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JOEORR

Dick Hannah Honda page 14

March 2010

Internet Sales:A Darwinian Fight for Survivalpage 8

Put the Right Content on Your Site page 12

Technology Trends:Making Profit with your IT Department page 23

The Cruel Mistress of Social Mediapage 24

DD 2 March 2010 DigitalDealer-magazine.com

ABLE OF CONTENTSTMARCH 2010

PRESIDENT AND CEOMICHAEL ROSCOE

VICE PRESIDENT AND EDITORIAL DIRECTOR

CLIFF [email protected]

248-351-2620

PUBLISHERGREG NOONAN

[email protected]

CONTENT COORDINATORMARIA BURKEL

[email protected]

ART DIRECTORJOE BIRCH

PRODUCTION MANAGERELIZABETH BIRCH

PRINT PRODUCTIONNICK THOMAS

COVER DESIGNJOE BIRCH

CIRCULATION SUBSCRIPTIONRICH JARRETT314-432-7511

[email protected]

NATIONAL ADVERTISING [email protected]

607-264-3359

Dealer magazine makes every attempt to ensure the accuracy of all published works. However it cannot be held responsible for opinions expressed or facts supplied herein. Nothing may be reproduced in whole or in part without written permission from the publisher. All rights reserved. The publisher encourages you to submit sug-gestions. Submitted materials become the property of Horizon Communications, Inc. and will not be returned. Send material for publication to 330 Franklin Rd., Suite 135A, PMB 386, Brentwood, TN 37027. The editor re-serves the right to edit material; submission of material constitutes permission to edit and publish that mate-rial. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is presented with the understanding that the publisher is not engaged in rendering legal, accounting or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. From a Declaration of Principles jointly adopted by a Commit-tee of the American Bar Association and a Committee of Publishers.

A PUBLICATION OF

! " # # $ % & ! ' ( & " % )

FEATURES Digital Dealer Cover Story 14 Joe Orr General Manager Dick Hannah Honda

Digital Dealer Vendor Profile 20 ActivEngage: Over 3 Million Chats and Counting: ActivEngage Shatters Online Communication Boundaries with Personalized Live Chat and Dealership Marketing Intelligence

COLUMNS AAISP Notes 6 Profitability – A Dirty Word Today? Cliff Banks

Internet Sales 8 A Darwinian Fight for Survival Tom Mohr

10 Is Your Web Site Fully Optimized? George Nenni 12 Put the Right Content on Your Site Brian Rabold

18 Quick Tips to Improve Online Pre-owned Sales Rob Lange

Technology Trends 23 Making Profit with your IT Department Sandi Jerome

24 The Cruel Mistress of Social Media Joe Webb

DEPARTMENTS 4 News

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333456748976

BZ Results, an ADP, Inc. Company, 2000 Nooseneck Hill Road, Coventry, Rhode Island 02816 ©2010 ADP, Inc. – Dealer Services Group / BZ Results and the BZ Results logo are registered trademarks of ADP, Inc.

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DD 4 March 2010 DigitalDealer-magazine.com

IGITAL DEALER TECH NEWSD

Dealer Specialties launches Twitter posting tool

Dealer Specialties, a division of Dominion Dealer Solutions and the nation’s largest pro-vider of comprehensive inventory manage-ment solutions, web sites and Internet mar-keting tools, is excited to announce a tool that allows posting inventory on Twitter through the company’s recently launched Inventory Manager (IVM) 3.0.

Dealerships are embracing social media and understand that being part of the online con-sumer conversations is increasingly important. Being involved in these conversations involves listening. Once engaged, dealers know what the needs are and are able to provide informa-tion accordingly.

As a form of distribution, Twitter has been integrated into Dealer Specialties recently redesigned Inventory Manager (IVM) 3.0. IVM 3.0 was developed for scalability and made the quick-to-market launch of a Twitter posting tool easy. Customers are now equipped through IVM 3.0 to expand their vehicle specials, aged inventory and unique in-stock vehicles directly to an engaged and relevant audience on Twitter.

With an established Twitter account, deal-ers are empowered to select which vehicles to post on Twitter whether it’s their entire used vehicle inventory or specifically identified vehicles. “We recommend choosing vehicles that consumers are talking about, vehicle specials and vehicles that are sought after by a small interest group. Listing your whole inventory in an effort to do an inventory blast is equivalent to spam,” says Glen Garvin, Dealer Specialties group general manager of product and development.

Obtaining access to the Twitter tool requires a customer only to activate the set-ting under settings in IVM and add their Twitter profile information.

The Twitter post listing includes vehicle information such as the year, make and model with a shortened URL that takes potential customers to the vehicle details page on GetAuto.com. Marketing messages that describe vehicle uniqueness are encouraged.

“Adding Twitter to the Dealer Specialties distribution network was a seamless integra-tion and an initiative that will provide cus-tomers with an opportunity to further engage with their network while creating a new venue for generating increased ROI from a relevant consumer segment,” says Garvin. “Twitter is an online community of actively engaged customers. It’s important to understand the audience, the purpose and ultimately establish rules for engagement. Once in place, it’s time to start tweeting.”

www.dealerspecialties.com

Dealer Lead Track provides dealerships

real-time advertising data Dealer Lead Track utilizes advertising

information entered by sales staff determining exactly which ad sources are producing sales and which ad sources need to be eliminated, saving thousands of dollars per month in wasted ad spending.

Dealer Lead Track’s easy to use, stand alone web based lead management system guides sales staff to capture which ad source is producing each lead in a drop down menu asking “where the customer saw the vehicle advertised.” This advertiser drop down list is maintained by management so sales staff selects from current advertisers.

Along with keeping advertising drop down lists accurate, the total monthly ad budget is entered by management for each ad source. With this information Dealer Lead Track’s advertising report computes exact figures on how much ad spending each lead and sale is costing dealerships to generate along with conversion ratios for all ad sources.

Monitor Dealer Lead Track’s advertising report daily, weekly, or monthly to gauge the effectiveness of each ad source and quickly shift advertising dollars away from sources that aren’t producing sales. Ad sources that just produce leads are ineffective. Ad sources

must produce sales or ad money is being wasted every month.

Can you currently verify which ad sources are producing your sales?

Dealer Lead Track provides factual real time advertising data so dealerships can cancel advertisers that are not producing sales with confidence.

www.dealerleadtrack.com

Reynolds announces collaboration with Polk

for data cleansing servicesThe Reynolds and Reynolds Company

and R. L. Polk & Co. has announced an agreement for Reynolds to utilize Polk’s industry-leading automotive information and data services. The agreement includes data enhancement services, list hygiene services, and data suppression services (do not call lists, for example).

“These services will help us serve our cus-tomers more effectively and enable them to operate with even more confidence in their dealership’s customer data,” said Trey Hiers, vice president of Corporate Marketing at Reynolds and Reynolds. “Whether the dealer-ship is using customer data for digital market-ing programs or service reminders, the ability to target customers accurately, using reliable data that eliminates duplicate and out-of-date addresses, is a critical step.”

Additionally, through the agreement, Reynolds will make available to its dealer-ship customers the Polk Cross Sell reports, which provide individual dealers with sell ratios compared to all dealers within a given region.

“We are very excited to be working with Reynolds and Reynolds to help their cus-tomers more effectively leverage their infor-mation to extend their reach though tradi-tional and digital marketing campaigns,” said Andrew Price, vice president, Polk Automotive Retail Solutions. “List enhance-ment, hygiene and data suppression services, along with the Polk Cross Sell reports allow Reynolds’ dealers to utilize the most compre-hensive information available to maximize their market opportunities.”

www.reyrey.comwww.polk.com

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DD 6 March 2010 DigitalDealer-magazine.com

Profitability – A Dirty Word Today?“The retail system

needs to be fixed.” I hear this statement often. It’s always in the context of how consumers are fed

up with the automotive buying process. Last summer and fall, so-called experts were cor-relating the sales decline to consumer anger. Trying to push a new way of selling —perhaps one-price selling (which isn’t a bad thing if done correctly), software that helps you develop a relationship with your customers, social media, palatial facilities with all sorts of amenities – numerous consultants are claiming we need to change how we sell cars.

