Perfecting the Art of Sales Prevention

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Jul 19, 2005
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By Mark Lilien, Consultant, Retail Technology Group

www.retailtechnologygroup.com

Most businesses have a key department or function that drives the rest of the organization.

For example, in the movie business, producers are in charge. They hire the directors and actors, acquire financing, negotiate distribution deals, etc.

For some retailers, the key department is merchandising, because the function sets the tone and positioning of the store to customers.

In automotive retailing, I’ve recently come to believe, the key department is sales prevention. I realize this Web site doesn’t have many articles about automotive retailing and there have been no articles about sales prevention (as a business discipline) so I believe the following story to be worthwhile.

Recently, I tried to help my friend Emily buy a new car. She wanted to test drive six manufacturer brands. She asked me along because she’s not comfortable with car salespeople and, for reasons that elude her, I really enjoy dealing with them.

She picked a Sunday to go car shopping because she’s a very busy doctor.

She wanted to spend $30,000 to $50,000 and maximum driver comfort was her primary goal.

Her current car is a 1997 Infiniti model with 166,000 miles on it. Emily was looking to replace it and be behind the wheel of new car within a couple of weeks.

I started the shopping process by going to various Web sites to see which dealers in the NYC area would be open on a Sunday. Unfortunately, there is no Web site that easily answers this seemingly simple question, so I ended up calling a dozen dealers to determine who’d be open on Sunday. My introduction to the sales prevention process had begun.

When it came to sales prevention practices, the two most dominant brands were BMW and Lexus. Neither had a Manhattan dealer open on Sunday and so each was awarded a Gold Star for excellence in preventing possible sales.

The Manhattan Honda dealer, when we asked to see a hybrid Accord, proudly said there’d be no waiting since he had four in stock.

Not wishing to be outdone in the area of sales prevention, the dealer informed us none of the hybrids were on display and we’d have to go up to an elevator to test “sit” in one. The retailer had a policy of “no test drives for any car on the weekend” so hitting the road was out of the question.

Hoping that reason might prevail, we explained that Emily would not be able to easily return to the dealership on weekdays because of her professional demands.

Seeing that even though the car was licensed and sitting in front of the garage car elevator, it wasn’t going anywhere, we tried another tactic. We asked for literature on the model. Not having any actual literature, the salesperson was only able to provide a photocopy of specs from his reference copy.

For its innovative test drive policy and other best practices in sales prevention, the Honda dealer earned a Silver Star rating.

The Manhattan Infiniti dealer’s showroom contained a car Emily had an interest in buying. At first, we thought the sales prevention police were on the job as the car’s seat and steering wheel could not be adjusted.

The receptionist explained none of the showroom cars had any electricity but the model outside did. Perhaps, we were not encountering sales prevention techniques as much as a temporary avoidance of a sale.

Going outside, we found the model we were looking for sitting in the sun. The dash thermometer read 104 degrees and the luxuriousness of the experience went right out the car window with the heat.

For making us sweat and thinking twice about buying if not completely writing off a purchase altogether, the Infinity dealer receives an Honorable Mention in the area of sales prevention.

Not knowing when to get out while we were ahead, Emily wanted to test drive a six cylinder Volkswagen Passat with all-wheel drive. When we entered the showroom, we were pleased to see the cars had electricity. Our enthusiasm was dampened a bit when one car’s alarm went off and the showroom staff had to search several minutes for the key to restore quiet.

Having silenced the alarm, a salesman informed us that there were no more Passats of the desired model in-stock and the manufacturer was making others. Instead, a new model that would be available in four to eight weeks was being rolled out. Of course, he had no literature, specs or picture of the new model. For this and an ear buzz worthy of Ozzfest, the Volkswagen dealer is awarded a Bronze for sales prevention.

While so many dealerships distinguished themselves in the area of sales prevention, one was an utter failure.

Arriving at a Manhattan Acura dealer we were shocked to find cars on the showroom with electricity and no sirens blaring. The salesperson was all too willing to let us take a test drive and even provided literature on the model.

For failing to dissuade us in any way from purchasing a car, the dealer gets our lowest ranking for sales prevention.

Clearly, as our experience indicates, upscale foreign car dealerships in Manhattan on a hot Sunday afternoon excel in the area of sales prevention, the one exception being the unexplained sales-focused performance of the Acura dealer.

