Red McCombs Toyota, in San Antonio, Texas, is an innovator through and through and it pays off.
The dealership continuously works with its vendors to refine new software for automotive retail applications. So, naturally, it stays ahead of its competition in the digital arena.
Red McCombs Toyota draws its Internet customers not only from the far reaches of its region, but also from around the U.S. and around the globe – from Alaska to Afghanistan.
The dealership places a lot of emphasis on its social media outreach – so much so that it has a full time social media manager, working under its Internet director.
And, Red McCombs Toyota is the number one dealership and the highest rated Internet department among the Gulf State Toyota dealerships.
As a result of its leadership’s savvy, and the hard work of its lean sales team, Red McCombs Toyota is among the top 30 dealers nationwide in Internet sales—selling 2,186 new and used vehicles on the Internet in 2011. And, the number for 2012 is a respectable 1,874 – with less staff.
Mike Buffenbarger, Fleet & Internet Director for Red McCombs Toyota, recently shared with Dealer magazine, the details of that dealership’s secrets to success.
Mike, how did you get started in the car business?
When I retired from my career, in the U.S. Army in July 1999, I answered an ad for a car sales position at another dealership prior to Red McCombs. Then, I came here in 2006, as an Internet salesperson. I‘ve been the fleet director four years now, and I’ve always run the Internet side of it and I now have a Co-Internet Director, Rene Saenz, and a Social Media Manager, Tara Caballero, whom I work closely with.
Share with us the secrets to your success.
Key to our success is this: Jim Mangano, our general manager, understands the presence the Internet has for the customer and he’s not afraid to embrace it. I’ve worked for other managers that didn’t appreciate that fact.
In the past year and a half since Jim has been here, we’ve changed our philosophy and processes. Jim has encouraged us to be completely open and informative with our Internet customers. If customers want a price over the phone or by e-mail, they get the price. Jim has always stressed: Don’t be afraid to give the information to customers upfront. That’s different from the old school approach.
We attribute 47% of our total dealership sales to Internet sales. Our competitors are not anywhere near that. So they are not taking advantage of their Internet sales opportunities.
Where do your Internet sales opportunities come from?
We get Internet leads and customers from coast to coast – from Oregon to Virginia. I had a customer come down from Alaska and we picked him up at the airport which is only 10 minutes away. A lot of times the customer is looking for a very specific type of vehicle and we have it. They’ll see it on the Internet, call us on it and then come pick it up.
We get heavy Internet traffic from the U.S. military serving in Afghanistan. They are online searching for a car prior to getting home. We get online and communicate with them back and forth until they get here. And we have their car ready for them when they arrive and they come by and pick it up.
Does your background in the military help you better market to our service men and women in Afghanistan?
We have quite a few former military people who work here and we all understand their way of life and their needs and that they have to be helped a little bit differently. It’s a longer buying process for them. It’s not a quick sale. You have to stay with them and provide them with everything they’re looking for and then six months later they show up and want their car and they don’t want any surprises. We make sure they get what they want and deserve. We don’t worry so much about the sale; we’re focused on customer service. Coincidently, we are right across the street from USAA.
These service men and women also count on us to help their family members – finding them the best vehicles – while they are away. We have a big owner base and lots of trust. People know and trust the McCombs name.
Is there something unique about the way you handle your Internet customers?
The way that we handle our Internet clients is way beyond what other dealerships do in this area. They are way behind the power curve in answering Internet leads, and getting people to purchase cars.
We get 800 to 1,000 Internet leads per month and our close ratio is 10 to 12%.
The process runs in our BDC. We use ELEADS for our CRM and it works very well for us. ELEADS integrates really well with everything – our pricing programs, desking tools and call systems. For our desking tool and DMS, we use Reynolds, and that works very well for us also.
With ELEADS, we have an auto-responder that goes out as soon as a lead comes in; within four minutes of receiving a lead, our program sends out information on the vehicle the consumer has selected, as well as information on comparable vehicles, and we contact the customer right away. We generally follow up on an Internet lead for 180 days.
What makes us truly unique, however, is the extent to which we go to make sure all of our software programs are integrated and working together really well so we can effectively market and sell to our customers. The way we’ve worked with vendors to achieve this integration is definitely unusual and may be unique.
We’re pioneers in this area of doing a lot of development with vendor applications. I’ve been in Internet sales for 13 years and my side role has been to work in development with our vendors so that our Internet programs work harmoniously with each other.