I’m not saying their thinking is devoid of any truth, but the fact is, the unbelievable plunge in sales in 2008 was because of credit or the lack thereof. It had nothing to do with consumer angst of over visiting a dealership. Just a few years ago, we sold 17.1 million new vehicles under the same system we have today. If people don’t like the experience at your store, they’ll find another dealership.

In the last year, two sharply different schools of thought have emerged about the future of the automotive sales process. The one defi-nitely is more customer-friendly. So friendly, in fact, it seems to advocate the sacrificing of gross margin to keep customers happy. That’s a gross simplification, but in essence, that’s the bottom line.

The Internet is driving a lot of this customer friendly focus. But the war on dealership prof-itability began when President Eisenhower implemented the interstate system, which resulted in giving car buyers easier access to more dealerships, new vehicle profits have been on the decline.

Of course, J.D. Power and Associates had a lot to do with this by convincing automakers they needed to measure customer satisfaction at their dealerships. Funny thing is, for years Buick was one of the leaders in CSI scores, yet, its sales kept dropping. Toyota, who con-sistently scored low, became a sales juggernaut.

The Internet has pushed profitability down even further by giving customers instant access to information which they use against you in the shopping process. Remember Edmunds making

transaction pricing available? Several years ago, I sat in a room with all of Group 1’s general managers and Internet managers and watched as they skewered a representative from Edmunds.

Now TruCar is trying to promote a product that tells customers what similar vehicles in their market area sold for. Dealers are complain-ing the data isn’t accurate and that it puts them in a tough spot when someone comes in with a printout claiming to have that information.

A popular dealership trainer recently remarked to me that vAuto’s inventory man-agement tool is the most dangerous product to hit dealerships in years because it erodes profitability on each deal.

Dale Pollak, vAuto’s founder, argues the Internet arms the customer with so much infor-mation, the dealer is forced to price vehicles accordingly, or they won’t even be in the game. The classic home run (or lay down) deal is becoming more and more rare because of the web. Dealers now need to focus on developing a more consistent level of profitability on each vehicle, Pollak says. In other words, fewer home runs, but more doubles and singles.

The manufacturers, at least over the last 10 years, have forced dealers to invest mil-lions in new, more customer-friendly facilities. Yes, dealerships should be clean and com-fortable, but do we really need to have that $500,000 service department floor imported from Germany?

OEM facility strategy, as much as anything, has hurt dealership profitability the last few years. I have yet to see a study that proves pala-tial – or just new – facilities leads to any kind of sustained sales increases. Maybe they exist, but I haven’t seen one.

Another element is that facilities with the latest amenities, selling processes that are friend-lier means happier customers which means you’ll keep them through the life cycle of the vehicle. They’ll keep coming back for service long after the warranty is up. That’s a popular sentiment, but I think it’s hogwash. Dealers can’t compete on service-related pricing once the warranty is over. New car dealerships get a significant portion of their service revenue from warranty payments from the OEM. And dealers have a lot of say in determining the labor time rates paid by the manufacturers.

There’s some truth to the idea that dealers priced themselves out of the long term service market years ago.

A second school of thought comes from the old car guys who argue we need to get every bit of reasonable profit we can from each deal. Why leave money on the table, they ask?

I believe the truth lies somewhere in the middle. There’s no doubt the old days are gone. Pollak is right on several levels. The home run deals are going to be extinct. And yes, dealer-ships need to work harder and more creatively to get customers in the door. But in many ways, we’ve lost focus of what is important, and instead have put way too much emphasis on the wrong things.

Car sales still are negotiation-based, which means there will be a winner and a loser in the process. Frankly, customers need to lose, yet think they’ve won. It’s the dirty little secret, but it’s true.

And dealerships need to find ways to increase the profitability on each deal. You can sell a ton of vehicles but not make much money. I’ve talked to way too many Toyota dealers the last few weeks who have relied on volume who are sweating because they’re not sure how they will survive if sales continue at the level they are now. They aren’t making enough money on each deal.

What makes a dealership successful hasn’t changed in 50 years. Answer the phone prop-erly, work the deals, constantly train the sales staff on the proper selling methods, follow up on leads – these are the basic blocking and tack-ling areas that good dealers focus on. Do the “little” things right and profitability will follow.

I’ll take a dealer who worries more about these areas, yet is ignorant about the latest flashy things, such as social media, reputa-tion management, web-based advertising and even long term customer-relationship management.

IGITAL Dealer AAISP NOTESDCliff Banks

Cliff Banks

Vice President and Editorial Director

DD 8 March 2010 DigitalDealer-magazine.com

A Darwinian Fight for SurvivalWinning dealers know customers want price and want it quick

Here is a stark but simple fact: for the past year, the marketplace has offered fewer active buyers than

needed to sustain the dealer community. A Darwinian fight for survival proceeded; over the past year an alarming number of dealers went out of business. Those that have survived this first shakeout have proven they can deal with adversity. Going forward, those that thrive must gain and cultivate an operation-ally persistent competitive edge.

How can a dealer leap into this evolutionary winner’s circle?

The answer to this life-or-death question is hidden behind another: where do dealers have the greatest opportunity to impact a buyer’s choice of dealership? This is key. If you know the moment of truth—the moment when the customer is most open to a dealer’s courting rituals—you gain a distinct advantage over competitors. By closely observing the steps a consumer goes through to buy a car, the point of maximum influence ability becomes clear.

Two incontrovertible facts guide us. First, over 80% of car-buying customers use the Internet to gain an information advantage as they prepare to interview dealers who

seek their favor. Consumers do this because they prefer to engage prospective dealerships from a distance until they have gained more information and have built trust. Second, an increasing percentage of customers extend their remote engagement further by sending their first expression of interest (a lead) over the Internet, to multiple dealerships. Dealers who thrive in the midst of the shakeout will have figured out how to seize advantage in the domain of the Internet customer.

The moment of truth, of course, is the point where the consumer has sent a lead to 3-5 competing dealerships. The dealer who leaps in front of the pack and first initiates the courting ritual, then is gently persistent with insightful words and offers over time, leaves his competitors clamoring in the dust.

Rapid response and effective follow-up are the one-two punch that knocks out the other guys. Experience shows that dealers who can deliver an immediate response with a price quote every time when a customer submits a lead, and personalized follow-up every time when the customer doesn’t buy, will see at least a two percentage point increase in close rate on average. Get these two critical steps right and you’ve made the leap into the winner’s

circle. Why? Because so few dealers can pull it off.

Here’s the opportunity: customers want a quick, information-rich response. If con-sumers do not receive a quick response, they will walk away. A rapid, relevant response increases sales.

Speed is key, but it’s not the only important factor. Evolutionary advantage is also tied to the content of the dealer’s message. Customers want the dealer’s price! Dealers who hide it hurt their prospects for a sale.

A Ford dealer in Dallas which uses an automated tool to achieve quick price quote response recently received a note from a happy customer: “I am writing to you about my recent purchase of a new truck at your dealer-ship. Late one night I sent e-mails to several dealerships, the only e-mail I received that night was from your dealership. Not only was I surprised to get a reply that quickly, the e-mail had several trucks with different options with prices on them. ….I will refer all my friends, family, and acquaintances to your dealership.”

A fast, relevant and transparent response is important in order to build customer confidence and trust. If delivered on every lead every time, a dealer will grow sales significantly.

