When asked to name their biggest challenge, most dealers say: “Finding qualified sales associates.”
Many dealers lack a clear idea on how to find the right sales candidate for today’s marketplace. Compounding the problem is that they employ an old-school compensation plan.
The majority of dealers still look for people who are like their “old horses.” Those are high-volume salespeople who’ve been with the store for years and don’t feel comfortable trying to adjust to a new type of customer.
Yesterday’s skill sets created their success. They are highly persuasive, bordering on confrontational. Dealers rode these “old horses” to outstanding financial success.
But times have changed. There is more to sales now than the still-valuable skills to confidently approach strangers and connect with them. Those hearty handshakes will always be appreciated, as will the ability to look strangers directly in their eyes.
But …
Today, virtually every new customer is an “Internet customer.” They spend anywhere from 10 to 15 hours online shopping for and researching cars. That’s right, they make much of their decisions without encountering that friendly handshake and persuasive sales pitch.
That means the era of your sales staff meeting and greeting a fresh “up” is a rarer occurrence, because most potential buyers visit your website before coming to your store.
If the site is welcoming and information-rich (including posting vehicle prices), it is likely shoppers will email or phone the store. If you have seen this trend yourself, you know you need to hire salespeople with skill sets that work in this new environment.
You need some “new horses.”
Spoiler Alert: Here’s where I’m going to surprise many of you. It’s time to eliminate the business-development center.
BDCs were established for a good reason. The old horses didn’t have the skill sets to handle incoming phone calls and certainly not Internet leads. They were hired to handle walk-ins. So it made perfect sense to establish sales BDCs to complement the veterans’ skill sets and become their appointment setters.
But since almost everyone now is an Internet customer, we need to change our hiring criteria and eliminate the BDC layer of expense.
Killing off the BDC or transferring an individual BDC into the sales arena is especially important in an era of continued margin compression where dealers should do everything possible to lower transaction expenses.
The hiring profile for the new horses:
- Likes sales.
- Excellent phone skills.
- Good grammar/typing skills.
- Product knowledgeable.
- Outstanding organizational skills.
The goal of the incoming lead also has changed. The old school BDC-driven goal was to set an appointment, pretty much at all costs.
But most prospects contact a dealership for information, not to set an appointment. Their goal is to gather granular information that will aid them in their buying decision.
So the new goal in this digital-sales strategy is to get the potential prospect to want to meet me. This is very different than trying to get an appointment.
This is about creating trust and confidence by being transparent and knowing a tremendous amount about the product, which can only happen if the salesperson possesses outstanding product knowledge.
The more trust and confidence the digital salesperson can establish, the more customers will want to set an appointment.
This sales model allows your sales staff to achieve high levels of empowerment. It may fly in the face of old-school sales management, but it will attract a better-educated more diverse sales team.
In this model it is important to note you are running two different sales groups: A smaller staff that meets and greets showroom floor “walk-ins” and your digital sales force that handles in-coming calls and Internet leads. This new group never works the showroom floor hoping to get a walk-in customer, but it is a dedicated team that works only by appointment.
Okay, so, how do I compensate the digital sales agents? We’re going to assume this is a younger staff comprised mostly of Generation Y.
That’s not a group that is turned on by a straight-commission job opportunity. They want more financial guarantees and a flexible work schedule. If you don’t want to meet those qualifications, you’re going to continue to ride your old horses until they retire. But then what?
Your compensation for Gen Y should revolve around these principles:
- A training salary, typically at least $2,500 for three months.
- Then a blend of salary and a flat-fee per unit sold with volume bonuses.
- Some compensation for F&I-related sales, including securing the financing and a small spiff for menu items. Incentivize this group to completely support the F&I department.
- A flat fee for 5-star reviews from online sites.
Hopefully all this is enlightening, not frightening. If you’d like some examples of methods to recruit your digital-sales staff or have additional questions, contact me at [email protected] or 916-715-8129.
Former dealer Mark Rikess is founder of The Rikess Group, a consulting and training firm. He is one of the original advocates of 1-price selling.
