Automotive News - March 12, 2018 - MAXDigital - S3

Dealing with Discontent:
Customers aren't buying the way
many dealerships are selling
Very few people like the way cars are sold
today.
Customers say they'd rather visit the
dentist than go through the process of
buying a car. Nearly three-quarters of all
dealership sales consultants leave their
jobs in any given year. And dealership
managers moan about low profit margins.
"Dealerships have not been able to
make that shift from the traditional way
they have sold cars to the way customers
want to buy cars," says Patrick McMullen,
senior vice president of strategy and
innovation at MAXDigital.

How do customers want to buy cars?
With more transparency, more
confidence in the deal-and faster. They
want to buy cars like they buy other
goods in the internet era: researching on
their own time and their own devices,
gathering information, reading reviews,
and comparing prices and deals.
Dealerships have responded in part by
changing the way they price cars.
But McMullen says many dealerships
haven't really changed their approach.
Too often, when a shopper arrives, he
or she faces a confusing, Byzantine
purchasing process, with a back-andforth on price-a price that sometimes
doesn't even include the figure that has
been posted online.

McMullen points to five persistent
problems with the traditional way
that cars are being sold:
1. Customers lack trust with most
dealership salespeople. Research from
the Gallup organization finds that only
10% of Americans say they trust car
salespeople. In contrast, 11% say they
trust members of Congress.
2. That trust is eroded further when
customers possess more information
about the cars they're considering
than the salespeople do. The 2018
Cox Automotive Car Buyer Journey
study found that shoppers on average
spend more than 14 hours online
researching before purchasing, while
61% of dealers surveyed last year by
MAXDigital said car buyers know more
than the salespeople.
3. Many dealerships use a multistep
sales process that frustrates shoppers.
McMullen points to 12- or 15-step
processes posted on dealership walls
that extend the purchasing process at
a time when survey after survey finds
that consumers want to be in and out
of a dealership in about an hour.

A tough
sell: It's
hard to keep
good help
Employee
turnover
adds to the
problematic
purchasing
process,
dealers say in
a survey.

74%

of dealers say
turnover is an
issue at their
dealerships.

42%

suffer more
than 30%
turnover among
first-year
employees.

32%

hire salespeople
without
automotive
experience most
of the time.

90%

pay salespeople
using either a
100% commission
plan or a
combination of
low fixed salary
with a high
commission.
Source: 2018
MAXDigital
Dealer Study



Table of Contents for the Digital Edition of Automotive News - March 12, 2018 - MAXDigital

Automotive News - March 12, 2018 - MAXDigital - SIntro
Automotive News - March 12, 2018 - MAXDigital - S1
Automotive News - March 12, 2018 - MAXDigital - S2
Automotive News - March 12, 2018 - MAXDigital - S3
Automotive News - March 12, 2018 - MAXDigital - S4
Automotive News - March 12, 2018 - MAXDigital - S5
Automotive News - March 12, 2018 - MAXDigital - S6
Automotive News - March 12, 2018 - MAXDigital - S7
Automotive News - March 12, 2018 - MAXDigital - S8
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