Tom Mohr is CEO of ResponseLogix, and has worked closely with auto dealers for 25 years. Prior to ResponseLogix, Mohr was president of Knight Ridder Digital, where he was on the board of Cars.com.

If you wish to discuss this article with other dealers, or with the author, please go to the “Discussion Forums” at www.Dealer-communications.com and enter the “Internet Sales” forum or e-mail him at [email protected].

IGITAL Dealer INTERNET SALESDTom Mohr

www.DigitalDealerConference.comJoin us in Orlando!

CONFERENCE & EXPOSITION

8TH8TH

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DD 10 March 2010 DigitalDealer-magazine.com

Is Your Web Site Fully Optimized?Effective SEO campaigns are more than just keywords and meta tags

It’s not news that search engine optimiza-tion has been a hot topic in the automo-tive industry for quite a while. You have

probably spent a significant amount of time throughout the last year learning SEO terms and best practices. You might have even come to the conclusion that creating a successful SEO campaign can be somewhat overwhelm-ing—especially when you’re trying to beat everyone else to the top of search engine results pages.

Keep in mind that optimization isn’t simply about getting higher ranking or more traffic to your web site. That’s just one piece of the puzzle. What good is a web site if shoppers are leaving as soon as they get there? A site that is optimized well will not only attract shoppers, but also keep them engaged in the car search. Just as you can’t see the full image until all of the puzzle pieces are in place, your web site is not truly working for you unless you have tuned each part of it.

One piece to think about when developing your web site is the design as it relates to your dealership brand and what you have to offer to car shoppers. Coordinate your design with your logo and make sure the colors and layout

of your web site reflect the brand of your dealership. Remember, consistency is key.

Also, consider how your users will respond to the layout and functionality of your site. Will visitors notice your specials? Is searching your inventory a quick and easy process? Do shoppers have the ability to compare several vehicles at once, or the opportunity to build their ideal car? Including useful tools that help shoppers find the cars that meet their needs will make them more likely to make their next vehicle purchase at your dealership.

Another important piece of your online presence is determining how you’re going to measure the web site’s success. As you are building your site, you need to set up an ana-lytics tool, such as Google Analytics, to get insight into how users find your site and what they do while there. Use this information to determine what keywords you should include in your page content.

Once you have collected and looked at the stats for your web site, evaluate the content. Make yourself the authority in the auto busi-ness by turning your web site into a one-stop shop for vehicle information, and consumers will keep coming back to your web site.

Start with the basics, such as your contact information, dealership history and inventory listings. Then take it a step further and include OEM-specific information and other details that would interest customers such as parts and services or credit components.

Shoppers also appreciate user reviews from existing customers. In fact, the New Autoshopper.com Study noted that about 38% of online auto shoppers use these reviews as a resource, and 87% of them believe the information was helpful during their shop-ping process.

Another sticky element you should always keep updated is your specials. According to Mintel’s Automotive Purchase Process, nearly 80% of shoppers are online just to check vehicle prices. But, simply having a coupon available on your web site won’t be enough generate leads. You have to make the specials eye-catching, with a strong call to action.

This web site content is important, but it becomes infinitely more useful when you optimize it. According to the most recent Automotive Internet Shopper Study by J.D. Power and Associates, 86% of auto shoppers are going online to search for their next vehi-cle. With so many people looking to dealer websites for information, you need to make yourself familiar with SEO basic best practices.

Go back to your analytics tool and see which key words and phrases are driving shoppers to your web site and adjust your content to include that information. Avoid stuffing your content with keywords as this is frowned upon by search engines and will lead to lower ranking for your site.

You can also create more indexable pages for your site by optimizing your inventory content. For example, you can insert alt text on each of your images so search engines will know more about the vehicles in the pictures. You should also give your customers

IGITAL Dealer INTERNET SALESDGeorge Nenni

continued to P-DD28

877-738-3313www.homenetinc.com

[email protected]

List It

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site-based ads intodynamic visual ads that generate

signi!cantly greater emotional response while dramatically

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Dynamic, dealer inventory landing pages incorporate search

engine aggressive technology, so more buyers see your

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DD 12 March 2010 DigitalDealer-magazine.com

Put the Right Content on Your SiteProven and emerging web site content to attract traffic and drive sales

In today’s market, before a buyer ever steps into your store you can bet they’ve checked out your dealership online. A

recent Zogby International survey commis-sioned by Chrome Systems found that 86% of vehicle buyers research their vehicle online before purchasing or leasing.

Once on a dealer’s site, the top three things that most influenced a consumer to buy or lease were: price with preferred equipment selections (56%); the ability to find a vehicle that matched needs in inventory (57%); and that the vehicle looked best in side-by-side comparisons (41%). Obviously, research-orientated content is king online. You can compete online by creating a web site that meets consumer demand with proven and emerging content.

Proven content that drives leads and sales

Your success begins with complete vehicle descriptions. While this may sound like a no-brainer, compelling descriptions contain much more than just a price and equipment list. Look beyond simple year, make, model, and trim listings and instead deliver detailed information like full descriptions of optional and standard equipment, safety features and ratings, dimensions, specifications, warranty information, and aftermarket designations. You may not think consumers want this level of detail, but remember, the Internet can make anyone a vehicle expert.

With 41% of consumers looking to comparisons to help them make a vehicle purchase, you have to link your inventory to your configuration and comparison tool. Comparisons can highlight your brand advantage, and you can decide how much or how little vehicle detail to return. Round out a comprehensive description with on-demand

content like full-motion vehicle video and third-party ratings and reviews.

Detailed content has the added benefit of being keyword rich, which is essential to a solid search engine optimization (SEO) strat-egy. The Chrome survey found that 54% of respondents use search engines as an integral part of their automotive shopping experi-ence, and robust content can help push your inventory to the top of search engine results. Microsites created to appeal to a niche market or to promote a special are also a great way to boost SEO, and they are relatively quick to build.

Emerging web site trends and opportunities

There are several emerging trends and opportunities that can also drive addi-tional leads and sales. Consider needs-based searches. Traditional year, make, model searches are car-centric, forcing consum-ers to have some familiarity with a vehicle. Needs-based searches are consumer-centric, allowing shoppers to search based on their needs and wants. Whether in the form of a set of questions or a series of criteria, these searches can showcase inventory a consumer may not have considered before, and build engagement with your site. If you’re mindful of your site, you can also capture analytics to determine the most common searches and build customer profiles.

Estimated to be over a $32 billion industry, accessories are emerging as the new profit center. Tap into your customers’ desire for personalization by featuring accessories on your web site. Integrated into your configura-tion tool for easy consumer access and view-ing, accessories can add hundreds of dollars to every deal.

Mobile optimization of dealership web sites

is also a hot topic right now. Analysts estimate that smartphones will outnumber PCs by 2011, meaning consumers are increasingly likely to use their phones to research your dealership. Just remember that most shop-pers turn to their mobile phone when they are further along in their research and want specific information; they typically don’t want to peruse your entire site. The Chrome survey found that of those who use their phones in the shopping process, the majority (55%) use them to locate a nearby dealer, 54% search for available makes and models and 37% search vehicle inventory.

One last opportunity is social media sites. Primarily brand builders, sites like Twitter and Facebook are an effective way to connect with current and future customers. Remember that if you start, you have to be committed to continuing. If you let your social media efforts wither on the vine, they can ultimately hurt your dealership brand.

Taking advantage of strong content and recognizing the value of emerging trends can help you compete online by meeting the demands of today’s Internet-savvy and well-informed consumers. Get started today and stay ahead of your competition.

As senior Internet product marketing strategist for Chrome, Brian Rabold helps dealerships of all sizes identify and implement new online technology and enhancements to increase brand awareness, generate leads, and drive sales.

