Todd Smith, General Manager at McElveen Automotive Group in Summerville, South Carolina, has been in the business of selling cars for more than twenty years. Starting as a teenager working on weekends at a used car dealership selling cars, Todd loves his chosen profession. Today as General Manager, he oversees the operation of their Buick and GMC new car franchises, as well as two used car lots serving the Charleston area. In the last two years, McElveen has become the largest Buick and GMC dealer in the state.
Committed to serving their local community, McElveen supports a multitude of charitable causes, from raising money for cancer research to helping preserve water fowl wetlands. Giving back in another way, Todd teaches business classes at a local high school, helping to introduce the next generation to the many career opportunities available in the auto industry.
In the following interview, Todd, passionate about all things automotive, discusses how their auto group has embraced digital marketing and the benefits they’re seeing because of this change. He gives tips on how to “win the click” with online shoppers and talks about the benefits of fishing for “low-funnel” buyers.
Thanks for agreeing to talk with Dealer magazine this morning. I’d like to start with a basic question of career choice. How did you get started in the business?
I started when I was 18 as a sales representative with Michael’s Chevrolet here in Summerville, South Carolina. Worked my way up to used car manager and sales manager, then I came to work for the McElveen Automotive Group in 2004. Back then, we were a Pontiac, Buick, GMC, and Hummer franchise. With the downsizing of General Motors, they quit making Pontiacs and Hummers, so those franchises left us. At that point in time, we decided to get into the used car business, in addition to our new car business, and we opened two used car lots off site and named them True Auto. We also started our own finance company and called it Low Country Credit, where we do buy here-pay here. And that, in a nutshell, has been my 23-year-career in the car business.
Could you talk more about McElveen Automotive?
McElveen has been in business since 1978. They’ve always been Pontiac, Buick, and GMC franchises. Still locally owned and operated. The owner is Doug McElveen and I’m his General Manager. I want to say Charleston is a small town, with a population of about 600,000. McElveen has been the largest GMC dealer for the last ten years. Here recently, in the last two years, we’ve become the largest Buick and GMC dealer in the state. McElveen Auto Group as a whole, including our two used car operations, employs about 175 employees. Between our new car stores and our used car stores, we retail about 350 cars a month.
Starting with your marketing efforts, please tell us about the vendors you use and the level of success you’ve enjoyed.
We were spending close to $100,000 a month in advertising. We were doing the television commercials, the radio spots. Loud, blaring, “$99 Down-$99 a Month” advertising. Billboards. The typical national advertising you see with most dealers, we were the same guy. It wasn’t so much about message, it was how much advertising can you buy, how many times can you be on TV and radio, how many billboards can you have around town. It was the typical shotgun blast advertising. Then we signed on with PureCars for our online marketing. We weren’t the first dealer to jump on the digital wagon but we weren’t the last one, either. We realized the average customer was doing more shopping on the Internet than they are getting up on Saturday and driving what we call the Auto Mile and shopping ten different dealers for ten different prices. We told ourselves we have to get into the business where our showroom was our website and we’ve got to figure a way to what we call “win the click.”
Win the click sounds catchy. What does it mean and why is it important?
To win the click is to get your customer to click on your car, request more information, and then set an appointment. It’s using more of a targeted rifle shot than a shotgun blast to attract prospects and customers. You find out what’s relevant to you, as a business, and then, of course, what’s relevant to your products and your customers. You want to attract the attention of low funnel buyers.
Okay. Low funnel buyer is another term I like. Could you explain what you mean by it?
If you take a triangle and flip it on its head, the tip at the bottom would be the targeted buyer. This is a buyer in market ready to make a buying decision about a product you own. I’m happy to work with any customer, but I’d much rather talk to a customer who is in the buying market versus the thinking or shopping market. If a customer is in-market for a Chevy Silverado, that customer is in the high end of the funnel. One day he’s going to retire. One day he’s going to buy a boat. One day he’s going to need a truck to haul the boat. His search is at the top end of the funnel. A buyer at the low end of the funnel would enter more specific search terms, such as “Chevy Silverado, 342 rear end, towing package, heated seats.”
How has committing to digital marketing made a difference? Could you share some sales close ratio numbers or more data points that speak to results?
When we started looking at the numbers a few months ago, to be honest with you, it was kind of overwhelming for me. I knew we were doing a good job and our close ratio on our internet leads was going up. Because the leads that were coming in were more specific, the sales process became easier. I believe our sales close ratio for internet leads went from 21% to 53%. It wasn’t as if my internet traffic tripled. What I had were more low-funnel buyers coming to my website. In other words, the quality of the traffic coming in through the internet changed. It was more of a specific buyer more relative to the product I had in stock.
What other vendors do you use?
If you’re trying to sell cars, you need to be on third-party sites, such as cars.com, AutoTrader, or CarGurus. These sites invest a lot of money into SEOs, which extends your reach. You don’t have to be with all three. Find out which sites work best for you and stick with them. Currently, CarGurus and cars.com are a good fit for us.
How about your DMS and CRM tools?
