Ditch That Old Notion

Ted Linhart, CEO for the Dominion Auto Group in Richmond, VA, says it is time to get rid of the idea that automotive Internet customers are different from other customers.

It is one of the first things Linhart says during a presentation at the ENG conference on how search technology is changing automotive retail.

“I want to dispel the notion that there is a separate Internet customer today,” he says. “I don't see any difference.” Linhart believes ending the separate treatment will lead to a better experience for all car dealership customers.

He is on General Motors Corp.'s information technology advisory board and was one of the pilot dealers for the Cobalt Group's online search product.

Ten years ago, when the Internet was making its first forays into car sales, customers shopping online were different, Linhart says. They shopped price and demanded better treatment.

But now the Internet has gone beyond the so-called elite shoppers. It is used by the masses. Studies indicate 60% to nearly 90% of automotive buyers conduct part of their search online.

That does not mean, however, that the Internet is the only place or first place of contact for the customer.

“We're naive to think that,” Linhart says. “Thinking there is a certain type of Internet customer is a dangerous concept. It forces us to segment our customers more and makes us put aside money to accommodate that segmentation.”

Many of today's lead management or customer-management solutions focus only on the prospective Internet buyers.

“We need CRM solutions that encompass all of the customer touch points whether they be by Internet, phone or walk-in appointments,” Linhart says. “I think holistic solutions are the way to go.”

Part of the problem is integration of the systems.

“Most of us (dealers) have CRM processes in place, but the touch points are isolated,” Linhart says. The result is a patchwork of tools and databases a dealer must cobble together to develop an effective CRM strategy.

Although he believes Internet customers are not a separate group, he is passionate about the power the Internet provides to dealerships as a way to increase brand awareness.

Linhart says a stack of unused phone books sitting on a pallet in one of his stores' service departments recently convinced him that leveraging search-engine technology is the 21st century method to enhance dealership branding.

The phone company each year would deliver a couple of pallets of phone books to the dealer group. The books used to disappear within a couple of hours, claimed by employees.

However, last year, one pallet of phone books remained unclaimed for several months prompting, Linhart to ask one his daughters, an employee at the firm, if she knew why.

“She asked me what I wanted a phone book for,” he says. He then learned he could find phone information and much more online and realized that is what many of his customers were turning to.

“You have to ask yourself, ‘Am I making my company easily accessible to my customers?’ Search-engine marketing is one way to do that,” Linhart says.

The company's experience with search technology also convinced him that his customers were using the Internet to find dealerships for other needs, such as service and parts and not just sales.

Currently, the dealer group is doing organic search, which means optimizing the website to make it more friendly to search engines. It also is buying key words to enhance its ad positioning on the search engines.

Linhart says he will keep spending on search technologies until the group no longer sees efficiencies from it. He believes the budget ultimately will settle in the $10,000 to $20,000 range.

He has a message for Web-related vendors that service car dealers. “Dealers don't get a lot of this,” he says, using terms such as “impressions,” “click-throughs” and “cost-per-clicks,” as examples. “I don't have the time to work through all of this stuff. We're still trying to get our leads answered in less than eight hours. The industry has to understand just how complicated this is for dealers.”