Monday, May 23, 2016

Car Salespersons' Six Deadly Sins

The internationally renowned research and polling company, J.D. Power, LLC, conducts annual surveys of U.S. car buyers to learn what motivates them to buy from one particular car dealer rather than another. The surveys reveal six most common reasons that car buyers choose not to buy from a car dealer.

Surprisingly 49% of people who buy cars, buy from the first dealership they visit. This is a shocking statistic to me because it means that a lot of car buyers are not getting competitive prices from several dealers. This means that they overpaid for their vehicles. Of the 51% of those car buyers who shopped more than one car dealership before buying, 21% bought the same make car from another dealer than the first one they visited for six reasons. I’ve labeled these “The Six Deadly Sins of Car Salesmen”.

(1) Thou shalt not be rude to thy customer. In schools for sales people, no matter what you’re selling, you’d think this would be full explained. How could a salesman expect to make a sale after insulting the prospective customer? But, apparently it happens often. One of the most common offenses is male chauvinist car salesmen referring to female customers as “honey”, “sweetie pie” or other demeaning terms, and even telling them to go home and come back with their husbands!

(2) Thou shalt not be dishonest with thy customer. Of course this applies only to the salesmen who are “caught’ being dishonest.

(3) Thou shalt be knowledgeable about thy product. Today’s automobile is a highly complex, very sophisticated computerized machine. Buyers look to the sales person for answers to their questions. Buyers rightfully assume that, if the salesman can’t even show them how the navigation system works or tell them what the city gas mileage is, why they should believe he’s right about anything else he has been telling her.

(4) Thou shalt not pressure thy customer. Can you believe that car salesmen still haven’t figured this one out yet? Who likes to be pressured? I often drive by car dealerships and see a half dozen or more sales people gathered together in a “pack”, often smoking cigarettes waiting for their “prey” to drive onto the lot. I wonder how many prospective car buyers just keep on driving after absorbing that fearful scene. Has a car salesman ever said to you, “This price is good only for today? If you wait until tomorrow, the price will go up”? How about, “I won’t give you my best price until you tell me you will buy the car today”? Or, “Shop around with the other dealers and get their prices, come back and see me, and I guarantee I’ll beat their prices”?

(5) Thou shalt not ignore thy customer. My first reaction to this one is how a salesman could afford to ignore anybody that might be thinking about buying a car. The unfortunate answer is that a lot of car salesmen think they can tell just buy a person’s appearance if they can afford to buy a car. Boy is that stupid! I know many wealthy people who dress down because they like the comfort or because they don’t want to be seen as having a lot of money. That person that walks into a car showroom wearing a Tee shirt, flip flops, and jeans may well be able to buy the whole dealership.

(6) Thou shalt quote thy customer a firm price. You may find this hard to believe, but this is true of 95+% of car sales people. In fact, a lot of car dealerships have a firm rule never to give a prospective customer a firm price unless that customer will buy now. A salesman can be fired for giving a customer a firm price and letting that customer leave the dealership. This is “old school” but still common and it’s very insulting to the customer. When I ask other car dealers why they continue this practice, they ask me “why should I give the customer a firm price so that he can go to my competitor and let him beat it by $100?” What these car dealers don’t understand is that this is what the free marketplace is all about…shopping and comparing products and prices so that you can make the best buying decision. If you deny your customer this inherent right, they will not buy from you. If you do give the customer a firm price, you show your trust and often times that customer will return to give you a 2nd chance to meet a better price.

I recommend that you do your homework before you begin car shopping. NEVER BUY FROM THE FIRST DEALER THAT GIVES YOU A PRICE. The single best source of information about reliability, performance and safety on cars is Consumers Report. I also recommend that you use a company named True Car to find out what a good price is for the car you’ve chosen to buy. Go to www.TrueCar.com. Armed with information on what a good price is, you can begin your car shopping. The certified True Car dealers you will find in your market are required by True Car to give you an out-the-door price plus tax, tag, and title (government fees) only. They are contractually bound to include their dealer fees and dealer installed accessories. You don’t have to buy from a True Car dealer to get their price; you may want to buy from another dealer who will meet or beat that price.

7 comments:

  1. Earl, one day the other dealers will come around to your way of thinking. Until then it must be nice to know that you may be the only honest and forthright auto dealer in South Florida.

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  2. Suart, thanks very much for saying that. I hope you're right about the other dealers coming around to honesty and transparency. I believe they will eventually because they will have no other choice.

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  3. I have to say that I'm surprised to read an article today that still attributes the reason for a consumer to buy from a particular dealer is price. I thought we had buried that concept a long time ago.

    First of all, as you mentioned, today one can find the proper price to pay for a car within a very narrow range before every entering a dealership. Armed with that info, he/she can then decide upon other factors to determine if the dealership they're visiting is providing them with what they really need: convenience, cleanliness, the look and feel of the service department, the attitude and customer-friendliness of the personnel and finally the borrowing terms.

    When one is paying $35,000 for a new car, and the price quoted is even $100 more than the published target price, does the extra money really matter over 4-5 years if you can go to the nice, clean and friendly dealership five miles from home rather than a lesser quality one twenty miles way?

    Salespeople need to help educate customers about all the factors that should go into their dealership decision OTHER than price.

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  4. Douglas, I totally agree that price is not the most important thing when selecting the car dealer that you buy from. However, it is important. I find that customers will sometimes find a lower price but return to the dealer they trust and like to ask if that dealer can meet the price or even buy from that dealer at a slightly higher price.

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  5. Years ago, I went with my dad to buy a Chevy. He always bought Chevy. The salesman, an older guy, would not give a price or a trade value until my dad agreed to buy that day.

    We left and drove down the street to the local Pontiac dealer. My dad bought a Pontiac that day.

    The real impact of that foolish salesman was my dad never bought another Chevy in his life.

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  6. Thanks for sharing that story about your dad buying the Pontiac instead of the Chevrolet. You'd think that car dealers would learn a lesson after all these years but most of them still play that silly game

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  7. The surveys reveal six most common reasons that car buyers choose not to buy from a car dealer.This is a shocking statistic to me because it means that a lot of car buyers are not getting competitive prices from several dealers.

    ReplyDelete

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