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Ziegler Supersystems, Inc. November 2002 Dealer Mag Article |
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Worlds Greatest Salesman My son, Zach Ziegler, is the world’s greatest salesman (sales person). He’s a better closer than virtually everyone reading this article, including the writer himself. A story that I have been telling in recent seminars started out about fours months ago when Zach came bouncing down the stairs filled with enthusiasm and excitement. The sales pitch was well rehearsed...probably role-played several times in the mirror. Every gesture, every facial expression, every voice inflection was carefully orchestrated for the maximum effect. “Dad, do you know what a GoPed is?” Actually, I had to admit I had never heard of a GoPed. Once I admitted ignorance about the GoPed I quickly realized I had been set up for a world-class features and benefits presentation. Now, you’ve got to understand, my son, Zachary, is the classic example of the spoiled little prince. He is an only child with older, successful, affluent parents. At age fourteen we are going through that stage where his mother and I have suddenly become stupid and extremely uncool. We try to do everything to win his affection. Arguably, his mother is quicker to fold...a softer touch than I am. As it turns out a GoPed is a big skateboard with standup handlebars and a two and a half horsepower gasoline engine capable of speeds in excess of thirty-five miles an hour. Zach explained to me that virtually every kid in the free world owns a GoPed and he is the only kid he knows whose parents have deprived him of this necessity of life...And...Its only $600, fully-equipped. I reminded him that we had recently purchased him inline premium skates ($400.00) and we had also gotten him a BMX trick bike with titanium frame ($500.00)...and he just got a brand new paintball gun ($280.00). “Son, I think you are very fortunate. We’re going to pass on the GoPed. Maybe we’ll talk about it for next Christmas.” He stomped back up the stairs, obviously unhappy with my decision. A few minutes later he reappeared, standing over me as I reclined in the Laz-e-Boy. “Dad, I’ve been thinking.” He said with that serious tone and expression. “I hope to Hell what you’ve been thinking about doesn’t have anything to do with getting a GoPed.” I replied. Without another word, he stomped back up the stairs to his room. A few days later I was in a hotel in Pittsburgh checking email on the laptop. I receive hundreds of emails every week, mostly from car dealers and industry types and other reporters. There was an especially welcome unexpected email from my son, Zach. The tag line said “Dad we miss you!” I was visibly touched. Opening the email the only message was a blue hyperlink that said, “click here.” Did you know that GoPed has its own company website? When I called home that evening my wife was in one of those “pull your hair out” fits of frustration. I detected the symptoms immediately by the level of stress in her shrieking voice. “If I hear GoPed one more time, I swear I am going to kill him. He hasn’t stopped.” “Okay, I’ll handle it...put him on the phone.” “Zach, listen...listen hard and don’t say a word, you understand? You have been giving your mother a hard time and I’ve had it. I will be home tomorrow night and you don’t want to face me if you don’t straighten up immediately. Got it? And, if I hear one more word about that damn GoPed, I am going to beat you till you bleed. (Not that I would actually do that but it sure sounds cool) There is never...as in never-ever-ever going to be a GoPed in our garage....not in a million-billion years. Now do you fully understand? Good, now go apologize to your mother and behave.” I had made it perfectly clear who was in charge. You should see this child riding that GoPed! He’s had it for about three and a half months now. Zach Ziegler, the greatest salesman in the entire world? Yes, he is a better closer, with more determination, better follow-up, and better salesmanship than anyone reading this article. Not one of you is as good as Zach. Of course there was a time in your life when you were that good. I look at our sales people and our managers today and I don’t see that fire and desire to close the sale. We don’t want the deal badly enough to regroup and go at it again and again till we close the deal. Our presentations aren’t as finely tuned, well-rehearsed, with the perseverance of the average fourteen year-old. As a consultant and trainer, I have to remind people that we have that much ability in everyone of us...we just haven’t used it for a while. I was reading an interesting article last week from the Associated Press; the title read Car Buyers Prefer Test Drives. Well...duh! It seems as if a Paris based international research firm, Cap Gemini Ernst & Young, conducted an extensive survey on the car buying habits of American buyers as well as international trends. Even though there are more than 80,000 automobile dealers licensed in the United States, the survey