I had software development in college. Now, I don’t do the actual software development, but I map out what we need here on the McCombs side, what the process should be – I figure that out and communicate that to the vendor.
I’m so into what the programs do, that when there’s a glitch, I’ll know about it and I’ll reach out to our liaison at the vendor and we’ll talk about it and how it’s supposed to work. Then the vendor conveys that to their programmers and they’ll make it work the way we want it to.
We have helped vendors like DealerTrack test and develop their software over the years. One software program we are working on now has been three years in the making and we’re using it full blown and soon DealerTrack will be selling it to other dealerships. That’s all I can say about that.
Does DealerTrack host your website?
Yes, and DealerTrack also manages our SEO and we’re very happy with that. It’s extremely effective in bringing in leads. We typically don’t use third- party lead providers, except for AutoTrader and Cars.com. Unless you have the correct inventory to market with them, you can spend a lot of money for very little results. With the used car market the way it is, with the pricing of inventory, we are in and out of using third- party lead providers. We really don’t need them.
We create and upload most of our own content for our website. We have a DealerTrack tool that lets us get in there and put up banners and specials, and if we need a landing page for a special deal, Rene will develop that in-house.
If we can’t post something on the website ourselves, we’ll send it to DealerTrack and they post it online for us. We keep our content revolving and changing all the time. We do things within an hour. We keep our artwork in-house and it’s a lot more cost-effective than sending work out to an ad agency. It’s faster too.
Do you have a mobile website?
Yes, but we are not getting many leads from our mobile sites yet. We do QR codes on pre-owns and don’t see a lot of traffic from that yet either.
What is your biggest challenge in Internet sales?
Keeping and retaining qualified sales people. Right now, we are quite low on dedicated Internet sales people. We are sitting at five. Normally, we have 10, and we’re set up for 12. We’ve had people move on. So, we are looking to hire qualified people.
It takes a certain type of person to handle Internet sales and retaining that kind of individual is hard. It’s easy for them to move on to a management position. To find a sales person who wants to stay in sales is difficult. We are constantly bringing in new people and training them. Once they get a good year under them, they are either promoted to management here, or they may find a job elsewhere at a management level and they leave.
What do you envision as the future of Internet sales?
Industry-wide everyone understands that 80% or more of the customers are looking online to find out about cars. They may not make an Internet inquiry; they may get the information they want and then make a phone call, because they are really looking to see do you have it and how much is it.
We’ve switched to a BDC environment because of the number of calls coming in from the Internet. It’s very common that on every call someone saw something on the Internet that they want to talk about. Salespeople need an understanding of the Internet and phone skills to help the customer purchase the car. Being multilingual doesn’t hurt either.
Our salespeople offer our customers the convenience of being able to speak in Arabic, Farsi, and Spanish, as well as English.
How do you stay on top of technology?
I get shot-gunned all kinds of information every day. We have a corporate group of three people at Red McCombs Enterprises that keeps us up on the Internet.
We also go to the Digital Dealer Conference & Exposition every year in Las Vegas and go to the vendor booths. We’re looking at updating some programs right now with some new companies.
What is your typical day like?
I get in at 8:15 in the morning and go through e-mail and see what hasn’t been answered and take care of that. Then the sales people get in and we go through yesterday’s business – contacting customers and sending information to people who have made inquires. Then we make phone calls – trying to schedule appointments, and providing pricing on the spot. We’re in that mode all day long until an appointment shows up; then I help with that.
What advice would you give to someone just getting into Internet marketing?
My advice would be to know your products, know what the customers are looking at and what they want to buy. Without knowing that, you aren’t going to be able to help them with their decisions. I’d also tell them to learn all the Internet software programs.
What are you doing in the social media arena?
We have a social media manager whose entire job is to oversee and promote our presence in the social media arena. Tara Caballero handles our presence on Facebook, Twitter and Pinterest and handles all our online reputation management. We have a program where the salespeople give our customers who have just purchased a vehicle a card with links to DealerRater, Yelp, and Google and we ask them to give us reviews on those sites.
Our Red McCombs group also helps us out with social media, and by taking photos at events we sponsor. As part of our social media outreach, we are heavily involved in the community; we sponsor blood drives, charity walks like the Susan G. Komen Walk for the Cure, etc.
We feel very strongly that social media plays an important role in drawing in Internet customers and so we have a dedicated resource to handle it. To ask an Internet manager to do social media as well as Internet sales and marketing is just too much.
