Dealership Marketing Blog

Step-by-step dealership strategies, guides, and tutorials that will help you dominate online.
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How To Prevent Dealership Digital Ad Fraud in 2020

Bobby Fikree and Michael Cirillo Apr 10, 2020 3-4 min read

Did you know that your ads are out-spending your hard-earned dollars on BOTS late at night? Yup... it's true. We originally published this blog back on October 30, 2017 but have found it to be an even more timely message today. Digital advertising, in many regards is what has helped many dealreships remain connected to their target shoppers during the COVID-19 pandemic. While we maintain that running relevant and timely ads are important even if you have to decrease your overall budget, it would be a shame if you were losing money due to bots or unsavoury websites late at night. As the marketing technologist at Flexdealer I spend most of my time ensuring your ads show up in front of people who want to see them. A key part of this is ensuring that the ads show up when people are searching for content that is relevant to your brand. My responsibility is to ensure that your ads show up on properties that are consistent with your brand's values. It's about time the digital marketing world came clean. Until recently nobody in the industry had any idea which specific properties were showing your ads or who was viewing them. We had educated estimates but that’s about it. Surely Google and Facebook Knew? Google and Facebook (apparently) didn't. Because of not knowing this information approximately 250 advertisers boycotted YouTube and AdSense. The list included big-spending marketers such as PepsiCo, Wal-Mart Stores, Starbucks, AT&T, Verizon, Johnson & Johnson, and Volkswagen. While advertisers haven’t boycotted Facebook’s platform in the same numbers many brands have taken action after seeing their content showing up on the alt-right website Breitbart. Despite blacklisting the site many companies found their ads showing up on the site. The twitter account Sleeping Giant notifies companies as their ads show up on the page. It's unclear how many, if any, of those have returned to YouTube since Google promised to hire more human reviewers and upgrade its technology to keep ads away from repugnant videos. Both Verizon and AT&T, two companies that are trying to expand their own digital ad networks to compete with Google, told The Associated Press that they are still boycotting YouTube. FX Networks confirmed that it isn't advertising on YouTube either....
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Top 30 Canadian Local Listing Sites Your Dealership Needs To Be On

Michael Cirillo Apr 09, 2020 10-11 min read

If you've ever wondered what you can do to enhance your search engine ranking, pay attention. There's something online called citations, and you want them.  Why? Citations are an online reference to your dealership name, business address, and phone number. Google uses them to evaluate the online authority of your business. You might be thinking, "Isn't that a backlink?" Kinda, but not really. Citations differ from backlinks because you don't need to include a link to your website for you to get credit for them. The difficulty in building citations, however, is that they can be time-consuming. You have to source credible directory websites and then go through the process of creating a profile on each.  That said, there is massive value to doing so especially when considering how mobile device usage has surpassed desktop usage.  The easier it is for people to find your information, the better. That's why our Local SEO specialists have compiled a list of the top 30 Canadian local listing websites you need to know about. YellowPages.ca...
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What Retail Vehicle Dealers Can Do During A Market Contraction

Michael Cirillo Mar 31, 2020 0-1 min read

If there is one thing that we know, it's that the COVID-19 pandemic has leveled the playing field. There isn't a person or business that isn't or won't feel the impact of it in some way or another.  Luckily, we live in an era rich with abundance. Even when there are unknowns, many things remain within our control.  That's what was discussed inside of my recent conversation with Jeff Bounds, Director of Automotive at Grant Cardone. Jeff has worked in the auto industry for the last 25 years, and has a keen grasp on the activities required to stand up and stand out during times of uncertainty.  Listen to the full interview here:...
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Why OEM Compliance is Killing Local Dealerships and Their Marketing Efforts

Whitney Norrad Jun 24, 2019 6-7 min read

That’s right, I said it. In a time when we’re seeing more requests than ever for local SEO services and more worldwide experts chiming in about how important it is, OEMs are falling backwards.  OEMs at national and international levels are continuing to put dealers into corners by mandating them to use specific website providers and digital marketing companies that truly don’t seem to have their best interests at heart. On top of this, they’re killing local SEO and the flexibility that individual dealerships need to perform....
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What Google's Latest Algorithm Update Means for Auto Dealers

