With 2014 looking up, many dealership groups are moving beyond survival to focus on expansion. While some are building new rooftops, others are actively looking to acquire existing stores. Acquisition may seem like a better fiscal option for your assets, but it does pose certain risks. Beyond traditional research, how deep do you look into a potential acquisition’s reputation?
A good market and a good financial statement can often hide underlying problems within a dealership. It’s very easy to keep sales up for a window of time while neglecting customer relationships. When conducting your research, and mystery shopping their store, evaluate their responsiveness to online inquiries. One of the most important take-aways with mystery shopping is determining whether the customer’s questions are ever directly answered. If not, the dealership is putting itself in a questionable light with the customer from the outset, making it an uphill battle to ensure a positive experience, much less a sale.
In addition, according to a 2014 DealerTrack study, consumers now visit 1.2 showrooms before making a decision. This represents a paradigm shift in the way today’s consumers shop for a vehicle. Gone are the days of consumers spending their weekends visiting one dealership after another before a final decision is made. Now, the majority of that research is conducted online.
A “2013 Online Customer Review Study” from Maritz Research stated that Edmunds.com and Yelp are in the top five most trusted sites by consumers. Google +, Four Square, City Search and Dealer Rater also made the top twelve list. With the majority of customers browsing dealership websites and customer review sites before walking into a showroom, it’s vital that any dealership you acquire has a healthy reputation. When evaluating their online reputation, ask yourself:
- Do these reviews look fake or real?
- Does the dealership respond to positive reviews thanking the reviewer for their time?
- Does the dealership respond to negative reviews and if so, do their responses work to resolve the situation or displace blame?
A good online reputation relies on the active management of customer review sites. While gaining positive reviews is the immediate goal with these sites, the second most important aspect is responding to negative reviews. Negative reviews don’t necessarily have to give dealerships a negative image. By addressing the customer’s concern and taking the conversation offline, dealerships have a great opportunity to turn that negative review into a positive experience. Customers expect to see negative reviews on these sites, but what they pay the most attention to is how the dealership handles them.
Beyond customer review sites, it is also important to review their social media assets. Facebook and Twitter have become two of the biggest platforms for consumers to directly interact with companies. Big or small, companies from all industries utilize these sites to inform the public about new products, receive feedback, conduct product promotions, etc. If you’re looking into a dealership with a social media presence, pay attention to their interaction with their fans:
- Do they simply push out information?
- Do they encourage comments?
- Do they respond to comments to further engage the audience?
- Is their content focused solely on the dealership or they post about community involvement or engaging questions?
A well-developed social media presence is much more than creating a page and posting content. It involves engaging the audience with content that’s relevant to them, encouraging discussions, and responding to their inquiries or concerns.
It can be very difficult to overcome a negative image. And, you would be surprised how much a negative online presence can affect sales volume. When researching potential acquisitions, pay attention to their online presence and consider whether you want their image associated with your dealership group. Once the deal is done, their reputation will forever color yours.
With over 36 years of experience in the dealership space, EFG Companies knows how to equip you with consumer insights and marketing analytics to complete your due diligence when bringing on a new rooftop. Contact us today to find out how to take your business to the next level.