Author’s note: No domestic dealers were surveyed on this shopping trip, since it was Emily’s strong assumption their sales prevention practices would be on a major
league scale compared to those of import dealers whom she viewed as toiling in the minors. As with any important piece of business study, more research is needed.

Moderator’s Comment: Does it sometimes appear to you that retailers (or some associates perhaps) are in the business of sales prevention? What companies
have great sales cultures and how do they create and maintain an organization focused on selling?

Mark Lilien – Moderator

Please practice The RetailWire Golden Rule when submitting your comments.

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17 Comments on "Perfecting the Art of Sales Prevention"


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Ian Percy
Guest
15 years 7 months ago
Don’t even get me started on car buying/leasing experiences! This is without doubt the worse consumer experience in existence. You can buy a house faster than you can buy a car. First you have cave man technology – form after form, repeating the same information five and six times – “Can I have your Social Security number again please?” To auto retailers – move into the 20th century, we’ll work on the 21st later. Then of course, the Secret Approval Process (SAP) where a salesperson (apparently with the IQ of tire pressure) goes into the bad place with the words, “Let me see what I can do…and hey, I’m on your side.” Now if this were his or her first time, you’d understand and be gracious. But after years of selling, wouldn’t you think he or she would sort of be on to what they can sell a car for and what they can’t? Want to amuse yourself during the three hour buying process from hell? Insist on going to the bad place with the… Read more »
Lisa Everitt
Guest
Lisa Everitt
15 years 7 months ago
So many retailers practice “sales prevention” — though few have raised it to the art form practiced by car dealers. Take the clothing retailer that lets you wander around for 20 minutes toting an armload of garments — but won’t let more than 6 of them in a fitting room at a time. Or the food retailer that staffs the so-called service deli counter with one overworked teenaged kid who really doesn’t know how to work the slicer. Or the restaurant that keeps customers waiting and waiting and waiting to sit down and eat while unbussed tables are visible from the holding pen. Or anyplace that forces a shopper to wander the sales floor looking for somebody to take their money. As a middle-aged woman, I find myself becoming more and more invisible. I can walk around all kinds of stores picking up merchandise, checking price tags, reading shelf talkers, even taking notes — all behaviors that should signal “ready to buy” to a salesperson. Does anyone check up on me? Rarely. It’s great in… Read more »
John Rand
Guest
John Rand
15 years 7 months ago

The car buying process is one of the last areas where retailing is still on the level of the medieval bazaar. And since almost no one is trained in negotiating and bargaining in our Western, fixed-price culture, it stopped being consumer-comfortable a long time ago.

Still, the internet leveled the field to this extent – no one who tried even a little should be unaware of the fair price for a car – new or used. With that alone, the buyer regains control of the transaction, if one knows even a little bit of how to say “no.”

It still amazes me, in a consumer-driven culture, that we don’t have classes in high school on car-buying, balancing a checkbook, comparison shopping, and critical advertisement resistance.

M. Jericho Banks PhD
Guest
M. Jericho Banks PhD
15 years 7 months ago
Dear Mark, Many business owners choose not to work on Sundays for religious reasons. If you wish to chalk this up to “sales prevention,” be sure to include all businesses – and yourself – that are not open 24 hours per day. Also, elevators are definitely not sales preventors. Instead, they transport shoppers effortlessly to additional shopping areas. It’s a good idea to remain conversant with recent technology. Finally, “caveat emptor” is a two-edged sword. It cuts both ways. In shopping, customer expectations must be intelligently tempered with knowledge of the real world. We can be savvy shoppers, or we can join Joe Piscopo’s family of the “perpetually surprised.” For clear reasons, this topic and its resulting comments have focused on car retailers. However, the question addresses ALL retailers. The problem which Mark addresses is pandemic, and the reason is “why.” Here’s an automotive illustration: In the old days, right after the earth cooled, gas station attendants “checked your battery.” Battery checks were designed to make sure that battery fluid (distilled water) was topped off,… Read more »
James Tenser
Guest
15 years 7 months ago

Bravo, Lisa, for focusing this thread on some wider issues. Many retailers (not just automotive) shoot themselves in the foot habitually. Sales prevention comes in the form of long checkout lines; inconvenient hours; poor signage and organization; under- and substandard staffing; abysmal store hygiene; inadequate parking; and the granddaddy of them all: out-of-stocks.

What’s crazy is that most of us know these things are happening constantly and yet retailers seem unable to improve on them. I say it’s the result of a chain-centric mentality that values corporate strategy and deals over operational excellence. Good service practices are enabled by good systems that support good people with good training.

