22nd September, 2015 · Sales

Your CRM May Be a Bad Fit with Your
Dealership Business Model

4 minutes to read

In this article

Why CRMs Are a Critical Tool

Before I discuss what a dealership should look for in a CRM solution and highlight warning signs with your current system, I want to enlighten holdout dealerships on the value they are missing.

Don’t Fall In Love with Features

Modern CRM systems have innovative features that give dealerships an edge over those that don’t use one.

5 Signs You Should Rethink Your CRM

If your dealership is unhappy with your current CRM system, did I hit a nerve in discussing any of these key criteria?

It’s Never Too Late to Change

Thinking about all of these issues will aid your dealership management with CRM platform decisions.

Be alert for these warning signs that you should look for a different kind of CRM
Today’s car buying marketplace demands nothing less than a connected, personalised customer experience.  Consumers want dealerships to know who they are and what their interests are, and to anticipate the types of cars and services they need. They want to reach their salesperson whenever it’s convenient for them, whether by voice, e-mail, video or text.

These expectations make it critical for a dealership to really leverage its customer relationship management (CRM) system. I’m often amazed when I come across dealerships that regularly use a DMS but still don’t have even a basic CRM solution. I’m not just talking about small independents, either. I see franchise Dealers that either have no CRM system or use an ineffective one that is not working well.

Some of these dealerships do realise the value and potential in a CRM system, but they are not happy with what they bought and are frustrated their salespeople just aren’t using it.

I’m not going to debate whether this is a principally a management or a salesperson problem, but clearly it’s a problem!

Why CRMs Are a Critical Tool

Before I discuss what a dealership should look for in a CRM solution and highlight warning signs with your current system, I want to enlighten holdout dealerships on the value they are missing.

At its core, a CRM system helps to manage sales and marketing processes, while delivering a more streamlined customer experience. CRMs let dealerships set workflows for their sales and BDC teams, manage Internet leads, and store valuable customer data that allows remarketing to existing customers.

For example, a dealership can leverage a CRM database as it would Internet leads, to run customised campaigns encouraging trade-ins. CRM leads are warmer, as you have more information about an existing relationship than with an lead purchased online. Also, CRM systems help both management and the sales team shorten sales cycles and turn inventory faster. Plus, manager dashboards help track overall trends and individual performance levels, while resource-specific views show each salesperson his or her open opportunities in order to ensure prompt follow-up for faster closes.

Some market research shows CRM adopters typically see a 32 per cent improvement in win rate and a 50 per cent acceleration of sales conversions. With that type of ROI, it’s worth it for dealerships of all sizes to explore what is possible to meet their CRM needs.

Don’t Fall In Love with Features

Modern CRM systems have innovative features that give dealerships an edge over those that don’t use one. However, technological bells and whistles mean nothing if the system doesn’t fit your dealership’s sales process and deal flow. Fit is the single most important CRM criteria; your CRM needs to align with your sales culture, workflow, deal processes and business goals. If you use a UP system, then the CRM should complement it. If your business is single-or multi-rooftop, then the CRM must be calibrated to work well with those physical facilities.

A CRM needs to meet your dealership’s basic needs, have an intuitive user interface and be simple to learn. It has to be mobile and free your sales team to “work the lot” from virtually anywhere. A good CRM system provides multi-channel communication capabilities via e-mail, voice, video or text; and has integrated social media tools to stay connected with prospects. It offers your people increased visibility into the pipeline and sales trends at a glance, with dashboard-centric reporting. And, all of this must also be affordable.

5 Signs You Should Rethink Your CRM

If your dealership is unhappy with your current CRM system, did I hit a nerve in discussing any of these key criteria? Here are five warning signs indicating your CRM approach may not really be working for your dealership:

  1. Price: Are you paying more for your CRM than some of your sales peoples’ salaries? Do you lack a clear ROI on your CRM system, and are you locked into a multi-year contract?
    If yours is a smaller dealership selling 50 cars a month, then a CRM solution that is geared toward multi-rooftop Dealers and loaded with every whiz-bang feature in the book is not the best or most cost effective highway to travel. Create a critical features checklist in concert with your sales team to cover what your dealership really needs, and do your due diligence when researching different CRM systems. Demo several of them to identify a good fit for the price and a system that works well with your sales processes.
    At the end of the day, you want to trim your monthly CRM payments with a more affordable system that is right-sized for your business.
  2. Poor mobile app: Does the mobile version of your CRM create the feeling that you’re using a brick phone? Mobile is crucial for salespeople, with statistics showing a 30 per cent increase in the number of “fresh-ups” once they start using a mobile CRM.
    Putting everything at your salespeople’s fingertips, with faster data entry tools, improves sales productivity. Having the ability to scan both VIN and driver’s license information is the sign of a good mobile CRM.  Knowing who’s calling with details of their car interests, via screen pop-ups, is also a best-in-class mobile CRM feature.
  3. Legacy system: If your dealership has a CRM system that feels “clunky” and doesn’t integrate with other applications you use, consider dumping it. If the interface looks outdated and does not integrate with top social media tools, then trade in your legacy system for a newer model.
  4. Overly complicated with “feature overkill”: Does your CRM actually make the sales process inefficient and slow down momentum? Are there a zillion features, when your process really only requires a few critical ones?
    You get out of a CRM what your salespeople enter into it. If the CRM just slows them down, then they will stop using it. Stick with a simple CRM solution and focus only on what your sales team really needs.
  5. Generic CRM: I often run into Dealers who use B2B-focused CRM systems that are feature- and report-rich but are not focused on the B2C automotive industry. Your dealership CRM needs to be automotive-specific, not a general SaaS system.

Make sure your CRM is tailored to the automotive world, with modules that work with important dealership tools.

It’s Never Too Late to Change

Thinking about all of these issues will aid your dealership management with CRM platform decisions. Make the best possible decision by including your sales and BDC teams in crafting a critical CRM functionality checklist and walking through how the CRM will affect the sales process. If yours is not a tech-savvy team, consider bringing in an outside consultant to help evaluate CMR systems for your dealership and sales culture.

Change can be hard. It often takes 60 to 90 days of using a CRM before it becomes a natural process for your team. Follow the guidelines I’ve provided, and stay patient in order to maximize your CRM ROI.

 

Zach Klempf
Contributor