BKH

I have a friend who is the sales manager for two different Auto sale lots, one new with about 90-125 cars and the second used with about 50-60 cars on the lot. I gave him free accounts to see what would happen with using text messaging for each of his cars. This is what we did and found in running the campaign.

First account: We had 100 generic keywords, each placed on a car with medium sized print next to the information sheet and a couple “deals of the month” had large print on the windshield. During this testing phase I had him send me the information that he wanted for each car to limit his involvement and basically get him to agree to it. I set the account up as an information-only account, which means the end user texting in was not opting into anything just receiving a response to the inquiry and the number can NOT be contacted back by text. (Less information needs to be shared with the user) This just emails him the phone number of the lead and which car the lead is interested in.

The texts we were sending back on this account looked similar to this:

All power and leather, Keyless entry and remote start
MP3 play w/display
Premium sound w/10” sub
Free year of XM radio w/this text
3.9 APR
<URL>

The idea was, for anyone that is like me and doesn't want to be bothered by a sales person while looking at a car, they stop by after hours, peek through the windows and get specs off of the information sheet. Now they have the ability to capture the lead by sending additional information via text.

I had planned on grabbing about 5-10 leads per month and approaching him with the cost of $500 for 100 cars. It didn't work quite that way! The first two weeks we were setting everything up so I didn't keep any of those stats. Over the next month he received on average 2 new leads per night with one Saturday night grabbing a high of 7 leads. This gave me great ammunition in my quest for selling him the package.

After the first full month running the campaign, I sat down with my friend and said “It worked even better than I had projected”. He nodded his head almost in disgust of being wrong (he didn't believe people came to his lot after hours) then slid me a check across the table made out for $1200. I asked him “What is this? We haven't discussed a price yet”. Apparently when he talked to his manager about the program he was told that “they would not spend a penny more than $200 per converted lead!” 62 leads turned into 6 sales and I was smiling with a new way to approach this. Sell the lead!

Oddly enough they are willing to pay $300 on the used car lot and we have just implemented this same program on that lot. On the used cars we will be only offering the price by text...more stats on this to come!

Here's the idea for approaching the next car lot! Sell them the leads at $10 each and $200 per converted lead. That's $1820 using this scenario and my cost to set this up is less than $150 after I made a deal with my provider but normally only $200 a month; roughly $1600 a month income from one car lot.

Anyone have any ideas how I can tweak this or obstacles I might run into selling it? Could you sell it like this? Please share your thoughts!
b

susanMC

nice! but how would you know when the lead get converted ? unless you just trust the person,..cant you do a flat rate fee a month or per text etc?

{SMS marketing software $45 SEND unlimited SMS messages}

TheLocalCoach

Awesome!! This is so great, there are so many lessons here!

What a perfect example of how we often think we're selling a service (SMS, Mobile Sites, etc), when in fact what we're selling is results! And in this case, the business taught the "lesson" by just assuming that you would want to be paid on results.

We teach a similar model to this, using QR codes (along with printed call-to-action) in car windows targeting exactly the off-hours lot visitors. I would suggest taking the extra step to get the opt-ins, so you the dealer can market similar cars, price reductions and new specials to the visitors.

Are you getting any resistance to the lot visitor being called by a salesperson when they weren't expecting that? Just curious. If so, you could add a Request-for-Call to the text auto-response (or a button on mobile website), to trigger a text notification to salesperson that someone WANTS to be called about this car. Now that's a hot lead!

Congrats again on a great SMS campaign, please keep us up to date with more results.

BKH

Susan, This was my original intention, a flat fee, but I got paid for conversions...Idk though how I would find out if the lead converted outside of trust...maybe someone could chime in with an idea?

EDTJ, Idk if they have ran into any resistance on the call backs. He is giving the leads to his sales people who are making the calls and they are closing about ten percent, so I wouldn't think there's much resistance.

Thanks and I will update with more stats with the used lot.
b

ADukes81

Yea, the trust thing could be an issue. Why not charge him $20/incoming text? That's basically what this breaks down to and it's easy to track. Have it in writing, though.

I am working something similar to this with auto trader magazines. Just started it this week, but I have been wondering how I am going to price it. I think $15/incoming text to start and possibly bump it to $20-25. If they close @ 10% I think that's fair for both parties.

