Second-Fastest Responders Show Better Closing Rates

SAN DIEGO – First responders don’t always win when it comes to how fast dealerships reply to online customer sales leads, according to a data analysis.

Showing the highest closing percentages were dealers who replied within 16 to 20 minutes. That’s not the quickest, but nor is it egregiously pokey.

DealerSocket, a customer-relationship management software provider, analyzed 20.7 million Internet leads and response times of 3,700 dealerships.

It determined the closing rate for stores replying within 16 to 20 minutes was 5.42%, or 23% higher than dealerships that responded within 15 minutes. Also beating out the fastest responders were dealerships that replied to a customer’s online inquiry within 31 to 60 minutes.

The results defy conventional-wisdom claims that fastest is better.  

What traits does the 16-to-30-minute group share? They spent more time crafting their responses and provided richer information, Reuben Muinos, DealerSocket’s director-business development, says at the company’s annual user conference here.  

They offered information not only on the vehicle in which shoppers expressed an interest but also optional vehicles that might appeal to them.

They crafted personal responses, saying things like, ‘I notice you live nearby. I’d be happy to bring out a vehicle for a test drive.’

“They included third-party references in their replies, and they tried to set up a phone call,” Muinos says.

All that takes longer than firing off a quick bare-bones reply, but it pays off, he says. “It is quality trumping speed for the first email going out.”

Although this is the Internet age, getting online shoppers offline and on the phone offers better sales results than sticking too long to email exchanges. Those serve a useful initial purpose, but add little to building a relationship with a prospect, a vital part of selling.

“The best-performing stores send fewer emails and spend more time on the phone,” Muinos says.

Although fastest isn’t necessarily best, dealerships that take their time responding to emails show lower closing ratios. Those drop to under 3% after five hours, according to the DealerSocket analysis.

Slow or no responses are akin to ignoring customers who walk into the dealership, says Fran O’Hagen, president of Pied Piper, a consulting firm that conducts annual mystery shopping studies to gauge how well dealerships by brand respond to online customers.

He agrees with the importance of trying to set up a phone call. It’s unusual to find a dealership that effectively handles online leads “if calling on the phone isn’t an integral step,” he says.

Muinos says, “The more calls made, the more cars sold.”

For customers who go to the dealership, close rates vary according to whether they made initial contact by email (53.6%), phone call (44.1%) or walk-in visit (24.8%), according to DealerSocket’s data crunching.

“No surprise there,” Muinos says.

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