Dealers should respond to questions quickly or internet shoppers will leave

At Proctor Honda in Tallahassee, Fla., salespeople are expected to respond to Internet leads within 20 minutes.

Why? Because online shoppers are receptive for only a few minutes, says Alex Jefferson, e-commerce director for the three-store Proctor Dealerships group.

"The closer you can reach them while they're in the right mental state [to listen], the better your chances are of getting them to come in," he says.

But Proctor Honda's quick replies are exceptional in an industry that has tolerated slow responses for years to Internet leads, in which shoppers leave e-mail addresses or phone numbers and request replies. Dealers respond on average in three to five hours to Internet leads, dealership consultants say.

Dealers chalk up slow responses to a variety of reasons: Salespeople are busy with other duties. Many leads that flow into dealerships are of dubious quality. And many salespeople believe customers eventually will come to the dealership regardless of how the Internet inquiries are handled.

But slow responses are unacceptable to shoppers conditioned by Google, Amazon and others to expect immediate answers to online queries, says Larry Bruce, president of consultant OnlineDrive and former dealer in the Houston area.

The consequences? Untold lost sales at dealerships that sit on leads.

Studies show that Internet leads account for about 20 percent of all auto sales in the United States.

The best way to fix the problem? Track response time carefully and reward salespeople who convert leads into test drives and sales.

In a recent study of how 125 dealerships handled 15,000 online leads, Bruce found that shoppers who received replies within 10 minutes were three times more likely to visit a store than those who had received a slower response.

Bruce says responses by phone, personal e-mail or text are useful. He considers auto-responses virtually useless because they seldom answer a shopper's question and don't stop them from seeking information elsewhere.

The study shows stores were OK if they could contact a prospect within 10 to 20 minutes, Bruce said.

But after 20 minutes, the bottom falls out. The data showed no discernable difference in coaxing a shopper in for test drive between leads followed up on in 24 minutes or 24 hours, Bruce said. Clearly, the shopper was onto something else or another store.

"If you don't get to the lead within 20 minutes, you may as well wait until tomorrow, because it doesn't matter," he said.

Automakers are aware of the problem and have moved to address it. Chrysler Group, for example, is seeing results from the effort it made 18 months ago to speed up replies to leads and to address a host of other dealer digital marketing issues.

In late 2012, Chrysler hired digital managers at its nine regional dealer business centers to promote better digital practices, said spokesman Ralph Kisiel. Another nine digital experts were hired by Chrysler vendor Shift Digital to help, he said.

"These dedicated digital experts assist dealers with building an engaging Web site, driving traffic, and most importantly responding to the shopper promptly," he said.

Despite a 25 percent increase in lead volume in 2013 over 2012, Chrysler dealers as a whole responded to 97 percent of leads in 2013, up from 91 percent in 2012. And average response time improved to 32 minutes in 2013, from 52 minutes the previous earlier.

In 2011, the response time across Chrysler dealerships averaged 20 hours, according to comments made in 2013 by Chrysler's U.S. sales chief Reid Bigland.

Jefferson at Proctor Honda says the key is building a culture of responsiveness and holding salespeople accountable.

His five-person Internet sales team handles 400 to 700 Internet leads per month. And a designated person is constantly monitoring response times and whether appointments are booked from return calls and e-mails, he said. The store also has another nine floor salespeople. Any of the 14 salespeople can handle walk-in traffic and phone appointments.

Bottom line: The best performers in responding quickly and cementing store visits get the most leads to handle and convert to commission-generating vehicle sales and leases, Jefferson said.

Faltering performance results in fewer leads and potentially a pink slip if problems can't be rectified, he said.

The store sells 175 to 220 new and used vehicles per month, and Internet leads account for 35 to 50 percent of those sales, Jefferson said.

The Proctor Group also has Acura and Subaru franchises.

Jeremy Alicandri sees Internet leads as a race against competitors.

That's why Habberstad Auto Group's 10-person business development center is required to respond to Internet leads within 30 minutes or less. His goal is to get the person sending the lead on the telephone and into the dealership.

"If you're the dealer that responds first, you'll be the one that gets the opportunity sooner to start working with the customer," says the vice president of corporate development at the Huntington Station, N.Y., dealership group. "There's also the chance that the customer only contacted your dealership, and if you start working with them right away they don't need to contact other dealerships."

The group of one Mini and two BMW dealerships sells more than 3,000 new and 600 used vehicles annually.

Alicandri says the Internet leads are time-stamped and assigned to employees who earn incentives based on the number of leads they convert into dealership appointments.

He says Internet leads sent to the group generate automated responses acknowledging the dealership's receipt of the correspondence and a message saying to expect a follow-up phone call or e-mail -- whichever way the consumers indicated they would like to be contacted.

Though e-mails are useful, the dealership would much rather have a telephone conversation with the person who sent the lead, Alicandri says.

"Talking to them over the phone is better opportunity to vet the customer, see how anxious they are to buy, see what their needs are and more importantly set up an appointment," he says.

Nine months ago, Sun Chevrolet Inc. in the Syracuse, N.Y., area created a business development center to handle Internet leads and phone calls for the Chevrolet store and two used-vehicle stores, said owner Todd Caputo. The center now has 14 employees, including a manager.

Caputo said he puts such a premium on fast and detailed responses to leads that two center employees now work from home on Sundays so prospects don't have to wait until after the weekend to get the information they desire. Last year the Chevrolet store sold 575 new vehicles.

Rick Case Honda in Davie, Fla., also has a business development center to handle incoming leads, said General Manager Richard Bustillo. Internet leads get a response by e-mail within 15 minutes, including prices for vehicles identified by the prospect as well as three certified-used vehicles that might meet the sender's needs, he said.

The store then has processes in place to contact the prospect up to five additional times by phone or e-mail to see if the dealership can assist the shopper, Bustillo said.

Bustillo said for the most part dealers have the software to aid them in following up with customers. But too many lack the discipline or processes to hold salespeople to account for contacting prospects promptly with relevant information.

He said dealerships in the large metropolitan areas, in particular, just have the old mind-set that showroom traffic will come regardless of the Internet.

Bustillo said: "They take it for granted. That's good for us."

Arlena Sawyers contributed to this report.