I heard Ken Schmidt of Harley-Davidson recently talking about how to do business. He of course has a great story to tell of a company just about out of business that made a come-back to heights they'd never been before or even dreamed of. I pulled 4 big ideas from his comments:
1. The Harley corporation realized that if they tried "to build the brand through corporate, we can't win. It had to happen at the dealer level." That's exciting because the correlation is obvious between Harley and GM. What happens at the customer level, in the look-me-in-the-eye level is what builds a brand.
2. Trying to sell motorcycles is a fool's errand because it isn't sensible or logical to spend $24K on a bike (vs. $8K for an import)? It isn't necessary. You've seen their billboards by the side of the highway that show a guy on his bike with the caption, "He's having fun. What are you doing?" The reason you buy a bike isn't logical, you ride it is because it's fun. They've tapped into people's emotions and continue to do that in every action they take because that's what builds loyalty and that's profitable. How much of the time are the things that we do and say logical vs. emotional? Not only Harley, but every successful business out there has figured out that emotion buys.
3. EVERY Harley is sold to someone who was talked into it by a friend, a Harley disciple. The best customer retention tool is DISCIPLES. They validate your business. Harley dealers make this easy too by creating a noticeably different environment from the time you enter the lot, to how things are arranged, to how people act and talk inside, to the constant events and activities they sponsor that create a community. Anyone can go to a Harley dealership and they will feel comfortable. We can't say that for a car dealership... people are afraid to come here, they are defensive, they are uncomfortable, they are not relaxed.
4. Take specific, real actions that make the magic happen. Don't use traditional greetings… "can I help you?", "finding everything you're looking for?", these are wasted lip service. They are dull, lifeless, predictable language of business. You've got 5 seconds to excite me, don't become everybody else, don't commoditize your business. Terms like "quality", "made in USA", "warranty" "customer satisfaction" appeal to the sense of logic. Quality is a given, it is the price of admission. People are not logical, they are not rational. They are emotional. Reach into their gut, their heart and surprise them by being noticeably different. They will feel better about themselves and then they will like you and that means $$$$$. Passion and enthusiasm are attractive – people are more attracted to this. Say no to bland.
I can hear the negative comments: "GM isn't Harley." "We don't sell motorcycles." "We can't do that." Yawn. My reply to you is BE THE ANECDOTE TO THE FEAR AND NEGATIVITY CULTURE. Don't complain about things you can't control. Dig in and decide you CAN try something different, you CAN take actions that surprise and delight your market. Why not take a field trip to a Harley dealership and see what ideas you can extract that would work for you?
Thursday, October 23, 2008
Monday, October 13, 2008
Bon Apetit
I love to collect examples of icons, of people or businesses or teams that inspire excellence. Here is a story from a place I hadn't expected: restaurant chef. The person of note is Chef Douglas Keane of Cyrus near San Francisco.
This year he received a coveted spot in the Michelin Guide with TWO stars! This isn't his first award, oh no, he's no sluch; he was Esquire's Chef of the Year in 2005. Anyway, after receiving the phone call from Paris this year announcing his award he decided to reduce the number of tables in his dining room. This would ensure that with fewer patrons he could serve consistently perfect meals.
Read reviews of the eatery and you find terms like passionate, wowed, amazing, attention to detail, memorable experience, consistent, warm and friendly. So it matters not whether you liten to the "experts" at Michelin, or the masses of patrons who gladly drive 60 miles north of San Francisco for the experience, Cyrus' reputation is pristine.
Mr. Keane speaks about his desire to maintain this honor, to be worthy of the reputation that this award would suddenly bestow, even in addition to the local reputation which he had already worked to earn. His attitude after the award is uncommon and excellent as it was before. He is not satisfied with what is noteworthy today, rather he retooled his current situation to ensure that he continues to be excellent.
This year he received a coveted spot in the Michelin Guide with TWO stars! This isn't his first award, oh no, he's no sluch; he was Esquire's Chef of the Year in 2005. Anyway, after receiving the phone call from Paris this year announcing his award he decided to reduce the number of tables in his dining room. This would ensure that with fewer patrons he could serve consistently perfect meals.