concluded that nearly three-quarters of U.S. consumers bought their last vehicle from a franchised dealer. And then...the survey touched on an area that I have been writing about for the last couple of years. Internet dealers, such as Autobytel.com, were responsible for only 1 percent of car sales among those surveyed. This agrees with every reputable piece of research I have seen. I’ve said repeatedly that the Internet for car sales is a major non-event...always has been just a small niche market demographic. It is never-ever going to be mainstream. I have often quoted Consumer Reports statistics in my articles. (Consumer reports, a reputable research firm with no obvious conflict of interest or ethical dilemmas that does not use devious bogus alleged research to set up sales of products, seminars, inspections or services to the corporate blackmail victims of the alleged research results) Well this new research directly parallels Consumer Reports findings, which give it increased credibility in my mind. According to the article, Consumer Reports says that only one out of three consumers that try to buy a car online actually completes the sale. According to Consumer Reports most consumers don’t believe the online price is the best deal and they preferred face-to-face negotiations. There you have it...reputable research...not what we have been accustomed to seeing from industry alleged research sources...saying consumers prefer to negotiate. Something the majority of successful car dealers have always known. Negotiation is customer-driven and the way consumers prefer to do business. ``The consumer still wants to go to the dealership and test drive that car before he (she) buys it,'' said Michael Wujciak, vice president of the global automotive sector at Cap Gemini Ernst & Young. Wujciak also said he wasn't surprised by the small percentage of people buying cars online, but he did expect to see higher numbers of shoppers using the Internet as a source for information. In all the markets, less than 20 percent of those surveyed claimed the Internet as a source of research. Eight out of 10 said they relied on visits to traditional dealers as their main source of information. He said most still feel more comfortable sitting in a car and taking it for a spin instead of choosing one on a computer. That floored me because we have been spoon fed tons and tons of bogus drivel from suspect surveys saying the majority of consumers are doing a ton a car buying statistical research online...which hasn’t been what I have experienced in the real world, in real dealerships, with real customers. Manufacturers have used this bogus misinformation to justify putting invoice pricing online. True...some customers do a lot of research on the Internet before shopping but I have said strongly repeatedly most consumers do very little to none research before they shop. I theorize the average consumer does not even look in the newspaper the day they go car shopping. Of course, there are those customers who are the ultimate grinders and they come in armed to the teeth but that’s not most people as this research substantiates. I am not sure whether or not this really bothers me or not…the headline reads… Isuzu is in serious trouble…the subtitle said…Carmaker cuts production and ad spending. Well. It just might be me but I never really had any emotional attachment to that particular franchise. Let’s face it, Isuzu is a stupid sounding name and who would drive something with a stupid sounding name you have to explain? Sort of like saying you are the proud owner of a Volkswagen Touareg. Sadly enough, it appears that Isuzu’s spokesman, Joe Isuzu, who is a world famous liar might be unemployed if the company tanks, as seems inevitable; BUT …I see a strong possibility that Joe Isuzu (world famous liar) might be picked up by a California research firm...maybe as senior partner. Also on the ropes… I am extremely disturbed that it appears AmeriCredit is struggling in a life or death battle to raise $600 million to stay ahead of losses resulting from bad loans and overaggressive lending. AmeriCredit has been the premier source for secondary finance for more than three years now. There has got to be a competent source…with staying power…in the sub-prime arena to keep that segment of the industry alive. We are seeing an economy where more than 63% of adult Americans have serous credit problems. Most of this is due to erratic fluctuations in the American economy. There has got to be an avenue for these Americans to reestablish that protects lender from risks associated with the market segment. I predicted in recent article that there was strong possibility that Honda would take their eye off of the ball…Well sports fans it seems that the Honda Odyssey has a big ugly zit, right in the middle of its face. Do we want to talk about arrogance, denial and stupidity? The Japanese are not immune to a gross deficit of competence or ethic. The concept of large-scale gross incompetence appears to be a multi-cultural phenomenon. It seems that Honda has had to extend their