In The Wizard of Oz, Dorothy and her trio of pals sought the all-knowing and all-powerful Wizard. Dorothy wanted to go home, the Tin Man a heart, the Cowardly Lion bravery and the Scarecrow a brain. After an adventure, they arrive to meet the wizard and find that the Wizard is a fake and is just a man. Their disappointment is something felt by many auto dealers who realize that many of their new digital vendors, while not “a man behind a curtain,” are peddling smoke and mirrors. Dealers have been taken advantage of for far too long.
A common scenario that plays out in dealership nationwide is the “multi-vendor” deal. What is the multi-vendor deal? It is a car deal that several vendors take credit for and that dealer only get to sell once. Dealers are provided with reporting from each vendor that shows a positive ROI and the deals that each is taking credit for bringing to the dealership. The problem with these reports is that each is created independently from the others and, often, the same car buyers are present on multiple reports. It kind of feels like getting squished by a falling house.
Many dealers are presented with a confusing maze of reports from multiple vendors based on different criteria, leaving the dealer unable to take action to improve the store. This doesn’t have to be the case. Dealers need to demand a “yellow brick road” of accurate reporting based on the criteria they choose. Vendors will always choose reporting methods that shine a good light on the results they have produced for the dealership. Don’t leave it up to them. You are the customer and you can’t run your business with faulty data and reporting.
How do we move forward and correct this issue? How do we get accurate information so that we can spend more on the things that are working and less on those that are not? It really can be quite simple. All deals need to be assigned to a source — a single source. If a car buyer got a piece of direct mail three weeks ago, a set of emails over the last month and, finally, interacted by text message to a Facebook Lead Generation ad, who gets the credit? Well, the mail and email did not motivate the customer to take action. Although the customer will show up on the list of those who were mailed and emailed, it is not likely that the customer even engaged with either message. The final marketing piece — the one that inspired the customer to take action and engage with the dealership — is the one that should get credit.
Don’t be a Cowardly Lion with your vendors. It’s time to have a hard conversation with your marketing partners. This will be far easier than dealing with the Wicked Witch’s flying monkeys. Keep in mind: If they truly are your partners, they will want what is best for your dealership. Set up a conference call or online meeting with all of your vendors. Tell them how you intend to measure your marketing effectiveness and ROI. Let them know that the days of multi-vendor deal are over. Tell them that, from now on, only one vendor can get credit for each deal. Show them how you intend to determine this and what information you will need from them in the form of reporting.
Some dealerships have been successful with split deals amongst vendors. Just like on the showroom floor, if a deal is split, so is the credit. The dealer only gets one deal and one gross. Why should a dealer be expected to pay for this deal more than once?
Finding your own yellow brick road to accountability is a four-step process:
• Make the decision that you want accurate reporting and that you will no longer pay for the same deal multiple times.
• Decide how you will assign credit for deals and if you will be using any type of split-deal system.
• Determine what data you will need from each vendor in the form of reporting.
• Set up the call and lay down the law. Don’t forget you are the customer.
In the end, Dorothy got to go home and her friends realized they already had what they desired. You and your dealership will get what you want as well. You don’t need a wizard; you hold the purse strings. Your vendor partners need to respect your wishes and deliver the reporting you need to grow and improve your business.
For a free sample of a plan, please email me with “NO Multi-vendor Deals” in the subject line. With some planning you, too, can follow the yellow brick road to greater profit.