Michael Cirillo Mar 14, 2019 4-5 min read

Google confirmed a recent “broad core update” to its search algorithm this week so big that it was predetermined that they call it Florida 2. While Google makes updates to its algorithm almost daily, my research indicates that this is larger than normal.  Any time Google makes updates, it’s important to know what that means for your dealership’s digital presence. Don’t Make Dramatic Changes to Your Website Broad core updates are Google’s way of making overarching changes to its algorithm. The purpose is to better understand search queries and their associated search results. This is an indication that relevance is still a very important focus for Google and should be a top priority for your dealership’s web presence as well. Don’t Panic Some prominent members of the SEO community have noticed that, in some instances, rankings and page traffic can either be positively or negatively impacted. Whatever the case may be, don’t panic. Panic often leads to making changes without sufficient data to support your actions. Remain calm; read on. How Your Dealership Should Respond to Florida 2 There are many facets to search engine results, ranking, and SEO. There are many opinions out there, which is why I tend to recommend information that comes directly from the inner sanctum of the search world: Google.  While I don’t recommend making dramatic changes to your site, any updates targeting relevance and understanding search queries leads me to a single conclusion: the absolute need for creating high-quality, relevant content.  In a string of tweets dated March 12, 2018, Danny Sullivan, Google’s public liaison of search made the following comment about broad core updates. “There’s no “fix” for pages that may perform less well other than to remain focused on building great content. Over time, it may be that your content may rise relative to other pages.”...
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What's Next For FlexDealer? Auto Remarketing 2019 in Toronto

FlexDealer Team Feb 14, 2019 2-3 min read

Recently, at NADA 2019 in San Francisco, our fearless CEO Michael Cirillo and the voice of The Dealer Playbook Podcast sat down with Bill Zadeits from the Auto Remarketing Podcast to chat about what’s to come at the approaching Auto Remarketing 2019 event. What’s the Event? Coming to Toronto on March 19 and 20, dealers from around the country (and beyond) will be hitting Canada’s Used Car Conference at Westin Harbour Castle to learn new strategies and chat ideas to help grow their businesses. This is a great opportunity to learn, educate, and network within the automotive industry. Here’s your sneak peek. The Wheels are Turning Not just figuratively, but literally as well. Flying in from Edmonton, Michael will be speaking at the event and helping to educate dealers with practical business solutions. In addition to attending the event as a sponsor with FlexDealer, Michael is a part of AR Canada’s highly anticipated event: Dealer Training Tuesday. DTT will kick off the event on March 19th with the biggest goal being education: sessions that aim to provide realistic action items to rocket your business forward. Michael Cirillo's Keynote Sneak Peek Without sharing too much, Michael’s goal at Auto Remarketing Canada is to share with dealers, the action items that keep so many listeners coming back to the Dealer Playbook for each new podcast. The content of his session will focus on helping dealers learn how to future-proof their business model in an age of digital advancements and perceived automated threats. He’ll cover tariffs, government legislation, and avoiding the scare of vehicle vending machines, while also providing simple and practical action items to take back to your dealership. He’ll help you demystify buzzwords like disruption, AI, and more, to show you how to grow and scale despite all of the white noise out there. How Does FlexDealer Fit? We love helping dealers find success in the ever-changing digital world. As an agency with a long history in the automotive business, FlexDealer’s goals are simple: Reduce the cost of essential technology within the automotive industry Help dealers become more educated and empowered to make marketing and sales decisions that will help them sell more vehicles Provide insights and decision making tools for dealers of all sizes Evolve with the industry while growing the businesses of our dealer partners Catch Michael and members of the FlexDealer team this March 19-20 at our FlexDealer booth to talk shop, find out what we’re up to, and how we can help you win online!...
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What Parts of Your Website Actually Matter to Vehicle Shoppers?

