The Appointment Culture Light – PART 2
TRANSCRIPT: Now, you would think, given these two alternatives; be a Walmart of car dealers or be a Ritz-Carlton of car dealers, that every salesperson out there (every commissioned salesperson), and especially, every manager, would choose the latter. Make no mistake; the Walmart of car dealers doesn’t need desk managers and they don’t need F&I managers, either. So, knowing this, you’d think that every one of these managers would be eager to change their culture and embrace everything about creating what we call ‘the perfect appointment’.
Nope, not even close.
About 80% of the dealerships I work with who are openly eager to switch to an appointment culture eventually go nowhere with it. Most say the right things. Nearly all of them agree that this represents the future of their industry and their dealership. But, in the end, it takes work to change ones culture. It really does, and most dealership managers just simply aren’t willing to do that work.
Of course, it’s not because you’re all lazy. It’s true, there are a few lazy managers in automotive, but, most often it’s because when you’ve worked your way up to a senior management role in one of America’s new car dealerships, you usually bring with it one of the three biases we talked about. That makes enacting any kind of a meaningful cultural change nearly impossible. Remember they are the ‘success bias’, the ‘clock bias’ and the ‘satisfaction bias’.
Now, the ‘success bias’ is one of the hardest biases to overcome in any business and this is especially true in a dealership. I recently worked with a dealership whose culture would be best described as ‘old school’. That is, they grind the customer for every last penny so they can squeeze as much gross margin out of the deal regardless of customer satisfaction; all while beating the crap out of their sales team each and every day. Now, to their credit, they are immensely successful at both endeavors, right? Their customers typically pay more than they would at a competing dealership and their employee turnover is astoundingly high, even for a car dealer. Moreover, the managers don’t see either of these as a threat to their present or future business.
This is simply remarkable, especially when you consider that little thing called the internet. Remember that place where consumers, and your former employees, are, and will continue, to shout to anyone and everyone how they were treated when dealing with you. It’s only a matter of time before this dealership’s ‘rat bastardness’ catches up with them.
There is a saying in business that “sales cures all ills”. What this means is that success; in this case, the short term gain of selling at a high margin, minimizes the awareness or focus on any threats or risk to the long term business’ health. In fact, this dealerships own ‘success bias’ is so great, that I suspect they will close their doors (or be forced to sell by their manufacturer) before they ever consider changing their culture. Now, the perversely funny thing to me about this dealership; the one that sells at high grosses, but really grinds their customers to death and treats their employees poorly, is that if they would incorporate the appointment culture, they would find out ,like others have, that this ALLOWS dealerships to sell at higher grosses. At the same time, it improves both customer AND employee satisfaction.
That’s known as a ‘Win, Win, Win’, which is very rare in business today, especially in car dealerships.