Sales Integration

Compensating sales primarily through commission has always been controversial. To those who love it, this is the free-market system at work. Many who sell on commission compare it to owning their own business. Indeed many managers try to spur their commissioned teams with the notion that they are in control of their own destiny. That is what lures so many people into selling on commission, but it also may be what leads to its eventual death in automotive retail.

I've had many sales jobs that were purely commission based and also owned several businesses, the difference is essential to understanding the problem. When you own a business you control your equity, not just your income. The value of the business is partially a function of the assets minus liabilities and partially a function of the brand value. Business owners care about the value of their brand, because they own it. Commissioned sales people are free to take risks that may trash the brand, because they can move on virtually without recourse. Just as individuals on Wall Street can no longer be permitted to  risk entire companies for their own short-term gains, commissioned sales people cannot be left free to risk the reputation of the entire store in order to gain an extra $1,500 in gross profit.

The blue sky portion of a dealership's value has fantastic growth potential. The number of franchised dealers is at a historic low; the driving population is at a historic high, and the nation has an incredible amount of pent-up demand for automobiles. Any boost in the economy will bring a fantastic boost to auto sales.

Many dealers are using social media to grow the value of their store name or group name to levels never before seen. The flip side is that social media can kill in a matter of hours the store value that took generations to build. Catastrophic risk is in this area is something dealers cannot insure against and must diligently work to avoid.

Telling a commissioned sales team to "just get them in" or "just get 'em closed" can be a recipe for disaster. Commissioned sales people will do exactly what they are incentivized to do, close deals for short-term gain by any means necessary. Managing commissioned sales people is extremely hard, precisely because they feel as though they are running their own business their own way. As long as the sales come in, everyone should just shut up and cash the checks. But that is the kind of thinking that jeopardizes all that beautiful brand value. If you can keep the store or group brand strong, it will continue to generate additional sales each month for years to come. But your commissioned sales team isn't being paid on brand value, and they darn well know it.

Recent industry shifts combined with the growing importance of social media place great emphasis on retailers' reputations. Those with extremely strong management teams may be able to keep the incentivized actions of sales people within the parameters of the store reputation. Those with weak management teams must invest in training, bring on a new team, or consider a more controllable compensation model. I don't know whether compensating sales primarily by commission will ever die across the entire industry. I do know that it needs to be seriously reconsidered at thousands of stores with practices that are all but inviting a social media catastrophe. 

Monday, Lindsay Chappell broke the story in Automotive News that AutoNation will provide information on competitor's vehicles and price within the store. Using iPads loaded with inventory information from both AutoNation stores and competing stores, AutoNation will be providing the same level of market transparency within the store that shoppers already have on their computers and smart phones. Here is how I see it for dealers: The complete answer to mobile is not just having a mobile capable website but having an alternative to mobile functionality built into the in-store shopping process.

The move is consistent with AutoNation's philosophy about information transparency. The effort is led by Garry Marcotte, Senior Vice President of Marketing. Gary was a pioneer in automotive internet and is known to be something of a visionary. However, I think he would acknowledge this move is not very far out in front of the industry and actually behind the consumer.

Whether you sell cars, motorcycles, ATVs, boats, trailers, RVs, or planes, shoppers already have information about your competitor's products in their purse or pocket via smart phones. The question is whether you want shoppers running away from the salesperson to secretly check the information on their phone or work with your salesperson. By discovering the competitive options with a sales rep can point out differences in the offerings. Differences might include:
1. Difference in use: miles, hours, visible wear
2. Difference in certification or warranty
3. Different trim package
4. Different options

Of course, the sales person is going to highlight the importance of features his unit has that the competitors does not, and minimize the importance of features not found on his unit. However, this sort of service will ultimately enhance the retailer's status as a trusted advisor. I suspect some shoppers will begin abandoning their online shopping earlier, knowing they can get the same information from within the store with no dirty looks or having to be secretive about looking for it on their smart phone. It's really this simple: Shoppers in your store can have access to your competitors through the private use of their small screen or in conjunction with your salesperson on a larger screen. One or the other is going to happen, and latter is better for both parties.