Whitney Norrad Jan 28, 2019 6-7 min read

Being in the dealership website and digital marketing game can often be a battle like a teeter-totter; balancing doing what we know is best for our clients’ performance, and also doing the things that matter most to those clients and their dealerships. Can I get a “no more sliders” chant, please? When it comes to making the right choices for your website, there are many factors to consider. We’re big fans of making decisions based on research to decide what areas of websites to focus on and optimize to make the best user experience and performance possible. Here are some insights as to how common dealership pages fare in the real world. Showroom Pages: a Dying Breed? As the years progress, showroom pages become ever-more competitive in terms of design and demand. Dealership clients want bells and whistles on these pages more than almost anything else. But, as time passes, these pages are increasingly becoming less important to vehicle shoppers. Showroom pages are something we get many questions and change requests for, from dealers. Why? Well, we know that dealers like to brag about their promotions, put effort behind old stock or exciting inventory, move what has the best offer, and show that their numbers stack up against the competition in a price-sensitive market. Do these things truly matter to consumers? Showrooms: Dealership vs. Manufacturer A study conducted by Google breaks down the vehicle-buying journey as it relates to dealership websites, review sites, manufacturer sites, and Google searches. This study showed a shopper’s digital interactions over a three month period: 186 manufacturer interactions 139 Google searches 69 Dealer interactions And the stats get lower from there (check them all out here) When it comes to dealership vehicle showrooms, they tend to mirror a lot of the information available on your OEM’s national site. It’s just the nature of the automotive beast. The thing is, customers have often already visited your manufacturer’s website before ever arriving on yours. They’ve done the build and price, they’re familiar with (the same old, boring) promotions available at all of your brand’s locations and they’re now ready to interact with a local brand’s personality and inventory. Does it really matter if I can get a 2019 Honda Civic for 0% financing for $17,970 cash with zero added features if the only units local dealerships have are the LX and EX trims? Nope. So why so much love for the base offers? The Real Dealership Showroom Statistics I took real data from a dealership website client of ours to see just how showroom pages hold up. Using the Google Analytics Behaviour Flow feature, I looked at just how much traffic eventually hits the showroom pages of the website compared to the rest: Last year, over 56% of traffic flowed to inventory-related pages For that same period, 4% of traffic flowed to lineup pages The showroom pages? 1.37% of all website traffic flowed to showroom/incentive pages at any point in their interaction with the website The bulk of the remaining traffic visited staff pages, landing pages, and content pages To avoid isolating the above data, I pulled additional stats from yet another dealer in a different province and from a different OEM. Here’s what I found: 77% of users chose inventory-related pages as their first interaction 0.006% of users chose the showroom as their first interaction 0.15% chose incentives as their first interaction The remaining ~20% flowed to landing pages, blog posts, and promotional/dealership efforts I kept researching through additional behaviour flow statistics across varying client types and found similar data at each point in the website journey. Shoppers seemingly care about inventory and your dealership brand, as it relates to your website, more than they care about national offers that they can find elsewhere. Inventory Pages: Where the Party is Bumpin’ Inventory. Isn’t that the name of the game? I certainly can’t buy a vehicle from you if you don’t have it available (see my Honda rant above), and I’m even less likely to complete a lead capture form if there are no pictures of it. That can’t be exclusive to me. Inventory Images for Ads Using an ads client as an example, we compared their ad performance using dynamic inventory ads where some had images and some didn’t. This client started with about half of their used inventory being merchandised with real photos and went to having all vehicles merchandised with real images. Comparing one month to the next, their ad spend per VDP (vehicle display page) view dropped from $0.95 to $0.60, with all other factors (spend, targeting, etc.) held constant. This also snagged them more results (read: clicks and conversions) for the same spend. The images were the only change to the campaign! Same budget, similar inventory, same targeting, same ads structure! Inventory Images on SRPs and VDP The same concept of imagery applies to your SRPs (search results pages) and VDPs. This is where I got into some serious data entry. I took data points across both new and used vehicles, across multiple OEMs and independent dealership sites, makes/models, etc. to get a balanced idea of how VDP views relate to images or lack thereof. Analyzing over 30,000 VDP views, here’s what that looked like....
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Setting Marketing Goals that Will Make a Difference for Your Dealership