warranty on problem transmissions to…get this…seven years or 100,000 miles on vehicles with problems transmissions. They also have agreed to reimburse Honda owners (in cash) who have paid out-of-pocket for replacement transmissions. Wait a minute here…are we saying that Honda actually made these people who purchased these Hondas pay for replacement transmissions when they knew all along these transmissions were (to use a southern colloquialism) “pieces of crap”? Did Honda arrogantly and defiantly refuse to back their product, specifically vehicles with these transmissions, until the consumers came after them like an angry swarm of bees? Did they only do the right thing after there were appeals to the National Highway Administration for a mass safety recall? Okay, lets review here…first of all Honda extended the warranties on about 1.2 million Honda and Acura models equipped with automatic transmissions, citing problems that may result in premature wear or failure. However, the official Honda spokesperson said Honda didn't recall vehicles because the problems aren't safety concerns. Honda became aware of the issue after it investigated warranty claims on some vehicles. (With the government breathing down their neck perhaps?) Excuse me; did Honda say the problems weren’t safety concerns? According to all of the stories I’ve read, including USA Today, it seems these Honda transmissions had a tendency to allegedly slip out of gear…or not even go into gear…or abruptly, without warning, they would automatically downshift or not even shift at all revving up the engine to dangerous levels…so much for all of that legendary Honda integrity ad quality propaganda. What bothers me is the fact that Honda was so apparently willing to try to sweep this proverbial crap under the proverbial carpet and apparently (to me anyway) try to outmaneuver and stiff their loyal customers. If I were a Honda dealer, I’d be all over these people. We’re talking about 2000-01 Accords…2000-01 Preludes…2000-01 Acuras. According to my friend, Erle Eldridge, at USA Today we’re talking about more than one million Hondas. In my opinion, Honda has spent twenty-five years building a quality reputation and they’ve taken less than one year to piss it all away trying to cover up this obvious defect. The Odyssey has been Hondas “premium price” state-of-the-art top seller. Honda actually held out and forced customers to replace their transmissions with cash-out-of-pocket before the company gave in under duress and threat of government intervention. At least that’s my spin on what I am reading and hearing here. You pretend to be the benchmark for customer satisfaction while in actuality you are willing to carry out such a chicken poop maneuver on your loyal Honda customers finally admitting the transmissions were obviously defective before the government stepped in. Shame on you! James Ziegler opinion…world class attempted cover-up. Honda should be ashamed, embarrassed and humiliated. Honda dealers should be incensed and enraged (pissed off) and… Hey do you guys over there in Japan still do that Hara-Kiri thing with the knife when you lose face? Wow! What a spectacular headline… “Entire Honda Executive Board Commits Mass Suicide”. Wouldn’t that be something? In the Toilet… My mouth dropped open and I gasped in horror. The headline read … “After 10 consecutive years of rising U.S. sales, the Swedish automaker has hit a pothole this year…what's wrong with Volvo? Excuse me here, can I ask a Ziegler question at this point? Could it have anything to do with the fact that Ford Motor Company now owns Volvo? The
article went on to say that Volvo sales are off more than 16.2 percent
year-to-date even though the U.S. and international markets are up over
last years record pace. In the meantime Volvo dealers seemingly have to deal with oppressive, overbearing factory interference in the retail process. Volvo, the apparently, evidently clue-impaired factory, is apparently interfering with every minute detail in the sales process down to furniture, dealership decor, greeters, sales process, they set retail pricing, encourage invoice selling and they even survey their dealers about the diversity of their employees. In other words, the factory evidently has stolen the dealer’s autonomy and is micro-managing the sales process…therefore is solely responsible for the incredibly stinky sales volume. So, I assume Volvo, as heavy-handed, overbearing, and dictatorial as one might readily assume they are, must assume 100% of the responsibility for dragging down their documented dismal sales results deeper into the dumper. They appear committed, in their perceived arrogant, all-knowing non-business plan to continue screwing around with their entrepreneurial dealers. I am not saying the factory executives who are in charge at Volvo are pitiful self-absorbed fools, clue-impaired out-of-touch MBA morons, nor am I saying they are blithering intellectual, out-of-touch, incompetent idiots…all I am saying is let the factual evidence speak for itself and let the cards fall where they may. Judge