Ed Dennis
Guest
Ed Dennis
15 years 7 months ago
Don’t blame the dealer; he was taught well. The big three (GM, Ford & Chrysler) are to blame for the horrible sales experience most people have at the auto dealer. Is this a secret? I don’t think so! But why does it happen virtually everywhere? It’s due to General Motors, which has been responsible for half of all auto sales (until recently). They set the pace; they have trained the dealer managers and their salesmen. They have allowed a totally antiquated business practice to survive and continue into the 21st Century. Technology exists for a consumer to order and price a car by computer, get a pick up date (at his/her choice of dealer/service center). If the vehicle is late for delivery, the consumer would be rewarded with steep discounts for their trouble. The dealer would serve as a service point/display area only. You might ask why this isn’t being done. Beats me – it would displace few people (and dealer salesmen seem to change jobs every four months anyway), focus dealers on service (which… Read more »
David Lilien
Guest
David Lilien
15 years 7 months ago
1. When asked how Nordstrom trains its salespeople to give such great service, the CEO replied that Nordstrom didn’t train them – their mothers did! Nordstrom just hires them. 2. The last time I tried to buy myself a new car, I already knew exactly what model I wanted, down to the options and color. I needed no convincing, I was already sold. I just needed a salesperson to find “my” car. It should have been as easy as ordering a birthday cake at Dairy Queen. The dealership in the next town had a used one that approximated my preferences. I plunked down a $1,000 deposit to bring it to an independent mechanic and when it passed his inspection I was ready to write a check for another $24k+. Unfortunately, their sales prevention was too efficient and they ended up refunding my deposit rather than replace $180 worth of tires. They lost an easy $25,000 sale. They must be doing really well to turn away business so casually. Turning to the Yellow Pages, I phoned… Read more »
Mark Burr
Guest
15 years 7 months ago
My own rating for sales prevention in a car dealer is no pricing on cars, in particular, used cars. Used cars are the only smart buy in the first place. Too bad, however, it took me over 20 vehicles to realize that, but that’s another story. In the end, I can shop to my heart’s desire and never be bothered by a salesperson until I make that choice to be involved. From that point, I own the process. Most dealers in my area are even limited on Saturday. Imagine that! Saturday! The day when so many are available – they are not! What can other retailers learn from this example? There is so much to learn. Really there is – look way beyond the horror stories. There’s a message. Car buying is so much different than so many other products. Smart buyers understand that it’s far more about the ownership experience than the sales experience or the car itself. That’s totally different than buying groceries, clothing, etc., etc. We don’t think about needing an oil… Read more »
Nikki Baird
Guest
Nikki Baird
15 years 7 months ago

I sat in on a consumer panel in May where the topic was the future of shopping, and universally the 6 consumers on the panel said that they actively practiced ‘sales assistance avoidance’ for car shopping. Some even mentioned that after the success of that practice in the car-buying arena, they extended it into other shopping areas – one guy said he bought absolutely everything online today. So I guess retailers complaining about losing out to online shopping can point to car salesmen as that reason!

And, the last car I bought was an Acura – I would have to second their abysmal rating in sales prevention.

Mark Hunter
Guest
Mark Hunter
15 years 7 months ago
Unfortunately, it just isn’t in auto sales where this type of mentality exists….it’s only been refined to an art form in auto sales. Two issues prevail: franchise laws which make the whole automotive supply chain a joke and very inefficient. Second issue is the auto industry (domestic and foreign) that does not believe you can incrementally generate sales by doing anything other than by reducing price. Now that we’re talking about supply chain issues, let’s compare autos to computers. Why is it I can custom order a Dell computer and have it built and delivered to my home in less than 72 hours while doing the same with a car takes weeks, if not months? Why should we as consumers pay escalated prices to cover the cost of the “rolling inventory” dealers have on hand….many times in excess of 100 days of supply? Archaic, yes, but in the end every auto franchise group is protected by a state trade association that has as their primary focus lobbying their state legislature to maintain their fiefdoms, and… Read more »
Chuck Hartwig
Guest
Chuck Hartwig
15 years 7 months ago

I would buy more cars if the sales person would be honest with me. I ALWAYS pick the model that does not have a “lot of room to work”; “not much margin.” The last car I bought, I went to Sam’s Wholesale. They connected me with a dealer who gave me the Sam’s price. The other dealer told me that he would take it to his sales manager, but I should give him a check for $100 dollars to let his manager know that I was serious. I will buy my next car through a buyers club. I will “lead some sales person on” as I examine the models I want to test. Seems only fair!

