Pub. 14 2015-2016 Issue 2

N E W J E R S E Y C O A L I T I O N O F A U T O M O T I V E R E T A I L E R S 23 new jersey auto retailer W W W . N J C A R . O R G took root and it was proven that customers will buy if given the opportunity to do so. Not only were wait times reduced, but cus- tomers were saved from having to endure the “pressure cooker” experience. Things became suddenly simple, and non-threaten- ing. Profits soared and history was written. No-Haggle Pricing Finds Success When Saturn first entered the market in 1989, pundits proclaimed that it would fail within a year. Surely, no car company could be able to hold its own with such uniquely different tactics. All vehicles were sold at sticker price. Veterans of the industry reacted as if the sky were falling. Surely, nobody in their right mind would pay full retail for a car. But the concept caused customers to flock to Saturn showrooms. Here was a no-haggle environment, where customers knew in advance that they wouldn’t have to bother with negotiations. It was a concept that proved customers had grown sick and tired of the games. Regard- less of the eventual outcome for Saturn, nobody can deny that customers enjoyed the no-haggle experience. Online Auto Sales Come To The Forefront More and more automotive customers are conducting their vehicle researchonline using a varietyof thirdparty tools.Now, dealerships are beginning to develop their own tools in order to provide customerswith amore seam- less online experience. Recently, AutoNation announced it was going to roll out its own digital storefronts in order to give consumers more ownership of the sales process before they ever set foot in a physical location. By transforming their websites from solely informational to trans- actional, AutoNation is taking the nextmajor step – proving dealerships don’t have to rely on third party providers to deliver on total transparency. What Does This Mean For F&I? F&I departments will be compelled to en- gage customers sooner in the buying process, via dealershipwebsites. Internet departments will be communicating efficiently with fi- nance, most likely staffed by qualified and experienced virtual F&I managers to meet customer demand. In order to make this fly, finance departmentswill have to evolve. They will have to learn how to meet the customer on their terms. This kind of changewill make all the difference in the newworld of automo- tive sales. Additionally, there are companies that offer dealerships the oppor- tunity to turn their informa- tional websites into transac- tional platforms that allow customers to negotiate deals, including financial terms and products, right from the comfort of their homes. As you might expect, many veterans of the industry claim this is “unacceptable.” They stick to their guns andproclaimthat customers don’t have a right to the information. According to some, buyers don’t have the right to dictate howdealerships do business. These vets dig in their heels and fully expect a new generation of buyers to hang around dealer- ships, waiting for paperwork to be completed, just as their parents did before them. The simple fact remains that time and evo- lution change everything. Customers today want the heavy lifting done for them long before they even set foot in the dealership. Credit-challenged customers don’t want to be bounced from one car to another in a haphazard attempt to find the car they’ll qualify for. Providing the customer with the option of shopping online and qualifying in advance cuts out the fat and creates a faster buying process that eliminates the F&I bottleneck. It also greatly increases the probability that customers will actually enjoy the experi- ence, bringing their business back time and time again. Resistance is Futile One thing is for certain: the days of dealer- dictated buying processes are coming to a rapid end. Even Lexus recently announced a no-haggle retail sales program that’s likely to cause many more to hop on the bandwagon. In short, the dominos are falling. ThingsWILLchange,withorwithout the vet- erans on board to reap the financial benefits. Today’s customers want to shop for their ve- hicles online. They want dealerships tomake financing terms and product information readily available. They want a seamless pre- approval process that’s worked out the kinks long before they even arrive at the dealership. And those dealers who are gutsy enough to take the plunge and adapt to a new era of car selling will earn the lion’s share of profits. Rebecca Chernek is the founder and president of Chernek Consulting, LLC and hasmore than 30 years of experience in the auto retail industry, For more information on Rebecca, please visit www.chernekconsultingvirtualpro.com .