for yourself based on transparent facts and evident reality. I am not saying let’s all run out and lynch Vic Doolan, but I do know where the rope is. Another article said…"It has been a negative and tortuous year," admitted, president of Volvo Cars of North America Inc. "But we're going to turn the corner and move forward strongly from this month on." But further research (by Ziegler) reveals the executives at Volvo do have a marketing strategy designed to restore sales and profitability. Its simple they plan to aggressively cut costs while they are decontenting their cars. They’ve already started on this year’s models. Whoa Der Buttwheat, hold de presses here…Scuse me… I was beating up on Volvo for losing substantial market share and sucky profitability but I didn’t read all of the way to the very bottom of the article. The article went on to say… (Quote) “ Volvo also is climbing the key J.D. Power indices. Its initial-quality score rose 26 percent in 2002 and was tops among European brands. Its sales-satisfaction ranking improved from 10th to seventh. And customer service jumped from a mediocre 11th to fifth in the industry, also securing the top ranking among European brands.” Wow! I am so sorry not to have mentioned that. It seems that Volvo has risen to number 5th …up from number 11th in service satisfaction in the prestigious J.D. Power surveys…and from 10th to 7th in J.D. Power sales satisfaction, all makes. The article also accredited J.D. Power and Associates as documenting a 26% rise in initial Volvo quality. I cannot help but wonder why their sales suck so much if they rank so high in J.D. Power surveys? Of course, I have to always bear in mind when I read those irrefutable alleged statistics that J.D. Power and Associates is on Ford’s payroll, certifying and inspecting their dealerships for the Blue Evil Intimidation program. Is it just me or does anyone else feel this is an ethical dilemma and a conflict of interest on their part? Let me make it perfectly clear however that I am not definitively saying J.D. Power and Associates, the company per se, is suspect, criminal or corrupt…I am just honestly wondering about the incongruence of logic. Let’s see here. I am just a high-school graduate from the rough side of Jacksonville. Help me with my logic here…J.D. Power says Volvo is number 5 in sales satisfaction…J.D. Power also sys they have a 26% increase in initial quality…Okay…the article claims Volvo sales absolutely suck bigtime (Ziegler translation) Excuse me, does anyone besides myself get the feeling that something really stinks here? I smell a Powerful odor here.
The headline says… “Jaguar Taps Brakes on Growth Despite Launch of Its XJ Sedan.” I almost cringe every time I pick up another week’s issue of Automotive News. Week after week I experience déjà vu all over again …the story is always the same only the brands keep changing. In another words, same corporation, another brand. Originating during the Paris Auto Show where Jaguar’s new XJ model was introduced, this week’s story is centered on Jaguar projected losses. Same ole story, there’s Nick Scheele out front aggressively bean-counting with that hang-dog look on his face, side-by-side with Bill Ford. Scheele announced Jaguar is going to have a difficult year estimating losses at $500 million. Scheele cited the same problems he cites at virtually every press conference lately when he is up there with Bill…again… pitifully explaining losses due to heavy incentives…quality problems…engineering changes…manufacturing problems…glitches on the XJ that will delay the launch into next year. In other words XJ profitability for 2002, somewhere between 10,000 and 15,000 unit sales, will not happen this year. Bummer! Again! Bill Ford says… “We’ve got to get it right, so we will take the hit.” Brilliant Bill! Evidently when London called, nobody answered. Ironically overall Jaguar sales are up. Unfortunately, sales increases were due to volume outpacing projections in sales of the new X-Type model (British Taurus), the smaller, less expensive Jag. The premium, luxury, upper priced Jaguar lineup took a hit. What the article didn’t say but I can logically figure out…and remember I predicted this…is that they have artificially and aggressively driven the sales of the X-Type with unrealistic, over-residualized leases that will come back to bite Ford on the corporate ass three years from now (again) when those puppies come home to roost. This is Ford’s secret weapon under siege they have used repeatedly throughout the last decade. Over-residualized leases delay losses until later and create an immediate accounting impression of immediate sales and profitability. This “hide the weenie” mentality is part of the reasons why Scheele and Ford have to stand in front of reporters repeatedly apologizing for profitability and quality. As for Jaguar…it’s really a great franchise and it has a rich heritage and great dealers BUT I have to once again shake my head as I watch all of this heritage and momentum flushed by the bean counters. Of course Ford has continually and