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Study Finds Top 10 Reasons Car Shoppers Leave Auto Dealership Differ from what is Commonly Believed

April 18, 2011

CAR-Research XRM,  a single-source CRM solution uniquely branded as; “XRM, Exceeding CRM”, today released findings from its study of the top ten reasons car buyers really leave the auto dealership without buying. The study used a sampling pulled from January 2009 through October 2010 of approximately 250,000 Interviews with customers from over 250 auto dealerships across the US, conducted by CAR Research XRM’s Unsold Research Call Center. The findings show that while many believe the highest percentage of customers leave due to lack of time or that they need to confer with another decision maker; the real reason is that there was some upset in the sales process, commonly known as the ‘Road to the Sale’ process.

At 27 percent, Sales and Management Staff issues ranked as the highest single reason customers abandoned the sales process at dealerships.  The Sales and Management Staff Issues reported by survey respondents ranged from among the following:    Rude and disrespectful treatment by sales personnel; Sales staff not being knowledgeable about product or financing information;    Appointments not kept by the proper sales staff member that customer was expecting to meet with;  Condescending attitude and not working directly with or talking to a female when a male was present with her;  Not being respectful of customers time by back and forth communication with sales desk manager;  Manager that took a turn was seen as rude or too pushy and lacked empathy for them.

These findings are in direct contrast to what many believe to be the main reason customers leave: lack of time or that the customer needs to confer with another decision maker. Based on the survey results, it would seem that the customer does not always tell the dealership the REAL reason they are leaving, but instead, make up a ‘False Excuse’ designed to let them leave the dealership gracefully.

While over 50 percent of the time the sales person or sales manager entered Time and Decision Maker into the CAR-Research XRM software as the reason the customer told them they were leaving without buying; Time and Decision Maker was reported by just 3 percent of survey respondents as the reason they actually left the dealership.
 
“While customers are telling dealerships that they are leaving because they are out of time or have to talk to their spouse, CAR-Research has found from literally millions of consumer interviews that this is in reality only a real reason 3 percent of the time, and that 97 percent of the time the reason given for leaving the dealership is a lie just to get out of there,” commented Kurt Kubicki,  “the real excuses turn out to be something like they did not like the sales person, the sales person lacked product knowledge about the vehicle, the manager they scheduled the appointment with was not available, etc.  The real reason is important as the truth then leads to the correct handling and a close,” Kubicki added.

The survey found the top ten reasons car shoppers left without buying to be as follows:
  1. Sales and Mgt Staff Issues 27%
  2. Shopping 21%
  3. Price  12%
  4. Financial 12%
  5. Inventory  9%
  6. Style  5%
  7. Payments 4%
  8. Trade 3%
  9. Time 2%
  10. Decision Maker 1%
  
 
These results are taken from a sampling of approximately 250,000 Interviews from over 250 auto dealers pulled from January 2009 through October 2010. Research has a margin of error of + or - 3%.
 
Other key findings from the survey include:
  • Items that ranked 2, 3, and 4 (Shopping, Price, and Financial) accounted for 45 percent of the reasons cited by customers for leaving a dealership without purchasing a vehicle. 
  • Of this customer segment, it was identified that 71 percent of these customers did not receive key Road to Sale process steps while at the dealership that research was being performed for. These key process steps included Product Presentation, Demo Drive, Service Introduction and Walk, and Manager TO Interview before leaving the dealership. It is indicated that if these steps had been performed at a higher level of efficiency, less customers would have left, and more customers would have purchased during visit.
  • Of those customers that were interviewed by the CAR Research XRM’s Unsold Research Call Center, and an email was captured at a capture rate of 63 percent, through subsequent dealership marketing efforts 31 percent of them came back into the dealership, and 51 percent did business with the dealership at some level (i.e. purchased a vehicle, serviced a vehicle, purchased parts, bought service contact etc). 
 
“In conclusion, Sales and Management issues with customers greatly affect performance of showroom activity, and understanding the reason that a customer left the dealership significantly increases the ability of the dealer to get the customer back in, and subsequently close the deal,” said Kubicki.”
 
CAR-Research XRM is the only CRM in the auto industry that also provides the unique follow up of its Unsold Research Call Center. The data gathered by this center was recently used for a major research project, the KainAutomotive Independent Leads study, due to be unveiled at the 10th annual Digital Dealer Convention in Orlando, FL, April 19-21. The study reviews closing data provided by CAR-Research XRM on 4.3 million Internet sales leads.
 
About CAR-Research XRM:
Now in its 16th year, CAR-Research XRM has paved the way for better customer relationships with its use of market research to capture unsold retail customers.  Utilizing its signature "third party inquiry" interview process, the company provides real-time information to dealership management on potential sales they would normally lose. CAR-Research XRM is currently doing business in thirty-one states, Canada and Puerto Rico. From its headquarters in Houston, Texas, the company maintains its high-touch approach, providing daily training, monthly performance reviews, and on site account management, ranging from single-point stores to large dealer groups. Additional information is available at www.CARResearchXRM.com

4/18/11

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