Thank you for sharing this.

How to Build a Sales Funnel for FREE

BKH

I think your right! Break it down to a higher per lead charge and not worry about if it converts or not.

Its good to hear you got stuff working with auto trader...I was wondering about how it would work with them advertising their cars in a paper or something. If you can let me know how things work out with that.

Goodluck,
b

ADukes81

Wow! This sounds like an awesome system. I am going after a few dealerships in town and am hopeful to be working with one soon. I will be getting ahold of you for more information.

How to Build a Sales Funnel for FREE

AmyKay

Just spent about 30 minutes with them on the phone. They have great stuff and help for working with car dealerships. I'm impressed!!

scarab

BKH, awesome post and the results you were able to get. It is the 'leads'. We of course keep the unconverted leads in the db. When a similar vehicle arrives on the lot we send out a message to the unconverted leads informing of the new vehicle. As always it's in 'list'.

Vagabond 007

I would definitely charge per lead and not per converted lead. Mainly for the reason others have stated, trust. Car dealers = liars. I've worked at one before. My dealership was pretty good. But at the end of the day, they are trying to get every penny out of you that they can.

The other reason, if the salesman suck at closing the deals, your income suffers.

Just charge per text and be done with it.

And the reason they are willing to pay $300 for a used car is because they can make A LOT more on used cars. There isn't much mark up on new cars. Despite what you read on the internet. When I sold cars, even if I sold a new car at sticker, I didn't make much money.

But on used cars, the mark up can be very high.

Thanks for sharing your story. Please keep us updated, I'm interested to hear on how things progress with this biz model. May be something I look into.

The Ultimate Sales & Marketing Mind Map (Just updated - now twice as big!) - scott_krech - "Quite possibly one of the BEST WSO's ever."

www.UltimateMindMap.com

JToneyUK

This is an interesting read and I guess this accomodates greater numbers of people than offer QR codes and mobile pages for each car as that just accomodates those with smart phones. The text service accomodates practically everybody, barring those living in the past who don't have a mobile phone. Anyway, I think it might be worth putting on the sign that by texting the number you are agreeing to be called about taking the car for a test drive or just a discusssion about it. The details will already be displayed on the car.

I am planning to hit local used car dealers to offer them mobile set up solutions, and integrating SMS to run along side maybe a good idea also.

One issue I could see is with the volume of cars and therefore the number of keywords you would need. The SMS service I am planning to use charges £5 per keyword, so that could really rack up the bill. You could always just get the client to text the car number on display, and when the salesman calls them back they simply match up the number so they know which car to discuss.

JToneyUK

Also for anyone in the know of how local car dealers work, is the owner usually around the forecourt during the day? I think this is best sold by walking in on the business with a made up flier which has a barcode and/or Text code and a mock up mobile car page to demo to them there and then.

BKH

Thank you! I think I may have found a way around tracking a converted sale but I'm doing some testing on it with my friend now to make sure it works...I'll fill you in as I know more.

I normally pay $2 per key, per month but I worked out a deal with my provider to give them to me at $1 per month because they are generic and I don't think they cost them at all. Even at the $200 in keys just 20 leads at a cost of $10 would pay for that and the rest is pretty much gravy.

Thanks to you all for the replies,
b

SirThomas

I just have to ask this, but what do you guys mean by "after hours" or " evening" visitors? Don't salesmen hang out till late hours on their lots? Just asking :-)


Thomas

Vagabond 007

Depends. The place I worked at is huge. The owner had 23 dealerships. But he still did pop in from time to time.

Either way, it doesn't really matter. You want to speak to the GM (general manager) of the dealership. They usually work a lot of hours. And they are the top guy at the dealership (assuming the owner isn't there everyday, of course).

If you talk to a sales manager, they still have to talk to their GM.

After hours as in after the dealership is closed. Salesman leave as soon as they can, trust me. The hours are long, so once their day is over they want to get out of there asap. The only reason they would stay past closing is if they are already with a customer.

After hours also means on Sundays. In the US most dealerships are closed on Sundays. So people like to browse lots then.

The Ultimate Sales & Marketing Mind Map (Just updated - now twice as big!) - scott_krech - "Quite possibly one of the BEST WSO's ever."

