I am looking for any advice from anyone who has experience with succesful internet departments.

Our dealership operation currently does not have one person who is responsible for all leads or internet activity as a whole. We currently have three of our 10 salespeople who handle all of the leads that come in. As you can imagine between lot traffic and other daily activities our “internet team” is busy with a lot of other things than responding immediately and consistently to our leads.

Our closing ratio is not good at this point and we know we need to make changes.

 Thus brings the question of what to do?

 Do we hire one individual that can handle all of the leads and also monitor the websites (GM and Chrysler) to update incentives?

 Does this person handle all internet activity and make it their own?

 Do we pay a salary with bonus levels based on performance?

What have you found to work or not work?

Thank you for the help!

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There are a 2 ways I eccomend to compensate internet teams or departments, salaried or hourly with the following bonuses:

  1. Pay on shows and on delivered units
  2. Pay on delivered units only (but this would be a higher bonus structure).
  • bonuses at when "X" amount of units are delivered; or
  • bonuses with a per unit amount that increase when a set number of units are delivered 

I am partial to choice 2.  It keeps the department more honest.  If less scrupulous individuals have a good # of friends, they may make them appointments just to get paid on shows. 

Anyway, people need to be paid on some kind of survivable income.  So make a pay plan suited for your area of the country with the understanding that to retain good appointment setters they have to be compensated well.

Maybe $400.00 a week or $10.00 an hour.  Structure the bonuses around that.  Look at your monthly average of units sold and expect 30-50% of them to be appointment based.  (Here on Long Island I averaged around 35% of my appointments were delivered.  I did between 85-120 appointments/mo. depending on how good a month the dealership was having)

The internet dept. should be product knowledgeable and even certified.  (Mine was also answering sales calls).  They should not need to find a salesperson to answer with "I don't know's".  (It's easier to play stupid than to act otherwise.)

Each person in the department have their own assigned customers to work.  Once an appointment is made and the customer comes in, they get introduced to a "product specialist". and then maintain follow-up if it doesn't sale.

Internet departments may be less gross but more unit driven.  There are a lot of price shoppers and a legitimate and competitive quote must be given if all else fails.

The department should know the sales process and be able to take deposits, insurance info and write up a deal by phone or internet. This provides a quick delivery and good CSI.

The minimum amount for an internet team should be 4 people, which may or may not include an internet/BDC manager.  This allows for days, nights and weekends to be covered as well as when someone calls out sick.

Let me know if you have any other questions.

Mark Jama

Wow!  There's a bunch of differing opinions on this subject, Aaron.  ...and a few with similarities, to be fair. 

 

Here's my slant (from owning 3 different dealerships where 65% of my sales are/were from Internet-based Sales AND from training over 16,000 people how to do it).

 

* You need a separate department in order to maximize your opportunities.

* Your selling methodology in this department needs to take a different dynamic than your floor sales team methodology (Not necessarily a different pathway, but a different dynamic).

* You must RID your Internet Team's purpose for simply "getting them into the dealership" (a common mistake by many dealerships and salespeople)...as many clients are far more willing to transact without entering a dealership.

* Set a payplan that rewards sales performance AND activities!  These would be activities that lead to sales results (# of contact attempts, quality of contact attempts, response times, referrals, etc...).  Activity measurement should play a role in BONUS structure!

* Expect that each Internet Salesperson performs community outreach so as to further deliver the quality message of the dealership INTO targeted pockets in the market (as part of expected position activities).

* Try multiple sources of Lead development, including 3rd party regular and 3rd party special finance leads, in order to secure a somewhat steady and manageable formula for lead generation.

 

The dealership needs to use the most MODERN METHODS of email, CHAT, and TEXT copy, as many of today's current methods being offered and trained are quickly losing their effectiveness.

 

The dealership must also attend to it's personalized and relevant attention to social interaction as it pertains to the Community Outreach expectation AND Internet client interaction.

 

I build Sales Plans for free for dealerships, too.  If you're looking for a concrete set-up that matches your market, geography, product mix, and dealership culture, I'd be glad to help out.  (And it really is free!).

 

Tom Vann     

According to previous comments, you are either converting walk-ins to internet or are exaggerating the truth.  Understand that DealerElite is made up of about 80% vendors.  Dealerships fall into three different groups: the subpar dealerships, average dealerships and market leaders.  Market leaders don't need consultants to tell them how to run their business. 

