Dealer's use of Web turns Main St. into high-sales highway

New car dealers learn to use the Internet to sell more vehicles.

Auto Tech

Automotive News

HILLSDALE, Mich. -- Chrysler Group dealer Tom Vann embraced the Internet as a sales tool nearly 15 years ago, when the technology was still a novelty.

He's sure glad he did.

Because nearly 70 percent of his car sales today come through the Internet, it doesn't matter that Vann's Team Hillsdale Chrysler-Dodge-Jeep is tucked into this small, predominantly farming hamlet deep in south central Michigan.

"We saw a long time ago that we couldn't just focus on our Main Street business," says Vann, 45, whose father, Bill Vann Sr., was a longtime dealer in nearby Albion, Mich.

The surrounding county has been losing automotive and tool-and-die jobs for the past decade. Unemployment in Hillsdale County, population 46,500, was 17 percent in September, according to the state of Michigan.

But Team Hillsdale has been largely immune to the slide. Vann's average online buyer comes from 120 miles away. His biggest market is the heavily dealered Detroit area, 100 miles away.

Vann's sales territory ranges approximately from the border with Ohio and Indiana to the south, Lansing to the north, Kalamazoo to the west and Ann Arbor-Detroit to the east.

Until the fourth quarter, Team Hillsdale had been selling about 60 new and used vehicles a month. About two-thirds were new and two-thirds were bought online. But sales eroded in the fourth quarter to about 30 a month. Vann says customers have lost some interest in Chrysler vehicles since the company failed to provide dealers enough cars during the cash-for-clunkers program this past summer.

"It was a moment in time that the company couldn't take advantage of," Vann says. Tom Vann has co-owned Team Hillsdale Chrysler since 1986 with his brother Fred. A third brother, Bill Jr., owns a Ford dealership in Albion.

For years, Tom stayed away from the business because he objected to the high-pressure sales techniques that he saw at his dad's stores while working there during college summer vacations.

"One of my first days on the job, I spent an hour helping a guy, walking around with him and answering all his questions," Vann recalls.

"A senior sales guy pulled me aside and chewed me out with a stream of expletives, telling me how that customer would never buy a car that day and he was wasting not only my time but the store's as well.

"I didn't even last the summer. I realized that day that I couldn't play that sales game."

In 1995, Vann returned to Hillsdale. By then he had spent nine years in the restaurant business in the San Diego area, first learning about and then training employees how to please customers at the high-end restaurants he managed.

Vann discovered a new, entrepreneurial company -- Autobytel Inc. -- that could provide solid sales leads to dealers in the hinterlands because of information it got from the Internet car-buying searches of prospective customers.

No squirming

It was a dream come true for Vann. He could take the leads and sell comfortably to customers over the phone without ever watching them hesitate and squirm on a car lot.

From his first monthly batch of 27 Autobytel leads in 1996, Vann sold 21 vehicles. The next month he closed 18 of 28 leads.

Within weeks, Vann sought and secured an Autobytel commitment for most of lower Michigan.

It has been a long run since then. In the past 11 years, Team Hillsdale has sold about 8,000 vehicles over the Internet, with 7,000 of those purchased sight unseen. Vehicles are delivered to customers' homes or offices.

Vann says another wrinkle has been instrumental in creating a pain-free buying experience: Team Hillsdale allows buyers three days to return the vehicles, no questions asked.

Vann says that's possible, without the car being designated as used, because buyers do not need to sign a state form for transferring title until the three-day test drive is complete. Vann throws in a $50 dinner certificate so buyers can experience what it feels like to drive up to their favorite restaurants in the new vehicle.

If the buyer wants the car, as is almost always the case, Team Hillsdale will send a representative out to the buyer to sign the title form. If the answer is negative, the dealer brings the car back on a trailer.

'Minimize the risk'

"We minimize the risk of purchasing the car -- that fear in the customer that they'll regret the deal the next day or they'll drive off the lot without the navigation system or accessory they really wanted," Vann says.

Vann keeps tinkering with his Internet operation to try to coax customers back. He recently added a pop-up on the company Web site featuring a perky college girl. She invites viewers to navigate the site and contact the dealer when they're ready to take the next step to buy a new or used vehicle.

Kelley Blue Book in Irvine, Calif., made Vann president of its dealer advisory panel when it was created four years ago, says Michael Romano, Kelley's senior vice president of dealer strategy. Vann has used the Internet to bring consumers the convenience and breadth of information they require when making buying decisions, Romano said.

"He's always trying new tools to attract consumers via the Internet," Romano says.

Vann says he also dabbles in so-called microsites such as jeepgeek.com, which he is developing to espouse the thrills of driving Jeeps off-road. Those sites then can direct viewers to the dealer site.

He remains a believer in third-party lead generators such as Trilogy Enterprises Inc., of Austin, Texas, which are good at rating the chances that an individual will buy a vehicle within a designated period of time.

"With the Internet, consumers are in a position to make buying decisions without undue influence from us dealers," Vann says. "Our message today has to have the tonality of friendship without the assumption of friendship."

(Source: Automotive News)

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