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JToneyUK

Most local car dealers I know of around here stick to the usual 9-5 routine! Some may stay open a little later, but not too much later.

But think about it, most people are also working 9-5 during the day as well. However buying a new car is quite exciting to most people, and they will be eager to have a look around, even after a long day at work. So if they really wanna go looking for a car during the week after work, they will first want to go home and have some dinner. It could be 7-8pm by the time they end up hitting the roads to the local closed car dealerships. They may just be scouting for cars in order to go back on the weekend and test drive. But how helpful would it be to the dealer to have some way of getting this potential clients phone number even though their business is closed for the night?

Take this example, and I'm totally improvising here:

People generally will look at mutliple cars, from multiple dealers before making a decision. Say Barry goes around town at 7:30 lookin at some cars, but he is aware they are all closed for business. The very first place he goes to has a nice looking car he would definately like to try out. He notices in the window is a QR code and it says "Scan to arrange test drive" or words to that effect. He scans it with his smartphone, and it takes him to a page about the car and asks him to enter his number and the car#. It then gives a message that someone will be in touch. His number has been put into the dealers' database.

Barry goes to 4 more local dealers and he saw 10 similar car models in these other dealers. Once he gets home his head is spinning. He went to 5 dealerships and saw loads of cars and can't fully remember them all. The ones he can remember most are the cars from the last two dealers he visited.

He plans to go back to those last two dealers to test drive one or two cars at the weekend. But the next day he gets a call from the very first car dealers he went to, where he scanned that code. He'd totally forgot about that! On the phone he arranged a time slot with the salesman to take the car for a test drive. And what do you know, he went and bought the damn thing!!

Wild Card

BKH,
I like the concept, plenty of car dealers with most of them looking for an edge. Also, plenty of different ways to use the technology in order to make money.
It seems to me that the car dealer has done the hard part - getting the prospect on to the lot. It would be a shame to lose them . . . What are your plans to follow up? and What will you say to dealers that put all the info on the sheet in the car?
Jim
PS There is a SMS reseller that charges $49/month and includes 3000 messages and unlimited keywords. That should save you big time on your monthly costs. I'll post that info here when I find it.

Jim Bettke
http://s-m-s.ca

rackemup

Very cool. Lots of good tips and ideas on this thread. Thanks for sharing.

chrisclements521

This sounds like the best solution would be a Dedicated longcode so that you would not have to pay for each Keyword... Even at $1 per keyword, you are looking at $100 per month, just for Keywords!

This is a great example of an innovative way of using SMS...

Good job...

Chris Clements, Founder & CEO, YeeZ Mobile Inc.

BKH

Thanks Chris! I actually made the decision to go with shortcodes a while ago knowing that my margins would not be as big but my target customer is the large corps that need (hopefully) a lot higher through-put.

I am meeting with the sales manager tonight to go over the used car lot stats and I'm already shocked at how well it's done...I will update when I have all the stats.
b

ADukes81

Would love to hear about the stats. Please update us when you can.

I had emailed out 5 or 6 videos explaining this method to dealerships and heard nothing back. I followed up with a DVD and plan to follow up with them in the morning. If I had some stats to provide, that would be great.

Thanks again

How to Build a Sales Funnel for FREE

justinc21

Is this a system you have developed that is based only in the US at the moment? If so is the problem the use of the SMS provider? I am not in the US but can see how good this system would be.

bryson

The car lots in my area typically stay open til 9pm, but most of the indie's are closed after 5-6 pm

BKH

So I met with my friend at the car dealership and think it may take another round of use before I will be able to get some solid stats. The numbers are a lot (no pun intended) different this time around. I'll start with the used lot because it is its first set of numbers.

For starters Gregg has no pricing at all on his cars and offers to give the price by text, I thought this was a good idea as it would generate more opt-ins. Unbeknownst to me, he added the call to action to his ads in the local “freebie” paper displaying the auto and information but stating “text xxxx to xxxx for pricing info”, this hurt my margins and stats a bit. I'll give you the numbers then explain:

484 opt-ins
78 leads
5 sold

Albeit, I was paid $1500 I was a little miffed that the numbers were so much greater and I made less, but here's why! There was about twenty leads that text to get the pricing on all of the cars that were in the ad so one lead generated 20 opt-ins. I still made a large amount of income, I was just assuming it would be better than the new lot.

