“We are proud to be associated with the ADM community,” says Brett Stevenson, Publisher of Dealer Marketing Magazine. “There are a number of social networks out there for auto dealers, but this is the Granddaddy. They have a large influence in the auto industry and have always helped dealers learn from one another.”
Archives For Automotive Market Share
The furniture and carpet retail industry’s pay commission only, BUT their salespeople get a percentage of the GROSS SALES REVENUE, in many cases 6% to 8% with an average being about 7%. The key there is that the salesperson’s percentage is based on transaction amount and NOT on gross profit. When there is a slow moving line of furniture or carpeting, it is not uncommon to see a retailer put a 10% commission on that product line to get the salespeople fired up.
There is nothing FUNDAMENTALLY wrong with automotive sales professionals being paid on a commission based system, but when the pay structure was established in 1972 and based on a gross profit margin that was, as a percent of the transaction price, 2 to 3 times what it is today, then there must be adjustments made in order to ensure that a sales professional position in the car business is still a high paid job.
When I started selling cars on Friday, February 13, 1981 my commission plan paid a similar commission as a percent of gross profit margin as many dealerships pay today. This is ludicrous and counter intuitive! My first dealership felt compelled to put a CAP on sales commissions because we were selling diesel VW’s for $2,000 to $5,000 over window sticker… My first year of selling cars, a 10 month years in 1981 I made over $84,000 as a car salesman. Let’s put that into perspective in today’s 2012 dollars… Can a first year car salesperson make $175,000 today? And, don’t say I was anything special, because there were at least 4 or 5 people in my dealership that outsold me.
If you give an entire class of professionals a pay cut ever year for over 30 years, what do you suppose happens to the quality of who we have available to hire and the turnover in that professional category? Yes… It is as obvious as it seems and a lot less complicated than people want to admit. Until the entire automotive distribution system in the USA allows for sales professionals to earn a living commensurate with the skills required for them to do a great job, we will be relegated to lousy salesperson performance as an industry average. This is not just a dealer responsibility… Every time an OEM strips gross margin out of the MSRP on the window of a new car, and puts that money into dealer cash that is paid separately, they are in fact reducing every sales professionals income from selling those cars. I personally believe that there needs to be more gross profit margin in the MSRP shown on the window of most new vehicles sold in this country. And based on what most consumers seem to believe we have for profit margins in those Monroney sticker prices, they agree as well!
COMPETITIVE ADVANTAGE VIA COST CONTROLS – Dealers United enables
independent dealers and small dealer groups to generate big savings from
vendors by leveraging multiple dealerships’ purchasing power. Today,
independent dealerships and small dealer groups are unable to demand the
same level of discounts from their vendors as big dealer groups are
capable of achieving. Dealers United levels this playing field and
allows independent dealerships to compete with the purchasing power of
large dealer groups. Use the link provided to learn more about
enrolling your dealership in Dealers United…
Industry Thought Leader Shares Guerrilla Marketing and Competitive Conquest Advertising Strategies – Automotive Digital Marketing Professional Community.
Ralph Paglia, Vice President of Digital at Tier10 Marketing, is sharing with automotive dealers and managers his insights on guerrilla marketing and competitive conquest advertising strategies
DETROIT September 7, 2011 Ralph Paglia, Vice President of Digital at Tier10 Marketing, is sharing with automotive dealers and managers his insights on guerrilla marketing and competitive conquest advertising strategies for the web. With today’s technologies and the sophisticated messaging and advertising systems available, there are more ways than ever before for aggressive dealers and managers to take their competition’s customers away from them.
What are some online tools and techniques that dealers can use to see exactly which keywords the competition is bidding on in Google?
How can dealers and managers use their dealer advertising association’s own web site to take customers from other dealers?
Paglia offers advice to dealers and managers on:
- How to create a dealership Google Adwords account.
- How to register competitive conquest domain names.
- How to build guerrilla marketing microsites.
- How to determine the weakest gazelle for conquest.
Ralph Paglia has 20-plus years of leadership in information technology enabled automotive marketing strategy and tactical implementation. Widely known as the outspoken director of Digital Marketing at ADP Dealer Services, Paglia is now vice president of Digital at Tier 10 Marketing.
Paglia is also the founder and editor-in-chief of America’s leading social network for automotive marketing and sales professionals. The Automotive Digital Marketing (ADM) Professional Community provides an online exchange for strategies, tactics, best practices, files, images, videos and professional networking among marketing professionals working in the car business.
Paglia has presented critically acclaimed workshops at each of the 10 previous Digital Dealer Conferences.
Ralph Paglia will be speaking to dealers and managers about guerrilla marketing and competitive conquest advertising strategies for the web at the 11th Digital Dealer® Conference & Exposition, October 5-7, at The Mirage, Las Vegas, Nevada.