4/4/2011-How to combat the smartphone price-shopper

‘Make me part of your clubhouse’
If a customer stops engaging with a salesperson and begins talking on, texting with or barcode scanning using a smartphone, the store isn’t giving that person enough of a buying experience, says Sam Dantzler.
“If dealers took time to create an experience with a customer when they walk in the door, then the cell phone, the PDA, the smartphone doesn’t become an issue,” the dealer trainer and 20 group consultant said.
Dantzler, the owner of Junior Inc. and Sam Dantzler Powersport Consulting, has yet to hear any stories of dealerships running into customers price shopping with smartphones while talking to a salesperson, but he has heard grumblings that customers are distracted by the technology as they talk and text their way through stores. That wouldn’t happen, he says, if dealership staff created a relationship with and earned the respect of each customer. He suggests dealers stop worrying about customers scanning barcodes or checking competitors’ websites and pay more attention to their own customers.
“If the dealer thinks he’s losing sales to price tags, he should be focused on his own customers,” Dantzler said. “They’re not losing sales because he has a different price than the last guy, it’s because the experience isn’t enough in the store. I get so tired of dealers saying, ‘Oh, they’re price shopping me.’ If you can provide an experience that can’t be matched, they won’t price shop you. An experience has nothing to with the with product, product knowledge or the product price, it’s a relationship.”
Freedom Harley-Davidson, a dealership he visited in Denver, operates out of an old movie theater. When Dantzler visited, the owner showed him around the building and talked about the historic area where it was located, relaying stories about the Gold Rush and about the hotels and brothels from the early 1900s. That is an example of the experience Dantzler says customers are looking for.
“All of a sudden you have this historical view of Colorado, and you know what, I bought something that day,” he explained.
Many dealerships sell the same units and PG&A at relatively similar prices, and information about the products is available on the Internet, so what is important is giving customers a reason to come in to your dealership.
“Give me something more than a price tag and product knowledge,” Dantzler said. “Make me part of your clubhouse, and I will buy from you.”
One of the ways to create loyalty is by turning to the devices that people carry day in and day out.
“Cell phones aren’t going away; smartphones aren’t going away. If anything, customers are becoming more dependent on them,” Dantzler said.
He recommends dealerships get involved in text messaging and social networking. Both provide dealerships the opportunity to give followers special incentives for stopping into the store.
“It can be used quickly to generate floor traffic when there are days that aren’t generating floor traffic,” Dantzler explained.
Each dealership should be asking customers how they prefer to be contacted, and if the chosen method is through smartphones, dealers should be using those avenues. They should also learn about the capabilities of the phones and apps, such as barcode scanners that show customers the lowest prices nearby.
“You need to know that exists, but at the end of the day, if the guy is going to go 10 miles down the road because something is cheaper, I haven’t created an experience in my store,” Dantzler said. “Nothing trumps walking into a motorcycle store and seeing a new unit or interacting with a good sales person.”
He says dealers should use the technology but not lose track of their in-store customer service, because people are still seeking personal advice on what type of motorcycle they should be riding or what size jacket they should be wearing.
“I will always say that in this electronic world … just philosophically, with Facebook and Skype and all these electronic ways of communicating, nothing seems to be more valuable than a face-to-face interaction with another human being,” Dantzler said. “I think you can use all the electronic gadgets and widgets you can to get them in the door, and once you get them in the door, that human-to-human relationship has to trump everything else.”
Hold steady to your pricing
After thoroughly looking over a product and then using his smartphone to look up prices at competing retailers in your area, a customer looks at your salesperson and says, “The guy down the street can offer me $20 off this tire. What can you do for me?”
What should your reaction be?
As a retailer trying to make sales, should you match the price of the competitor? Should you beat the price?
Don’t do either, says industry sales trainer Don Cooper.
“That’s the worst possible thing to do,” he explained, “because if that dealer does that, that customer will go back and bring that price to the first dealer and will play the dealers off each other. Someone ends up selling the product below cost, and then that customer is immediately using their smartphone to post the deal that they got on Facebook, Twitter and LinkedIn. Now everyone knows how low they can go.”
Alternative responses to the situation exist, as do options for dealers to get involved with smartphone technology in a positive way. What is key, however, is sticking to the sales tactics that have always worked.
“The same principle still applies when a consumer’s price shopping and that is to get the consumer off of price,” Cooper said, “and the best way to do that is to ask the person, ‘Is price the only issue to you?’ If they say yes, the best response is to say, ‘OK, I guess we’re not the right dealer for you.’ That takes guts, but we have to be willing to walk away from the deal because if you’re not, you’ve already lost.”
Other than refusing to lower their price, dealers also can ask the customer why he or she came to their dealership as opposed to the store offering the lower price, and then proceed to sell the value of their dealership.
“A buyer who doesn’t know what else to look for besides price is going to make a bad decision more often than not,” Cooper said. “They’re likely to buy from the cheapest person in town. They’re not going to offer the best service; they’re not going to offer good delivery, which means the buyer isn’t going to have a good buying experience, and that can sour the buyer on the whole sport. So it’s the salesperson’s job to help the consumer understand what factors are important besides a low price.”
Though dealership staff should take the focus off smartphone price shopping, dealers shouldn’t disregard the technology altogether. Cooper says dealers should embrace social networking sites like Facebook, Twitter and LinkedIn and use them to create a following.
“They can offer special deals just for their Facebook fans or their Twitter followers, so maybe one day a week there’s a special crazy discount on one time in the store, and that gets those followers into the store that day,” Cooper suggested. “Once they’re there, you at least have the opportunity to up-sell them and add items.”
Dealers also can use smartphones themselves to take photos of customers with their new units upon delivery. Those photos can be posted online, and buyers can be “tagged” in the photos, so all the buyers’ online friends will see the new purchases.
Smartphones, Cooper said, offer dealers one more tool they can use for marketing and advertising.
“Any technology has the opportunity to create both positive and negative impact, so dealers need to assess how to minimize the negative impact and also take advantage of the positive impact,” he said. PSB