Now the new car lot was quite a bit more on track with its first go around but again I was hoping that the increased numbers meant increased profit.

136 opt-ins
73 leads
5 sold

So I ended up with more opt-ins and more leads but less sales. Again, the only way I am able to track the sales was because the sales manager is a friend of mine but I can see where this is going to be a problem with another lot. I've talked with him about just charging him for the leads at $20 a piece but I don't think his manager is buying into that.

Leads and sales are pretty close averaging about 65 leads and 5 sales. I think I am going to need to find a way to track sales as I believe this is going to be the best way to sell it to a lot. Any suggestions are greatly appreciated.
b

ADukes81

What are you considering a "lead"?

Are they following up with all these people opting in and then determining if the person is interested?

I definitely think you are onto something. Keep us posted.

How to Build a Sales Funnel for FREE

BKH

We are considering a lead a new phone number that opts in, but there are a few that are opting into multiple keywords. They are getting the info on the camaro and the mustang so it shows as two opt ins but of course it is just the one number or lead.

Any number that opts in is followed up with by his sales people the following day. He hands out the phone numbers to his sales people and they will call as if it were a lead that came off their online ad. One interesting note is, he said that they were only calling the numbers 3 times before discarding the lead. Meaning anyone that did not answer they left a message each day for three days then had the salesperson discard the number. Almost a third of the numbers don't get contacted. We are trying to work out end of month text to them to basically say "hey you were interested is there anything else we can do".
b

NameThatCandy

hi BKH,

I am interested in selling sms marketing to car lots. Are u in US? What state are you? Just curious!

Does every single cars in the car lot have the "text info" on the windows? I plan to offer free trial period for them, but I can't afford 100 cars or more for free. Just wonder how many cars will be effective enough to see the result.

thanks

D_Rogers

I like this approach

BKH

I live in the states and live in CA but do business in AZ, NM, UT, NV and CA. The majority of my stuff is in NV.

Not every car has a keyword but I'd say 80% of them do. His new lot probably has 130-140 cars and we've got a keyword on 100 of them. The used lot has 68 keywords and I'm pretty sure there is one on each he has. A thought I had for going forward, maybe charge a set-up fee of whatever your initial cost is. I have not tried this yet so I don't know what the opposition may be.

I'm still trying to find a valid way of tracking the sale.
b

BKH

A side note for anyone that gives this a go:

There is a lot of management to these accounts as I get nearly two emails a day to change the response when his cars sell and he needs them added to another. Not that big of a deal unless you have a 9-5 and several other customers.

Just a heads up,
b

NameThatCandy

thanks!

Setup fee is great idea! I haven't had time to contact any car dealers yet. I am not sure that should I walk in or cold call.

JToneyUK

The ongoing maintenance of such an effort should be considered in your pricing.

I myself plan on creating/updating mobile pages per car and charging per car. Something like £30 per car page. Plus a set up fee and a monthly fee for the SMS service. What I am not going to do is have a unique keyword to identify the car but only 1 shortcode for the dealership.

"Text DealerName + Car 1 + your name for more info to XXXXX"
"Text DealerName + Car 2 + your name for more info to XXXXX"
"Text DealerName + Car 3 + your name for more info to XXXXX"

Using this method doesn't involve sending the customer any car info, but it is an "opt in" to get a call back from one of the sales people to arrange a test drive or whatever. There would be a QR code and a shortend url for people to visit the mobile page for the car.

In this scenario the SMS side is all managed by the provider, you can set it up so that as soon as someone texts their message it sends the dealer an email with the phone number and text message attached.

For this you could charge an initial set up fee (for QR codes, SMS short code and setting up template page with logo etc ready for car details to be added), plus £30 per mobile car page. Then each week or whenever they send you the list of cars they sold and details of new ones they bring in and again its £30 per page update.

If they sell 10 cars a month, thats £300 just to switch the basic car info on the already set up pages from the old car which has been sold, to the new car they have on display (10 minute tops per car, they keep using the same QR + car number poster), plus your monthly fee for the SMS service which runs itself.

