Archive for the ‘Selling’ Category

It’s not too early to start thinking about your sales in 2016

If you thought 2015 was a good year to be in the automobile business, you’ll love prospects for 2016. And December is a good time to start gearing up.

Typically one of the best months of the year for selling cars, December is expected to top off a record year after a very strong November and set the table for another possible record next year.

“U.S. auto sales are now clearly on the path to set a record in 2015, with volume we haven’t seen in 15 years,” said Jeff Schuster of LMC Automotive, a marketing intelligence firm.



But there’s little time to relax afterward with tax season and the big month of March around the corner.

While 2015 has seen tremendous and consistent growth in new-vehicle sales, new-car and light-truck sales should go even higher in 2016, Steven Szakaly, National Automobile Dealers Association chief economist, said during a recent press conference, according to F&I Showroom.

“New light-vehicle sales will rise to 17.71 million units in 2016, a 2.3 percent increase from our forecast of 17.3 million sales in 2015 … the seventh straight year of increasing new-vehicle sales,” said Szakaly.

Some experts say 2017 will be even better for light-vehicle sales, hitting 18 million before leveling off.

And the positive outlook isn’t limited to new-vehicle sales, according to industry experts.

“We are looking for used-vehicle sales to continue to grow as we move into 2016,” Tim Fleming, Kelley Blue Book analyst, recently told Auto Remarketing. “Prices should continue to ease from record highs seen a few years ago, making the used market even more attractive to consumers.”

Overall, franchise dealers sell nearly as many used cars, trucks, SUVs and minivans as new vehicles – more than one-third of all used vehicles sold – based on data from CNW Marketing Research. The remainder is sold by independent dealerships and in private-party transactions.

Santander Consumer USA plans to help franchise dealers make the most of the 2016 opportunity by providing support through our knowledgeable sales-and-marketing team, email content and blog posts. If you have questions about working with Santander Consumer USA and Santander Auto Finance, talk to your sales representative or area sales manager or request a visit from a representative online.

Sizzling summer sales: Why higher-end cars, trucks, SUVs are bigger than ever

The sizzling summer sales season appears to be especially hot for higher-end luxury and mainstream car models, as well as trucks and SUVs.

And that trend won’t cool any time soon, according to an analysis by, as positive economic conditions “are encouraging shoppers to seek out bigger and more expensive vehicles.”

“The cost-conscious, fuel-efficient mentality from the recession and early recovery years has faded,” said Lacey Plache, chief economist, whose team analyzed two years’ worth of data from the website in compiling the report, “What car shoppers want now.”

American car shoppers are going bigger in 2015.

American car shoppers are going bigger in 2015.

“We expect these economic trends to continue into next year at least,” she added, “so there’s every reason to believe that shopper preferences for larger and more expensive vehicles will continue along the same path that we’ve seen emerge in the past year or so.”

That’s very good news for car dealerships in the midst of some of the biggest sales months of the year.

Positive economic trends include lower unemployment, higher consumer confidence and lower gas prices, as well as low interest rates, low inflation and heavy vehicle replacement.

Two of the biggest factors that are encouraging shoppers to get more expensive vehicles are cheaper credit and the movement toward leasing, according to Edmunds.

Leasing is on a record pace in 2015.

Leasing is on a record pace in 2015.

May figures show that 9.5 percent of buyers who financed new vehicles got zero percent loans – the highest percentage since last September. “And over 28 percent of new cars and trucks sold so far in 2015 were leased, putting the year on pace for the auto industry’s highest lease penetration rate ever.”

Industry experts are predicting that around 17 million new vehicles will be sold in 2015.

Meanwhile, the lower interest in fuel efficiency is driving car shoppers away from the two most popular segments of recent years – midsize and compact cars – as well as hybrids and electrics.

“The share of shoppers configuring higher-end, better-equipped vehicles has increased while the share configuring lower-end vehicles has decreased,” according to Plache.

“The upgrading of the new-vehicle market also is obvious when you consider that trucks and SUVs have outsold cars in each of the last 21 months, despite significant average price differences,” said Edmunds.

“In May, for example, the average transaction price for trucks and SUVs was nearly $37,000, while the average transaction price for cars was about $27,400. Most shoppers are not only more attracted to those bigger vehicles, but they are paying on average $9,500 more to own one.”

Now, that’s hot fun in the summertime.

Calls to action: When words matter most for your sales funnel (Part 4 of 5)



Words matter.