Tom, I agree with everything that you said.  The only exception is the 3rd party leads.  I developed more leads than we could handle without having to purchase leads from any source, including the manufacturer.  We had limited resouces: desks, phone lines and computer drops.  We had outgrown the facilities.  I simply couldn't afford to purchase leads that would close at 3 to 6%.

We concentrated on our three largest variable expenses: floor plan, advertising and salesman's compensation and how to tweek related to the amount of internet business we were doing. 

 

 

I hear you, Doug.  Sharp comments and great results! 

We've found our way to 8-11% closing ratios on standard leads and 8-13% on spi-fi leads. (it takes a whole bunch of continuing conversations with lead providers PLUS that focus on a superior selling method).

Compared to home-grown leads, the penetration ratio blows, but ROI is still above 300%.

Whose comments are exaggerated, by the way?  I must have scanned right over them.

Cheers!

Tom

 

I was basically called a lier for saying that I had similar results you are producing. Go back through the thread and you will find it interesting. 

 

Its still real simple

Customers walk in, phone in or they lead in, to contact with your dealership. The first two they have been doing for many years and they didn't become internet business because they switched sources to dial or walk, or because you called it that.   They can and should be sourced for advertising purposed so you spend correctly but if you count everyone looking on line, your all full of your own false results because 90% look on line before they have anything to do with a dealership.  

Counting the correct way is harder and identifies fruit higher on the tree.  It also drops all the con artists out there who mix digital marketing results to call it e-commerce so they can BS an owner or GM for a pay plan. Don't their results sound great when you hear it?  

I challenge anyone on this blog who counts the wrong way to actually do it correct. and measure correctly and find out what your really closing. Any other way the store gets played by a digital marketing guru who thinks he knows something the owners don't.  

The put together artists spend lots of time on these blogs trying to collect clients with there magic bullet formula and the store really never gains anything.  I guess at least media spends head in the right direction, hopefully cheaper. 

There is no new math in the car business.  Just in digital media buying and how it effects a dealership.  You will find most of the people on this blog have not EVER run a store from the top.  Don't care about the results accept what they can make you believe they will do, thats NEVER measured the right way.  Because to measure it the right way, you would have to have some managerial experience at a store to control it and that scares these guru's to death. 

A FEW of us who teach have done it and some think they have done it.   The "done it" must be measured the right way and not in a bubble. 

Any current owners or GMs reading this blog, please give some of these clowns a try.  Mark your stores total sales before they start and afterwards.  If they get more sales for you then it really doesn't matter what anyone "including me" says in a blog, it worked. 

Im positive you will find when measured properly it doesn't.  You can then call me and I will help you drive a process in to the store that produces sales that the put together artists can't touch.  

Been there, done it, teach and train it, getting the results with baselined measurable results. 

You sure sound BITTER, William.  Jeez, man. 

Do you own or have ever owned a dealership?  I've owned 3 and still own 2 and train and consult professionally (Internet, Showroom, BDC, Fixed Ops, Marketing Copy, etc...) ...and I've never stopped selling throughout the years.

You sound as though everyone has it wrong except you. 

Are you in a resume' battle with a bunch of these guys?  Is this a constant name-calling "challenge" you lay down against guys you disagree with (calling them "clowns", "con artists", "put together artists"). 

Aaron was looking for advice about successful Internet departments and it looks like he received a bunch, although you seem to try and debunk most of what's being offered as bogus information offered by "cons".

Naïve? Ignorant?  or just holding a grudge?

I've been doing "Internet Sales" since 1996 and STILL like to get tons of information from guys in the guts of selling AND guys that have trained it for awhile...even if I disagree with their formulas.

Don't YOU?

You want Aaron to push aside info from the guy who ran Internet Departments for Van Tuyl and Group 1?  Do have some old blood fued your hanging on to from years gone by with this dude?

Let's assume Aaron's a pretty smart dude and can dissect the information just fine.

Frankly, I'd like to hear more info from Steve Richards.  I like how that guy thinks!!!!!

Hey Tom 

You in to counseling now also?

 If I needed your advice on my personal life I would have asked, but i didn't, and if you want to discuss what pisses me about this, pick up the phone and call me, I'm much better on the phone explaining my self.