Well this is pretty much the system I am going to try out. It has a mobile web solution for those who wanna stop by after hours and use a QR reader or just input the shortened URL to see details about the car (which can include a callback option). And for those without smartphones or who want to discuss the car with an employee there is the SMS service to arrange a call back the next day or whenever.

You just charge per car update so the owner will only lose a small amount on each car sale, but that should not be a big issue if it's leading to more cars being sold overall. It's only the set up fee's which they are taking the hit on, and these dont need to be priced too high.

tonyserugatonyseruga

Each mobile marketing communication channel has its own benefits and drawbacks. there are lots of websites on internet you just need to search cleverly

dv8

BKH - What service are you using for the SMS?

uberstudios

Hi
I am looking for local Email Marketing Data or SMS sender in Delhi . Can you give me some information about this or show me your some work demo, you done before .

Uber Studios provide Graphic Design Services & Online Marketing Services

BKH

I use the txt180 reseller platform but really any platform will work with this idea...it's just a matter of what the platform offers you.
b

bryson

I recently got a lead with a car dealership and so I am very interested in this thread. I have also been combing the WF for any informartion on car dealers. One titled "Major Car Dealership Group here in Chicago" had responses calling the leads at $50 each.

I am just starting to work all this out so I may be off the mark. So if the average car earns the dealer $2,000 per sale. -> 100 leads -> 10 sales.

20,000 to the dealer and at 50 per lead that is 5,000 in your pocket or 25%. At 40 per lead its 4,000 or 20% and you can follow the math from here.

20 per lead is only 10% IDK about the rest of you but that seems cheap. Car sales bonus checks for beating sales targets can be more than 10% on top of their commission.

I am thinking the 30 to 40 per lead is a sweet spot.

Any feedback is appreaciated.

Shefiu

This is certainly a great idea selling SMS service to car dealers. I'm based in the UK and we have a lot of car lots who could really do with this type of service.

Personally, I think charging a flat rate per opt-in lead is more appropriate, as it gives you more control financially. And you can just solely focus your energy on consistently generating and tracking leads. Cost per sale is out of your control unless you have a system in place to track those sales.

However, if you can do a deal with someone you know and trust, then I will seriously consider a combination of cost per lead and sale.

jasonthewebmaster

sell the plan based on Cost Per Sale - 30 to 40 per lead is the sweet spot and most dealers will go for it....

but then charge based on per lead basis ... as that is the only thing you can control... make the dealer understand it's up to them to close the leads, in effect, they are in control of their cost per sale!!

cybernet

could you clarify your post... not sure what you mean when you say "cost per sale"

BKH

Bryson, I think you may very well be right! I am charging in the $10-$15 range and I have seen a huge response. It started out pretty slow the first week but I started getting calls back from interested lots and and now two weeks of footwork and selling has turned into a week of revisiting and setting up packages. A couple went with a flat monthly fee to try it out which works for me because I was not doing any of their signage and it's how I am really used to selling it. Aside from my friends lot I now have 7 car lots all paying me between $10-$15 per lead...I am really thinking that I may increase my per lead charge to about $25. If I am still able to sell it at that cost I will be looking at quitting my 9-5 by start of second quarter next year. Had some interesting conversations with some fellow warriors about tracking conversions that I may try but for now I will stick with the per lead charge.
Good luck to you all,
b

danielp310

Hey bkh,

I saw another thread where you wrote that you offer this service to real estate agents, just wondering how much you charge them per listing?

thanks for your help.

NameThatCandy

hi there,

When u said $10-15 per lead, is that mean per car? How much do you charge for flat monthly fee?

how did you approach the carlots? cold calling or walk in??

One last question, in where I live there are some family-owned small carlots and some big carlots, do you approach both? I am curious that which type of carlots are easier to sell.

Thanks

BKH

The cost on the listings I charge ranges from $5 to $10, less for more listings. I had set amount of listings for them. For example $50 for five listings, $75 for ten or $100 for twenty. I did go up against another company when talking to a broker about it and they were upwards of $20 per listing 'til they got to 25 so there's room for play.

A lead would be any unique phone number that opts to receive the info on a car. If they opt in on multiple cars it's still one lead. The flat fees were on smaller lots of 25 to 40 cars and I charged $200 and $300 for those...I did not do any signage for those two.

