Shortly after I began writing this post, an article popped up on my
Google Alerts about another dealer group, accused of deceptive marketing
by their state attorney general's office, having to pony up a
six-figure settlement. Not surprising at all, I'm used to seeing these
types of articles on a regular basis. Another day, another enforcement
action against a car dealer.
In
this case, the dealerships were accused of "having advertisements
online and in print publications that misrepresented the actual prices
of automobiles", "dealership employees asking consumers to sign
incomplete documents with the understanding that they would be completed
using the negotiated vehicle price, but later entering a higher price",
and "allegedly charging consumers fees for unwanted or undisclosed
warranties and services". According to the article, the auto group
denied any wrongdoing but agreed to the settlement.
But I digress.
The above story really isn't the point of this post, nor is it my
intention to try to warn you of the legal dangers of non-compliance with
the laws of the land. I, and my peers, write enough about that. Sure,
I'm now a compliance consultant, but my ramblings here are based on the
things I learned during my 20 plus years in automotive retail - and the
realization that I probably had it all wrong.
This post is about
Transparency. It's about the Big Picture. It's about opening your mind
and stopping to think about the absurdity of old school tactics. Not
from a legal or ethical mindset, but from a common-sense business
perspective.
I realize that "Transparency" is the latest, and
perhaps most over-used, buzzword in the car business. But please bear
with me for a few moments while I pose a few questions. Hopefully, it
will stimulate some "outside the box" thinking.
First, what is the upside of hiding information from your customers?
Sure,
you have to do whatever it takes to stay ahead of the competition.
Sure, that's what the legendary automotive sales trainers taught us.
Sure, the chances of getting into a legal bind are pretty slim. Sure,
everybody else is doing it. Sure, if you give customers too much
information they'll just use it to shop you. Sure, there are ways to
"manage" your online reputation, even if you have some unhappy
customers. I get all that.
But - Big Picture Time - is the
"anything it takes to make a deal" mentality really a sensible way to do
business in today's world? Do you really think this will lead to
customer satisfaction and retention? Do you really believe that
customers will continue to put up with this type of behavior forever?
Here's how I look at it: Every time you...
Post a misleading ad, or
Charge a customer more than the advertised price, or
Lie to a customer about a vehicle being in stock, or
Present a foursquare with inaccurate numbers in order to confuse a customer, or
Present "packed" payments, or
Fail to truthfully disclose a vehicle's history, or
You're not completely honest and upfront with your customers
...there are some things you might want to consider:
- You may be breaking the law - but it's only illegal if you get caught, right?
- What you're doing may be an unethical business practice - but customers have no loyalty and you're just trying to make a buck in a fiercely competitive marketplace, right?
- You may be pissing off customers (or potential customers) - but "ya gotta have haters, right"?
- You're gambling with your future - this is an unsustainable way of doing business in the modern world and your continued success is greatly at risk.
Now you may be perfectly comfortable
rolling the dice on number 1 and not care a lick about numbers 2 or 3,
but what's your answer for number 4?
I challenge you to think
about it. Just think about it. Unfortunately, I didn't when I worked in
dealerships - I was a faithful practitioner of the old school ways.
Now,
I realize that you may feel that this post is just more nonsense from
an ex-car-guy-turned-consultant who doesn't get it - and you may be
right. Only time, and customer sentiment, will tell. But you may still
want to ask yourself just how long are customers going to put up with
business as usual?
Let's face it; consumers have access to much
more information, and choices, than they ever did. You can hate the
internet and all its information. You can hate the idea of
"transparency". You can hate all the regulations that dealers have to
contend with. You can hate the consumer advocates. You can hate the
media and all of its anti-dealer sensationalism. But guess what? None of
it is going away. The "But We've Always Done It This Way" mentality
just doesn't hold water anymore.
Now, I'm not a believer that the
internet is going to somehow take over car buying. I totally agree that
dealerships are, and will continue to be, the primary way that customers
will purchase vehicles for a long time to come. But remember this;
while customers may always choose to do business with dealerships, they
don't have to choose to do business with your dealership.
One
final question: Are you a true professional who is ready, willing and
able to succeed in the new world or are you hoping that things will
never change?
In my book, transparency is not a dirty word, but complacency is.