Especially when you’re asking someone to take action on your website that keeps them engaged (increasing your chances to convert them into a customer).

“The first step towards acquiring a new customer [is] getting them to raise their hand and take an action,” says CarStory in its white paper, How to Convert Used Car Shoppers to Buyers, based on a recent used-car-shopper survey. “Providing the right call to action (CTA) is yet another way you can convert a shopper to a buyer by winning their attention and their clicks.”

CarStory, a company that provides independent reports about vehicles and features in specific markets, even compared specific CTA words and phrases to see which words generated bigger responses.

RELATED: The first commandment for turning used-car shoppers into buyers (Part 1), The most important three-letter word when selling used cars (Part 2), And now the most important number when selling used cars (Part 3)

The calls to action to which shoppers are most likely to respond by category, according to CarStory?

They are “Check price” (about 36 percent of shoppers survey), “More information” (about 27 percent), “Contact the dealer” (about 14 percent) and “Schedule a test drive” (10 percent). Some CTAs that didn’t fare as well: “Check availability,” “Make an offer,” “Save/add to wish list” and “Request financing.”

But even knowing the right categories for your CTAs doesn’t mean your work is done.

“In the price category, the CTA ‘Check price’ outperformed every other option by three to 10 times,” CarStory said, with about 46 percent of respondents saying that would move them to action. Fails included “Is this a good deal,” “Get an e-quote,” “Free price check,” “Get an awesome deal” and others.

“If you are using anything but “Check price,” now would be a good time to update your website.”

In other CTA categories, similar action wording did best with prospective customers:

More information: “View details” was scored 31 percent better than “Vehicle details,” even more over “See more details,” “Get information” or “Request more information.”

Contact the dealer: “Email dealer” generated a greater response than “Call dealer” or “Contact dealer.” Added CarStory: “It is interesting to note that consumers flagged ‘email dealer’ … when, in fact, most sites don’t allow you to send an email, but rather have you submit a lead form.”

Scheduling a test drive: “Schedule a test drive” outscored “I want to test drive” or, simply, “Test drive.”

Or, as CarStory says: “Calls to action – they are not all created equally.”

NEXT: We’ve made you a list, so check it twice to boost your used-car sales

What dealers and automakers must know to meet the challenge of millennials



Millennial customers present the auto industry with a significant challenge.

They reportedly are more enthusiastic about ridesharing services such as Uber and public transportation than owning a vehicle. They mistrust traditional financial services and traditional media.

And they are saddled with student loan debt that makes borrowing difficult.

Because they are the largest generation ever – 79 million versus 76 million baby boomers – it is important to automakers and dealers, alike, that many are interested in buying or leasing vehicles.

A reported 71 percent of millennials are interested in owning cars and 43 percent are either “very likely” or “completely likely” to purchase a car in the next five years, according to a January study by Elite Daily, which bills itself as “the premier online news platform by and for millennials.”

So, given that millennials eventually will come around, what does the auto industry need to know?

Millennials diverge significantly from older buyers in how they borrow money, pay for purchases and communicate with brands, according to a study by Fair Isaac Corporation (FICO).

Millennials are ten times as likely as those over 50 to consider a peer-to-peer lender such as Lending Club or Funding Circle. The numbers are low – 23 percent of millennials – but they are growing rapidly.

This level of comfort with alternative lenders could mean consumers are more likely to explore alternate avenues to buy vehicles online from peer-to-peer car selling marketplace such as Beepi, one of a growing number of sites that brings social media interaction into retail. An approach like this may work with millennials because social media communication is ingrained in their experience.

Millennials also are more likely to pay for products and services by alternative means, with 52 percent saying they use or are very likely to use services such as PayPal, Amazon Payments or Venmo. Millennials like these services because they are transparent, low-friction, and simple, according to the FICO survey. Significantly, they also are available on mobile devices.

And a third of millennials use or are very likely to use mobile payment systems such as Apple Pay or Google Wallet, so payment options with an emphasis on mobile devices are important.

FICO, which surveyed more than a thousand millennials, learned that they prefer communicating by email, text messages, website forms and mobile apps in that order. Over 60 percent say they are more likely to become loyal customers if a company engages with them on social media.

The time apparently will come for millennials to get vehicles, so dealers will have to be able to conduct interactions and transactions in ways that makes that generation feel most at home.

– Philip Ryan

Why car-buying experience pushes customers over the edge at many dealerships



Let dealers beware.

