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Sales at Your Fingertips

The explosion in smartphone usage among car shoppers put phone leads ahead of Internet leads at the close of 2014, a trend reflected in the deluge of mobile-ready offerings lining the aisles at NADA 2015.

March 2015, F&I and Showroom - Cover Story

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The drive to digitally connect dealers with customers reached a fever pitch at the 2015 National Automobile Dealers Association Convention & Expo, where the NADA’s new chairman, Bill Fox, cited a wave of online innovations as one of several key reasons the auto industry has survived economic challenges such as the Great Recession.

“Dealers have adopted the Internet because we know we often make our first impressions digitally,” Fox said during his Jan. 24 keynote at the Moscone Center in tech-savvy San Francisco. “We’ve adopted technology that includes our customers in the sales process more and more. We are innovative and we offer the consumer what they want and need: value.”

But consumers also want a way to connect to dealerships on the devices they use most. Last year, 58% of U.S. adults owned a smartphone, and the development and adoption of new applications for smartphones and tablets is happening faster than any other technological wave in history, according to analytics company comScore.

Even more startling, the boost in smartphone adoption has completely reversed a trend that was driving the proliferation of Internet departments. Three years ago, Internet leads were on pace to overtake phone calls to the dealership. But according to data from CDK Digital Marketing, from 2012 to 2014, phone leads were up 46% compared to Internet leads. And in spring 2014, phone calls outpaced email or form leads by a 4 to 1 ratio.

“Everything has to be mobile. Why? Because for the first time in my life, the number of leads coming from mobile devices exceeded landlines,” said Sean Stapleton, VinSolution’s vice president of sales and marketing, on the NADA Convention’s show floor. “So are your F&I menus mobile-friendly? You know this is the device that I’m working from. Shouldn’t the dealership’s responses be optimized for this device?”

VinSolutions’ VinConnect Mobile puts a dealership’s CRM directly in the hands of salespeople, wherever they are on the lot.
VinSolutions’ VinConnect Mobile puts a dealership’s CRM directly in the hands of salespeople, wherever they are on the lot.

Tap to Call
VinSolutions was just one of many exhibitors at the convention launching mobile-ready products designed to help dealers connect with customers using smartphones or tablets. The dealership technology provider unveiled VinConnect Mobile, an app that allows dealers to have enhanced access to their customer relationship management (CRM) software directly from their mobile devices.

Part of the app’s appeal, Stapleton noted, is that it keeps the salespeople close to their customers, allowing them to scan driver’s licenses and instantly drop that data into the CRM. VinConnect Mobile, which can also scan the VIN of the vehicle the customer is considering, offers the ability to record and log all outbound customer calls in accordance with applicable state laws. And if a salesperson uses the app to make a call from his smartphone, it appears to be coming from the dealership’s phone number.

“The reason [recording calls] is important is I don’t want a disconnect between what was said on the phone call and what is discussed in the dealership,” Stapleton explained. “If there is, [the customer] is not at all comfortable because I just broke their trust.”

Stapleton demonstrated how dealers can use technology to engage with customers the way they want during his “Execute a ‘Catch and Keep’ Customer Strategy” NADA workshop on Jan. 25. Connecting with potential car buyers can be as simple as making the dealership’s phone number a clickable link for smartphone users, he said.

Edmunds’ texting solution, CarCode, logs conversations between customers and salespeople in a dealership’s CRM.
Edmunds’ texting solution, CarCode, logs conversations between customers and salespeople in a dealership’s CRM.

“The biggest mistake car dealers are making today is they sell their customer the way they want to sell them,” Stapleton explained. “You need to serve your customer the way they want to be served, or they’ll find someone else to serve them.

“Think about it. Are you making it easy for the customer to buy from you?”

Text Tracking
Over at the Edmunds booth in Moscone West, CMO Michelle Denogean said that many dealers are falling short when it comes to providing the responses customers want — and they aren’t alone.

“Even though everybody is using cell phones to text, only 7% of businesses actually have the capability to text you back,” she noted. Denogean added that Edmunds hopes to change that — at least in the auto industry — by offering its CarCode solution to its dealers for free. “The advantage with mobile is that you’re already there, because you’re in everyone’s pocket. We look at this industry as needing to catch up with that.”

The CarCode solution makes it possible for potential car buyers to text the dealership from their mobile phones — something 34% of them want to do, according to Edmunds’ 2013 Car Shopping Trends report. The dealership is assigned a local number and the incoming texts are sent to all salespeople assigned to the system. Once a salesperson replies to the text, all conversations are logged in the CRM. A customer can opt out at any time, in compliance with the Telephone Consumer Protection Act.

CarCode was originally developed by a Seattle-based group that won Edmund’s second annual Hackomotive competition, which asked participants to solve common car-buying problems. The team took home a $20,000 grand prize and was placed in the lead provider’s Fastlane Accelerator program to help launch its product. But at the program’s conclusion, Edmunds decided to purchase CarCode and make it available to its dealer network.

“We didn’t go into this thinking we were going to acquire them,” Denogean explained. “We were just blown away with what they developed.”

DMEautomotive’s Dealer Pay is a new mobile payment function on its Dealer Connect app. 
DMEautomotive’s Dealer Pay is a new mobile payment function on its Dealer Connect app. 

Mobile Pay
Edmunds executives are also playing around with the idea of making the company’s no-haggle Price Promise certificates compatible with Passbook for iPhone, allowing users to pull up the voucher for their chosen vehicle when they get to the dealership. But what Denogean is really curious about are payment applications like Apple Pay and Google Wallet.

“I think the idea of the mobile wallet is interesting,” she said. “But I don’t know how that will apply in the automotive space.”

