Four Reasons Why BDCs Fail and How to Improve Them NOW

Dealerships are always struggling with the decision on whether they need a BDC or not. Some try and succeed, but others try and fail. Why does this happen? How is one dealership’s BDC succeeding when other BDCs are failing and returning to status quo after a significant investment? The following are four reasons BDCs fail and solutions for making your BDC a success.

1. Is your team struggling with accurately entering data into your CRM? Do you always feel like a “Data Entry Cop”?

 

This is a super common problem when salespeople’s goals aren’t aligning with the those of the dealership. This struggle point isn’t uncommon in the dealership. The dealership wants data in order to track and measure ROI on marketing expenses, and the salespeople just want to just sell cars. This problem can be fixed through a couple of ways. The first way is that dealerships can use a pay-plan driven strategy to get the salespeople to do what the dealership wants by connecting their pay plans to showed appointments. By doing this, you are aligning behavior to money which can be a powerful motivator. Unfortunately, this strategy is just a band aid. Dealerships are treating the symptoms but aren’t addressing the root cause of the illness. Let’s ask a different question. Why aren’t salespeople entering information correctly into CRMs? If you step back and evaluate, the answer is clear. The salespeople don’t see the true benefit. The average salesperson doesn’t look at the people they sell with a personal LTV (Life Time Value). Instead, they are just a short-term sale and immediate income source. This philosophy is at the core of what separates the best salespeople in the nation from the masses. If the average salesperson looked at selling cars like an insurance agent looks at selling insurance, data entry issues would be a thing of the past.    

 

2. Does your dealership set a lot of appointments but lacks a proportionality high level of showroom visits?

This is an issue that is rooted in a few potential areas. The first could be pay plan structure; the second could be in the quality of the appointment conversation and, finally, the third could be in the lack of management involvement in this part of the shopper’s journey. Any or all of these could be affecting the outcome. Let’s break these down in a little more depth in order to extract some insight and potential action steps. The first is pay plan and how much financial weight is put on the appointment compared to how much the rep receives for the actual sale, if any. Appointment setting really sets the pace for the transaction, so it is critical that dealerships get their pay plan formula in order to drive results. Paying BDC reps to just set appointments uncovers the age old saying: people work their pay plans. Design a pay plan that gives the BDC rep skin in the complete game and holds them accountable for too many missed appointments.

Second is the quality of the appointment-setting conversation. Selling a customer on an appointment is not only selling an opportunity to drive the vehicle but also to learn about all the features in a personalized experience for the shopper. I really like something Mitch Gallant, GM of Capital Ford Lincoln, is doing. His method personalizes the test drive experience for the shopper by enabling them to select their drink of choice for when they arrive for the test drive. This creates commitment between the shopper and the appointment setter for a minimum investment. Mitch is leveraging psychology at its best.

Finally, another opportunity is always the management appointment confirmation call. This allows a couple critical things to take place. First, it establishes a relationship between a manager and the shopper which begins a relationship that will come in handy during negotiations. Second, it provides the manager with the opportunity to ask a few questions in order to really understand the shopper’s needs and make sure that the appointment is aligned correctly for a sale. Managers need to get involved early and stay involved. By doing so, they can remove friction points along the shopper’s experience and be more effective in increasing the chance that the shopper shows up for their appointment.

 

3. Do you find yourself constantly saying the same things to your team to help keep them on pace each month?

Welcome to management, folks. This is a core fundamental part of management: the constant reinforcement of behavior. At no point in time is your sales team going to wake up and just get it. They will need constant direction and leadership to continue to drive the direction of your BDC. I label this job security. Instead of it being a struggle in your management responsibilities, turn it into the best aspect. Train your staff on one aspect of the department duties. Let’s say it is “Overcoming Objections” during an initial phone call. Lay out a simple 10-minute training plan that outlines the “Top 3” shopper objections that your sales team are hearing from shoppers. Deliver the training then reverse the script on your team. Elect one of the team members to create the same training outline that you just delivered but with three other objections and then have them deliver it to the whole team in a week. Keep doing this until everyone has them down then move on to the next topic. You will find that you get tons of new insights from your team and the conversations become much more open. The team will get to learn from different voices which will be reinforced over time. This is how you make an amazing team that works together and that delivers results.

 

4. Are you spending hours and hours per month compiling reports trying to make sense of departmental data?

This is what I like to call “TPS Report” HELL! This is the one area that seems to be getting more and more complicated as we consume increasing data points within the dealership. Even though we have the potential to track everything within the dealership, you have to ask yourself what are your true “Vital Signs.” Basically, what are the top five most critical data points you want to measure and analyze in order to run your BDC correctly? I would have this mastered first before ever layering on more complexity. After speaking with so many stores, I find many dealerships living in data hell. Take a deep breath. Step back and truly grasp the most important things for you and your BDC.

 

By truly evaluating and adopting these four practices, dealerships will be well on their way to seeing a successful BDC that increases revenue rather than one that fails to provide the revenue it was expected to.

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