If you wish to discuss this article with other dealers, or with the author, please go to the “Discussion Forums” at www.Dealer-communications.com and enter the “Internet Sales” forum or e-mail him at [email protected].

IGITAL Dealer INTERNET SALESDBrian Rabold

13

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DD 14 March 2010 DigitalDealer-magazine.com

Joe Orr General Manager

Dick Hannah Honda

COVER STORY

DigitalDealer-magazine.com March 2010 DD 15

With more than 20 years in the dealership business, Joe Orr, of Dick Hannah Honda, is redefining the role of general manager in the 21st century. He’s a freak about the numbers and holds his vendors accountable. He knows where the traffic is coming from but he’s also a master at finding new ways to generate sales. Once a skeptic of online reviews, Orr changed his tune and is using reviews to create hundreds of sales. He’s also willing to share his secrets.

We sat down with him recently to learn more about his success.

The Dick Hannah Group is one of the largest groups in the Northwest.

Orr: Dick Hannah has been around since 1949 and is now a third generation dealership. There was Bill Hannah, then Dick Hannah, and now Jason and Jennifer Hannah.

I’ve been here 20 years. I have always been at the Honda store, I managed most of the stores here at one time or another but have always had the Honda store.

Right now I am the general manager of the Honda store and two used car superstores. They’re called “Dick Says Yes Stores.” They were big into special finance but now we are trying to move away from that. We focused on it when special finance was high.

I was the first one who came up with that name and then it seemed like the whole coun-try came out with something that says “Yes.” It was all over the place.

But now we are trying to repurpose the word “Yes,” to a campaign about transpar-ency. We show the customers, “Yes” to over 500 used cars, “Yes” to not showing you only the price and miles of our car, but also the

price and miles of every competitive car just like it within 100 miles. So we are trying to give the customers exactly what they are look-ing for. A one-stop shopping place so they can actually trust us. We got the vAuto cutout of every one of the cars so they can see, when

they walk onto our lot, if they are looking at a 2008 Accord LX, they can see on the window there are nine within 100 miles, see the miles and the price of all of those vehicles. We want

them to have all of that information, we are practicing transparency.

How much do you do with the Internet and social media with those two stores?

Orr: Well what’s interesting is that at the last Digital Dealer conference, I met Mike Fitzpatrick with Dealer Trend. They build microsites, they do WordPress, they can send a specific piece of inventory through a WordPress news blog so it actually becomes SEO relevant.

We have been working with him since the show and have created seven microsites: three for the Honda store and two for the Vancouver Used Car Superstore and two for our Albany Used Car Superstore.

The goal, the sole focus is to get these microsites on the first page of the most traf-ficked automotive searches in Oregon and Washington. And I think we are one of the first dealerships in the country to actually use this technology. I really got excited about it at Digital Dealer.

How does that work? Every piece of inven-tory has its own WordPress blog?

“Once in a while I will do

a TV campaign, where I let

the customers talk about

their experiences and the

online reviews about our

pricing model and how

we differentiate ourselves

from other car dealers.”

—Joe Orr

DD 16 March 2010 DigitalDealer-magazine.com

Orr: Yes. If I enter a piece of inventory in today, like a 2007 Chevy S10 pickup, it goes through his technology and becomes a WordPress new release, but actually is just a detailed inventory page. And it ties back into my microsite for that store and should show up if anyone is searching for it. People do now search for a “Chevy S10 Oregon.” We just released that just a few days ago and are looking forward to the analytics.

Are you doing any social media for your used cars?

Orr: We are creating a blog that we have not done yet. It is called “Living in the couve” and is about living in Vancouver. It will be automotive focused — spy photos, automo-tive press releases — we will be releasing that shortly, but right now we have our hands full.

How time consuming is it?Orr: The microsites are a lot of work. It is

not simply pushing buttons anymore to get what you want, but is it worth it?

I have factual data that proves while I’ve cut a lot of my expenses – and I do see all of the other dealerships financials in my area — I am spending less and making more. We have also moved up the ranks from fourth to second in our district.

With new we are number one, so we must be doing something right. Is it worth it? It is hard when my team creates the data from our built daily processes. It is much easier when I can hire someone else to do the data, and I have done a lot of that too. That’s why I would like to see web-based 20 groups with the top Internet dealers in the country.

Aren’t you worried about the competition seeing your secrets?

Orr: We have so much to share, so many secrets and that’s what I am really going to start talking about, why do we have secrets. Why do we let others (mostly third parties) tell us what does and doesn’t work, when we know, we have the real data, and we have the real life results?

Within our stores we have had big suc-cesses and failures. Let’s share both with each other. There are a lot of things we can do. I

can share the results of the study we’ve done with you. Here is my process, and this is from my perspective of how it works and here is my analytics, ROI and store benefits, and I want to take from them their perspective of how we could make it even better and then also be on the receiving end of all their ideas that have real results tied to them.

Imagine, if we had one top digital mind from every 250-mile radius, you would have a lot of dealers who can share. We have our hands full as dealers, and if we build relationships with each other and share successes and failures, it would be a huge step forward digitally for us all.

How did you get into the business?Orr: My grandfather sold cars and owned

some dealerships. At 17 I started selling cars – I lied about my age. When I finished high school, I worked at the Volkswagen dealer from 1 pm to 8 pm five nights a week to sell. They found out how young I was and I only had two months until I turned 18, so they let me stay on.

My first paycheck I made $3,500 — my dad never made over $2,500, 36 years on the job. I cashed it and stuck it in my pocket. The next day I was buying everything for everybody in school. I felt like I was Tom Cruise. Those were fun days.

Did you go to college?Orr: I went into the military. But after

seven months, I got kicked out for getting into a fight with the same officer twice. Then they caught me with a fake ID —I was just a hellion back then. And they kicked me out. I went right back into car sales.

As the general manager of the Honda store, what kind of things do you do on the fixed operations side using the Internet?

Orr: I do the same as any general man-ager. I have an advantage here, I have Gary Schuler. He is the corporate fixed operations manager. He was actually a top notch fixed operations consultant prior to his employ-ment at the Hannah’s. So he has taken on a lot of responsibilities for a lot of our general managers here. Probably the most talented fixed operations trainer in the country. We have learned a lot from him.

My main concern as a general manager is the overall performance for all my stores. I focus on new technologies. True statement: every general manager in our corporation, except one, worked here at the Honda store with myself and Marty Green (corporate GM). The Honda store is kind of the incu-bator. It’s the mothership.

From what I’ve read, your numbers are astounding.

Orr: The amount of traffic we get now is phenomenal from the Internet.

I started doing search engine optimization in 1999, before it was cool. I was impressed with Google. I actually ended up getting a hold of the VP of Exteres Auto and told him my store could be a test store for him if he could do for me what no other SEO company had been able to.

We focused on getting first place page placements on all search words/phrases for “service” “parts” and “sales.” They created an algorithm to help us track it.

In 2006 we averaged 321 Internet gener-ated calls per month for sales, service and parts. That year, we were spending $5,500 per month on PPC (pay-per-click) alone. In 2007, I began getting on the first page of search results. In January 2008, we reduced our $6,000 to $500 and my calls went from 321 per month to (I am a freak about accountability and on every page of my web site I have a separate tracker for sales, service and parts. These are factual numbers) 565 per month in 2007, and then to 663 the next year, and over 800 in 2009.

These are just Internet-generated calls from the web site. That has nothing to do with my other initiatives. Every year we reduce our ad spend on radio, TV and newspapers – on which we do close to nothing anymore. Once in a while I will do a TV campaign, where I let the customers talk about their experiences and the online reviews about our pricing model and how we differentiate ourselves from other car dealers.