So its written, what upsets me is vendors (or employees) ripping dealers off with bad advise they pay for.  As a business owner who's only work is consulting, I think a part of my job is to tell dealers the truth and be held accountable for the results of what I train.  Jacking the numbers around to pretend about your results is fraud, and only hurts dealers who are my friends and clients 

  If you agree with most of this BS on this blog, then you also need to learn more.  For the answer to your question, Yes I have owned a dealership, and I don't currently because I like you, cant serve to masters or pretend to do it all.  If your stores don't separate walk in, phone in, and lead in business, then they ARE NOT doing it correctly and can achieve better results than they now get. A financial statement that you and I both should know how to read will prove my point. 

If you don't think so, I challenge you or any one on this blog to allow me to get on a go to meeting with you, and open up your CRM in front of me so I can show you what your process of non-separation of this business produces with your clients.

Pull your DMS sales records and match it against the leads (not phone calls or walk in's) you got that month and see if your close anything like what you think.  Every time I do this with a dealer they are very lucky to hit 10%.  

Van Tuyl and Group 1 for the record, are only large not good at this activity, they also count business as e-commerce business THAT ISN'T.   The director of one of them has ZERO experience of ever running any store.  I have personal inside experience with one of these groups and I personally know what they call e-commerce business. 

So Tom are you Naïve? or  Ignorant? or have difficulties admitting that things are not grey, they are black and white, and numbers don't lie.  

For a lot of this blog Im not commenting on pay plans appointment set ratio's ect ect ect.  Lots of formulas to get there that work. If your paying people and counting sales as e-commerce that isn't ,it kills true results.  Counting your results falsely is the way to arrive? 

So to answer you final question, I don't even know this "dude" but I now what's not true.  So no bad blood just a strict policy on correct math to achieve improvement. 

Some good advise on this bog and some smoke and mirrors.  Start with the truth and the math shows the truth.  

Anyone closing on LEADS ONLY above 20% that can prove it, and Im a front row student to listen and gain. If your pretending for the sake of selling your services, blogging or a pay plan, you can expect "bitterness" or what ever you want to call a reactions to negative harmful advice.  

Let Aaron be his own judge and listen to who he wants.  Your opinion or mine is not relevant, its his sand box and bottom line.  

This has gone on too long for me.  You get back to running your two stores, consulting and bring about world peace.  Im headed back to the trenches with my dealers to beat the ones who believe they are doing it right.  My money back guaranteed for my services says it all, love to see yours. 

all the best Tom 

Bill   949-374-2750

I like you, Bill!

Cheers, Buddy!

Tom

Ditto Tom 

Thanks!!!!!

Van Tuyl and Group 1 for the record, are only large not good at this activity, they also count business as e-commerce business THAT ISN'T. The director of one of them has ZERO experience of ever running any store. I have personal inside experience with one of these groups and I personally know what they call e-commerce business.

I will have to agree with you on Group 1; however, not with Van Tuyl. They had some stores that did an excellent job with eCommerce. They run some of the strongest F&I departments which is a plus for internet departments. For the record, I have run dealerships.

I will say this again, we only counted deals where the ISM had a confirmed appointment or the customer asked for the ISM by name.

"Pull your DMS sales records and match it against the leads (not phone calls or walk in's) you got that month and see if your close anything like what you think. Every time I do this with a dealer they are very lucky to hit 10%." At Group 1, they only pay internet deals that are in the DMS.

I think that here is our disconnect. I believe that our success was due to two things, good marketing and great ISMs. I spent a great deal of time assuring that we had good pictures, custom descriptions and competitive market-based pricing. We led the Metroplex in new car VDPs for AutoTrader. In my display advertising and web presence we had a strong call to action which really pushed the phone call. (When I added a strong call to action, it dramatically increased our phone calls.) If a customer calls on a Cars, Autotrader or a website VDP, this is an internet lead. If a customer calls on a TV ad, newspaper, direct mail piece, those are sourced to their respective media and ends up on the sales floor. We had call tracking and measurement software with different phone numbers for each advertising source. Seriously, I would much prefer a phone call to an email lead. With the amount of time that I spent making sure that every VDP looked like a newspaper ad, I take strong exception that phone calls should be considered other than internet leads, from those sources.

I personally listened to every sales call that came into that dealership.

Our internet presence had a positive effect on our walk-in traffic but just because the customer said they saw something on Autotrader, it wasn't logged as an internet sale.

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