Auto dealerships have made great strides in responding rapidly to customer inquiries on their websites, according to a new study from consulting firm Pied Piper Management Co.
“What everyone has learned is that responding quickly to customer inquiries translates to higher web lead close rates,” Pied Piper CEO Fran O’Hagan told Automotive News. “What that means is that out of every 10 people who contact a dealership through the website, more of those 10 will end up purchasing if the dealership is good at responding to them.”
Fifteen of the 17 dealership groups surveyed scored higher than the industry average, according to the study. O’Hagan said the top performing dealer groups were three times more likely to respond to website customers within 30 minutes vs. the typical auto dealer.
Ken Garff Automotive Group in Utah made the biggest improvement. The company’s average score jumped to 74 out of 100 this year, good for fourth place. Last year, Garff scored a 48 and finished last.
Napleton Automotive Group was tops overall with an 83 average score, up 9 points from a year ago. Penske Automotive Group and Herb Chambers Automotive Group tied for second place with a score of 76.
Sam Jarvie, vice president of sales and finance and insurance operations at Ken Garff, said the company took last year’s poor rating seriously, using its “We hear you” tagline as inspiration to enact changes.
“We deployed mystery shoppers, trainers and store personnel to create better, faster and more thoughtful responses to our customers,” Jarvie told Automotive News. “It is imperative that we give our customers the best experience possible to stay competitive in an extremely competitive industry.”
Pied Piper conducted its annual study by submitting “mystery-shopper customer inquiries” to the websites of 1,614 dealerships representing 17 dealership groups. The firm asked a specific question about a vehicle in inventory and provided a customer name, email address and local telephone number. After that, Pied Piper evaluated dealership email, telephone and text message responses through the next 24 hours.
Dealership group response to website inquiries increased six points year over year with an overall average score of 65 out of 100, according to the 2023 Pied Piper PSI Internet Lead Effectiveness study. The overall auto industry average grew three points, to 58 from 55. Pied Piper identified increases in how often salespeople sent text messages to answer customer questions and emails to try to set up an appointment. More salespeople also are sending emails that encourage customers to act quickly, the study found.
Other noteworthy results: AutoNation scored 66, gaining 8 points from last year. Sonic Automotive earned a 65 average score, up 7 points year over year.
While response times made real improvement, O’Hagan said the quality of the replies has to move beyond a focus on simply “stopping the clock.”
“The industry got distracted by [the idea of quickly stopping] the clock and then using technology to generate automated emails … but they really pay no attention to the customer’s actual inquiry,” he said. “There’s a lot of variability.”
O’Hagan said there are many ways dealerships can improve the quality of their responses after an email inquiry.
“If you and I owned a dealership, we would probably continue to use automated emails and automated texts,” O’Hagain said. “But what we would be sure to do is make sure our employees didn’t say ‘Oh, well, the automation is taking care of it. I don’t have to actually read the lead and I don’t have to personally respond.’ ”
The key, O’Hagan said, is relying on digital communications and old-fashioned phone calls in equal measure.
“There are dealerships out there that are really good at emailing and they’re not good at calling, or vice versa,” O’Hagan said. “You just can’t do that anymore. You have to do both.”