So, you stop paying the $5,500 a month in PPC, and got it down to $550 a month

DigitalDealer-magazine.com March 2010 DD 17

and your calls skyrocket?Orr: Correct. We realize people are at a

point where they trust organic search results more than the paid.

The SEO results are an accomplishment and we can prove it with the data. When we started no one got the results we did. We demanded the information and results from my SEO company and were not negotiable on our demands, and they never said any-thing was impossible (I liked that). Once we achieved our goals and reporting needs, they could offer the SEO product to other dealerships outside of my area – but we are exclusive in our area.

What about dealership online reviews? You seem to have had a lot success with them.

Orr: I have to give props to my old Internet manager (Merla Turner). She was beating me up about review sites. In January 2008, we had five reviews and a two star average. She said we have to change it.

After five to six months we spent hundreds of hours getting on all of the directories and review sites and creating processes that actu-ally got us results. Most of the directories have now adopted the review sites. If you cannot beat them...join them!

A lot of the information out there on the directories is wrong or is sloppy. We spent hours putting our right information and trackable 800 numbers, pictures, hours and service guarantees on these sites. Then we began tracking the analytics and developed a process for managing it.

Over time, the call volume start going up. We put different trackable 800 numbers on each review site, including Google and city search. We wanted to be on all of them.

In 2009, we had over 1,000 calls produced from the review sites alone. Once we fig-ured out the management heavy successful process and mapped it, Exteres automated it for us.

As we get more and more reviews, we get more calls from consumers. For the spring Digital Dealer conference, I am putting

together a compilation of actual data that we gathered over the entire year of 2009 prov-ing beyond a shadow of doubt the power of online reviews and the fact that consumers trust each other way more than the dealer. I am also going to hand out a step by step playbook on how to get these results and watch the very culture of your store change for the positive.

This really drives home how dealerships can and should market in the 21st century.

Orr: Yes. In August 2009 we received unique 188 calls from the review sites. To track ROI, let’s say I spend $55 advertising dollars per call so run the numbers — 188 X $55 equals: $10,340.

The bottom line is, I pay nothing for this. I get 188 unique calls from Internet consumers who see we have 1000 reviews. We have a 4.9 ranking (five being the best). They let the current customers tell them how great we are. Some of them have driven 300 miles to buy cars from us. There is no better advertising than word of mouth — and this is the cheapest, most effective word of mouth advertising available.

Concerning our web site visitors, we are addicted to understanding where they come from. Between Google analytics, your indi-vidual trackable 800 numbers and your web provider, it is just sitting down and doing the math. It was eye-opening for me — 48% of our traffic comes from organic SEO.

On 82% of what has been deemed the top service, parts and sales searches for my brand (Honda) I am on the first page. That repre-sents over 1,000 searches when you add 10 unique cities to all those top searches. My near-est competitor is at 13%. I am just crushing them. I also see my competitors SEO reports every month, I know where they are; they don’t even know.

You seem willing to share what you’ve learned.

Orr: I’ve made it my personal mission to learn from the top digital dealers that really under-stand how this industry is changing and get them into an Internet 20 group of sort and really help each other transform our dealerships and

prepare for the digital revolution. I am watching my dealer friends facing having to close their doors. I think it is time we joined efforts as a professional family and help each other out.

[email protected]

Dealership name: Dick Hannah Honda

Internet leadproviders:Dealix

AutoTrader.comCars.com

F&I tools:DealerTrack

Web site provider:DealerPeak

DMS provider: Reynolds and Reynolds

Auctions:Manheim

AdesaBlack Book

Livelane.com

CRM program:Contact Manager

DEALERSHIP PARTNERS IN PROFIT

DD 18 March 2010 DigitalDealer-magazine.com

Quick Tips to Improve Online Pre-owned SalesCreative merchandising of inventory improves sale chances

We’re well into the first quarter, but it’s never too late to tweak our annual goals. At the very least we

all can use a reminder of the basics that got us to where we are today.

Think back to your first days in the car business. You were constantly reminded not to cut corners in your dealership’s sales pro-cess. You were drilled on the five to seven steps that need to occur with every customer to give yourself the greatest chance of selling a car. Sometimes we were amazed to witness the quick success of new salespeople, while old timers struggled. But when we thought about it, the answer was simple. They didn’t use shortcuts, instead, they followed the same proven steps with each customer every time and it worked.

Well, the same holds true with online sales efforts. More than 80% of customers use the Internet to shop and last year more than 60% actually found the car they purchased online first, rather than on a dealer’s lot. Because that is the case, this is a good time to review what the most successful dealers do to present inventory in a way that increases the chance for a sale.

1. Minimize, simplify vehicle capture and updating time

Employ an upload process and make it a standard operating procedure for your dealer-ship. There are tools that make it easy to edit vehicle data as well as integrate with your DMS polling to ensure accuracy.

2. Minimize time to marketUpload vehicles prior to reconditioning

so they’re immediately visible. Days that are wasted waiting for cars to be frontline ready before posting them online equate to lost sales.

3. Maximize distributionYou must have your inventory posted on

the most visited sites used by online shop-pers, your local sites, niche, second tier and classified sites. Select a solution that allows easy distribution to all of these types of sites, including eBay and Craigslist.

4. Maximize contentThere’s no such thing as too much informa-

tion. Each listing should have accurate vehicle data on standard and optional features cross referenced against Kelley Blue Book, Chrome and Polk. Also, dealers should provide access to vehicle history reports, designation as a “one owner” vehicle when confirmed, per-sonalized seller’s notes to accentuate the posi-tive and suggest mental ownership, a pricing comparison between suggested retail and your selling price to show savings to the consumer. If there is one small thing that will make a difference, it is making sure you have great, customized seller’s notes on each vehicle to strike a nerve with any customer’s hot buttons.

5. Price competitivelyAlthough price is not the end all to

most purchase decisions, customers are well informed and have access to a lot of

competitive data immediately available. To maximize turn times and hold gross price, your vehicle must be competitive to others in the market right from the outset. There are several great tools avail-able providing you a quick snapshot or detailed information on similar vehicles currently available, such as, CDMdata’s Market Pricing.

6. Display the right quantity of high-quality photos

How many is enough? Customers tell us that 16 to 36 photos allow them enough visual information, raising com-fort levels, eliminating less desirable or poorly advertised vehicles from consid-eration and making them more likely to move to one particular vehicle or dealer’s direction.

7. Reinforce consumer trust with branded window stickers

Customized window stickers for CPO vehicles from your dealership or Kelley Blue Book provide a level of professionalism and instills confidence in customers.

The first thing to do is shore up the dealer-ship’s marketing foundation with these help-ful hints, and then use other creative ideas to catch the eye of the discriminating online shopper to sell more cars.

Rob Lange is the national sales training director for Kelley Blue Book.

If you wish to discuss this article with other dealers, or with the author, please go to the “Discussion Forums” at www.Dealer-communications.com and enter the “Internet Sales” forum or e-mail him at [email protected].

IGITAL Dealer INTERNET SALESDRob Lange

“Sometimes we were

amazed to witness the

quick success of new

salespeople, while old

timers struggled.”—Rob Lange

DigitalDealer-magazine.com March 2010 DD 19

DD 20 March 2010 DigitalDealer-magazine.com

Overview and historyLong gone are the days when just having a static dealership web site was enough to provide automotive consumers an engaging online shopping experience. The dealership Web site should not be a billboard: lifeless, boring, unpersuasive. An online billboard may have been fine 10 years ago, or even five years ago, but in today’s competitive automotive marketplace shoppers simply expect more. Consumers want a more inter-active, dynamic experience and the ability to have questions answered instantly, while they are on the dealership Web site. Further, while phone and e-mail still have their place in the repertoire of sales channels, consumers increasingly demand a faster way to ask questions and get more detailed information when shopping online.

