Major auto dealer groups tout their digital retail operations and prowess, but many of them only rank first in the mystery shopping survey Pied Piper.
The online lead effectiveness study conducted by the consulting firm primarily measures how quickly large dealer stores respond to a specific question sent through their websites. Autoresponder is not counted.
Among the major groups, Penske Automotive, Berkshire Hathaway Automotive and Asbury Automotive Group scored above the industry average.
Conversely, Sonic Automotive, Hendrick Automotive, AutoNation (the largest US dealer chain), Group 1 and Lithia rank below average. (See the chart below for the full ranking.)
“We knew some of them would do well,” Fran O’Hagan, president of Bed Piper, told Lords. “But there is a huge behavioral variance.” Some agents excelled at using one communication channel, but not others. Premium Agents are adept at using all channels, be it email, text messages, phone calls or chat.
“It is not enough to be good at one and not the other of what a customer might prefer,” O’Hagan (Pictured, bottom left) Says.
It’s helpful for an agent to stay on top of Internet inquiries, and avoid putting digital operations on “speed control,” he says. “Our measurements show that merchants who respond quickly, personally and completely to customer inquiries via the website sell, on average, 50% more cars for the same amount of website customers than merchants who do not respond.”
Pied Piper submitted customer inquiries from mystery shoppers through the individual websites of 1,631 dealers, asked a question about a vehicle in stock, provided the customer’s name, email address and local phone number, and then assessed how dealerships would respond within 24 hours.
“If you craft an answer that’s nice but it takes 36 hours, you’re not doing very well,” O’Hagan says. “Quick response is the highest correlation with strong shutdown rates.”
O’Hagan says that clients of the top performing merchant groups were three times more likely to get a quick response than clients of poor performers.
David Kane, a leading digital auto retailer, tells Wards that the choppy performance among the dealership pool isn’t surprising. “You see a little bit of digital fatigue among the big groups,” he says.
He points out that while groups of merchants are essentially centralized operations, general managers who have a stake in the business run many individual stores.
“If the CEO is adaptive to digital technologies, he will perform well,” says Keane. (Pictured, bottom left)who heads consulting firm Kain Automotive, co-founded the flagship FordDirect 25 years ago and part-ownership of a family agency, Jack Kain Ford in Versailles, Kentucky.
Kain talks about merchants needing to interact with shoppers, figuring out why they’re shopping and “not treating them like you’re trying to cash them at the register.”
The larger marketing budgets of dealer groups give them one advantage over independently owned stores, Kain says. “But the Pied Piper study shows that there is no advantage when it comes to interacting with customers.”
The following are study examples of performance variance by company:
- How many times have company agents email or text an answer to a website customer’s question within 30 minutes? More than 50% of the time on average: Napleton, Pinsk, Morgan, Serra. Less than 35% of the time on average: Ken Garff, AutoNation, Lithia, Victory.
- How many times has the agent used a text message to answer a website customer’s query? More than 35% of the time on average: Asbury, Automotive Management Services, Napleton, Morgan. Less than 20% of the time on average: Ken Garve, Pinske, Greenway, Berkshire Hathaway, Victory.
- How many times does the agent contact the web client within 60 minutes? Over 75% of the time on average: Napleston. Less than 30% of the time on average: Victory, Greenway.
Pied Piper has conducted similar obscure shopping studies for agents by brand. This is her first team effort.