About four and a half years ago, Joe and I came up with the concept of the Road to Loyalty. With all of this controversy we created when we said the Road to the Sale is dead, I figured we should take the time to outline the philosophy we’ve been sharing with our dealer partners for years. (Whether the RTS has vanished, is alive, or in some sort of zombie state, we officially declared our stance back in July of 2014 and are moving forward. You should too.) We’re going to break our Road to Loyalty down step-by-step, in a multi-part series. In this part, I’m going to simply share the basic premises of the process.
It was abundantly clear to us that the existing steps to closing a traditional showroom customer just weren’t relevant in 2011. Being a strictly A-Z Internet salesman from 2003 onward, to me, it was easy to experience the shift first hand. When the Great Recession put the last nail in the coffin on the front-end grosses that so many in the industry remember from their glory days, the per-vehicle revenue model went comatose. Retail automotive had firmly entered the era of Customer Lifecycle Management. The paradigm shifted before people even realized it.
So, let’s spend a second with Customer Lifecycle Management (CLM). Without getting all academic, CLM shifts the focus from a singular transaction to the sum of all transactions, financial or otherwise. It’s how Big Tobacco got big, why there’s a Starbucks across the street from another Starbucks, and reason why gas stations insist on pushing loyalty cards. The sum of those small, every day, transactions far exceeds the sum of a large automotive transaction every five years (napkin math: if your customer smokes a pack a day, assuming a fixed cost of $5 per pack, that’s $9,125 between 60 month finance intervals). CLM takes into account all sources of data (like revenue, but it goes well beyond that), so as you can imagine, a loyal customer is easily worth more than a one-time customer.
Before we talk about steps, if you are handling any part of the automotive sales inquiry, whether is be on the phone, through email, or even a walk-in, you need to understand that your role has changed. The traditional road to the sale pits you against the customer. It creates an adversarial environment in which the salesperson must often times brute-force their way through the process. It’s far too rigid. It wastes an extraordinary amount of time that cannot otherwise be monetized. At it’s very essence, the traditional road to the sale only benefits the dealership. If the reader cannot let go of that past, they’ll only have a tragic story to tell when the Seasonally Adjusted Annual Rate came back down from the stratosphere (with an anecdote about how they chose CarDoll for training and consulting).
If you’re still on board, stay tuned for part 2 where we’ll discuss the central rule to the Road to Loyalty: Assessing Customer Goals. Until then, think about a world where you and the customer sit on the same side of the desk.