Is your Internet Business Prepared for a Recession?

Published May, 2008 by Digital Dealer Magazine

You have heard a lot of rumors circulating about a recession in the United States. Whether it is true or not is a moot point. When I sat down to ponder this question I was hit with the concept that you should always be operating your dealerships as if you were in a recession and make sure every penny is accounted for while trying to squeeze everything you can out of each and every department, including the Internet.

Today I want to focus on your Internet business, which I break down into a couple of sections for ease of analysis.

Web sites and technology
I look at this section of the business as a rock hammer to a master mason. These are the tools you need to shape our business and achieve your desired outcome. What is most important is that you have the right tools in place and you are maximizing the utilization of the tools each and every day. There are great technologies out there that do all sorts of interesting things, but as my fiancé told me when we moved in together, “If you haven’t worn it in a year, throw it out.” I thought that made good sense or maybe she just wanted more closet space; I will never know. But in our business when you are not utilizing a specific technology or tool by 75 percent or more you are not getting the most out of the technology. So maybe it is time to try to live without it or get busy increasing your utilization of the tool. A great dealer friend of mine has always brought up a good point when referencing technology. He comments that 15 years ago we didn’t have any of this stuff, yet now I have all this great technology, but wonder whether it is really helping me sell more cars or just keep pace with the local marketplace.

When was the last time you sat down and looked at your entire marketing spend and dissected it? I mean all of it. I walk into stores so often that they tell me they are spending 25k, yet after I go through the dealership doc I find out they are really spending about 40K because things are not being put into the advertising line of the statement correctly. Sometimes I hear that it got charged to this account because of this reason or that one goes there because of that reason etc. Is it advertising? Charge it to the right account. When you can get a complete 360 degree view of your advertising expenditures you can start to really focus what you are spending and where to help you create a more accurate cost per unit retailed figure.

Also, take the time to know what you are marketing and the messages that you are using. Are they in conjunction? Do they conflict? Your business is dependent on your ability to reach people in the marketplace and entice them to take action. Is your marketing doing that for your dealership?

Customer communication processes
This is one of the most overlooked and important areas of the Internet department. I know you set up your follow-up schedules when you first set up your CRM and you don’t think you need to tinker. As consumer buying habits mature online so should how you approach and manage these relationships. I would set up and print every letter in your CRM monthly and make changes. Also, change follow-up schedule length and timing. You would be amazed at how a few key tweaks can open a flood of activity within your existing lead management tool. You would be shocked that I still walk into stores that are using subject lines in their e-mail marketing and customer correspondence that I guarantee will be triggered by spam filters. Yet all you have to do is look online to see what words are triggering your messages to get spam-boxed and make sure none of your e-mails are using any of these keywords. Get involved; roll up your sleeves and dive in. Your business depends on it.

People capital
This area is still the one most dealers, including myself, struggle with almost daily. Finding the right people to execute the vision is another key piece of this puzzle to recession-proof your dealership. People are assets and must be trained and consistently driven to improve the dealership’s bottom line. Which means involving your team with not the typical, “We don’t have enough units out speech” but a much more hands-on approach to how their specific actions or inactions are affecting the operation. When people are genuinely brought into the picture a new level of teamwork happens. It takes a while but is well worth the effort. Take stock of your team and make sure your vision and message is being transferred throughout the dealership.

Today’s dealership challenges are difficult especially in the ever-changing Internet department, but with a little extra effort and some basic analysis you can watch your Internet sales grow: rain or shine, or recession.

Todd Smith is one of the leading authorities on Internet technology and its utilization in the retail automotive industry. For the past year Smith has been the general manager of a Northeast Chevrolet dealership putting into practice all the techniques he teaches. Lear, LLC, Smith’s consulting company, is focused on leveraging technology to enable other dealerships to sell more vehicles at a higher gross profit while reducing customer acquisition costs.


Geo-tracking: Opportunity Knocks

Published: May 19, 2008, iMedia Connection
by: Craig Walmsley

Location-based targeting is on the verge of exploding — find out what this technology will soon enable you to do.

In 2005, Microsoft launched a Location Finder as part of its Live Maps service. The application examined the networks a person was connected to, cross checked his IP address, and then predicted where the person was on a map. It was far from 100 percent accurate, but when it was right, it was ever-so-slightly terrifying. Coupling a person’s location with 3D aerial map views, it showed the person a picture of the building he was sitting in with a big “X” on top of it — giving him the simultaneous sensation of being the CIA agent locating a target, the target expecting an incoming cruise missile, and the viewer of a sophisticated, futuristic spy-movie.