Read reviews of the eatery and you find terms like passionate, wowed, amazing, attention to detail, memorable experience, consistent, warm and friendly. So it matters not whether you liten to the "experts" at Michelin, or the masses of patrons who gladly drive 60 miles north of San Francisco for the experience, Cyrus' reputation is pristine.
Mr. Keane speaks about his desire to maintain this honor, to be worthy of the reputation that this award would suddenly bestow, even in addition to the local reputation which he had already worked to earn. His attitude after the award is uncommon and excellent as it was before. He is not satisfied with what is noteworthy today, rather he retooled his current situation to ensure that he continues to be excellent.
Wednesday, October 8, 2008
Workstream #2 - Digital Selling
Our second workstream for 2009 is Digital Selling. Internet business is critical. The clichés of the "invisible customer" and "shopping price" are not true. Internet shoppers are not invisible! There is no such thing as a virtual customer. We have to make EVERYbody who encounters our business delighted. What led them to us? What stories will they tell?
For 2008, GM's primary goal regarding internet leads was response time. At the beginning of the year, nationally we were answering leads within 24 hours and we have reduced that now to 12 hours. Our next goal is 95/5 which means we want 95% of our leads answered within 5 hours. Because we have made such progress on response time and our trend is still reducing, our priority in 2009 will be on the Quality of our Response. The measurement for this is to improve our national closing ratio from 12.7% to 13.7%.
Our task in 2009 is to track and increase our closing rate on our leads. What we know is that we have to be engaging, we have to answer what was asked, and we have to tell each shopper why they should buy from us. Our shoppers use the internet to shop and gather information; what they need specifically from us is not more information, but instead a counselor to help them make the buy decision.
In line with this goal is the training requirement next year for each SFE dealership to have a certified internet manager. You already need this certification to get OneSource leads, but this is just another alignment area for 2009 that it is specified.
I'll work with you on using your tools to track effectiveness and make improvements in your dealership's processes and profitability.
For 2008, GM's primary goal regarding internet leads was response time. At the beginning of the year, nationally we were answering leads within 24 hours and we have reduced that now to 12 hours. Our next goal is 95/5 which means we want 95% of our leads answered within 5 hours. Because we have made such progress on response time and our trend is still reducing, our priority in 2009 will be on the Quality of our Response. The measurement for this is to improve our national closing ratio from 12.7% to 13.7%.
Our task in 2009 is to track and increase our closing rate on our leads. What we know is that we have to be engaging, we have to answer what was asked, and we have to tell each shopper why they should buy from us. Our shoppers use the internet to shop and gather information; what they need specifically from us is not more information, but instead a counselor to help them make the buy decision.
In line with this goal is the training requirement next year for each SFE dealership to have a certified internet manager. You already need this certification to get OneSource leads, but this is just another alignment area for 2009 that it is specified.
I'll work with you on using your tools to track effectiveness and make improvements in your dealership's processes and profitability.
Friday, October 3, 2008
Workstream #1 - Customer Retention
2009 goals will be supported by two priority workstreams. They are both vital, I'm just saying number one because I am separating them into two blogs and have to start somewhere. So, anyway, here we go with Customer Retention.
The point is clear and unequivocal; keeping customers is good. The facts staring at GM are that 50% of their dealers are SFE dealers and these account for over 80% of the business. For their success, yours is required. SFE dealers are setting goals and achieving them, so that's where the focus is. GM knows if SFE is working on it, results will follow.
Our charge for customer retention is to make the most of our processes and resources to not just capture a customer, but to retain that customer. In regard to vehicle ownership, 80% of a customer's vehicle experience with you is in Service. Owners who service with you, repurchase from you and they also spend more with you everytime they spend. So it makes sense to work there.
