Auto Dealer Monthly Magazine is the daily operations publication serving the retail automotive industry. This automotive publication serves dealer principals, officers and general managers with the latest best practices.
Issue link: http://autodealermonthly.epubxp.com/i/79640
result, target marketing, allowed suppliers to appeal to specific segments of consumers. In the 1980s, technology-driven relationship marketing began making strides toward today's CRM products through elec- tronic database management, though it was little more than a digital index of data used to profile current customers. This was mostly a one-way interac- tion, however, allowing the sales department quick access to vague consumer informa- tion. Keith McKinzie, dealer principal at Sonju Superstore on the western shores of Lake Superior in Two Harbors, Minn., said in those days, CRM systems offered little more than a log of current customers and a reminder of when to send out cards on birthdays, anniversaries and Christmas. A decade later, CRM was offi- cially born as an early version of the relationship-building tool it is today. Businesses not only acquired static information on prospects, but added tracking of consumer spending and other habits as a means to nurture trusting business-to- consumer interactions. These were the days when reward programs—frequent flyer miles, credit card points, etc.— emerged, recognizing con- sumer loyalty. Retailers could, for the first time, interact with consumers through CRM e-mail functions. Finally, at the dawn of the new millennium, as the Internet became a household fixture, CRM emerged as an even more powerful marketing tool, utilizing the Web and other ad- vancing electronic technology to manage not only current, but also prospective consumer data. It was around this time that industry-specific software for auto dealerships emerged. "Things started to take off with CRM around [the] turn of the century," said Christian Thorn- ton, senior executive vice presi- dent of business development at AULtec. "It's amazing to see how far we've come." DDS's Braunbeck said the automotive industry was a different world when he en- tered the realm in 1999. "A lot of dealers didn't even have websites". In 1997, reported the U.S. Small Business Administration in January 2002, only 47.1 percent of dealers had websites. That number grew to 83 percent in 2000. Today, 99 percent of auto retailers have an online showroom, according to Paul C. Taylor, Ph.D., chief economist with the National Automobile Dealer Association (NADA). Thornton said Facebook, started in 2004, helped launch the Internet from Web 1.0— which allowed for endless amounts of static content but little to no interaction with users—to Web 2.0, the social, interactive Internet we know today. This second generation of the Internet is what helped open previously-shut cyber-doors to dealerships. Dealers came to see, Thornton suggested, that not fully utilizing the Internet could only hurt their business. CRMs Grow Up Since the early 2000s, iMagicLab's Harsha said, vendors have spent their energy "chasing the Holy Grail of all-in-one CRM technology." But after years of trial-and- error, CRMs are beginning to mature, offering cutting-edge technology on a more streamlined, user-friendly platform than ever before and integrating functionality for all departments of auto dealer- ships. "Over the last two years, we have seen CRMs come into their own, helping dealerships sell cars," he said. VinSolutions of Overland Park, Kan., is the preferred CRM solution for McKinzie and Sonju Superstore. "To me, it's an amazing tool," said McKinzie, who has used VinSolutions at the 88-year-old dealership for several years. "CRM is all about customer re- tention management. I believe VinSolutions does that best. I was able to cancel six or seven different vendors to go with them. They combined all those functions in one." Today, dealers are turning to CRM systems for controlling customer data and associated contact reminders, building and maintenance of their Internet site, detailed analysis of web- site traffic, scouring social media like Facebook for conver- sations about the dealership, and mobility through CRM apps. Dealers also welcome any other tools that help cultivate interaction between the business and consumer, Sonju's dealer principal said. One such tool, VinLens, combines live traffic reports from a dealer's website with a CRM. This tool has shown McKinzie that Sonju's website is averaging almost 30 views an hour, and if one of those visi- tors is already in the dealer's CRM database, he is able to see who's paying an e-visit to his dealership. This provides an opportunity for follow-ups for the all-important retention of customers. Shane Born, chief operating officer of ProMax Unlimited in Davenport, Iowa, said his com- pany's CRM now gives dealers more tools than ever to disseminate information to the consumer. That may include information about a particular vehicle, such as financing options, videos, pictures and even a customized e-brochure that allows managers to send a potential customer a concise, attractive presentation of requested information. "It can pretty much answer any question a customer has on a car," said Born. But despite revolutionary en- hancements to the capabilities of CRMs, vendors and dealers agree that a CRM is still only as good as the people operating the system. Customized Ride If you ask some dealers, inte- gration and customization are among the top improvements to CRM systems of late. Like McKinzie, Tamara Darvish, vice president of DARCARS Auto- motive Group with more than 20 stores located around the nation's capital, said her CRM of choice allowed the group to drop multiple vendors provid- ing numerous functions in favor of one system that covers all their needs. "It's all integrated," she said of ELEAD One CRM from her Silver Spring, Md., office. "One company, one price, one training. It brings all worlds together in one." ELEAD One allows her to design her own management system and specialized programs for specific tasks or individual lots in the group. "It's extremely customizable," said Darvish. "One size doesn't nec- essarily fit all [when it comes to CRMs]." She also enjoys the automation of tasks ELEAD CRM can perform. "In the past, a CRM was just a reminder of tasks," she said. "Now, if the tasks are not performed, it goes ahead and does it." The ultimate in customization is building your own CRM. Today, technology has become so affordable and accessible that some auto dealers are taking it upon themselves to design their own system to better meet their unique busi- ness-to-customer relationship needs. Clifford VanMeter said Express Auto's specific niche in the industry as a buy-here-pay- here group made it difficult to find the right program for their narrow focus of work. So, they simply decided to build their own CRM. "I've hired a programmer and the (general manager) and I are working closely with him to develop a solution that is specific to our workflow," the marketing manager said from the Kalamazoo, Mich. store. "The problem with even the best off-the-shelf solutions is that they are designed to 25