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Who Signs The Cheques?

It has been said by industry giants like Sir RIchard Branson "Take care of your employees and they'll take care of your customers". Well this could and might be true but is also no guarantee that you will get them, the customers that is. I know his customer service is legendary and that's why people want to fly with him etc... Hold the phone... What... Customer Service is Legendary?

What does that mean? Did the Customer Service come before the employee or is it a combination of a significant number of factors? Personally, I believe creating the experience first allowed for the famous quote. Let me explain.

Today, Customers expect more, want to pay less, and have this little thing in their pocket that has the ability to reach out to the entire world. 

So let's try to reverse engineer this for a moment. 

That little thing is our biggest fear. We believe it holds our destiny in its microchips. For some it might, for others it may be the greatest blessing in the disguise. Why... It all comes down to superior service. 

Think of it this way, you're in a restaurant and you arrive early, the table's not ready but the host suggest you go to the bar and have a drink while they prepare. On the way there they turn around and say to the bartender, Mr. & Mrs. Jones are dining with us tonight, we don't have their table ready just yet so please let us take care of their first drink while we get the table ready. What are you going to do? You were the one that was early, it's not their fault. Most will pull out that little thing and post about the experience. How about if the server goes over the top in how they look after you or they comp something as simple as a coffee to end your night. You're going to blast it out there in the Metaverse.

Same goes for horrible service. You arrive early but the table is still being used and they just got seated not to long ago. So it's going to be awhile, the bar is crowded and loud, you can't get the servers attention. It's a struggle and once you do they get the order wrong. An hour goes by and still no table. Once you do get seated the menu is half sold out and the steak you wanted is so badly comes overcooked and tastes like leather. You complain and ask for the manager but they refuse to come or adjust the bill. What are you going to do... Take pictures, share, SCREAM IN YOUR POSTS LIKE THIS!!! All for more attention to be brought on the restaurant than the great experience above.

So yes, that little thing can be good and bad. It's your choice on how it plays out.

Now let's look at price... Price is the easiest of objections to get over. First, the Manufacturer sets the price as what we know to be the MSRP. This is a calculated number by their actuaries that is designed to be as low as possible to maintain the level of service expected by the purchasers of it's vehicles. Now over the years we've seen fluctuation both down and recently upwards based on supply and demand. 

What we have to do is explain the reasoning behind the price AND I couldn't give a rats butt about what the other guys sells it for or what the internet says I should. Wait a minute... that doesn't seem like you are willing to negotiate. No... I am not. The price is adjusted accordingly to fair market conditions. More and more dealerships are going to this one price model. Look at Tesla, not only have they been doing it since day one but they've changed the prices almost weekly over the last month yet you don't see customers SCREAMING all over the net about it.

Why... Because price isn't the number one issue when making a purchase decision.

But if we ask too much people won't buy they say... I also disagree with this... 

Let's go back to food again... I've used this comparison over and over again because it works. How much was the cheapest hamburger you ever had... Think about it? $0.99 is the most common answer... How about the most expensive... $15.00 - $20.00 or even more. So why the disparity? They are both burgers right. Sure one might be bigger but that doesn't hold weight in this argument as you just order double of the cheaper one. Something dramatic has to have you paying that much more when you KNOWINGLY could pay less. More often than not its service and experience otherwise you'd jump in the old wagon and go get the Whopper Jr.

So price is not a challenge... 

That means the customer wants more. So let's give it to them. Notice those little devices. They have opportunities all over them. How many times do you see on LinkedIn, Instagram, and Facebook someone getting a new car with a giant bow on it or covered for an unveiling? How about creating social channels (talk to Kathi Kruse about that)? Better yet follow-up texts, emails, calls and appointment bookings. There is so much more service we can provide and best of all the customer will gladly pay for it long term. We just need to be consistent and accountable for it.

