As Shaun's video and his post seem to suggest, our customers are asking us for better than that.

Tim

PS. I'm not mad, don't you be either. I love marketing as much as I love a lively debate!

 

[Jake]

When I'm car shopping at the retail level, I like to do everything on my own. I like to research cars online, compare pricing (actually value) between dealerships, and when I step onto the lot I want to be left alone. Nothing is more irritating than a salesperson who keeps talking to me when I don't have any questions. I'm the kind of shopper that most salespeople hate, because I tell them to stay away from me, but also the kind that salespeople love because I typically don't make them work hard for a sale. When I find a car I like I'm a bit of an impulse buyer. I've bought cars before after being on the lot for just 5 minutes. I hate the sales process because as a salesperson myself, albeit not a car salesperson, I know their every move. I never pay attention to advertisements offering cash back incentives, free gas cards, low monthly payments, or any of that garbage, because my #1 priority is getting a car that I like. I could care less whether that car is $10,000 or $10,000 plus a $1000 rebate - if I like it I'm going to buy it. I think a significant portion of the market DOES pay attention to those ads though, which is why they persist.

Me personally though, I like to be left alone to make my own decision without any "guidance" from a sales rep. I'm not afraid of pushy sales reps like a lot of people are, thinking they'll end up in a car they don't want. I just find them to be a nuisance and will head to another lot if they don't let me come to my own decisions on a purchase.

 

[Joey Stivick]

I highly doubt that any consumer would find a huge difference in buying from me or Joe. I think they could careless as long as they get the price they want. Their loyalty is dollar deep. Regardless of how great our CRM tool or process is.

 

[Lao Shi]

There is only information and choices most people can absorb, maybe some more than others enjoy searching a data base of information but not many want to. The choices now available to consumers in terms of automobiles, new and pre-owned are overwhelming for some.

How to market and sell your product depends on your vision as an entrepreneur, the interests of the market, the feasibility of the product in short, it depends on many things. You look at Mercedes, Toyota, Honda, they all have their methods. The successful entrepreneur will be flexible enough to adapt to the changes in the market, strong enough to keep his original goal in mind and wise enough to know what can and can't be done. The same is true for dealers.

The Internet is a rich source of information for learning about products, comparing them and finding where they can be purchased.

Most consumers’ research products to either make themselves comfortable making a choice, make sure they are not being victimized, paying to much or to rationalize their primary choice. They need to defend it to themselves, parents, and people who matter to them.

If consumers research and choose a product, they are expressing a view about themselves. Once the purchase is made and they find out they overpaid or could have received a better product for the same money elsewhere or their Uncle told them he got the same car for a deal over at this place they will remember this the next time they make a purchase and they will never forget who took advantage of them.

The US has become a post-industrial nation. An increasingly large amount of US business is in the service sector. Is this not what a vehicle lease is? Are we selling a product or service? They sell what people do rather than deliver product and merchandise. How we service the client needs. We give them loaners when the vehicle will be tied up for 2-3 days or more, we let them have a nice vehicle, one they may want to purchase or lease the next time they are in the buying cycle, we remember their birthdays and send holiday cards, we email them pertinent information, we shuttle them to and from the dealership.

The consumers are now purchasing on line from a variety of suppliers many who are internationally based.

The dealers who learn who the new consumer is and how to work and service their needs will be in a happier place.

 

[BJST]

As a consumer, and someone that works along side dealers to try and understand how to get the consumers in the door. I do believe it is stil considered and "emotional" purchase. Yes, it can be frustrating, but when you're talking the sub prime, cash car, or even BHPH customer, they are on a VERY tight budget. They are normally not going to get what they want, they get what they can get for the money.

That's where the emotion comes into it. They see the options for what they can afford and then think.... "will my family like it?" "will i look cool in this?" "will my friends like it" "is it going to run for as long as i'm paying for it?"...

That is where the consumer wants the sales person to tell them a "story" about that car. Buy painting a picture in the ad, to just telling.

The reason I bring up this "sub prime" type buyer is because it is EVERYWHERE and if the economy is bad, the smaller independent lots are going to be the ones reaping the benifits of the down swing in the economy because they CAN and WILL work w/ these types of customers. And most of them are the owner, sales person, marketing guy, gm, and secretary for their dealership... so they do care about the consumer, but at the same time, they do want their friends and family to come back. Something some franchises can teach their sales people, because the training is poor, and the management usually sucks. (that's another rant)

Than probably made no sense, so I'll summarize...

1. The purchase IS more emtional because of the down swing in the economy. So dealers need to know what their really want from the beginning.

 

[Al]

There are quite a few excellent points made in this discussion. I particularly find Lao's comments very insightful. Having information obtainable in no way means that you'll be able to find and digest all of it. Information overload is very real. I've been involved in the automotive industry as a vendor, consultant and car buyer. My experiences have been all over the place with regards to professionalism, service and support when buying a car.