Understanding what customers think about servicing/maintaining their vehicle will help us put our energy into making sure they choose us. A surprise to me is customer attitudes that we've captured about maintaining their vehicles. Here are the top 4:
Right out of the gate GM is bringing a resource to SFE dealers; a Preferred Owner Loyalty Program that is web-based and turnkey from the vendor that will encourage loyalty to you - to their dealer. You'll soon receive your invitation to enroll and it's FREE to you for 12 months as an SFE dealer. Here's how it works:
You will provide each of your customer households with coded key tags that they will use to earn points/dollars toward future purchases. Every time your customer spends money at your dealership, they earn points/dollars to spend the next time they come in. You fund the accounts at the level you choose (usually 5%), preload the card with a preset amount, you can even load special deals like buy 3 tires get the fourth free. It is all tracked by the system for you so you know what's working, where each customer is in their spending, and segments them for your marketing programs. The cards are used by an entire household of vehicles only at your dealership (you can choose to include all your BAC if you have multiple points too).
I'll work with you on managing dealership-wide processes to drive the effectiveness of this tool as well as the retention mind-set with all dealership staff.
The point is clear and unequivocal; keeping customers is good. The facts staring at GM are that 50% of their dealers are SFE dealers and these account for over 80% of the business. For their success, yours is required. SFE dealers are setting goals and achieving them, so that's where the focus is. GM knows if SFE is working on it, results will follow.
Our charge for customer retention is to make the most of our processes and resources to not just capture a customer, but to retain that customer. In regard to vehicle ownership, 80% of a customer's vehicle experience with you is in Service. Owners who service with you, repurchase from you and they also spend more with you everytime they spend. So it makes sense to work there.
Understanding what customers think about servicing/maintaining their vehicle will help us put our energy into making sure they choose us. A surprise to me is customer attitudes that we've captured about maintaining their vehicles. Here are the top 4:
- I'd rather pay someone to do my oil change than to do it myself
- An honest repair service is hard to find
- I just want them to fix my vehicle so I can get on with my life
- I don't have time to take my vehicle all over town, I want a one-stop shop
Right out of the gate GM is bringing a resource to SFE dealers; a Preferred Owner Loyalty Program that is web-based and turnkey from the vendor that will encourage loyalty to you - to their dealer. You'll soon receive your invitation to enroll and it's FREE to you for 12 months as an SFE dealer. Here's how it works:
You will provide each of your customer households with coded key tags that they will use to earn points/dollars toward future purchases. Every time your customer spends money at your dealership, they earn points/dollars to spend the next time they come in. You fund the accounts at the level you choose (usually 5%), preload the card with a preset amount, you can even load special deals like buy 3 tires get the fourth free. It is all tracked by the system for you so you know what's working, where each customer is in their spending, and segments them for your marketing programs. The cards are used by an entire household of vehicles only at your dealership (you can choose to include all your BAC if you have multiple points too).
I'll work with you on managing dealership-wide processes to drive the effectiveness of this tool as well as the retention mind-set with all dealership staff.
Thursday, October 2, 2008
Multifocals
Ugghh! I suppose I am glad that glasses don't have lines on them anymore... total buzz-kill. Still, I know that I now have a set of multifocal glasses. And it's not a fashion statement. I think I look smart enough thank you very much without glasses. But I need just a little help with reading and working on the computer. My optician, bless her little capitalist sales-y heart, convinced me to get multifocals so I wouldn't have to take them off between reading and not reading and driving at night and I can't even remember all the benefits...
I spent the first week being sea-sick and nauseated. This week I am finally used to moving my eyes and not my head, or if I'm moving my head to close my eyes or blink for a really long time which keeps me from wanting to hurl. Now I am nursing sore spots on the side of the bridge of my nose. I KNEW I should've picked the ones with the separate nose pieces and not the formed plastic!
Anyway, what is the point of this? Oh I don't know, I think I started feeling triumphant about learning how to wear them and being glad that she talked me into them...