Our DMS is through Reynolds & Reynolds. We’ve been with them for over 20 years. They’re the 800-pound gorilla in the software business and their stuff is state-of-the-art.
Our vendor with our CRM tool is DealerSocket. We’ve been with DealerSocket now for about four years and they’ve got some wonderful tools. Basically, every salesman has a work plan. DealerSocket will tell us, okay, you’ve got to call this customer today that you upped on Saturday. Or follow up with this customer and make sure they’re looking out for the customer survey.
DealerSocket also helps us keep in touch with our return on investment. I can go to our BDC right now and find out what is the hot car this month. Then I can go to my used car sales manager and say we need to stock more of these cars in this price range because it’s generating so many leads.
Could you talk about how you use social media, including Facebook?
We are very active on social media. One thing I’ve learned about social media is you need to do that in-house. You can’t hire a company in California to do your social media when you’re in Summerville, South Carolina. It’s got to be done in-house, because you know all about the local events, local food fairs and carnivals. When going out there and snapping a picture of a local teacher or principal who just bought a car and sharing that on Facebook, of course with their permission. When you do third-party social media that’s not in your marketplace, they don’t know about the upcoming events, they don’t know about the undefeated high school football team playing for the state championship. We’ve seen our best social media success by hiring a local person who’s active in the dealership and who knows all the salesmen, on a face-to-face basis.
What does McElveen Automotive Group do to encourage brand loyalty?
We reach out to all of our customers. If you’re in a GMC product, we market very strong and very hard to you and make sure you know about all the incentives. If you’re in a 2012 Yukon and incentives come out for a 2016 Yukon, we get that message in front of you, let you know about your trade-in value. That’s another thing we do with our BDC, we spend a lot of time trying to keep our customers in our product. We do a lot of mailers to our customers. We can it our “buy-back” mailer. We would rather buy our customers’ products back instead of going to the auction and picking up a vehicle we don’t know about.
Another thing we’ve done to increase brand loyalty is push leasing. There are some good percentages out there. The last time we checked with our GMC rep, if a customer leases your product, you’ve got an 84% chance that in two to three years they’re going to buy the product again.
If you could recommend only one digital tool for a dealership, which tool would that be and why?
Not talking software, I would have to say my favorite tool would be one that identifies the best keywords for me to use in moving my inventory. Those keywords can change from month to month, so it’s important to be on top of what’s trending now. I don’t want to waste money and time on useless or non-productive keywords. Additionally, my preferred digital tool would be constantly refining my marketing effort. Among other things, it would tell me which cars are generating the most clicks and most traffic. Such knowledge is especially helpful when I need to stock my used car inventory, for instance. A lot of times when you have your used car manager go to auction to pick up inventory for the next month it’s a guessing game. Wouldn’t it be a lot better to know what truck, what engine, what drive shaft, what drive axel, what equipment is moving the needle?
What’s the auto retail industry going to look like five years from now?
The bulk of your business is going to be the internet. It’s going to be digital, how does your car lot look online? How good are you at handling the leads and getting requested information back to people? Your vehicles have to be market-based priced and you have to stock the vehicles people are looking for. The dealer will have to put his best foot forward on his website. He’s got to check his website often. He’s got to make sure all his holes are plugged, from the time the customer generates the lead to how you handle the lead, how you follow up with the lead, how you price the lead, and how you stock your inventory. That’s going to be the key to success moving forward and I’m firmly convinced of that.
How does McElveen Automotive Group support the local Charleston community?
I’m looking at a board right now that’s inside of our facility and it’s called “Mac Gives Back.” Which is doing our part for the Charleston area, a region known as the Low Country. We give money to Ducks Unlimited, to help protect wetlands. We give money to the American Red Cross to help our local counties. We’re in the process of raising money for the University of South Carolina Children’s Hospital. We’re raising money for the MUSC Hollings Cancer Center. Our local Summerville soccer club. Our Dorchester Children’s Center. QDMA, Quality Deer Management Association. Toys for Tots. It’s a long list. We get involved in as many things as we can outside, because one thing you can’t measure – I might measure how many internet leads I had this month or how many sales calls—you can’t really measure the impact when you go out there and do things with your community. You’re planting seeds.
What advice do you have for anyone considering a career in auto retail?
I think it’s a very underestimated industry. I’m doing some classes at a local high school, where they asked me to come in and talk to the students about the automotive industry. I’m talking to these kids about basic soft skills, how to meet and greet, how to give someone your eye attention when you’re talking to them, and manners. I’m talking to them about the car business and they have no clue as to what the car business has to offer. Nowadays, we need savvy car salesmen. You have to be savvy on the computer, on the internet, on marketing. There’s a big shortage of mechanics in the automobile industry and there are several certified mechanics making well over $150,000 a year and these guys work forty hours a week in temperature-controlled shops. The auto industry is growing. The applications for the industry are growing. There are dealerships going to in-house BDCs, in-house marketing groups, in-house advertising. I need more mechanics, more service writers, more people working in my finance group. You’re seeing dealerships doing everything in-house, which creates a lot of opportunities for young people to get in the auto industry and have a career. We have a lot to offer.