It disturbs me when businesses utilize questionable and misleading tactics to draw people into a business - I don't care what type of business it is. When a local appliance and electronic store advertises a special on a HD TV and I take time out of my day to go there only to find they only had a "few" of those items in stock (and they are no longer available), I make one single determination - this store will not be getting any of my electronic or appliance business! The same goes for a car dealership. And, I'm a new technology guy who will share this experience on my blog and with all my friends in an email. Bad news has already traveled fast, but today, bad news travels faster and farther than ever before.

I purchased a van for my wife in the past 12 months and the experience still sticks in my mind. Why? Because I couldn't believe the types of tactics that one dealership salesman tried on me, even after I told him that I was in the business. It was "old" car sales 101. I thought there might be a change when he had to involve his sales manager for some "insight", but the manager just reinforced and ratcheted up the tactics of the salesman. Needless to say, the event did not work out to their benefit even though we were only $500.00 apart.

Did the $500.00 mean that much to me? No. Taking time out to find the same van in another dealer's inventory with the options and color my wife wanted would take some work, and this was after a fairly exhaustive research and dealing with my wife's feelings. I was ready to end this van search, but I just resolved to not enrich the people who would act this way. And, I shared my experience with my friends. How much did this cost the dealership in question? It cost them one sale and all of the service follow-up (because we have our cars serviced where we buy them as do a number of people I know), and any potential sales to my friends.

If I had liked and trusted the salesman, the $500.00 difference would have melted away and I would have purchased the van. The price the dealership was willing to sell at was still a good price and I place more value on a relationship where I believe the dealership will support me in service and support issues.

I used to live in another city where I luckily came across a man who is the most honest car salesman I ever met. He was truthful about service issues with different models, always was easy to deal with when it came to price questions, and was there to support me whenever I had issues with my cars. Over the course of 20 years, I purchased 9 vehicles from this man. It didn't amaze me when he was alwasy busy. Everyone that dealt with him appreciated his approach and he told me that all of his business came from referrals. I think he had something!

 

[Joe Pistell]

Nice to see how Al's and BJST's posts tie together, both talk about how personal relationships with customers bring benefits that can be counted. I agree completely, but in the end the real common denominator to sales sucess is EFFORT (read: hard work & dicipline).

Joe

 

[Joe Pistell]

Doing SEO research, reading the uber-famous ShoeMoney.com, came across this post:

Loading…

www.shoemoney.com

It reads:

This is why SEO’s are like used car salesman…
1) They can always sell you something.
2) They can never guarantee results.
3) They can not be held accountable.
4) They have a answer for everything.
5) All the magic happens behind the curtains - they cant tell you what they are actual doing because that would be getting to much into the secret sauce.
6) Anyone can be a SEO.

This comment is aimed right at the core of this thread. EVERYONE with a position on this thread will use this to defend their stand. We all know that Mr. Car Shopper has one hellofa bad attitude when they finally land on the lot. Does Mr GolfShith shopper have the same defensive posture with their GolfSmith commisioned rep?

Our industry has "roots and heritage" that are very negative and IMO, that only Consumers can solve. If consumers so hate the back and forth grinding, then they'll look for one price solutions like Scion and Saturn, or One Price new car dealerships.

Either way, it is clear that the New Car MSRP has dissapeared and everyone is quoting from invoice (at least the domestics are). There is only one conclusion, Dealerships must die to thin the ranks to return the balance of supply and demand. IMO, the mom & pops are at greatest risk due to lack of inventory depth. I am refering to the mom and pops where the principal is asleep at the wheel and prefers to avoid the day to day biz at all costs.

Like one of my earlier Blog Posts here, "Change is in the air...."
Joe

 

[TheFeministBreeder]

I work in the auto industry, and I've purchased two vehicles in two years. I can safely say that while I will be in the market for a vehicle in another two years, I would rather have a root canal than go through those shopping experiences again.

We were shopping for the "perfect" family vehicle, and ended up test driving every single make/model of every single SUV/Crossover ever made. It took 4 months to make a purchase, which we finally made at Carmax, because their sales staff were the only ones to didn't make every minute of our visit completely miserable.

WHY do salesmen make you wait for HOURS at their desk while they go "check on something?" Why didn't we leave that dealership, you ask? Because the jerk took our keys to do a "trade assessment" and then disappeared. We were held hostage like this time and time again. We got hip to this practice after Dealership #4. What is with that? Does this practice actually help you sell cars? Are people just so exhausted and tired by the time you get back to them that they're hypnotised into buying any car you put in front of them?

And WHY do dealers insist on the Bait & Switch? If I get to your lot, and you don't have the vehicle that I just saw on the internet - cause what? I think you're unprofessional, and I don't want you to "show me something else." Come on.... I'm hip to that game.

AND WHY do some dealers insist on listing a fake price, or a price after billions of imaginary rebates? Again.... Don't think that just because you lured me into the showroom that I'm going to fall for anything else you try to sell me. If I get all the way there, with my husband and kid in tow, I better be pleasantly surprised, or I'm leaving and you won't see me again.

I'd love to buy a new car. But I know that when that time comes, it will be the most miserable, stress inducing, painful period since the last time we bought a vehicle.

Can't Dealers just STOP all the shady practice? Be the better man/woman?