Until today, if anyone approached a major Internet department and said that they should be closing 61% of their leads, many may have balked. They’d cite example after example of how this simply isn’t possible. And the truth is, the more they’re like the lowest closing-ratio dealer, the more examples in their arsenal. And with more examples comes a stronger belief. But, just like the General Manager in Part 1 wiped last month’s sales board clean, we have to put that behind us.
Here are the three essential steps to increase your local customer closing rate 10x.
Step 1: Determine if you’re a “helpful dealer”
Everybody likes to believe they’re being helpful, but in reality (unfortunately) it’s simply not true. When I mystery shopped my competitors, so few actually took the time to engage with anything more than an auto-responder. When I told them that I was comparing their car to another model, only one responded quickly with an educational third-party comparison. The rest of the responders didn’t even question my motivations. I tried again, asking more questions, and only half took the time to respectfully engage.
“Helpful” actions include responding quickly and accurately – in other words, demonstrating genuine interest in assisting a prospect with their car buying experience. This has nothing to do with the “deal” itself. I also highly recommend incorporating video when possible. “Hi, Mr. Prospect, I’m standing next to the exact car you inquired about and wanted to point out a few things.”
Step 2: Determine if your leads are “local”
Take a look at all your lead sources (Dealer site, OEM, AutoUSA, Edmunds, etc.). What percentages of leads are local? Remember, you aren’t going to close all of your leads, but you can and should aim to close over 50% of local leads. What’s this mean for non-local leads? Under no circumstance should you be less helpful to non-local leads. You can and will still win these deals – just a lower percent. But if I had a choice between buying 50 leads from a source at 30-mile radius or a smaller provider sending 25 leads at a 15-mile radius, I’d take the local leads because I know I will have the time to provide the service they expect and I will always sell more units out of the local 25 than the widely distributed 50.
Step 3: Be neighborly and “take the deal”
Everyone prefers to buy from his or her local dealer, but some customers will drive to a non-local dealer to save a few hundred dollars. Granted, the percentage of savers would be lower with helpful dealers, but they’ll exist nevertheless. To a local customer, how does it sound when the nearby dealer says, “I’m sorry, I just can’t do that price. Good luck.” It’s not very neighborly. The customer didn’t tell their local dealer they got a lower quote simply for record keeping. They shared it because they want to buy from them and probably right now. Not next week or next month.
We need to be neighborly. If we have a prospect in our back yard with a lower price, wouldn’t most GMs say, “Just take the deal”? That deal may not be pretty, but the longer this customer shops the market, the uglier this deal will get. Be neighborly in that very moment by taking the deal and scheduling a 10-minute appointment. After all, we’ve just told them everything they wanted to hear and took away any reason to wait.
The key points to these steps is that they’re cohesive, and poor performance in any one step has catastrophic effects on closing ratios. True, a great deal more time will go into each Internet lead. But in this internet manager’s humble opinion, the effort is worthwhile because the reward of 10x is so great. And now, when my General Manager asks me about the infographic from CarWoo!, I’m prepared to present a plan.