Gunn's Internet selling secret? More people
Software, TrueCar help bigger staff do the job
Selling cars via the Internet requires lots of computer technology. But it starts with people.
That's why when Tony Rhoades took over in 2009 as executive director of e-commerce at Gunn Automotive Group in San Antonio, he hired a dedicated sales manager for each of the Internet departments at the group's six dealerships.
Internet salespeople were waiting in line to have their deals reviewed by store sales managers, who sometimes dealt first with customers who had walked in or made phone appointments.
"It's just easier sometimes to focus on a customer in front of you" rather than those waiting for answers online, Rhoades said,
Three years later, the new Internet managers, new computer tools and a good relationship with online shopping service TrueCar are paying off.
The seven-franchise, six-store group sold 4,562 new and used vehicles from Internet leads in 2011, about a quarter more than in 2010. Gunn Automotive sells Chevrolet, Buick, GMC, Honda, Acura, Nissan and Infiniti vehicles.
Last year, Internet leads accounted for 31 percent of the 14,600 total vehicle sales, said Sean Gunn, the dealer principal.
"Tony helped pull us out of the Dark Ages," Gunn said.
Gunn, 38, is the grandson of C.C. "Pop" Gunn, who founded his first dealership in 1955.
The group's Internet sales managers perform the functions of traditional sales managers: reviewing deals, working on quotes and paperwork and seeing that leads get proper follow-up, Rhoades said.
Since 2009 the group has doubled the number of Internet-only sales staffers to 40.
Once the staff was reorganized, Gunn and Rhoades began a quest to improve the six dealerships' customer relationship management software.
The search took Rhoades and his crew to the National Automobile Dealers Association convention in 2010 in Orlando.
After seeing demonstrations at several booths and talking with vendors, they decided they liked the products offered by VINSolutions, Rhoades said.
At the time, VINSolutions was a stand-alone entity. But the company was purchased by AutoTrader.com just one month after Gunn Automotive switched its customer-relations software to VINSolutions from ADP Dealer Services in April 2011.
VINSolutions' products create e-mail brochures and post vehicle listings on third-party shopping sites. They also perform a function known as "desking" -- calculating payments for buyers based on trade-ins, interest rates, down payments and other factors.
Rhoades said the software also offers an easy-to-configure reporting program and a tool that allows dealerships to track where shoppers looked on the store's Web site so a custom pitch can be made with that information in hand.
Rhoades declined to say how much the group pays monthly for VINSolutions.
Leads from TrueCar, the Internet shopping site, also have helped the Gunn group expand sales.
In many states, TrueCar has run into problems with its pay-per-sale model, in which dealers pay for leads only if they result in a vehicle sale.
That model has been deemed to violate anti-brokering or bird-dogging laws in some states -- Louisiana, for instance.
But in Texas, TrueCar has had no problems with state regulators because dealerships pay TrueCar subscription fees.
Dealerships pay monthly fees to list vehicles on the TrueCar shopping site and get leads from that network just as they would from other shopping sites such as autotrader.com, cars.com and shopautoweek.com, which is owned by Autoweek, a sibling publication to Automotive News.
TrueCar leads accounted for about one-quarter of Gunn Automotive's sales resulting from online leads last year, Rhoades said.
A lead is generated when an online shopper provides contact information to get more data about vehicles or to schedule a test drive.
TrueCar sends a lot of business to Gunn Automotive, Rhoades said, through TrueCar's affinity agreement with USAA, the giant insurance and service group for active and retired military personnel.
San Antonio is home to three military bases.
Under the affinity agreement, a USAA member can shop for a vehicle online and select a participating dealer to buy it from.
Rhoades said sales through USAA are profitable. That contrasts with some dealers outside Texas who have said discounting has become so competitive for TrueCar customers that they have been unable to make money on those leads.
Meanwhile, Sean Gunn said his staff is learning to mine and use the shopper data being collected in the e-commerce department.
He said: "Our ability to identify and target market to customers is the tip of the iceberg."
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