If you speak with a local Southern California Audi salesperson, he’ll tell you that the cars they have are selling at list price. And that would be okay to most consumers if the manufacturer passed out dealer cash, incentive financing, or lease discounts.
But the truth is that there are no discounts, and, to consumers, it looks like the dealer is greedy. Sadly, dealers will always add a “market price adjustment” to what few new cars they have, but those are few and far between. In most cases, as OEMs like Mini are doing, car prices are rising because they’re making 3% margin cuts on an already low margin for new car sales. Consumers think it’s the dealer’s fault, but, unfortunately, the sales guy is left to take the heat from the prospective buyer.
Last week this writer discussed an early (and profitable) lease buyout with the dealership. But it all ended when I realized that the exact new car lease payments would be twice what I’m currently paying – all because there were no lease-purchase incentives. So, it’s easy to see why customers are getting angry. And angry customers give bad reviews.
Do Bad Reviews Matter
Reputation (formerly reputation.com) research says that nearly 80% of consumers call reviews essential, and 41% say they will read at least five dealer reviews before a visit.
And, since consumer reviews carry substantial weight in any business, yes, they matter. But, unfortunately, one lousy review tends to attract even more disgruntled customers.
In a recent Ward’s Automotive interview, Ali Fawaz of Reputation says, “People are talking about the inventory shortages” and calls the situation top-of-mind. Consumers have just enough knowledge, but it doesn’t help ease their frustration when encountering high used and new car prices.
People are going to talk on Google, Facebook, and Instagram. It’s part of the digital and immediate gratification world in which we live. But unfortunately, they don’t tell you first and allow you to respond.
|Related: Why soliciting reviews is a solid business plan for dealerships|
What Should I Do with Bad Reviews?
To be clear, you don’t want to have 100% stellar reviews. Profiles like this look suspicious to the educated customer. Fawaz says it’s okay to have negative reviews because “It gives a [dealership] a chance to correct operational issues it didn’t know existed.”
Every business has strong and weak points, but they can’t always see them. Negative reviews allow a dealership to address critical flaws in the process and communicate transparently to the offended customer and other reviewers.
Everyone understands that problems can come from time to time. And if a dealership humbly reaches out offline to the consumer, it may be easy to address any issues they have. In addition, customers are reasonable and often want to be heard and respected, so taking the first step of communicating and helping them get what they want will often lead to an updated and positive review.
These days, dealerships need all the cheerleaders they can get. Your reputation depends on it.
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