Sales integration does not stop with the website and sales team. If you represent the motorcycles, cars, RVs, trailers, or boats of a manufacturer, then it is important to use the same names, capitalization, and hyphenations as the manufacturer. I recently observed a motorcycle retailer advertising a "Honda GoldWing." Honda does not join the two words "Gold" and "Wing." Frankly, I don't much care, but those who are strong advocates of the bike may begin to question how well you know the product.

Since store contact is a function of both product preference and store preference, it is important to describe the product properly in order to establish or maintain credibility that you are the right store. For complex products and services, shoppers are relieved to find people who know the product inside and out and suspicious of those who appear they may not.

Referencing other sources can help build credibility. Again, describe third party sources and their products in the same way they do. I recently read a book referring to research done by "J.D. Powers," but the proper name is "J.D. Power and Associates." The extra "s" on the end of "Power" is a tip off to some that the relationship with the firm and understanding of its methodologies may not be a solid as indicated.

Be careful with your facts and figures, but also tend to the tiny details. It takes a great deal to build credibility and very little to put it in question. Be 100% correct in order to keep your credibility above suspicion.

Advertising is one-way communication, from the advertiser to the audience. Sales involves listening and responding. Marketers must recognize every interactive touchpoint – human or technological – is a sales activity.

When a shopper clicks on your inventory for a better description, the result needs to be a sales response. That is to say, it must demonstrate the product. To the degree possible, it should demonstrate the product's ability to meet the shopper's needs. Too many product descriptions read more like a data dump from engineering than a good sales response.

Often, customer reviews contain more useful sales information than the product description. This can be a problem when consumers start raving about the product's ability to do things it was not designed to do safely, or claim the product can't do something when they simply are not using it properly. Good product reviews not only balance out inaccurate customer reviews, they also help prevent them from occurring. Lack of good product descriptions leaves a dangerous vacuum.

Shoppers are often curious about more than just price and features. They may want to understand the product's ease of use, alternative uses, and durability. Some of these demonstrations require more than simple text. Pictures, motion, audio, and interactivity offer far more understanding in far less time than text alone. Better yet, they offer greater engagement with the product.

Customer service responses are sales opportunities. I recently sent an inquiry asking about the difference between two model numbers from the same manufacturer on two different sites. The explanation was that one was this year's model and one was last year's. There was no indication if the two models have different features, or if the newer model has improved components or assembly processes. From a production standpoint, the inquiry was dealt with quickly and cheaply. From a shopping perspective the question was not answered at all.

Look at the content on your website, the content you provide to other websites, and all your human interactions. Do they try to win the business, earn customer loyalty, and generate advocacy? Anything worth making is worth selling. We find time and time again the company winning the business is not necessarily the one with the best product or the lowest price but the one best meeting shoppers' needs and earning their trust.

For more on this subject, my new book, Sales Integration, delivers over 100 examples of meeting shopper's needs at interactive touchpoints.

My new book, Sales Integration, is now available on Amazon.com, http://tinyurl.com/3x8fban. The subtitle, The 4th Wave of Sales, gives an indication of just how revolutionary this change is.

Sales is still people selling to people, but those interactions are often not face to face. Every interactive touchpoint with a consumer, whether human or technological, is a revenue-building opportunity. The book explores interactive touchpoints at the store and across 15 broad categories of websites with a focus on integration across all of them.

Nearly 150 sites, stores, and organizations are referenced, with dozens of examples of what works and what does not. Sadly, some of the best product demonstrations and shopping tools found during my five years of research no longer exist. Site designers frequently measure the value of site content by traffic count rather than sales impact.

The transition to the 4th wave of sales will be painful for some. Many retail sales people and clerks will lose their jobs over the years to come. Many sales trainers will find their message increasingly insufficient for the times. However there is growing need for sales content and shopping tools yet to be built. Learning how to create effective sales content is not difficult. Understanding why to do it requires getting past old bureaucratic barriers. Employees must think about business in a way that enhances quality of life for all stakeholders. In a transparent market, there can be no job security without loyalty and advocacy.

Every day, I scanned through posts or received calls from people I wished could read the book and wakeup to a more profitable way of doing business. Today, I wait no longer.