Car shoppers have a tipping point, and you may be close to pushing them over the edge.

“One of the most critical aspects of the dealership experience is the time consumers spend in store to complete a sale,” according to AutoTrader, the online shopping, selling and research website.

“Customer satisfaction is highest within the first 90 minutes at the dealership,” Cox Automotive reported in a white paper “It’s About Time: Streamlining In-Store Processes to Improve the Customer Experience” recently released by AutoTrader. “However, as the amount of time a customer spends at the dealership increases, customer satisfaction with that dealer is likely to decrease.”

Going beyond 2.5 hours steadily increases a customer’s dissatisfaction with the dealership.

“While some dealers are making strides in connecting the issues that contribute to purchase-day delays, there is still a lot of work that needs to be done – on our side as a partner and technology provider and in-store at dealerships,” said Jared Rowe, president of

This is no small matter when 55 percent of new car buyers and 57 percent of used car buyers experienced frustration during the purchase process, according to a separate study by IHS Automotive.

The top five car buyer frustrations, according to the IHS study, are:

  • The amount of time it took to complete the purchase (41 percent)
  • Negotiating a purchase price (37 percent)
  • Getting a good trade in offer (24 percent)
  • Dealing with salespeople (19 percent)
  • Applying for/understanding financing options (18 percent)

“To better understand the disconnect between customer expectations and the dealership experience, Cox Automotive conducted an in-depth analysis of four distinct dealerships to actual cycle times across key processes from post-vehicle selection to pre-delivery of vehicle,” AutoTrader reported.

Unfortunately, none of the dealerships consistently meets its desired customer cycle time of 90 minutes, regardless of their geographic, demographic, and strategic and tactical differences, the Cox study showed. In fact, their actual average time, which included vehicle sales after the customer made his or her choice, trade-in vehicle appraisals and F&I, ranged from 115 minutes to 184 minutes.

The dealer that came closest to meeting the 90-minute timeline was a “volume-based commission dealership” in the northern Midwest near a population of over three million. The dealership with the longest average timeline was a “traditional franchise dealership” located near a southeastern U.S. city with a population of over four million. Cox also looked at a “forward-thinking dealership” in the Northwest near an urban area with a population of more than 600,000 and a “lean dealership” augmented by a used-vehicle wholesale business in a midwestern city with a population over 800,000.

In our next post, we’ll look at leading dealership best practices to help you get from here to there.

Black Friday boost to vehicle sales sets tone for ‘epic’ selling season

black friday

Black Friday weekend helped push new-vehicle sales to their highest level in more than a decade as November shoppers stuffed themselves with cash-back, bonus, financing and other incentives after the Thanksgiving holiday.

Positive economic news and dropping gas prices didn’t hurt, either.

“After healthy Black Friday car sales, experts predict the auto industry’s sales will be the highest monthly sales for November since 2001,” reported the Detroit Free Press online.

And November sales may be just a warm-up for December and beyond, according to industry analysts.

“A lot of things are aligning” for a strong finish to the year, Jesse Toprak, chief analyst at told Jim Henry at Forbes online.

“Black Friday has established itself as the start of the final epic selling season of the year, and this year that season has started earlier than ever,” said TrueCar President John Krafcik. “Hard-hitting sales events, great new products, and receptive consumers are driving a 17 million (seasonally adjusted sales rate) in November. That’s terrific for the industry and a positive sign as we look to 2015.”

“November was another very robust month for new-vehicle sales,” said Toprak in a press release. “Year-end clearance deals for the 2014 model year vehicles, relatively lower gas prices and an excellent selection of cars and trucks propelled the sales rate to its highest level in a decade.”

General Motors led in unit sales, followed by Ford, Toyota and Fiat Chrysler. But Chrysler sales grew faster than any other manufacturer, rising 20 percent in November.

“Sales of our all-new Chrysler 200 sedan were up a strong 155 percent in November, helping Chrysler achieve its 56th-consecutive month of year-over-year sales gains,” said Reid Bigland, Chrysler’s head of U.S. sales. “In total, we had 11 vehicles last month that set new sales records.”

And yet, the industry was profitable as buyers spent an average of $30,874 per vehicle, or $165 more than the previous record of $30,709 in October, reported The Washington Times.


Car shopping differences between women and men drive sales opportunities

car shoppingCar dealers looking for an edge may know there are differences between women and men when they shop for new or used vehicles.

And the most savvy dealerships use that information to boost sales.

