Before I got into the car business I promised myself I would never lie to sell a car, and if I was ever asked to lie, I would quit. Most of the time, I’ve been able to live up to that promise. Most of the time.
But there have been a few times when I was placed in a position that made me exceedingly uncomfortable, times when I’ve been forced to choose between doing my job — which meant putting money in my pocket — and telling the truth. No salesman should ever be placed in that position, and yet we all are, in hundreds of dealerships across the nation, every single day of the week.
How does this happen? There are a million little ways, but more often than not it’s the result of a ridiculous ad campaign, an ad campaign that has been intentionally designed to be deceptive. And these ads tend to get worse around the major holidays: Memorial Day, 4th of July, Labor Day, etc. That’s when some dealerships pull out all the stops and make some of their most ridiculous claims.
Let me give you an example. I once worked at a dealership that ran a campaign on TV and radio for their big President’s Day Sale. In the ads, the announcer said: “In honor of President’s Day, we’ll pardon your negative equity! That’s right, no matter how much you owe on your trade, bring your car in and we’ll pardon it!!”
The minute I heard that I knew we were in for trouble. Why? Because dealerships can’t “pardon” negative equity. There is no magic wand anyone can wave over your car to make the thousands you owe disappear. It’s absurd on the face of it. The best any dealership can do is attempt to cover up negative equity with discounts and rebates. The idea that we could “pardon it” in any shape, form, or fashion was a total lie, and I knew it would lead to nothing but angry, disappointed customers.
That Saturday morning every person within a three hundred mile radius who was ten grand or more “upside down”in their trade showed up at our dealership bright and early, expecting us to work a miracle, just as we had promised. And just as I expected, it was a total disaster. Now, if a customer picked out a $70,000 Esperanto Deluxe, there was a chance we could “pardon” most of their negative equity, because the Esperantoes had $10,000 in rebate available at that time. But that was the only vehicle on our lot that had that kind of rebate. If the customer didn’t want to buy a $70,000 SUV and picked out a car with only $2000 rebate, that left $8000 of negative equity lying on the table — negative equity which could not be pardoned away, no matter how you cut it. The whole thing was a sham, and a total waste of time for everyone concerned — salespeople, managers, and customers. I think I got cussed out about ten times that day — and that was just before noon.
Here is how I was instructed by management to handle this situation: go in there and present the numbers the way I always do. If the customer asks, tell them we’ve added their payoff to the balance of the car. In other words, the “pardon” consists of doing what we always do, which is to tack the payoff onto the selling price of the vehicle. It was left up to the superior selling skills of the salesman to cover up the fact that the negative equity wasn’t disappearing; it was simply being added back to the bottom line, the way it always is.
I remember one young couple in particular who saw through this ploy immediately. After I finished presenting numbers, they looked at me and said “Are you kidding? That’s it? You’re just going to add what we owe onto the price of the car?” I had to admit it was. They said “We’re not mad at you, but you can tell your boss we’re never going to shop here again.” And then they left.
Nine out of 10 customers who came to our dealership that day left in a huff, vowing never to return. Of course, every single manager turned a blind eye to this and acted as if the sale was a rousing success. They never saw the reactions of the customers because they never left their ivory sales towers. When I told one manager that a lot of people were leaving angry, he tried to argue with me that the ad didn’t say what people thought it said. I felt like saying “If it doesn’t say it, why do so many people think it does? Are they all stupid?” Monday morning, positive words were spoken about the sale in the sales meeting, one manager commenting “We got a few deals out of it.”
We got a few deals out of it.
Unfortunately, this is the mentality of some of the people who run car dealerships. If you run an ad that ticks off a thousand people, but results in 5 or 6 more deals than you might have had, the ad is a success. Why? Because we got a few deals out of it. They simply refuse to see what the ad cost the dealership in terms of credibility, word of mouth, and potential customers.
Of course, you and I may sit here and say “We’d never be fooled by that.” But for every one of us there are at least a dozen others who are fooled, and who come into dealerships and buy a car. And every time that happens it sends a signal to the people who run car dealerships: “See? I told you so. They really are idiots.”
Until the buying public stops allowing itself to be suckered in by deceptive advertising that promises the impossible, car dealerships will continue to run them. It’s as simple as that.
Source : blogs[dot]motortrend[dot]com
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