Online connectivity is the key as consumers seek information on Facebook, Craigslist, eBay, newsletters, retail web sites, microsites and more. The ability to connect and engage shoppers on any relevant online locations differentiates progressive dealerships that actively reach consumers, from old school passive businesses that merely watch as the world passes them by. It may be hard to believe, but e-mail is now considered too “slow” for a growing percentage of the population participating in online shopping. In addition, many people are very reluctant to call dealerships because they may have had an uncomfortable experience with an overly aggressive sales person on the phone, or been routed through an endless maze of automated phone menus only to have no one respond to their calls.

Consumers want instant gratification online and progressive dealers are now offering this at their dealership Web site, with

proactive live chat that uses business intelligence to offer shop-pers just the right message, at just the right time. Most dealers are also very pleasantly surprised to find that shoppers use chat for more than just vehicle sales information. Consumers schedule service appointments, purchase parts, get F&I details and more.

With all this in mind, automotive industry veterans and technol-ogy experts Ted Rubin and Todd Smith, founded ActivEngage in 2007 to support automotive consumers’ growing need for more interactive experiences on dealership Web sites. In fact, Smith learned the power of live chat first-hand while he was running his own Chevrolet dealership back in 2006. He began using chat on the dealership Web site and started generating leads within minutes of use, and has his first car sale by the end of the next day. However, as he learned more and became more proficient in the medium, he realized that the available chat software and services were not well suited for the unique needs of auto dealerships. He was convinced that there had to be a better option, more in tune with automotive shoppers’ needs. He partnered with long-time colleague Rubin in early 2006 to develop advanced chat software specifically designed for deal-erships. They pooled their vast knowledge and experience to create the ActivEngage live chat solution and conducted over a year’s worth of development and “dogfooding” in dealerships of all sizes and types. When the software and services were perfected and outstanding results consistently achieved across all dealerships, Smith and Rubin made ActivEngage available for dealerships in 2007.

As live chat technology and best practices continue to develop, ActivEngage continuously evolves with them. Today, the

IGITAL Dealer VENDOR PROFILED

Over 3 Million Chats and Counting: ActivEngage Shatters Online Communication Boundaries with Personalized Live Chat and Dealership Marketing Intelligence

DigitalDealer-magazine.com March 2010 DD 21

company manages an average of 200,000 chats for dealers each month. This gives the service a competitive advantage that other suppliers cannot match because no other provider has the unique combination of industry specificity and high chat volume. What began in a single dealership now provides dealerships across North America an interactive web site edge that increases both lead generation and sales. Shoppers consistently praise the service they receive on the dealers’ web sites and cite the fast, friendly service as a key reason for choosing dealerships. This creates a powerful first impression and a “wow factor” that are simply not possible without the service. ActivEngage staff members continually train on general industry and product knowledge, as well as each dealership’s individual store promo-tions and specials, to ensure a seamless chat experience for all shoppers. The main goal is to push the technology and service boundaries of online communication for dealerships.

Three powerful chat service levelsActivConcierge is the industry’s premier proactive live chat ser-vice. Within the first day of deploying ActivConcierge on the dealership web site, additional leads are generated by turning web site browsers into active sales leads. ActivEngage’s highly trained virtual sales team proactively engages all web site visi-tors. Proprietary business intelligence also guides the conver-sation for optimum results. Further, ActivConcierge includes seamless integration of important shopper information, includ-ing the complete conversation transcript, with all CRMs and ILMs. ActivConcierge impacts the dealership immediately by creating a conversational web site, multiplying the amount of leads the site generates, with no additional work required from the dealership.

ActivGuardian offers dealerships that choose to manage chat in-house additional support to ensure that all chats receive fast, professional responses. ActivGuardian is the solution for

dealerships that already have well-developed chat teams, but still want a back-up support system. Since chat abandonment triples if it takes longer than 15 seconds to start a chat, it is crucial to greet site visitors quickly. If a dealership staff member can’t reach a customer within five seconds, an ActivEngage representative will pick up the conversation and deliver the results to the dealership. The service ensures that no ups are missed on the web site by always monitoring site visitors’ activity.

ActivSite helps dealerships begin online chat conversations with a software solution built specifically for auto dealers. The easy to use chat console lets the dealership begin engaging automotive web site shoppers in the first day of use. ActivSite pushes the web site to the next level by using the dealership’s best salespeople on the web site to greet every visitor. The combination of ActivSite technology and the dealership sales team gives dealers control of meeting and greeting online shoppers. Taking virtual ups at the web site drives more traffic to the showroom. Using ActivSite can easily double the amount of leads generated from the existing dealership Web site.

Leading featuresActivTestDrive leverages ActivEngage’s chat services with a unique virtual test drive experience that leads shoppers through a powerful online sales experience, combining a chat conversa-tion with video and detailed product information. Using chat on the dealership web site is a powerful first step in engaging more web site visitors into a conversation. ActivTestDrive now lets dealers move customers through the unique Virtual Sales Process to turn information seekers into buyers, and includes engaging custom videos for every make and model. Test drives sell cars at the dealership and ActivTestDrive sells them online.

ActivProspect lets dealers identify web site shoppers with par-ticular characteristics or behavior patterns. Dealer are able to

Todd L. Smith, PresidentTodd is co-founder and president of ActivEngage, Inc., the automotive industry’s leading live chat service provider. Todd has spent the last 20 years in the automotive industry and has worked in every

facet of dealership operations in numerous roles, including general manager. He has also developed cutting edge eBusiness, BDC and showroom sales solutions for a variety of clients including Ford, Ford of Canada, AutoNation, Budget Car Sales, Maritz Inc, Mazda North America, Toyota Motors Sales and ADP AutoTrader.com. He is a frequent speaker at national industry conferences and a regular contributor to industry trade journals.

Ted Rubin, Executive Vice PresidentTed Rubin, a co-founder of ActivEngage, Inc., is a leading expert on business development, Internet process and technology in the automo-tive industry. He began his career in the automo-

tive industry and has held virtually every position available both in dealership sales and service departments. He has worked with dealers, manufacturers and vendors to develop sales strategies, business development and training, including: Toyota Motor Sales, Volkswagen, Renault, Reynolds & Reynolds, AutoNation, Inc. and DealerUps.

DD 22 March 2010 DigitalDealer-magazine.com

set parameters based number of visits, pages viewed, order of page views, viewing time, specific pages, number of pages, time spent on site, and more. Then, dealers can send proactive custom mes-sages, based on this customer’s shopping behavior, enabling dealers to track and target the hottest prospects, spending more time with shoppers who are most likely to convert, and less time with casual browsers. Driving lots of traffic to the dealership Web site can be great, but it can also be a distraction if visitors are not good prospects. ActivProspect helps deal-ers focus their attention on site visitors who are ready to buy.

GeoTargeting enables dealers to identity shoppers’ geographic locations, whether they are in their local area, across the nation, or even a competitor checking out their web site. GeoTargeting gives dealers insight into their online approach, especially if they are a dealership that will give more aggressive pricing to a shop-per outside their local market. Dealers can then create specific messages based on the geographic location of potential buyers.

Shop With Me Technology also allows dealers to create a more powerful, per-sonalized online sales experience by

simultaneously viewing pages and videos, based on shoppers’ needs. Sending a link to a shopper using an instant messenger service is one thing, but controlled co-browsing is what makes ActivEngage’s enterprise chat software that much more powerful. Shop With Me Technology lets dealers lead shoppers around their web site, explain things as they go, and gives the dealer a powerful online presenta-tion. This allows the dealer to create a true online sales process, with an interac-tive experience similar to the showroom.