Some NADA exhibitors, however, did have a pretty good idea of how these applications will come into play at the dealership. Automotive marketing firm DMEautomotive launched the third version of its Driver Connect app prior to the show, which now includes a tap-to-pay function called Dealer Pay.

“Rather than calling to see if their car is ready and then waiting around in the service bay to pay, customers simply check their smartphone, tap to pay, and when they return to the dealership, just grab their keys and go,” said DMEautomotive President and CEO Mike Walther of the new feature, which relies on Apple Pay.

Walther said the app was inspired by a company-conducted survey of dealership customers. The results showed that 45% of respondents would pay for service through an app if possible. And that should come as no surprise, with the mobile payment industry expected to account for more than $1 trillion in sales this year, according to data from mobile marketing firm Velti.

The Driver Connect app, which can be branded with a dealership’s logo and messaging, also includes two other features requested by survey respondents: push notifications that alert service customers when their vehicle is ready and information on prepaid maintenance programs.

The marketing firm also unveiled its latest app innovation: Mobile Loyalty. It uses email and push notifications to send loyalty rewards to Driver Connect users, who, according to DMEautomotive, make 25% more service appointments than customers without a dealer app. “The average dealer’s service-visit interval has increased from 140 to 145 days, costing dealers an average of $91,000 in lost revenue each year — meaning customer loyalty is more critical to dealerships than ever,” Walther said.

Service Scheduling
DMEautomotive wasn’t the only company drawing connections between mobile apps and the service drive. Prior to the show, F&I product provider Dent Wizard launched Smart Claims from Ding Shield, an app designed to allow customers to initiate Ding Shield claims.

Unlike DMEautomotive’s mobile application, the Smart Claims app isn’t necessarily dealership-driven — but Aaron Cooper, Dent Wizard’s national director of F&I, thinks that could be a good thing.

Dent Wizard’s Smart Claims app allows vehicle owners to initiate Ding Shield claims and specify where the damage has occurred from a handheld device.
Dent Wizard’s Smart Claims app allows vehicle owners to initiate Ding Shield claims and specify where the damage has occurred from a handheld device.

“The dealership doesn’t really have to be involved,” Cooper said. “So it kind of takes the dealer — in a positive way — out of the loop of the claim. They don’t have to take the time out of their day, so they can spend time on doing what they do best: selling cars, selling service, selling F&I.”

Smart Claims allows the user to identify damaged areas on the vehicle by using the app’s option menu or uploading a photo of the car. The app then allows the customer to initiate the claims process right from their mobile device before they come in for service. They can also request that the service technician start the process using the app.

“It’s a very timely and unique way of servicing our customers from a claims side,” Cooper added. “We try to make it as easy, as quick, as efficient for both the customer and the dealer when it comes to making sure those claims are handled correctly.”

The Smart Claims app goes hand-in-hand with another product Dent Wizard launched at the show called Ding Shield Drive. It incorporates pre-existing damage on a vehicle into the service plan’s coverage.

Online Retail
Dealertrack Technologies was also demoing mobile applications in the exhibit hall. The dealership technology giant announced apps for sales, F&I, inventory management and parts and service.

The company’s Digital Retailing App, the sister product to its digital retailing suite, gives salespeople easy access to a customer’s information from a smartphone or tablet. “This is meant to be used in-store by the sales team and then they can go in and see the leads,” noted Pete Batten, senior director of product management for the company’s Digital Retail Solutions business. “If you walked into the store and I looked up your name, I can see you submitted a credit application and it was approved. I can see the vehicle you chose. Often, I’m going to update your trade while you’re in the store; we’re going to get to the brass tacks of the deal.”

Batten said the app should do well because customers using Dealertrack tools on a dealer’s site — which are now mobile-optimized for the 34% of customers shopping for cars on a handheld device — are often already settled on a vehicle and payment by the time they get to the show floor. And thanks to the company’s new ProtectionDriver product, those customers can even select F&I products while on the dealer’s site.

Dealertrack’s Digital Retailing App allows dealership personnel to access information customers submit online right from a mobile device.
Dealertrack’s Digital Retailing App allows dealership personnel to access information customers submit online right from a mobile device.

“It’s pretty cool,” Batten said. “One of the things we’re sensitive to is not eroding dealer margin. So now the shopper can look at the F&I products and understand the benefits, and what they select gets sent to the dealership.”

To prove the effectiveness of its online tools, the company commissioned two case studies that were released at the convention. In one, New Hampshire’s Port City Nissan achieved a 49% Internet lead-to-sale ratio, while the other store, Georgia’s Acura Carland, realized $1,145 more back-end gross per copy on digital retailing leads than non-digital retailing sales.

“[Dealertrack’s new tools] are solving an industry problem of how you get transparency to the shopper, allow them to have a good experience and still make money,” Patten explained.

Digital Ecosystem
The mobile offerings at NADA 2015 made one thing clear: Mobile technology at the dealership needs to be part of a bigger digital ecosystem. “The problem most dealers have is they don’t share data with all their profit centers,” said VinSolution’s Stapleton. “So if I mistarget the customer — for example, sending them a flier for an F&I product for a car they traded back to the dealership four years ago — I’m pushing them away.”

Another example of this, Dealertrack’s Batten noted, is when a customer fills out a credit application on a dealer site, but the dealer either doesn’t have access to that information when the customer gets to the dealership or doesn’t respond to the customer in the way they want. “I bought a car about a year ago. I did everything online, and the salesperson emails me back and all he says is, ‘It looks like you want a car.’ It was a frustrating experience,” he said.

Denogean noted that texting capabilities at the dealership can help bridge that communication gap, thanks to the technology’s tracking capabilities and ability to integrate with a dealer’s CRM system. The marketing executive added: “Plus, people who are texting back and forth with the dealership are more likely to buy.”

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