Whitney Norrad Jan 18, 2019 5-6 min read

At this point in the game, you really should have your 2019 marketing plan in place. With that being said, we’ve been in the dealer world for a long time. We know that it doesn’t always work out so smoothly, and that’s alright! Whatever the reason, we’re here to help you make plans based on your goals and desired outcomes. Know your Goals and Create Micro Goals to Get You There I could write an entire novel about goal setting (it’s addicting), but I’ll save you the deep think. When you’re building a marketing strategy, it’s important to know what your actual goals are. Not just your overall or long-term goals, but your goals for each channel and the smaller steps that you need to take along the way. The biggest goals can often be broken down into more individual, shorter-term goals on your path to success. If your goal is to obtain leads from Facebook, what goals do you have on the path to the conversion? You can’t use awareness techniques such as reach ads in hopes of completing a conversion action! If your end or long-term goal for these ads is more (setting a specific number is best!) leads, you’re going to need to set micro-goals along the way. Here’s a simplified example of how to get to a “bigger” goal, such as leads: Goal: Leads, leads, leads. Micro goal: Gain awareness. Action step: Use reach and awareness ads! Micro goal: Find the right audience of interested shoppers. Action step: Implement an ads pixel to track who interacts and remember those users. Action step: Retarget and market a more lead-driven message (compared to your awareness and branding ads) to users who have interacted and shown interest. Action step: Optimize each set of ads as you go, filtering out users that don’t show value on the site from your ads and capitalizing on those who have returned for a second, third, or even fourth visit. Action step: Narrow down their interest and provide them with a truly valuable offer. Result: High-quality leads. Goal, check! You won’t get to the “big” goal as often without meeting the smaller ones: plan smart! Don’t Forget the Funnel or the Buyer When you look to inbound experts and the highest-regarded marketing resources out there, there are a few methodologies that ring true to the “old school” marketing techniques taught to many of us back in college or university. The concept of a marketing funnel is not dead and we need to understand this now more than ever to truly harness the power of the incredible tools at our fingertips. "The concept of a marketing funnel is not dead." Buyers follow a personal journey through a funnel that roughly looks like this: Awareness: of the problem or need they’re trying to solve/fulfill (sometimes brands enter the funnel during this stage). Consideration/research: shoppers are considering their purchase. They are looking at brands, comparing prices, locations, and features that matter to them. Decision: They have made the choice to purchase or act on an offer or specific vehicle. Purchase: They buy your vehicle—great! Loyalty: Are they loyal? You better hope so! This is how they act after the sale is complete. Each step is different and requires its own approach to reaching the buyer while they’re there. Meet them where they’re at, don’t just wait at the finish line. Note: some sources and businesses have different funnels, which is completely okay! This standard funnel is used to demonstrate the concept at hand. How Does the Funnel Relate to Sales Goals? The methods you use to gain awareness simply can’t be the same as those that you’re using to create conversions. Having an awareness approach and a conversion goal means that the action and goal are misaligned. Heck, Facebook ads won’t even let you run an awareness ad with a conversion goal! So why are so many people still looking for conversions from awareness plays? Usually, this comes down to a few different factors. These are money, co-op, and lack of awareness. Often, OEM co-op agreements require dealers to run “tactical” ads that ring true to the example of an awareness ad.  You’ll see them everywhere you look, from Superbowl ads to the full spreads in your local newspaper.  Do they really expect me to see that and then immediately run to the dealership and purchase a vehicle? No.  These ads are meant to pique interest and eventually move me in the direction of a purchase. Digital should be treated the same way, but with one distinct advantage: we’re able to insert brands deeper into the buyer’s journey, or marketing funnel. Think about where your goal fits into the buyer’s journey, or if other steps are required to get there.  "Re-engineer the way that you're looking to find sales by tackling each step of the funnel." Re-engineer the way that you’re looking to find sales by tackling each step of the funnel. HubSpot has some excellent material that speaks to how to create content that caters to different stages of their ideal funnel. Determine what this looks like for your dealership and you’ll be armed with a true strategy for creating sales. On the journey to an online vehicle lead, your efforts, actions, and goals could look like this: Macro goal: vehicle lead Buyer’s journey step: purchase decision Micro goal: “I want people to know we sell motorcycles” Buyer’s journey step: awareness step of the buyer’s journey Action: run awareness ads to gain eyeballs This can eventually move to the purchase decision step, but they aren’t the same thing. Consideration step: shoppers looking to compare trunk spacing of suvs Suggested micro goal: insert your brand into their research Action step: create blogs that compare the trunk space and other features to that of other suvs Loyalty step: shoppers who have purchased from you before Suggested micro goal: make them into a repeat customer Action step: create small, memorable touchpoints with your brand until the next time they need a vehicle through email marketing Try it for yourself! Goal: ______________________________________ Micro goal: ________________________________ Buyer’s journey step: _______________________ Action: _____________________________________ Buyer’s journey step: ________________________ Goal: _______________________________________ Action: _____________________________________ Trying this exercise goal-first and buyer-first can be an eye-opening experience. Once you figure out how to meet your unique market’s buyers, you’ll be ready to set clear, actionable goals that will make a difference for your business.  It’s important to think both about your goals, as well as the buyer’s journey when creating marketing initiatives. Not sure where yo start? Our team is always eager to dig in and create buyer personas, conduct competitive analysis, audits, and help businesses achieve their goals. Reach out: we’d love to put our heads together....
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The Shocking Truth About the Cost of Automotive SEO