Reporting includes over 75-plus reports, letting dealers examine how shoppers use their web site on a granular level, including: total visits, new visits, return-ing visits, prospects, individual shopper click paths, keywords that convert to chat conversations, missed chat requests, and more. Easy to read, the reports allow the dealer to run their Internet marketing business more effectively and efficiently. Referring web site information is also tracked with detailed information to determine the quality of traffic from dif-ferent sources. Web sites tracked include, Google, AutoTrader, Cars.com, Bing, Yahoo, AdWords or any other referring sites, Further, all data can be monitored in real-time, with reporting available on-the-fly, based on the time parameters that

are most useful for the dealership. Dealers can see what works and what doesn’t, at any given time.

Results and what dealers say about ActivEngage“Everyone loves our live chat with ActivEngage, both our staff and our site visitors,” stated Alex Snyder, eCommerce director for Checkered Flag Automotive Group. “Like it or not, the reality is that people visit dealership web sites during their work day; I think about 95% of our chats are from people who are at work. Many companies monitor employee email and often other people can hear phone conversations at work. Chat is generally not monitored and it’s silent. Really, it’s a perfect method for consumers to get information.” Within two months of deploying the ActivEngage solution, chat to sales conversion increased by 150%.

Jenkins Automotive Group eCommerce director Jose Alonso commented, “Chat is the ‘missing link’ for our industry right now and ActivEngage’s live chat is what we’ve been waiting for; it’s interactive and instantaneous. Web site visitors just love it, regardless of the franchise or demographic. People are at your web site right now, hundreds of them, and that is where dealers should be commu-nicating with consumers. ActivEngage’s service is outstanding and they offer all the advanced features that no other chat service provides.” Further, within the first month of use of ActivEngage, the group increased web traffic, web site lead gen-eration and online sales by an average of 50%.

Todd Cole, Bill Dube Hyundai Internet director, added, “Customers on the web site like the instant gratification that live chat provides. Shoppers have questions and want more information. It makes a great first impression and begins the relationship before the shopper ever sets foot in the dealership, or even makes a phone call or sends an e-mail. It’s simply the best lead generating tool out there.” Vehicle sales have doubled since Todd began the serious Internet initiatives, including ActivEngage, last year.

5 Tips to Make Chat Work at your Dealership1. Build rapport upfront with the shopper before you try to

convert them to an appointment.

2. Personalize the experience every place you can for the shopper.

3. Walk the shopper through a step by step sales experience similar to what you do on the showroom floor.

4. Make it interactive by using video and chat together for a powerful presentation.

5. Deliver at least one ‘wow’ moment for the shopper during the chat experience.

DigitalDealer-magazine.com March 2010 DD 23

Making Profit with your IT Department

For many years, a major DMS provider would sell their system on the claim that if they switched to their system, a

dealership could reduce office staff by 50%. The latest claim that’s been going around has been if you get an ASP solution, you can get rid of your IT department.

Since DealerTrack is one of the most popular ASP solutions, I decided to ask DealerTrack’s Jon Reese about IT departments and their involvement in DMS services.

When asked how involved should the IT department be in maintaining the DMS, Jon responded, “Jim Collins, the author of Good to Great, explains that good companies become great by focusing on what they do best. The same is true with a car dealership. Dealerships should focus on what they do best, selling cars, and not be required to spend time and resources supporting an IT infra-structure needed to host, maintain and update their DMS system. If a dealership focuses on what they do best, selling cars, and employs the DealerTrack DMS to assist them in the management of their operation and work-flow, they could potentially eliminate all of their IT department expenses. DealerTrack’s web-based DMS eliminates the need for serv-ers, expensive hardware, continuous software updates and that on-call guy needed to keep things running smoothly. All that is needed are computers and Internet access.”

I agree with Jon, that a web-based solution can remove many server headaches, espe-cially if you’re involved in a flood, hurricane, earthquake, fire, tornado, etc. But, before you start firing your IT department because you’re getting an ASP solution, consider the fact that we do need computers for more than just our DMS. It also seems like every employee now needs a computer on their desk – which is a tremendous load on your IT staff along with all the various software and servers for CRM, leasing, credit bureaus, manufacturers – even

many phone systems have a server!For many years, I have recommended that

your IT department be more focused on providing profit generating services, rather than supporting the DMS. You already pay a pretty penny to your DMS provider monthly, so why would you also pay for an IT staff to answer and funnel support calls through to the DMS provider? I can’t tell you how many times I’ve spoken to control-ler groups that have told me that their IT department requires that all DMS support goes through them.

What are profit generating services? Database mining and database cleaning is profit generating. Nobody knows your data-base as well as your IT staff. They should be regularly finding ways to use that database to help employees sell and service more vehicles. A good IT department can reduce outsourc-ing repair costs and find the best buys for the software you need – including your next DMS system.

When I asked Jon about the IT depart-ment’s involvement in selection, he replied, “Users of the DMS and the dealership’s IT department should both be involved in the selection of the dealership’s DMS. However, it is imperative that users’ needs be considered first and foremost. Users are more aware of the dealership’s business needs and are better able to evaluate whether and how a DMS meets those requirements. They should ask:

1. Is the DMS robust enough to handle all of our unique requirements?

2. Is the product user-friendly?3. What type of customer service, training,

and support does the DMS provider offer?”“The primary IT-related factor that requires

consideration is the cost to install, maintain, and support the system. Maintenance and support can be an extremely costly endeavor. Depending on the DMS it chooses, the deal-ership may need to purchase or upgrade its servers and computers, and employ additional IT staff. The IT department also needs to determine whether the system can integrate with other software solutions being used in their sales and service process. Unfortunately, there are several DMS providers that attempt to eliminate integration with third party soft-ware providers, in support of their own soft-ware offerings.”

I agree with Jon on the movement by some DMS providers to squeeze out third party providers. There were over 100 technology companies exhibiting at NADA that depend on the data from your DMS database to pro-vide you with fantastic ways to stay to sell and service more vehicles. At the 8th Digital Dealer conference this month in Orlando, I’ll be discussing ways to use that database to make money with data mining, so consider sending someone from your IT department to learn how to become more profit focused.

Sandi Jerome is a former controller, CFO, system administrator, F&I, assistant GM, and fixed operations manager with over 20 years experi-ence in the automotive industry. She is the owner of Sandi Jerome Computer Consulting.

If you wish to discuss this article with other dealers, or with the author, please go to the “Discussion Forums” at www.Dealer-communications.com and enter the “Technology” forum or e-mail her at [email protected].

IGITAL Dealer TECHNOLOGY TRENDSDSandi Jerome

“Nobody knows

your database as well

as your IT staff.”—Sandi Jerome

DD 24 March 2010 DigitalDealer-magazine.com

The Cruel Mistress of Social Media

It wasn’t very long ago that the social networking sites

of today were being hailed as a virtually cost-free medium

to reach your clients with your advertising efforts. “Hey! You get to put your very same ads and commercials someplace else, but for free!” It was like having an affair with a young, attractive ingénue, freeing you up from the headache that was your marriage to traditional media advertising. Granted, some of the social networking sites (partners) available to us just a couple of years ago have faded away. For one reason or another, they didn’t stick around. Maybe the years caught up with them, they lost their looks, and we, as suitors, looked elsewhere for the newest shiny object. Their business models simply weren’t strong enough or we were just too ADHD. and jumped

to the next networking mistress. Regardless, we were able to grow with these sites. We explored new terrain, learned the lay of the land. They may have been indiscretions, but they were our “first”…the ones that helped us discover how to make all the right moves.

Now we’ve moved on to other social sites and are going steady with Facebook, Twitter, LinkedIn, and Ning. When we are being bad, we sneak away and jump on Youtube. We ask our friends what they think of our newest trophy site and seek out their comments on Digg, Tumblr, StumbleUpon, and the rest.