doggedly focused their vision and business plan for the future upon the fragile Premier Auto Group including Volvo, Jaguar, Aston-Martin, and Land Rover as the foundation for future profitability. The Scheele quote in an article from Reuters said… Despite the loss at Jaguar, Scheele said Ford's Premier Automotive Group, which also includes the Land Rover, Volvo and Aston Martin businesses, was on track to deliver strong revenue growth as part of Ford's multi-year-turnaround plan after the company's $5.45 billion loss in 2001. Of course the quote from Ziegler says… “What turnaround plan?” Simultaneously, another Reuters said… LONDON - Ford Motor Co.'s Jaguar said on Thursday it was cutting about 400 jobs or 3 percent of its workforce as its parent Ford. I Told You So… The headline read… “Chrysler makes new move on dealer consolidation” Like many manufacturers, Chrysler is making a corporate muscle trying to get dealers to feature stand alone Chrysler-Dodge- or Jeep combination dealerships. In previous articles I have alluded to Chryslers plan to eliminate and combine dealerships with an ultimate target number of 2000 five-star dealers. I am becoming increasingly respectful concerning Chrysler’s business plan although I remain wary about the method of implementation. So far it has been voluntary and Chrysler has not apparently used the heavy-handed tactics other manufacturers have used to achieve similar goals. As I reported and commented on in articles last year and earlier this year, this is aimed primarily at metro dealerships. I
couldn’t help but laugh as I read the rest of the article in Automotive
News. What I found amusing about that quote is that The Crowley Group is one of my premier consulting clients. Wonderful people. My company began training and implementing selling processes in those dealerships in July of this year. I have to take at least a little of the credit for those dramatic unit sales increases and gross improvements there and I suspect it probably was more effective than the impact of throwing out Kia. All in all however, I believe this is going to be a strong marketing strategy for Chrysler and I am predicting they’ll see great results, long and short term as a result. When you talk about the “Big Three” in the U.S. Retail arena…you might assume you’re talking General Motors, Ford and Daimler-Chrysler. Unfortunately, Chrysler has fallen out of the big three, knocked off by Toyota…and Chrysler is pissed off about that. Darryl Jackson, newly appointed marketing Czar at Dodge, says Chrysler division will sell more than 4 million units annually by 2010…half of those units coming from Dodge division. Trading press releases…Toyota vice president, Steve Sturm "The year we surpassed Dodge, it was due to SUVs," You see
Toyota has consistently sold twice as many cars in the U.S. as Dodge BUT
now we see Toyota taking away truck sales, including SUVs. Dodge is
limping along with the aging Durango, whereas Toyota has five fresh
products they’re offering in competition. Now Toyota is turning up the
heat moving into the big full-size truck market, which is going to give
the entire sector a fit. Big mistake at KiaKia dealers rate at the very top in Dealer-Manufacturer relationship surveys but it appears they are about to blow it. I have answered letters about this in previous issues and now the folks at Kia are about to announce a program I think is the worst miscalculation in their short corporate history. Unless I totally misread what they are doing, it is going to create a flurry of lawsuits and bad feelings. Those of you that read this column know that I have been a big fan of the Korean imports, Hyundai and Kia. Well, now that their ship seems to be coming in are they willing to double-cross some of those loyal dealers who helped get them this far? Kia plans to give stand-alone Kia dealers $350 per unit price advantage over dealers with dualled points featuring Kia and other franchises. Excuse me, Dan Myers and Loula Fuller are the very best dealer advocate attorneys in the known universe BUT why is Kia so apparently so readily willing to make them richer with this blatant two-tiered pricing end run around the spirit of goodwill with their own dealers? As I write these words… A weary Ziegler sits here staring at the computer contemplating the words and thoughts I have shared with you again this month. Ironically, the article began when Zachary Ziegler put me together on buying him a new GoPed. The irony is that this week we traded it in on a larger model called “The Bigfoot GoPed”…it was only $350 trade difference. This one has a bigger engine and off-road tires. As I sip and swirl my snifter of premium Remy Martin Cognac, I smile…now I am actually chuckling out loud. Just heard my wife tell Zach that he wasn't ever going to have a dirt bike as long as he lives under this roof. More Food for Thought God, it must be tough being Bill Ford these days. The company is under siege and everybody’s taking shots at them. The headline in Auto Snooze said… Bill Ford says repairing relationships is a company goal.