Michael Cirillo Oct 22, 2018 8-9 min read

"Can someone get me a new pair of pants? I've soiled myself!" That’s the initial thought I had when Rand Fishkin, former CEO of Moz and founder of Sparktoro answered my question about the cost of SEO. I had the pleasure of interviewing Rand on episode 142 of The Dealer Playbook and was curious about how much he would charge per month if he were going to deploy an SEO strategy for a business. I asked because I wanted to shape the narrative around SEO for dealerships, especially in a space where $99/mo is too cheap, but $5,000/mo gets you an abrupt “no.” $5,000 seems crazy expensive especially in the context of retail automotive, but why is that? First, let me share what Rand had to say and then I’ll provide my commentary on why I think things are so messed up in retail automotive. This was the exact phrasing of my question: “How invested should businesses be in… Is the cost of SEO going to drop? Is it marginally cheaper to have SEO done now or will there be no changes there? For example, companies are charging $20 - $50K or upwards of $100k per year to have SEO done. Do you think that will change or decrease at all?” Here is Rand's unedited answer: “Umm, no. Not generally. I would expect that you will continue to see the high-end ranges stay very high and then the lower quality or lower amount of effort and fewer results remain cheap. That is because, essentially, the price of SEO will rise to the point where there’s just a little bit of ROI investing in it and beating the next person and getting to the next result. So Adwords is an extremely efficient market, SEO is extremely inefficient market but give it enough time, it will act like AdWords and become effective as well. The cost of the clicks, the cost of ranking, and the search results of doing all these sorts of creative and technical things to get there will increase. You’re seeing that because SEO’s bad reputation is dying and the “oh it’s sketchy and scammy” is going away because it’s less sketchy and less scammy. There are more high-quality operators, it’s a lot more important, everyone recognizes the value of ranking in Google search, and also, these pros that have been doing SEO for a long time know their worth, they have big networks, they can get clients more easily, they can charge more as a result of that and so, high-quality work gets more expensive." I then asked this question: “If Rand Fishkin SEO were to do SEO for a business, what would someone of your calibre - what would the price range be?” The shocking, but extremely transparent answer? “Yeah, it totally depends on the service of the work and the sector. If you’re talking about, "hey Rand we want you to strategically advise this b2b customer, and they are doing something in a relatively unique space, and just a few hours with their tech and marketing team will do the trick - maybe a couple grand per month. But if you’re talking about needing my team and me to go and do the keyword research, create the content, build the links, do the creative, get the marketing message out there, do the demand creation… I would be shocked if you were charging less than $25,000 per month for a full-fledged program like that…” What are you willing to invest in SEO? Based on historical trends, especially in the retail car business - the answer to this question should be more straightforward, but sadly isn’t. Here are the factors to consider: 1. The scope of work Traditionally, most SEO in the car business is non-existent even though you are paying for it monthly. I can think of a few big players that charge for it on their monthly invoice as part of the mandated OEM programs, but sadly the dealers aren’t getting a lick of work done. A recent example was from one of our clients. As we looked into what they were paying, we noticed such a line item on the invoice and decided to reach out to their web provider. As it turns out, this client was being charged $650/mo by their mandated provider for a website plugin that wasn’t doing a darn thing, let alone proper SEO work! As a local business, you have some exciting options available to you. Options that will allow you to take advantage of the evolving landscape of SEO. It may not seem like a lot, but the structure of your website can contribute to your digital presence in a positive way. For example, think of Windows Explorer on your computer. You can store files within folders making it faster and easier to find and access the information you want. In a similar way, the information on your website can be properly categorized, by making adjustments to the URLs. Doing so will allow Google (and web searchers) to find and access your site content with ease. The easier Google can access your site information, the higher it can rank. Directory submissions are