5 ways to outsmart customers' smartphones
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Finance Director Megan Jacoby's job starts when her customers pull out their smartphones.
While she's explaining a menu of finance and insurance products to customers, some get online via their smartphone or BlackBerry to price the products elsewhere -- service contracts, finance rates, guaranteed asset protection coverage and tire-and-wheel protection.
"It's just amazing what's on the Internet now," says Jacoby, finance director at Bob Smith BMW in Calabasas, Calif. "We want customers to feel comfortable with what they purchased. But we have to be prepared for them to challenge us on it. Your job really starts when those questions come at you."
Here's what Jacoby does:
1. Sells with the idea that "seeing is believing."
She has a blown-out tire and bent rim in her office as a conversation starter to sell tire-and-wheel protection. But when she explains that a blown-out BMW run-flat tire might cost more than $600 to replace, she braces for what comes next.
"They'll say, 'Do you mind if I check that pricing?'" Jacoby says. "I find that the tires are the thing sought out the most because they're easy to look up online."
2. Comes prepared.
"When they're looking it up on their phone, it's our cue to say, 'You'll definitely find tires cheaper elsewhere, but it is a volatile market," Jacoby says.
She then explains to the customer that a tire might cost $350 one month, but it could shoot up to $600 a month later. And she tells them tire-and-wheel plans include the cost of mounting and balancing the replaced tire.
3. Shows actual repair orders.
Jacoby will also present repair orders from prior customers as proof of how a single tire-and-wheel replacement can cost up to $1,500. The tire-and-wheel plan costs $1,347 for three years on a BMW 335i, she says.
"We're prepared to say that the state of California is in a horrible place right now. There is no money to do repairs to roads," Jacoby says. "You're going to pay a one-time fee of $1,347 that covers all your rims and tires for three years."
4. Uses technical knowledge of potential repairs.
Jacoby and the other finance managers meet weekly with service advisers to learn about the vehicles.
"We cover what each part does in the car, how it can malfunction and what it costs when it malfunctions," Jacoby says. "You have to know your warranty to sell it. We go through the warranty book and we read it in full so that we understand what we're talking about when we discuss our warranty."
5. Offers discounts to close the deal.
Jacoby says she does not discount products based on prices customers see online, but she will offer reduced coverage for a lower price or offer an online coupon for a $150 discount.
You can reach Jamie LaReau at jlareau@crain.com. -- Follow Jamie on 
