Digital Dealer - January 2018 - 34

DDW & CATA | Feb. 13-14, 2018 | Chicago

DDW

Dealership Management

FEATURED SPEAKER
By Sean V. Bradley, CSP
Founder & President,
Dealer Synergy

Ready... Fire! ...
Then Aim
Unfortunately, the
"ready, fire, aim"
mentality is the reality for
many dealerships in this
country. How so? They
execute with no real
strategy! They spend
money on technology and
marketing, with no real
strategy; hire the wrong
people due to no real
strategy; and train their
people (or don't) with
again, no real strategy.
Most just execute with no
real "end in mind." It's
more like beginning with
nothing in mind.
Am I being harsh? NO!
I am being honest. NADA
has powerful statistics that
provide validity to what I'm
dishing out here, such as:
 Dealers have over a
70% attrition rate.
 The average dealership spends $640 per car
sold in advertisement.
 The average dealership delivers 96 units
per month out of its entire
dealership.
 The average sales
consultant delivers 9.6
units per month.
These stats are alarming. I mean no disrespect,
but this industry is making
so much money in spite
of itself. Dealers are
throwing money against
the wall and whatever
sticks, sticks. I know dealers in the United States
34

JANUARY 2018

who spend $150,000 per
month in advertising. ALL
of it is conventional and
they sell 180 units per
month. That is $833 per
car sold in advertisement!
BUT... they are averaging
$4,000 per copy. That
is $720,000 per month
and $8,640,000 per year.
Even though the dealer
is paying quadruple what
they should be in advertising, they are okay with it
because they are making
money? Okay, let's break
this down:
 They are overpaying
$624.75 per car sold in
advertising.
 That means they are
overpaying $112,455 per
month in advertising.
 That means they are
overpaying $1,469,460
per year in advertising.
 $208.25 is what they
could and should pay
per car sold (especially
if they are utilizing digital
marketing).
 $208.25 x 180 units
sold per month = $37,485
in advertising versus
$150,000 per month!
Let me be crystal clear
here and say that YES,
digital advertising should
ONLY be approximately
$200 (or less) per car
sold in advertising. Let
me give you an example:
if you buy 100 leads from
AutoWeb or CarsDirect

D I G I TA L D E A L E R . C O M

FEB. 13-14
CHICAGO

(or any other third-party
lead source provider) for
approximately $20 "per
lead." That total cost is
$2,000 for the month. If
you close at a modest
10% closing ratio, you
are at $200 per car sold
in advertising. If you are
at 12% closing ratio you
are ONLY at $166 per car
sold in advertising. On the
flip side, even if you had a
horrible closing ratio of 8%
you are still ONLY at $250
per car sold in advertisement!
Now let's take that
approximate $1.5 million
in wasted spend and
reinvest it appropriately
in the right marketing
and advertising plan. You
can double the sales in
the dealership (probably
triple). You can take a 180
unit per month dealership
and go to 360 - 400 units!
See, with strategy and a
plan with GPS precision
you can have your cake
and eat it too...and get
seconds and thirds!
I have so many examples, but for the purpose
of this article, I will give
you one more... "CRM."
CRM is the most abused
acronym in the industry.
The vast majority of the
CRMs in the country are
not set up the right way;
they are a hot mess. Most
dealerships do not train

their people on CRMs
properly nor do they hold
them accountable, which
is utterly absurd because
the CRM should be the
most important tool to the
dealership and every single
automotive sales professional within the dealership!
I want to digress for a
moment and tell you about
Tammie LeBleu. Tammie
was the #2 Nissan Consultant in the U.S. Here are
her stats:
 Delivered 47.5 units in
one month.
 Delivered 400.5 units
in one year.
 Worked at Orr Nissan,
in Bossier City, La. (population: 62,000)
 Generated $290,000
in personal income selling
Nissans on the showroom
floor!
 Tammie made more
than $1 million in personal
income in less than three
years on the showroom
sales floor!
How did she do this? It's
simple...she married her
CRM! That is right. Tammie
would tell anyone who
would listen that she married her CRM and turned
her "CRM" into her "ATM!"
Now, let me get back
to explaining why dealers'
CRMs are so jacked up...
Let me remind you
that the automotive sales
industry has over a 70%
attrition ratio. As stated
before, most dealerships
do not set up their CRM
the right way, they do not
train their people on how
to use their CRM the right
way, nor do they hold them
accountable for using their
http://www.DIGITALDEALER.COM
Table of Contents for the Digital Edition of Digital Dealer - January 2018