an example of something else you can do to provide positive ranking signals to Google. Google looks at the NAP (name, address, phone number) information on sites like Yelp, Facebook, Google My Business, and 411 to understand the relevancy of your business in a local market. Sadly, most dealers don’t take advantage because, well, it’s extremely time-consuming to set them up. It’s manual labour, but so critical as a foundational SEO activity. The amount of strategic information that a trained SEO analyst can gain from these two activities has the power to create SEO tactics that will completely unleash search dominance on your local competitors. If you’re not getting any of this work done at a very basic level, you shouldn’t be paying for it so look closely at your invoice and start asking questions. 2. If you want the best, you must pay for the best. Rand can charge $25,000 per month because he is in the upper echelon of the most premier thought leaders when it comes to SEO. If you want that level of SEO, be prepared to pay for it. Sadly, the disconnect here is that most dealers were sold a bill of goods by their provider, who made themselves out to be the best but actually weren’t. I’m not suggesting they were the worst, but they could have demonstrated a more transparent look into who they are and what they do. At best, the dealership could then decide which path to take. That’s why the $650 - $2500/mo is the current sweet spot for “automotive SEO” by most providers. Again, most deploy pretty standard keyword research, and shockingly, many are still implementing either black hat or incredibly outdated SEO practices. If you’re in this bracket and not seeing anything exciting happen with SEO, it’s time to consider why that is. 3. So what does $650 - $2,500 actually get me? It’s important to remember that most SEO, when done correctly, is time consuming manual work. While you are paying for a hopeful outcome (ranking, more visibility to a targeted audience), you are also logistically paying for physical man hours. It’s no different than your service department clients. While in their mind, they are paying to have the vehicle fixed and back on the road (the result), you know that they are also paying for parts and labour costs. Because it’s time-consuming work, that creates the catch-22 for most providers. Since providing SEO services is a core of their business, the only way to scale is to streamline or automate as much as possible or else they’ll be in a never-ending downward cycle of having to hire more people to handle the work. At FlexDealer, we’ve chosen to focus on the elements of SEO that we believe will bring you the most value. For example, Local SEO is a core focus for us because we think it’s vitally important in today’s marketing mix – especially as it pertains to you, a local retailer. Add mobile and voice search on top of that, and local SEO is something that you can easily focus on between $599 and $999 month. With local SEO as a solid foundation, adding extras like content creation and strategy (blogging, landing pages, targeted content pages, model pages) adds an increase in cost. For example, a dealership that’s partnered with us to do strategy creation and then the execution of local SEO, citations, content creation, on page optimization and graphics would sit in the $2500 - $3500/month range. If we were to add external link-building and a mix of social and search advertising, the monthly fee goes up. 4. According to Rand, does that mean FlexDealer is just “okay” at SEO? No, not at all. But if you notice that Rand mentioned that SEO work is mostly dependent on the sector, competition, and the services required. The remarkable thing about the retail car business is that most dealer website SEO is terrible. That’s good news for you. That’s also good news for us. That means while the saturation of dealerships is high, your digital competition isn’t. That also means, as a company, FlexDealer can choose the long game with you by focusing on what’s fair and what will speak to the narrative of our core value: Build relationships of trust. For us, it’s more important to be fair and do good work for you with the right expectations, than the promise to lasso the sun, moon and stars and not be able to deliver. With us, you’ll know what you’re getting, when, and how. We work with your team internally to ensure you are onboard with every strategy we deploy and create. Each month begins with a full accounting of the work completed, the results achieved, metrics, and collaboration. Not interested in paying $25K per month, but also want good Local SEO? We’d love to hear from you to chat about your online goals. Drop us a line. ...
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Why You’re Failing to Increase Online Car Sales Opportunities

