Car Dealer's Philosophy

 

“Buyers are liars” is a common saying in most sales meetings...

-Remember, when you mention to the salesman that you will "be back", keep in mind, that they don't believe you.

 

Car dealerships have a simple philosophy to maximize their bottom line profitability: sell the vehicle to the customer on their first visit. They adopt this philosophy because they know that customers will rarely come back to the dealership once they leave.  It is such a rarity, that salesmen refer to the return of a customer as unlikely as them being delivered on a magical “Be-Back-Bus”. 

 

“Buyers are liars” is a common saying in most sales meetings.  Salesmen understand the reason that customers make excuses to leave is because they don't want to be tempted to buy a car.  Because salesmen are aware of this dynamic, they are taught to not pay attention to the customer's “smoke screen” excuses about coming back and will try to sell a car today.

 

To entice the customer to "buy today", salespeople employ some simple strategies.  One popular strategy is to eliminate the customer’s objections.  This is simply accomplished by asking the customer what is stopping them from buying a car today.  Then they will isolate the customer’s objection and take it out of the equation. 

 

For example, the salesman might ask the customer what is stopping them from making a decision today. The customer might then reply with an objection like “I have to talk it over with my wife.” 

 

Now the salesman will isolate that objection (the wife) and remove it from the decision by saying “If your wife agreed, would you buy the car today?”

 

If the customer says “yes” now the salesman can move forward with the process.  This starts the negotiation whether or not the customer was ready or not.

 

In the above scenario the customer is objecting to one thing (the wife's approval), but is agreeing to everything else. All of a sudden, the salesman has converted a “car shopper” into a “car buyer”. Keep in mind, salesmen are instructed not let the customer off the hook.  If they are not buying today, they want to know why in order to isolate that “excuse” and continue with the process.

 

Another strategy salesmen will use is to tempt the buyer.  They can do this by providing the customer with a host of fabricated reasons to buy today.

 

For example, “If you buy today we can show you more for your trade-in because our used car manager has a buyer for it!”   These are all gimmicks to get keep the customer on a track.

 

The danger is that most customers will try to rely on their wits and reply “how much more will you pay for my trade?” What many customers may not understand is the salesman wants them to start this “shoot from the hip” negotiation.  Because when you are negotiating, you are only one step away from buying.

 

When customers are not prepared with all the proper information on price, ACV and Buy-Rate it will almost always will result in a nice commission for the salesperson. 

 

As you can see, a cornerstone of the guide book is not to buy the car on your first visit to the dealer.

 

The other major reason car dealerships train their salesmen to make a deal during the customer’s first visit is that the sale will be far more profitable. When the customer goes home to “think about the purchase”, it diminishes the opportunity for an emotional purchase. (See the article on Ether in the Dealer Secrets section. ) Not to mention the possibility that when the customer leaves they could research the price and if the customer returns they may attempt to purchase and/or finance the vehicle at a lower price.