The results of a recent market intelligence study by Kelley Blue Book may help. It involved about 40,000 U.S. adults and came from an analyses of data from KBB’s own website and other survey results.

First the big picture.

“When it comes to car shopping, women are driven by features – engaging in extensive research to find the best fit – while from the outset many men are revved about a particular car brand,” according to KBB, an auto-shopping and automotive industry information source.

“One in five men knows the exact vehicle he wants, while women are twice as likely to be undecided about what vehicle they desire,” said KBB. “Additionally, 58 percent of men are confident in the car-buying arena versus 38 percent of women. As a result, women take longer to make a purchase, because they are spending more time than men doing research to build confidence and knowledge.”

Women take 75 days on average to make a purchase, compared to 63 days for men, the study found.

So, the more a dealership can satisfy the need for information, especially online via mobile devices, the greater the likelihood that it will succeed in selling to women, experts say.

In its study, Kelley Blue Book also found that:

  • Women are more likely to see cars simply as a way of getting from one place to another, while men tend to view them tied to their image and accomplishments.
  • Women, who tend to be more utility-minded, prefer non-luxury SUVs and sedans, while men, who tend to be more image conscious, want trucks, coupes and luxury sedand.
  • Women prefer non-luxury Asian automobile brands, which they view to be more practical, while men want domestic trucks and European luxury brands because of the image they portray.
  • Women value practical benefits such as durability and reliability, safety and affordability more than men, who are more drawn to interior layout, exterior styling, technology and ruggedness.
  • Women define a successful transaction as getting the exact vehicle they want, while men are more about negotiating the best deal.

“What we can glean from this research is that we need to continue our focus on providing the proper tools and content to help shoppers narrow down choices, therefore bringing balance and filling gender gaps in the car-shopping experience,” said Hwei-Lin Oetken, vice president of market intelligence for Kelley Blue Book’s

Striking a balance is important to auto dealers because “women are the fastest-growing segment of car buyers,” accounting for an estimated 50 percent of light-vehicle purchases (around 27.5 million in 2013) and influencing 80 percent, according to a report from

The Kelley Blue Book data is a good reminder of that – or a good place to start.


Falling gas prices lifting trucks, sinking hybrids, other ‘green’ vehicles

gas prices

Perhaps “liquid gold” should be downgraded to “liquid silver.”

That’s because the average price for a gallon of liquid gold – gasoline – at the end of October stood at just $3.003, according to AAA, down 10 percent from the beginning of the month.

In fact, gasoline prices are lower in real terms than they have been in 20 years, and all indications point to prices at least holding steady, or even continuing to drop in the near future.

That sounds like great news – unless you’re trying to sell a Prius.

While truck sales have risen 17 percent and SUVs have risen 20 percent on the year, sales of hybrids such as Prius, plug-ins and EVs are down 5 percent, according to a National Public Radio report. Sales of green segment cars are down for the fifth straight month this year, Autoblog says, falling 11 percent year over year in August and 9.6 percent in September.

Trucks make up 53.5 percent of the model mix currently on the road, according to data, while cars make up 46.5 percent. A year ago, when the average price for a gallon of gas was around $3.50, the mix was evenly split between cars and trucks. The red-hot crossover SUV segment, incidentally, makes up 20.4 percent of market share through September 2014, Edmunds indicates.

The Toyota Prius, meanwhile, which leads the green segment in annual sales, has seen its sales volume drop 11.4 percent on the year through September.

“If you were to turn back the clock seven years, Prius was at the height of its game,” said John Krafcik, president of TrueCar, the car-buying and selling platform. “Demand was high, inventory was limited, and incentives were practically non-existent. Fast forward to this year: Hybrid popularity is waning, and the country’s love of the full-size pickup truck is remarkable.”

“Last month, incentives for the main Prius model … averaged $2,309 per vehicle,” according to TrueCar. “By comparison, in September 2007, the Prius sold with average incentives totaling only $91.”

And the outlook on gas prices doesn’t provide much consolation for prospective sales of green vehicles.

Tracy Noble, AAA’s mid-Atlantic region spokeswoman, said demand for gas is lower and supplies are higher than in recent years. The price has dropped at the pump 34 percent since its 2014 high in July, and a price of $2.50 or $2.60 is a possibility going forward, she said.

“Right now,” said Krafcik, “automakers with a heavy mix of hybrid vehicles, like Toyota, are feeling the effects associated with this turning of the hybrid-popularity tide.”