Microsoft re-assured users that no personal data was captured, and that everything was completely secure. Nonetheless, it required nerves of steel to retain this application after seeing your location determined with such apparent ease, speed and accuracy — perhaps explaining why Microsoft quietly withdrew this beta after a few months of testing.

This is a shame. Location is a very useful piece of information. Such location-based techniques are a staple of online advertising targeting. Search engines use IP address to determine geography to a very detailed level. New Yorkers searching for “PlayStation” or “Jewelry,” for example, may have much more disposable income than people in Albuquerque, and be much more likely to buy.

Display advertising networks like DoubleClick offer similar services, allowing for detailed geographical targeting down to the level of ZIP codes. So, whatever your qualms about location-based targeting, it is already a significant part of the internet experience. Brands can reach just the highest value customers, who, in turn, see ads that they are more likely to be interested in.

The usefulness of location also explains why people are very willing to share the details of where they are with others. Anyone who has worked in a multi-national company will have noticed people customizing their Instant Messenger to note their location. People who work in different offices will often note their office as part of their name, or, if they are on a trip, update their name to indicate that they are somewhere else. It’s not built into most IM applications, but people find it helpful, so they just do it themselves.

As people work remotely more often, such information becomes more and more useful. This is precisely the thought behind “Dopplr” — a Web 2.0 service that enables users to note their location and share it with friends to determine when they will overlap in a location with any one of their contacts. A smart web platform, it enables users to share location data across services, and create clever mashups. So, for example, someone could map all her trips across the world on Google Earth. Or she could enter an individual trip and then use a web service to create an estimate of the trip’s carbon foot-print.

All of this, however, is only just scratching the surface of location’s utility. Mobile phones have also long had basic location-based services, derived from the cellular networks that they use to transmit signals. These services have generally been limited in usefulness due to the inaccuracy of location, and the lack of an eco-system to support location-based services. Gradually, however, the conditions are changing and three key developments are likely to propel location-based services into the mainstream.

First, the iPhone is revolutionizing use of the mobile web. In February, for example, Google reported that it had seen 50 times more web searches on Apple’s iPhone than from any other mobile handset. People are getting much more used to using the internet from their phones. Google Maps is now available for many different mobile phones, providing a simple way to find information based around a certain location. Google’s mobile search is rolling out city by city, adding local businesses into a mobile search query, so that the results are more relevant.

Second, real-time location determination will shortly become a standard feature of all cell phones. The January iPhone software update added basic location-determination using cell phone towers and WiFi networks to place users roughly on a map. The next generation iPhone is widely expected to include GPS, providing pin-point determination of a person’s location. Indeed, GPS will become a standard feature on mobile phone handsets in the next 12 to 24 months. This plethora of location-based devices will create the opportunity to build all sorts of new location-based services on a powerful platform that people carry in their pockets.

Third, the evolution of Web 2.0 services means that there is a great deal more geographical data available for mobile phones to tap into. Location data can be integrated into available services — for example a portable version of — where Craigslist real estate listings are overlaid onto a Google Map — very helpful for anyone looking for a house in a certain area. Equally, an accurate location, coupled with a restaurant booking service like, would enable someone to access all the restaurants nearby that have bookings available right that minute. Feed that information into Google Maps, and you could have a set of directions to the restaurant, with a picture of what it looks like before you get there — very helpful for the user, and perfect for driving footfall. Indeed, American Express is now launching a Mobile Concierge service, which uses a phone’s location to alert customers to Amex offers, discounts and exclusives in their immediate vicinity.

It is just such opportunity that is driving Yahoo’s new Fire Eagle service — a smart piece of cross-platform web-plumbing that enables users to securely share their location with different applications and services. It can tell any application the user permits where the user is and when, allowing the person to connect together location-based services like Dopplr with social services like Facebook and data from any Web 2.0 service like Google Maps, Flickr or Wikipedia.

Web 2.0 technologies will ensure that location can be used in innumerable different ways, enabling people to innovate to create new, previously unimagined services. By giving the user complete control of how and with whom they share their location information, Fire Eagle should also remove some of those unsettling feelings that scuttled Microsoft’s Location Finder.

Location, therefore, is going to become an increasingly important part of the connected consumer’s life. This is doubtless why Nokia has recently acquired Navteq — a location-based services provider. This is probably also part of the reason Google is looking to develop its own phone. Location will be a major determinant of advertising relevance on the mobile platform, and advertising relevance is Google’s stock-in-trade. It is only a matter of time before longitude and latitude become important variables in the keyword bidding process. In short, “location” may well be the “Next Big Thing” in digital media, technology and advertising.

There may no longer be gold in them there hills, but knowing that them there hills are where you are — that might yet be a gold mine.