Michael Cirillo Oct 12, 2018 6-7 min read

Now that you’re a decade or more into marketing your dealership online, I think we can agree on one thing: if you build it, your audience won’t necessarily come. I don’t blame you. In digital retailing today, there are so many options to choose from, and even more mandates. Considering the current climate of digital retailing in the automotive industry today, it can be overwhelming to make anything you do stick. What if there is a deeper reason? What if the software, and website, and CRMs and processes have nothing to do with it - at least not at first? Let me share an analogy with you – tell me if it’s as ridiculous as it sounds! You walk into Home Depot (Bunions if you’re in Australia), and purchase the most expensive hammer you can find. You bring it home and lay it on the table. After a few minutes, perplexed, you wonder why in the world all of the pictures haven’t hung themselves. After all, you just bought the tool you needed to hang pictures. Sounds ridiculous, right? The missing link isn’t the tool. The missing link is the person using the tool. People are your most valuable asset, and if they are unhappy, the ripple effect can be detrimental to your dealership’s overall health. Why? When people are unhappy, they tend to pay less attention to detail. They don’t care as much. Which is an interesting catch-22 because employees come from one of two camps. They are unhappy because they hate their job OR they have become unhappy that the job they care so much about doesn’t seem to be evolving or growing for them. They’ve lost confidence or trust in the leadership team because they may feel unheard or underappreciated. Whatever the case may be, cheaper or more expensive tools will never combat or compensate for unhappy people. Don’t get me wrong; I understand entirely how easy it can be to forget about employee happiness, especially when there are a million and one things flying at you day in and day out. However, I’ve also experienced the positive effects on culture, productivity and profits when my team knows that I care and that their efforts are appreciated. In short (if this is where you decide to stop reading), stop wasting your time and money sourcing new tools when at first, they won't make a difference. In a recent interview on The Dealer Playbook Podcast, I had the pleasure of interviewing Kris Boesch from Choose People. She talked about the effects of employee happiness - both positive and negative. “As the leader of your dealership, you have a million different things that you're juggling. You're considering different strategies - there is a lot that you're trying to make happen, so why does this matter? The first thing you have to know is that there is a substantial financial return on investment with having happy employees. Now you might be thinking; I'm not responsible for making my employees happy. I would agree, you're not. However, you are responsible for creating and empowering context within which they can be happy. That's culture. It's the context within which your people work. It's the air they breathe while running your marathon." She goes on to say, "If you have an employee who is earning $45,000 per year and is unhappy, they will conservatively cost you an additional $39,000 per year in addition to their salary. Now if that same employee is happy, they will benefit your bottom line by at least $21,000 or a 1.5 multiple of their salary. Happy employees make 26% fewer mistakes. Now it's not like your employees are out to get you, but if they're unhappy, they care less. When we care, we pay more attention to detail." How many employees do you have? One of the most eye-opening exercises you can do as a leader is calculating the profit/loss of your people. Based on that same 1.5 multiple that Kris mentions you can get an idea of what your team is costing per year based on their happiness level. Let’s say, for example, that you have 40 employees with an average salary of $45K per year. First, rate their collective average happiness out of 10, with 10 being perfectly happy. Using a 7/10 happiness rating look at the resulting numbers. Positive financial impact of your happy employees: $450,000 per year Negative financial impact of your unhappy employees: $450,000 per year Potential positive financial impact of indifferent employees: $225,000 per year Not only would you be killing $450K per year in this scenario, but there is also a leftover unleveraged potential impact of $225K. You are leaving $675,000 per year on the table (actually you’re flushing it down the toilet)....
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