Bill was quoted recently as
saying…"There's no question we really shot ourselves in the foot in
relationships with our dealers, our employees and our suppliers," He went
on to say, "One of my main goals has been to repair those relationships.
Without trust being restored, we can't return to a true growth mode in
this industry." All summer we have seen Ford Motor Company executives putting on the blitz coercing dealers to give them good grades in relationships with the J.D. Power surveys, the NADA surveys and all of the other factory-dealer relationship research. Dealers were told “If you give us a bad grade on the NADA survey, you’ll hurt the franchise.” Dealers were intimidated and received letters from executives at all levels including Steve Lyons…the theme…please give us a good survey. (Even though we don’t deserve it) Well, I just read the UBS Warburg report detailing the results of their research in their September Dealer-Manufacturer relationships survey. Bear in mind, UBS Warburg is one of the most respected, prestigious, high-profile, award-winning research and investment firms in the world. This is not some, hidden agenda influenced, conflict of interest driven report. The UBS Warburg report read in part… “Ford took home the booby prize. Ford’s U.S. brands took each of the bottom-three slots on our UBSW Dealer Index. DaimlerChrysler’s U.S. brands faired little better.” “Toyota took top honors in the overall UBS Warburg Dealer Index. Honda and BMW were close behind.” “Strong contenders include Kia, Nissan and VW.” “GM came out in the middle again. The jury is still out but Chevy, Caddie and Saturn dealers are reasonably happy campers.” “Fifty percent of Lincoln dealers, 42% of mercury dealers, and 15% of Ford dealers rate their franchise as least desirable.” I could go on and on but the gist of this extensive research by a reputable firm indicated to me that Ford, Lincoln, and Mercury Dealers are disgusted, fed up, and even more than that, they are not optimistic that it is getting better and they don’t see the future as being brighter in the short term. Now look what a mess you’ve made Ollie? Informed rumor has it that Ford is about to dump the entire Blue Oval Certification fiasco. Well, that is exactly what they must do to restore dealer relations BUT not if they intend to keep the 1% they took from the dealers to fund it. Maybe they will lie down and conveniently lose a case in court…there are several cases…and then drop the program saying they tried to keep it while keeping all of the money. Jim O’Connor has repeatedly threatened they will not restore the 1% if the program goes away. You guys (gals) think you got troubles now? Loula Fuller and Dan Myers will have to hire an army of more staff if you try that one. Bill, I am appealing to you and Jim O’Connor to do the right thing. Intimidating these dealers and allowing your field people to threaten them is not going to get you cooperation or goodwill. You can put all of your “factory-lackey” dealers out front singing the praises of the factory …you can even install a couple of them on your councils but we all know the score and the true feelings of the majority. These people invested heavily in making your company what it is (was) and they took great risks along the way…you owe them better than they are getting. AND you’re never going to return to long-term growth and profitability without them on your side.
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