Here's the thing, I really felt emotionally warm and smart and confident when I made the purchase. Then I felt bad (literally). Then I felt good. Now I'm feeling hesitant, but hopeful. So if she'd made a follow-up call to me last week vs. this, she would've heard different stories. And I hope that when you follow up, you do it more than once. I recall a phone call and a letter hitting me for 6 days solid after I bought a new vehicle, but then all went silent. Hmmmm, I certainly know more how I feel about my purchase and have talked to many more people who could possibly be a referral now than when they asked for feedback when the purchase was fresh. If you want real feedback, and a larger list of referrals, call the customer a month or two out too.
I spent the first week being sea-sick and nauseated. This week I am finally used to moving my eyes and not my head, or if I'm moving my head to close my eyes or blink for a really long time which keeps me from wanting to hurl. Now I am nursing sore spots on the side of the bridge of my nose. I KNEW I should've picked the ones with the separate nose pieces and not the formed plastic!
Anyway, what is the point of this? Oh I don't know, I think I started feeling triumphant about learning how to wear them and being glad that she talked me into them...
Here's the thing, I really felt emotionally warm and smart and confident when I made the purchase. Then I felt bad (literally). Then I felt good. Now I'm feeling hesitant, but hopeful. So if she'd made a follow-up call to me last week vs. this, she would've heard different stories. And I hope that when you follow up, you do it more than once. I recall a phone call and a letter hitting me for 6 days solid after I bought a new vehicle, but then all went silent. Hmmmm, I certainly know more how I feel about my purchase and have talked to many more people who could possibly be a referral now than when they asked for feedback when the purchase was fresh. If you want real feedback, and a larger list of referrals, call the customer a month or two out too.
2 Workstreams
I am not sure how to spell Workstream since I am sure it is not in the dictionary, and my spell check is giving me the red dot underline... maybe it should be two words. Anyway, I digress.
The point of this is to tell you that GM and SFE, now in total alignment, have 2 Workstreams for 2009: Digital Selling and Customer Retention.
It's kinda nice to have the focus and it's very nice to be aligned with GM. So, stay tuned for some detail and prognostication (hey, that's the first time I've used that word this year...) on each of them.
The point of this is to tell you that GM and SFE, now in total alignment, have 2 Workstreams for 2009: Digital Selling and Customer Retention.
It's kinda nice to have the focus and it's very nice to be aligned with GM. So, stay tuned for some detail and prognostication (hey, that's the first time I've used that word this year...) on each of them.
Wednesday, October 1, 2008
SFE & GM
Mark LaNeve spoke to our group last Friday and shared his thoughts about SFE's relationship to GM, where the company is headed, upcoming challenges, and his perspective on how to approach it all.
SFE is the backbone of GM's relationship with dealers. What we've seen since it's inception in 1994 is improvement, institutionalized improvement. Cadillac was in real trouble from the product side and CSI scores 10 points below Buick, yet they made up the CSI deficit in one year and never looked back.
"Refuse to lose" is the mantra from Mark illustrated by the game-winning Super Bowl catch by David Tyree. We are entering a new era where success is for the one who executes best in regard to fuel and the environment and where we realize that competition is forever. He remembered his dad's career and how his persistence and diligence are an inspiration even now, to "pack your lunch, go to work every day, and figure out a way to win."
So SFE is key to GM's strategy to survive and thrive by succeeding at the dealership level. Across the dealer body, SFE dealers have better CSI, bigger profits, and better sales effectiveness so they are the key to starting a great second century for GM.
SFE is the backbone of GM's relationship with dealers. What we've seen since it's inception in 1994 is improvement, institutionalized improvement. Cadillac was in real trouble from the product side and CSI scores 10 points below Buick, yet they made up the CSI deficit in one year and never looked back.
"Refuse to lose" is the mantra from Mark illustrated by the game-winning Super Bowl catch by David Tyree. We are entering a new era where success is for the one who executes best in regard to fuel and the environment and where we realize that competition is forever. He remembered his dad's career and how his persistence and diligence are an inspiration even now, to "pack your lunch, go to work every day, and figure out a way to win."
So SFE is key to GM's strategy to survive and thrive by succeeding at the dealership level. Across the dealer body, SFE dealers have better CSI, bigger profits, and better sales effectiveness so they are the key to starting a great second century for GM.
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