HARDISON’S TIPS – DECEMBER 28, 2020 – WHAT YOU CAN DO TO IMPROVE YOUR NUMBERS IN 2021
Let’s face it, the auto retail industry is changing and many dealerships are having to get creative to meet their sales quotas and secure long-term profitability.
Even before the unpredictable shift in our industry caused by COVID-19, U.S. car sales were down 5.8% in December 2019 compared to the same month in 2018, while full-year sales fell 1.3%. NADA anticipated an additional 1.2% drop in sales volume going into 2020 – but we all know what has happened since and the ground we need to cover to make up for the downturn.
I don’t say this to scare you, but we need to face our reality to accurately set the stage for our recovery.
Outside the realm of COVID-19, the reasons for the decline are complex and multi-faceted, owed in part to shifting consumer preferences about vehicles and the overall car buying experience. Some of the main contributors to the decline in new car sales, according to the 2019 Car Buyer Journey Study from Cox Automotive, include:
- Increased competition from online retailers
- The growing popularity of ride-sharing services
- Consumers’ preference for used vehicles
- Higher new car prices and loan rates
- Tightening EPA regulations
To get out in front of these challenges, many car dealerships have started to rethink their sales processes with a focus on personalized shopping experiences. Taking a consumer-oriented approach, as many of the most successful dealerships do, requires ongoing learning as customer preferences continue to shift.
Ask qualifying questions
The first step to selling a car is getting to know the needs, preferences and budgetary limitations of your customers. This initial conversation is the basis for the relationship building that is crucial for making the sale and for retaining customers in the long term.
Car buyers who are happy with their shopping experience and trust yourdealership personnel are more likely to purchase F&I products, return to your service drive for vehicle repairs and maintenance, and recommend your dealership to friends and family. But as with any relationship, first impressions are everything.
One of the best ways to gauge customers’ individual needs and preferences is to ask plenty of qualifying questions when they stop by your dealership in person. Today’s in-person shoppers visit an average of 2.3 dealerships before making a purchase, meaning a single interaction can make or break a sale. Here are some key questions your sales teams should ask early on in the conversation with a new customer:
- What brings you in today?
- Are there any specific vehicle models you’re interested in?
- What features are you looking for in a new or used vehicle?
- What do you dislike about your current vehicle?
- What does your timeline look like?
- Are you planning to pay for the vehicle upfront or do you need financing?
- Have you ever financed a vehicle before? If so, what were your monthly payments like?
Of course, every sales conversation is different. Many of these questions may be answered naturally while speaking with car buyers about what they’re looking for and how much they’re willing to pay. That said, it’s important to avoid grilling consumers about their needs and finances, as aggressive sales pitches are a huge turnoff. Don’t forget that you need to know more about the customer FORM – NEED – SPACED.
END OF PART ONE
Make it a champion day!