Money Isn’t Everything at Car Dealerships

Price isn’t everything to car shoppers.

So says Kerri Wise, director-dealer marketing at TrueCar, an online firm that provides comparison pricing to automotive consumers.

It’s perhaps ironic she should say that, considering TrueCar’s controversial past.  

Last year, under then-new CEO Chip Perry, the dealership lead provider sought to remodel itself amid lingering criticism it pitted dealer against dealer, caused excessive discounting, cut into dealer margins and encouraged dealers and consumers alike to fixate on price, price, price.

But there’s more to it than that, says Wise, whose reformed firm has taken steps to prevent dealership price wars.

Yes, car shoppers want a “fair” price, she says. “But it’s not just the price point. It’s also about the customer experience.” Dealers who deliver the goods there stand out, according to a recent comparative analysis TrueCar did on dealer operations. The study focused on dealers who embrace price transparency while enjoying the highest close rates in their markets.

Wise cites some of the things top performer do well. Among them:

Above-average dealers also adeptly field Internet lead inquiries. They respond two-and-a-half times faster. Half of the sales went to salespeople who responded first.

“But it is not just about speed, it’s also about the quality of the response,” Wise says at a recent DrivingSales conference.

A dealership effectively using technology that tracks website visitors’ areas of interest “has information concerning what the consumer has done and acknowledges that person’s online journey,” she says.

Customers can get miffed if they feel they’re starting over at the dealership after doing a lot of online research and shopping.   

On a lower-tech level, a salesperson can learn a lot – from vehicle interest to potential trade-in information – just by thoroughly reading what a shopper might say in a lead submission or query.

“The top dealers personalize their responses,” she says. “Automated emails are great at stopping the clock,” but a human reply should follow shortly thereafter.

About 75% of top dealers in the study willingly give price quotes over the phone. Their transaction prices averaged 93.6% of MSRP. The nearly matched the 93.7% for average dealers.

To Wise, it debunks a myth claiming top-volume dealers deeply discount. “Instead, their pricing is in line with the market.”

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