‘Transparency’ is your best friend (or worst nightmare)

Remember back in the ‘good old days’, around 2005, we wondered exactly how the internet was going to change our business. We asked questions like “is the manufacturer going to deliver the car right to the customers house?” or “if we are the fastest and cheapest on the net, will they will come from miles around?” fortunately neither one of those came true. The greatest change the internet has brought to our business is ‘Transparency’, the ability of the consumer to make an informed decision about what to buy and whom to buy it from based on (not always accurate) information available.

Here are my ‘Top 5’ reasons why ‘Transparency’ is the best friend of a well-managed dealership:

1.PRICING:             Most of the time, the price is not accurate, no matter how good the site is. What it does do is allow the customer to find the ‘best price’ in their mind and arms them with a tool they can do battle with. They arrive informed and ready to question every move you make; then we confirm it by having only the MSRP or retail KBB on every vehicle.

A WELL-MANAGED DEALERSHIP:              Display pricing on every vehicle that leaves no (or little) room to negotiate, overcoming the credibility question.  Sit the guest down, take the time to explain how your dealership does business, investigate their needs and wants, and then help them choose the right vehicle out for them.

2. INTEREST RATES:              The media has now made the FICO score the ‘Holy Grail’ of financing, but that is not the whole story in automotive financing today. Customers feel that based on their FICO score they saw on www.freecreditreport.com, they qualify for the lowest rate on record. The customer might even show up with a bank pre-approval therefore frustrating the Salesperson, Sales Manager, and Finance Manager due to a perceived ‘no chance for gross’ deal.

A WELL MANAGED DEALERSHIP:               Post the ‘best average finance rate’ for a range of FICO scores on the showroom floor and make sure each guest receives an explanation of what the display means, how they may qualify, and offer a pre-approval upfront.

3. TRADE IN:            After using www.KBB.com the customer is convinced they know exactly what their trade is worth and not a penny less. We turn the situation confrontational by asking "how much did you want for your car"? Now begins the defense of the appraisal that is much lower than the customer expected which leads to frustration and impatience’s from everyone involved.

A WELL-MANAGED DEALERSHIP:              We give our guests two offers to purchase their trade. The Salesperson and the guest walk around the trade together (not degrading the car) taking information from the car to give the appraiser, not long after guest rides with the appraiser and evaluate the trade together. Then the guest is given 2 offers to purchase, one from the Dealership and one from Autotrader’s ‘Trade-in Marketplace’, and are allowed the higher of the two offers as a trade allowance.

4. GOOGLE:             Back in my football days we had a saying, "The eye in the sky does not lie", meaning whatever was on the camera was what really happened.  Your customer reviews your dealership on Google before ever arriving, it is a part of deciding the ‘who to buy from’ and GOOGLE does not lie. The good, bad, and ugly of your dealership are on YELP, Dealerrater, and GOOGLE for everyone to see. There is not a factory CSI plaque anywhere that can overcome poor ratings on these sites, and those ratings last forever.

A WELL-MANAGED DEALERSHIP:              Reviews are asked for at the time of delivery and a card listing the preferred site is given to the guest. The entire Dealership is made aware of reviews as they arrive. Negative reviews are handled by upper-management within hours of notification by way of phone call to the unhappy guest; whatever can be done to rectify the situation is done with speed and tenacity. Positive reviews are responded to by the employee with a quick "Thank you". Less is more in the guest's eyes.

5. SOCIAL MEDIA:                 Sure you have a Facebook page and you Twitter about the latest oil-change special and advertise the latest pre-owned special to those that choose to ‘like’ or ‘follow’ your dealership. Isn't that information available to every customer?

A WELL-MANAGED DEALERSHIP:              Give your guests something special for allowing your dealership access to their personal lives; allow your guests and their friends to see inside your dealership. Social media is about ‘connecting’ with the guest, about letting them into the ‘inside’ of our dealership.  A free car wash, ice-cream sundae, or bottles water on a hot day announced on social media (as well as relevant news and specials) reward those guests for being special.

There are many more reasons (Service, GenY, employee satisfaction, OEM-bank relationships, reputation just to name a few) why ‘Transparency’ is the best friend of a well-run dealership.

Take a minute to review your operation and ask how ‘Transparency’ could benefit you. When you apply common sense to this question it becomes clear; when you lead with the truth you have nothing to hide. As always, if you have any questions or if I can be of any help, do not hesitate to ask!


Kip Miles founded 5 Miles Consulting, an Automotive training and consulting company. Prior to 5 Miles Consulting Kip enjoyed a long and successful career in the retail automobile industry. From Lot Porter to Dealer principal Kip has done it all and done it successfully.

Kip is an accomplished speaker, trainer, and consultant for all areas of the automobile industry. Dealers, OEM’s, and 20 Groups have relied upon Kip’s knowledge and unique expertise to raise the performance level of their companies.

Kip lives in Southern California with his wife and 3 daughters. He enjoys travel, reading, running, and surfing as much as he can.


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