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Jun. 15, 2009 – A crash course in improving dealer profitability

June 15, 2009
Filed under Features

By NEIL?PASCALE
Editor
LITTLETON, Colo. — What’s the best way to convert the “just lookin’” consumer into something more?
Who is perhaps the least-represented consumer group in the apparel area?
Where should the sales racks be located and, conversely, not located in a parts department?
All these questions and more were addressed during Training Day, a Powersports Business dealership event that featured two industry partners. Both Derek Sanders, V-SEPT’s trainer and consultant, and Tucker Rocky’s Jennifer Robison, a retail environment specialist, spent a day at Grand Prix Motorsports, a metric dealership located near Denver.
Grand Prix had won a contest affiliated with Powersports Business’ Bold Ideas Contest to have Sanders and Robison provide on-site training at no expense to the store for one day. Sanders spent the morning with the dealership’s sales department focusing on a number of key selling techniques while Robison walked the PG&A department addressing retail merchandising tactics with parts staff. Below is a look back at those training discussions.
Sales Department
The worst opening line for a salesman?
“Can I help you?” Sanders said in discussing the importance of the consumer greet.
The idea of approaching a customer with a topic that will lead to more conversation — the weather, the biggest sports gossip of the day — rather than providing them an easy way to respond, “No, just looking” is a huge step in the right direction, Sanders said.
He noted this is so crucial that some sale staffs actually self police each other, pointing out when the dreaded “Can I help you?” question is asked.
Besides avoiding that question, Sanders says body language can be huge to enticing dialogue. He noted people often only truly understand and digest 10 percent of what is said while that percentage is infinitely higher if body language is used in conjunction with it. That could mean something as simple as bending down to show different features on a bike — rather than merely standing in one place and listing them off — or slapping your hands together when starting off a conversation to show your interest.
“Why not build that excitement with them?” he asked.
Even with such tactics, the “just lookin’” responses will still come, Sanders said. So he advised sales staff practice a couple of techniques to deal with these. One could be responding to the dreaded “just lookin’” by saying, “then you have to look at this” and show the consumer a model with custom elements to it or some other exclusive dealership offer. Sanders noted part of the key to this approach is actually begin walking away from the consumer and toward the notable bike once the salesman has said “Then you have to look at this.”
“People are like sheep, they’ll start following you,” he said.
Sanders also advised putting more thought into doing more with the traffic the dealership has, especially on slower days. For example, rather than merely redirecting a consumer who wants a common parts item, like a sparkplug, walk them back to the parts department and while doing so, find out what kind of bike they ride and then alert them to the dealership’s interest in trade-ins. While doing this, get a contact number and later call them back with the trade-in’s value. Sanders notes V-SEPT’s research has found 90 percent of powersports consumers don’t receive a call back from a store.
“Out of those, 22 percent will come back and 11 percent will buy,” he said.
Sanders also notes the importance of being prepared for the ultimate question.
“It’s going to happen,” he said of the price question, “be prepared for what you’re going to say.”
Sanders says the key is ensuring the answer doesn’t just stop with the price but moves into a related topic, like a model’s unique feature.
“This one is going to take some practice,” he said, noting again using body language with this could prove especially key. He notes, for example, actually reaching out and taking off an easily removable windshield or having the consumer press down on an easy-pull clutch.
Such tactics should allow the sales staff, and not the consumer, to remain in charge of the conversation.

Parts Department
Robison, in her walk-around in the parts department and its adjoining areas, counseled the Grand Prix staff to take a closer look at the department’s “hot zones,” those areas the consumer first experiences as they enter the PG&A area.
“This is some high-dollar real estate and you want to work it,” she said.
Some of the hot zones at Grand Prix included sales racks, which had previously been in the store’s second floor, an area that did not produce a lot of turnover for those items. So the Grand Prix staff brought the sale racks downstairs and have seen a positive effect from that move.
Robison, however, notes these crucial hot zones should show off the newest product that reflects the current hot segment, such as off-road gear in the summer.
“The front has to be the newest, trickest, most-exclusive items that you have to sell because that’s what they are coming to see,” Robison said of consumers.
She also notes consumers have been taught over the years where to look for sales areas. “Everybody knows in every department store anywhere there is a sales rack in the back,” she said.
Also drawing a comparison to malls, Robison notes Grand Prix should look at using more communication tools at each of the individual racks so consumers immediately know what they’re going to find at a given rack. She suggested perhaps having a helmet stand reflect a “big and tall” rack that had only large and extra large sizes rather than simply having different helmet brands and models placed together.
“Most men don’t like to shop,” Robison said, referring to why racks need to have proper signage. “If you need some slacks because you need to go to a wedding, do you want to spend all day doing it? No. You want to get in and get out.
“You need to know very quickly what it is and where it is you need to go.”
Another gender issue Robison pointed out: Dealerships are largely catering to younger women with their jacket displays vs. older women, who are more apt to have the means to buy such apparel. Robison notes Grand Prix had a larger selection of half-length, sport bike-styled jackets rather than the longer, three quarter-length jackets that may not have such aggressive graphics. That latter jacket selection is more likely to appeal to the older woman shopper who represents a huge opportunity for dealerships.
“Women may not ride as much,” Robison said, again noting the gender differences, “but they’ll spend more and they’ll buy more jackets than a guy will because there’s a point where (women) are like, ‘I don’t want to wear this every time I’m out riding.’”
Another potential gender issue: The lack of a sufficient number of mirrors in the parts department.
“If you have three or four people at one time, you can’t have them fighting for a mirror,” she said. “Multiple mirrors are always a good thing.”
Another good thing: Ensuring each retail area concentrate on one brand or segment. Robison notes an area that had both helmets and boots in it.
“Why helmets with boots?” she asked. “What are you trying to communicate with this message? Is it boots? Is it helmets?”
Robison also called out two other elements to this particular shelving area: the number of boots and the point-of-purchase material that had the name of the product and its price. Robison suggested the dealership only display one boot — “Don’t have pairs out because people mix them up and put them in the wrong boxes and I’ve had people go home with a 9 and 10” — and ensure the point-of-purchase display also included benefits rather than just the price of the product.
“Those are the things that are really important to people: How are they going to use it, how does it fit and what does it do? The price is like third on the list.”

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