Rick Moss
Guest
15 years 7 months ago
Oh, Ian. Stay out of that “bad place.” While there’s room for improvement in other retail sectors, car dealerships are in a class by themselves. They can inspire customer feelings like no other. In fact, I’ve never come so close to physical violence than when “negotiating” a car deal. As for moving the process into modern times, I thought salvation was delivered back in the late ’90s when it became possible to “buy a car on the internet.” The first time, it actually worked pretty well. I waltzed into the dealership with the smug satisfaction of knowing that the sales person would have nothing to do but show me where to sign and hand me the keys. And, since he was clueless as to what this internet stuff was all about, he obeyed like a scolded puppy. But by the time I tried it a second time a few years later, it was clear that the internet deal was simply the latest trick to get you in the door and start the process from square… Read more »
Tom Zatina
Guest
Tom Zatina
15 years 7 months ago

This is almost comedy. Too bad it is true. The reality is that retailing and other service businesses are tough work. Dealing with the buying public is not always easy. Being responsive to the demands and expectations of a customer takes skills and commitment. Sadly, too many sales associates seem to make it a priority to never let a customer disrupt their normal job routine, even if it means losing a sale.

On the other side of the coin, I am still impressed with Nordstrom. They seem to always have sales associates who know how to treat a customer. Are they hiring better? Perhaps. But they also invest in training and development of their people and must offer an appropriate reward system as well. And, for another example, check out the service at the Outback restaurants. They generally know how to generate sales and satisfaction.

Jeff Talarico
Guest
Jeff Talarico
15 years 7 months ago
Okay, ya’ll stop picking on the car guys. I spent 15 very successful years selling the iron and rubber you…YES YOU go goo-goo eyes over. What gives you the right to think you should pay anything other than MSRP? Here’s an example. If you asked the checkout person at a grocery store how much they paid for a gallon of milk, you would get a funny stare. If you asked the dairy department manager the same question, you would get the same look. I would be willing to bet if you asked the store manager what they paid for a gallon of milk, he wouldn’t tell you. Why? Because there is more mark up in a gallon of milk than there is in the car you want to buy. The dollar amounts are different, but the gross is higher. Jewelry stores too. Ever bought a diamond during a 75% off sale? When was the last time a dealership had a 75% off event? Never! There isn’t the mark-up available. The process itself is not entirely… Read more »
Robert Chan
Guest
Robert Chan
15 years 7 months ago
Bravo to sales_pro! You are so right on. The Big Three have been teaching dealers to treat customers as though they were stupid. Sales people are taught they should try to squeeze the most out of each customer. As a result, there is still a lot of “let me check with the boss and make sure that you’ll get the best deal” going around. Customers always wonder if they had got the best deals and later on find out that somebody else got a better deal from another dealership. Customers are often outraged and feel cheated! I actually went looking for a car recently. Where I live, there is a holding company owning probably 90% of the dealerships. Treating the customers as though they are stupid was still the attitude. Roger Smith, who was the CEO of GM belonged to the old school and GM was forecasting 20% growth/year to infinity. Customer satisfaction was something one would never hear about. Well, the Japanese had to come in and gave the Big Three a reality test… Read more »
Ian Percy
Guest
15 years 7 months ago

Just in case anyone is still following this stream, I want to say that Jeff (aka jjrico) is absolutely right. There are idiot car sales people AND there are brilliant, informed and communicative professionals who know how to develop relationships. What is sad is how much energy has to be spent by the good ones in maneuvering customers through an antiquated and dis-abling sales process. What all of us, regardless of our business, should be doing is finding all the possible ways in which we can enable positive and profitable customer experiences.

And Jeff, trust me, in the professional speaker world, we’ve got some real dingbats! I’d hate for us all to be lumped together.

Keith Scott
Guest
Keith Scott
15 years 7 months ago

What ever happened to that large word that so many corporations placed in their HR manuals, EMPOWERMENT? It is still talked about in every retail corporation, but when actual practice is observed, it is just as illusive as it ever was. Corporations do NOT want their employees making decisions. That job is left to upper management and that is a shame. Hire and train employees so that they can make decisions and find a way to reward those employees who are willing to make decisions. Customer service will be greatly improved!

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