What Is CRM? Breaking Five Auto Industry Myths

by Jan 16, 2016Newsletter0 comments

CRM in the automotive industry is still largely misunderstood. Perhaps it’s because the term CRM is used loosely to describe any tool that does anything that relates to a customer or prospect or perhaps we simply just need to do a better job conveying what the standard is and how it can be effectively implemented at a dealership. Either way, I thought I’d attempt to set the record straight by debunking five common myths about CRM in our industry.

Myth #1—I have an Internet Lead Manager, that’s my CRM.
While it is true that an ILM does a great job of tracking your inbound Internet leads, it will not follow that customer through their life cycle. In addition, if the only relationships you follow are those generated through the Web, what happens to the customers who walk in or come in for service? CRM should help you track all customers, not just Internet leads. There is no such thing as an “Internet” customer, they are dealership customers using the Internet to communicate and they will surely use other means over time. We need to be able and ready to communicate actively with them, through all mediums.

Myth #2—My DMS is my CRM.
Dealer management technologies were built to manage inventory and transactions, not customer relationships. We expect DMS providers to understand how to support our sales and service people when they can’t effectively support the back office? Using your DMS to manage customer relationships is a like using your dealership’s car wash to clean your suits—enough said.

Myth #3—I have someone mail out service reminders, I don’t need CRM.
Now more than ever dealers need a way to seize each and every revenue opportunity from each and every customer. Without a CRM solution tracking who has been in for service, who has declined service and who needs service, your dealership is letting dollars slip away. Don’t outsource the CRM vision to someone that provides a direct mail campaign for you and think you’re done. You are leaving money on the table and not just this month, but every month. Understand the customer lifecycle, support that lifecycle with technology, and then outsource only those things that must be done, but you cannot do yourself. Do not do it the other way around!

Myth #4—I have someone making calls for me, that’s my CRM.
Using a call center or a BDC is a phenomenal way to drive sales, but it is only half the equation. If you cannot track the appointment through to conversion how will you know if your dollars are being well spent? Your CRM should drive your BDC or call center activity and provide detailed reports that show you exactly what is working, and more importantly, what is not working. Again, identify the best practices and see that they are done either by the dealership or through an outsourced relationship. Then use the results to evolve and get better.

Myth #5—I can’t afford a CRM.
A well executed CRM can pay for itself the very month you install it. In an extremely tough economic environment dealers who have not implemented one CRM solution for all departments are missing the boat. The ability to produce the right buying experience through better marketing, sales and service efforts will drive revenues. One way is highly targeted marketing communications and offers to drive traffic to your showroom and service drive. This will be one of the big differences between those that survive and those that don’t.

So what is CRM? True CRM is managing and nurturing your prospects and customers through their buying experiences with your dealership. CRM should provide you with tools that can be used in every department to direct customer interactions and drive sales. CRM should provide an at-a-glance view into the buying cycle of each customer, how much they have spent in service, parts, and new and used vehicles as well as the timing of those experiences. CRM should also track every customer interaction, marketing, sales, service, CSI—know how, when and what was communicated and what the ROI was on that communication. CRM should then help you hold your people and vendors accountable to results and activities that drive the buying experience. CRM should be supported by technology that enforces and reinforces your leadership. CRM to your dealership is like air to your body. Are you breathing on your own or on life support?

Written by Jonathan Ord

Technosoft and its partners are strengthening relationships between Manufacturers, dealerships and consumers through a portfolio of innovative solutions, including Customer Relationship Management (CRM) integrated with Dealer Management Systems (DMS) — software solutions that provide tools for managing marketing, sales, service, parts and inventory management, business management, integration, and master data management across different systems.

Technosoft DMS information can be found in the Technosoft DMS Overview brochure.

Please contact us for more information or demo.


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