– Philip Ryan

Dealers wising up to use of smartphones by vehicle shoppers

smartphoneAre your dealership’s employees spending more time on the phone?

That could be a good sign for your business if you’re ready for it, say auto industry sources.

“It’s back to the future for car shoppers, who now much prefer to contact dealerships with an old-fashioned phone call rather than via the Internet,” reported David Barkholz of Automotive News.

“With technology now, people research on their smartphones, find the car they want, click to call the dealer and negotiate from there,” Nancy Bloom, regional sales manager in Florida for Santander Consumer USA, told us. “When I was working at a dealership, you could see the shift to emailing the Internet department start to rise. Now, it is back on the phones.”

Citing data compiled by ADP Digital Marketing, Barkholz reported that telephone sales leads are up 46 percent versus Internet leads over the past two years.

“The rise of the smartphone has definitely facilitated the ease of which customers inquire about their potential vehicle purchase,” said Hamzah Issa, finance director of Sutherlin Nissan in Orlando, FL. The click-to-call trend … has increased our phone call leads considerably over just the past year.”

For example, he said Sutherlin had 90 phone call leads compared to 55 email leads for July 2014, substantially different than July 2013 when there were just 14 phone call leads and 42 email leads.

“We are discovering [that] people want to talk to someone live instead of an email,” said John Carino, finance director for Off Lease Only of Miami and Lake Worth, FL, the largest independent used car dealership in the country with sales of about 1,800 vehicles per month.

As a result of the change, dealers are committing to more phone sales training and call monitoring. That must include speeding up their responses to shopper inquiries, according to Joe Webb of DealerKnows.

Webb explained to Automotive News that dealerships still take an average of four hours to respond to Internet leads with a custom response, about 12 times the ideal response time of 20 minutes or less. Consequently, shoppers have been conditioned to bypass Internet or email and just call directly.

“Instant gratification is an expectation many consumers have, and most people don’t have the time to wait on the average four-hour response time for Internet leads,” said Sutherlin’s Issa.

“Dealers need to educate all staff on how to properly work a customer over the phone and in email format,” said Bloom of Santander. “Speaking to a customer over the phone and getting them to make the appointment is key to the dealer’s success.”

Are you doing all you can to avoid sales department turnover?

salesmanSales staff turnover remains a big issue for automotive dealerships but the trend turned in a positive direction in 2013, according to CNW Research’s Retail Automotive Summary as reported online by Auto Remarketing.

Turnover rates for sales people at new-car dealerships dropped to about 111 percent last year from 124 percent in 2011, Art Spinella, CNW president, told Auto Remarketing.

“Though these numbers still seem unusually high, Spinella noted that historically, new-car dealership sales personnel turnover has been above 100 percent for decades,” Auto Remarketing reported.

That doesn’t mean turnover is high across all dealership departments.

“Technician turnover continues to be a bright spot,” Spinella told Auto Remarketing, at barely 15 percent last year.

Meanwhile, office staff turnover has been slower than in the past, according to the CNW report.

The results echoed a study last year by the National Automobile Dealers Association (NADA). The Dealer Workforce Study also showed high turnover rates for sales people (62 percent in 2012), with turnover among female sales personnel around 76 percent, Auto Remarketing reported.

If your dealership is having trouble holding on to sales people, here are some factors automotive industry experts suggest you might consider:

How you qualify sales people. You don’t want just warm bodies, but people who project a professional demeanor, have bullet-proof product knowledge, recognize sales is a process, are team players and do what it takes to “delight” customers, wrote Don Graff, an automotive industry consultant.

How you train sales people. Don’t simply follow “the salmon-going-upstream approach – if they survive then we will invest some time into them,” wrote Paul Sansone Jr. of 66 Automall in Neptune, N.J. “Train, train, train, train” to give your sales people the tools they need to earn a good living.

Whether you overwork your sales people. High rates of dealership employee turnover might be due in part to long hours, according to NADA. When employees work over 45 hours, turnover increases.

Whether you’re paying them enough. “Consultants working 50 to 60 hours per week earn 4 percent more a year than their counterparts working [only] 40 to 45 hours,” reported Auto Remarketing.

“Let’s face it. We are not brain surgeons or scientists,” wrote Sansone on the Auto Dealer People blog. “We are only selling cars. If we hire motivated, personable people that care, we should be able to make it a personally and financially rewarding career.”

– Mark Macesich