The Top 5 CRM Mistakes Dealers Must Avoid
Software is not the automatic culprit—in many cases, dealers are making basic CRM mistakes inside their system
Many times, dealers feel that despite their investment in a customer relationship management (CRM) system, their numbers are not where they want to be and they are not seeing any improvement in operations. And in some instances, their people are not even using the CRM.
Dealers typically attribute these issues to a failure on the part of the CRM system. The software, however, should not be viewed as an automatic culprit—in many cases, users are making basic CRM mistakes inside their system that are causing pain at dealerships.
Here’s a look at the top five ways dealerships miss getting the most out of their CRM.
1. Not knowing the processes
At the foundation of good CRM usage is understanding what processes are in place—or realizing that there’s a lack of processes. Establishing a process and training your staff on a CRM solution helps ensure consistent communication with leads and customers.
A lack of understanding (and belief) in all processes and training is a sign to employees that management is not engaged with the CRM system, and that utilizing it is not a priority. As a domino effect, staff will not complete tasks in the CRM, leading to significant fluctuation in customer satisfaction and, ultimately, lower conversion rates of leads to sales.
This mistake at the foundational level is setting you up to fail.
2. Lack of accountability
This is closely related to the first mistake. Without backing or follow-up from management, CRM usage will not become a priority throughout the dealership.
Most people want to be held accountable. But if there is no accountability or consequences for not following the process, the perception can take hold that it doesn’t matter whether someone uses the CRM or not. This will almost certainly lead to a decline in CRM usage, and poor results.
In today’s shopping environment, having an efficient process in place to reach out to leads and target customers, then get them to the dealership, is more important than ever.
When there’s a lack of management support and accountability, fewer appointments are made and fewer cars are sold, hurting your bottom line—despite the fact that you’ve invested so much time and many resources in a CRM system to manage your customers.
3. Making the process too complex
Let’s say you have management buy-in and you are holding your employees accountable. You have a process in place, but there are too many steps that make it impossible for your employees to effectively follow up on leads.
If the process is too complex and there is an overwhelming amount of overdue tasks in your CRM, there’s no point in having your staff jump through hoops while critical opportunities may be lost.
By simplifying and streamlining the process, you will have better engagement and results across the board.
4. Not entering every opportunity into CRM
You may have a streamlined process in place, but if you just had a phone call with a customer and didn’t enter it into the CRM, it may as well not have happened. If a lead is not entered into the CRM, it’s more than likely not getting followed up on by anyone at the dealership.
Leads that are typically excluded from the CRM are shoppers who are either early in the buying process or not ready to purchase a car immediately.
In truth, these are the most critical customers to enter into your CRM. Proper follow-up with them may well turn into an appointment and, ultimately, a sale.
5. Not going beyond the point of sale
A strong CRM solution is intended to help you manage the entire customer life cycle—from the initial interest in your product to ownership of a vehicle to the next purchase.
You should use your CRM to create lifetime customers. If you aren’t, you’re throwing future dollars out the window because it costs 10 times more to acquire a new customer than to sell to a current one.
Fixing CRM mistakes
If you’re guilty of any of these CRM mistakes, it’s not difficult to get started on the path to improvement.
To start, review your processes, and make sure they are right and realistic. Start getting every prospect into your CRM.
Communicate your expectations to the team, and hold everyone accountable. Finally, make a plan to use your database to market to new segments.
There is no quick fix to any of these issues, but if you start from the top and succeed one step at a time, your team will soon be reaping the rewards of effective CRM system usage.
Mark Vickery has been VinSolutions’ senior director of performance management since 2013, when he transitioned from vAuto, another Cox Automotive brand, where he served as a performance manager. Mark uses his lifelong background in automotive retail and customer retention to help clients realize the full potential of their CRM investment.