I approached the lots as advised by my buddy that is a sales manager at a lot...Walk in, talk to the sales manager, I don't give the sales manager any information about what I actually do, instead let him know that I can capture an additional 50-70 leads for him after hours and I wouldn't charge him anything unless he gets results. Typically, he asks what is it I do and I ask in return can you authorize an expenditure agreement? I always get a no and I ask who can. It's the GM or owner and I always follow that up by saying Why don't you bring him/her in on this so that you don't have to remember it all and explain it over again. To be frank, it never happens but I've met with nearly 50 lots and heard no straight out of the gate about 10 times to which I leave a card, I've heard back from them about 20 times and of those I've sold now 9 of them. With the long weekend and trying to catch up on things I haven't had the opportunity yet to get back with those that have not called me back yet. I'm assuming I can close another 5 of those if I'm quick about getting back with them.
My sales process was really put together by me and my friend that is a sales manager at a lot but I have heard great feedback from other warriors on how to approach it as well. Any more feedback is still very much appreciated.

I would say both...I've approached both and sold both thus far. The bigger lots I think are easier just because there is more of a structure to how it works but both small lots I sold were sold on the spot.

Good luck to you,
b

NameThatCandy

hi there,

thanks for the detail reply!

I have more questions, when do you get paid? Because you charge per lead, you won't know how many leads you generate.

You said you use txt180, I remember that they charge $2 per each keyword a month, so your cost are very high. If the carlot has 100 cars, it will cost you $200 just for keywords a month.

I am thinking to charge per car. But don't know how much to charge.

Thanks again!

danielp310

thanks for the reply

What did you include in the listing fee?

Just a qr code and a text message with the home info or did you build a mobile page for the listing with pictures, info etc..?

Winson Ng

Great infos here everyone..let some ideas/suggestions come pouring in !!

Cheers,
Thinkmaverick.com

Winson NG
CEO/Founder of http://thinkmaverick.com
Online Business & Entrepreneurship News, Advice, Strategy Think Maverick
Information to guide start-up entrepreneurs to grow and strategically manage a small business online, using market researched Intelligence.

JToneyUK

NameThatCandy - Check out my post at #33 for what my plan of attack is. It's based on providing a mobile page for each car and charging per car initially and then per update (when one car gets sold, the page gets updated with a new car they bring in). My only worry is if the owner is willing to lose £30-50 per sale in order to have a QR code and text number on the car on the off chance someone stops by after hours and is interested. Theoretically it sounds like a good system, but then again when are business owners ever theoretical?

SherylS

I've been thinking about the issue about not being to track how many of the leads convert. I use to work in a car dealership and was the F&I manager, which at our dealership was the last person to see the buyer to have them sign all the loan documents etc. I believe he/she will be the key to tracking your converted leads.

Every business needs to keep in contact with their clients, case and point, my husband purchased a Jeep two years ago, and we get a monthly email and a quarterly postcard with coupons for oil changes, tire rotations etc.

Here's my idea - when the buyer is finishing up his paperwork, the F&I manager can have the buyer TEXT in MYNEWCAR or JEEP or CHARGER (etc). Now the dealership is developing a database of ACTUAL customers and not just leads. This is an opportunity for you to upsell them into a SMS monthly package too. The dealership can save money on the postage, and send coupons out via text, I know my husband and I both delete or unsubscribe almost every email that we get. The one catch I see, is if the buyer doesn't do the final text... now the dealer will need to sweeten the pot for them to opt-in. Have the dealership offer the buyer his first oil change free or a tire rotation, that is a quick and inexpensive service, but important to a new car buyer. Perhaps the buyer must opt-in in front of the F&I manager, and then he can give him a gift certificate for the free oil change. Now the dealership is only out the expense of the oil change if the buyer redeems the gift certificate. Last year 27% of all gift cards went unused.

Now you can track and compare the opt-in numbers from the "actual sales opt-ins" against the "lead opt-ins". (Catch?- if they use a different cell number for the second opt-in- which most would not do unless they were using a spouses or got a new number.)

Thoughts?

Scott Logan

That's a great idea Sheryl for tracking to the final sale and welcome to the Warrior Forum

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