Now, those are quite a few sites to keep up with. Are you spreading yourself too thin? Are you forgetting about all of the online advertising platforms that grew your Internet department in the first place? Are you able to spend quality time with each social media site to get the most out of them? As anyone will tell you, if you want to make your relationship

work with one of these social networking sites, it’s gonna take time. A whole lot of precious time. It’s gonna take patience and time…to do it right.

Realize that these sites are moody, cantan-kerous, fickle, and capricious entities that need constant attention. Do you know all that is expected of you to develop a fruitful union with these sites? The more you spend time with one, the more your other sites pick up on the rejection, bask in their loneliness and cut you off from growth. Determine quickly what sites can yield you results with the minimum amount of time dedicated and focus on those. You can’t be everywhere at once, regardless of the thrill, so don’t take on too many partners. Exploring new site after new site will get you sick.

Dealers must continue to measure what these social sites are giving back to them. Don’t turn your back on your other Internet

IGITAL Dealer TECHNOLOGY TRENDSDJoe Webb

Our Users Ranked US #1-• Speed in Getting Changes and Modifications Made• Maintenance of Your Daily Business with Minimal Interruptions• Problem and Concerns being Fixed Correctly the First Time You Call• Prompt Follow-up to Handle the Needs of You and Your Staff

An endorsed provider

877-427-4367 • [email protected] • www.autosoft-asi.com

an Affordable, Simpler, Innovative DMS

The Most Likely Recommended DMS Delivers –Not Simply Software as a Service, But Software With The Service!When asked in the recent NADA 2009 Bi-Annual Survey of Dealership Satisfaction with Dealer System Providers’ Products and Services

DD 26 March 2010 DigitalDealer-magazine.com

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initiatives. To paraphrase Shakespeare, “hell hath no fury like a web site scorned.” Pay attention to your web site, your online inventory, and your leads. No new social networking mistress will make these basic profit generators obsolete. You’ve been rela-tively happy and successful with these for a while now. It is dangerous divorcing your-self from these responsibilities just to try to make it with one of these young, sweet things. Look at it in a real world scenario…if you get famous, you’d likely stay married to your current spouse, right? The one who stuck with you through the good times and bad? Of course. Because you know if you were famous and left to look for something “better”, you’d never really know if the new partner liked you for you or because of what you spend on them. In the ways of social networking sites, you spend time. Some…too much time. Relative to the profit they yield, way too much time. I bet if a few of these Internet sales managers pick up the phone and called as many customers as they poke on Facebook, they’d be much better off financially.

In the beginning, I mentioned these sites were initially cost-free. As it goes with time, they begin asking more of you…time, effort,

and yes, money (as new vendors find ways to monetize the sites – and you as the client must pay for these trainings/services/prod-ucts). Some dealers don’t want to dedicate the time to developing their presence on these sites so they reach out to us trainers, consul-tants, experts to manage their social media presence for them. Sometimes it is worth it for the dealer and sometimes it may not be.

What I am saying is… it is alright to cheat…a little. It’s perfectly acceptable seeing what the social sites can do for you provided you don’t spend all of your time trying to find out.

A social networking mistress is there:-To yield you some positive results.-To give you a shot in the arm of confidence

and reputation.-To kill a little time.-To feel young again.-To drive a little business and retention to

your dealership.It is not there to break up the family of

online advertising initiatives you’ve spent so long stabilizing. Very rarely will this new significant other give back the same way the others have…in leads…in conversion…in profit.

So sleep around, but keep one eye on your wallet and one eye on the door. When a

social networking mistress starts costing you too much money…too much time.it may be time to head for the door. Get yourself back home and realize what is truly important. Beware the cruel mistress of social media.

Joe Webb is the president of DealerKnows LLC, an automotive digital marketing consultation firm. It specializes in assisting dealers with their online advertising, lead management, e-com-merce marketing, and Internet initiatives. Webb also recently founded Dealer Signage Inc., where he is the acting chief operating officer. Dealer Signage is a progressive, digital advertising net-work and signage company that allows dealers to manage the media on their own televisions and deliver targeted digital messages to their loyal customers within their own dealership. Webb’s primary goal, as he always states, is “to better the culture of car sales.”

If you wish to discuss this article with other dealers, or with the author, please go to the “Discussion Forums” at www.Dealer-communications.com and enter the “Technology” forum or e-mail him at [email protected].

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DD 28 March 2010 DigitalDealer-magazine.com

AutoUSA listsyour dealership onover 100 automotive websites.

AutoUSA puts your dealership on the local dealer selection list on over 100 popular automotive websites. With AutoUSA your

dealership is there when online shoppers are ready to buy. You’ll get consistent exposure in your market area and pay only when a lead

is delivered*. To get listed right away at no cost and be everywhere your customers are, call AutoUSA 1-888-212-3063.

You’ll be there when your customers are ready to buy.

Increase your sales today!www.autousa.com/signup1-888-212-3063

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"#$"%&'('()*%+,-..///( 0121(&///(03(4/56

Advertiser .............................pg #

ActivEngage ..............................19

Autobase .....................................7

AutoSoft ....................................24

AutoUSA....................................29

BZ Results ....................................3

Dealer.com ..................................5

DealerPeak (Widestorm) .........10

Dealerskins ..................................9

FirstLook ....................................13

Homenet ...................................11

IMN Loyalty Driver ...................27

NADA Used Car Guide .............28

ResponseLogix ..........................26

the complete picture by including all essential vehicle information. Since online shoppers aren’t able to see your cars in person, include keyword-rich descriptions, a list of available features and other specifics such as miles per gallon, transmission and mileage.

It’s also beneficial to enhance your existing linking structure by adding videos of your vehicles to YouTube and linking those back to the appropriate pages in your inventory.

Once you have your design, analytics and optimized content in place, you should start integrating your social media presence with your Web site. Take time to regularly update the content on your social networking pro-files and make sure it’s consistent with the content on your website. Sites like Facebook and Twitter are great avenues for promoting user reviews, new specials and invites for com-munity events. Remember that the people who visit your Web site via your social media profiles are people who have already invested in a relationship with your dealership and have a positive opinion about you.

Any good Web site provider should know all of these online best practices and more —from building the site to writing the content to

optimizing its performance. But a great Web site provider will continue searching for ways to increase your site’s productivity and success, and they’ll always keep you in the know.

George Nenni has been with Dominion Enterprises since 1993 and now serves as the vice president and general manager of Dealerskins and Dominion Dealer Solutions. He is respon-sible for Dominion’s web site and inventory management businesses.

If you wish to discuss this article with other dealers, or with the author, please go to the “Discussion Forums” at www.Dealer-communications.com and enter the “Internet Sales” forum or e-mail him at [email protected].

In a marketplace full of numbers, how do you know which ones to trust when valuing a vehicle? Look to NADA. Our analysts take the industry’s most comprehensive data and turn it into reliable values that are relevant to your business. Auction. Trade-in. Retail. Loan. Whether you need them for wholesale or resale. Retail or repo. Leasing or lending. Insurance or assurance that you’re making the right decision about any used car. It’s all the information you need. All the time. All from one source. NADA.

Experience the full power of NADA’s vehicle information. Visit www.nada.com/power to learn more.

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auction trade-in loan retail

Internet Sales, Nenni (continued from P-DD10)

29

autousanew

AutoUSA listsyour dealership onover 100 automotive websites.

AutoUSA puts your dealership on the local dealer selection list on over 100 popular automotive websites. With AutoUSA your

dealership is there when online shoppers are ready to buy. You’ll get consistent exposure in your market area and pay only when a lead

is delivered*. To get listed right away at no cost and be everywhere your customers are, call AutoUSA 1-888-212-3063.

You’ll be there when your customers are ready to buy.

Increase your sales today!www.autousa.com/signup1-888-212-3063

*Where allowed by law

"#$"%&'('()*%+,-..///( 0121(&///(03(4/56