Back to paragraph three: Today, Customers expect more, want to pay less, and have this little thing in their pocket that has the ability to reach out to the entire world. Did we change this perception from an impasse to an opportunity I think so.

If we did then we've cleared one hurdle the reason why we don't do what we should do and moving with that forward momentum let's focus on why we should do what we can and more; THE CUSTOMER.

The customer is the one who pays us. Don't ever think its the Dealer Principal or the OEM; it's not regardless of whose signature is one the cheque. Don't let anyone ever tell you differently. Until an individual buys a car, brings it in for service or purchases parts there is ZERO revenue for the dealership. If there is zero revenue and money doesn't grow mysteriously on the trees behind the dealership so the dealer can pay you. So it's that revenue from the customer that feeds everyone at the dealership a little bit at a time.

Knowing this and looking at the customer value, it's important to understand the importance of long term retention as this is where the money is made. Acquisition costs can be enormous and must be amortized over time. This goes for everything from the land, building, equipment even the customers with advertising and administrative costs. So focusing on this requires attention and again superior service.

The trend is becoming clear now...

Offer superior service in a transparent, clear business transaction creating a long term relationship and everything will be golden, right?


Now we got that straight. Customer Service and Experience come from the team we need to treat the team right. Like Richard said treat them right and they'll treat the customers right.

So how do we do that?

Six simple steps:

Hire Right: We need to understand the process of designing our team and how they can excel. Most look for degrees, experience and previous successes but I have always found diamonds where you least expect them. Look for them in places with vigorous training, hospitality and customer service. They may never have thought of Automotive and it's your job to recruit them. If you do and they'll be your stars.

Onboard Correctly: Nothing shows you don't care by pointing at a desk and giving a password, five points of reference, a quick tour, your business cards are arriving next week and if you need anything Joe over there has been with us for 15 yrs ask him. We need to create true onboarding with measured training cycles, stair stepping to the position. Once accomplished the team member will be able to engage properly with success.

Set Expectations and Hold Teams Accountable: Why is it a business with revenues over a $100,000 needs a business plan to operate effectively yet we don't require one from our teams generating MILLIONS? It has to stop. Every revenue generating employee needs to file a business plan. We need to revue it and confirm reasonable expectations. Once set we need to hold them accountable for these efforts.

Coach Daily: By setting and maintaining accountability we need to Coach our teams to success. If they are failing back on their own expectations identify the reasons and tactically respond. Train and guide them to greatness. Don't do their jobs for them, teach them how to accomplish their tasks with ease and precision. Doing so will lead them forward with positive enthusiasm.

Invest in Retention: Your team is your business. Invest in them just as you would everything else you believe is an asset, as they are your biggest asset. The cost of replacing any member of your team can exceed their annual salary. Think recognition over remuneration as most look to see this as an understanding of their efforts. Of course a occasional financial reward goes a long way as well. This is the biggest factor in Sir Richard's belief system.

AND finally Lead by Example: I once worked for a gentleman who owned several premium luxury brands, 8 rooftops in total. Every day he'd walk the customer parking lot looking down, picking up garbage and cigarettes. We had cleaners and attendants that were paid to do that but every day out there he was. What happened... We all did it. No job was beneath us, If the Owner was doing it we were. If we saw a smudged glass window we cleaned it. This was our field and we were proud of it. Cars were aligned, shined and ready to go. And so were we.

Now we know it's the customer who pays us, that we need to look after both the customers and the teams to be successful we need to close out on one point. 

Let's lose the lingo. Throw the term UP out into the garbage where it belongs. An UP means you have to get UP off your ass and deal with them. How respectful is that to the person who pays you. Give them the respect they deserve, they are guests, like in a hotel, club or better yet your Home. Isn't that what the dealership actually is your Home. If not you might be at the wrong place.

Peter Smith heads the Lion Partnership, a collective of Automotive Experts that specialize in improving dealership environments. Please feel free to reach out to him and his team at any time and we welcome comments and the reposting of any of our articles to your networks.

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