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1 Newcomer Among 5 Dealers Elected to CATA Board Seats Volume 108, No. 12 June 27, 2011 Upcoming DealersEdge Webinars 1 newcomer among 5 dealers The Chicago Automobile Trade Association has estab- elected to CATA board seats lished a partnership with DealersEdge to provide high- quality training and informational Webinars that offer Results announced at Expo the content to CATA member dealers at a significantly An enthusiastic crowd of CATA board of directors discounted rate. dealers and their managers showed four incumbents and The rate for CATA members for the weekly presenta- showed up June 22 for the one newcomer won elec- tions is $149, half what is charged to users who do not 2nd annual CATA Dealer tion to three-year terms. Ed subscribe to DealersEdge. Webinars premiere on a near- Meeting & Expo, and they Burke, Dan Marks, Mike weekly basis. liked what they saw: 45 allied McGrath Jr. and Colin Even for dealers who hold an annual membership with members explaining their Wickstrom all won second DealersEdge, the new relationship with the CATA repre- products and services, and terms on the board. Bill sents a savings because DealersEdge offers its Webinars 11 educational seminars pre- Haggerty won for the first to its own members for $198. Regular annual member- sented during the day. time. ship fees are $397, and normal Webinar fees are $298 for At the Expo, results of A director may serve up non-DealersEdge members. this month’s balloting for the to three terms. Once purchased, DealersEdge Webinars and ac- companying PDF files can be downloaded and viewed Professionalism trumps price: study later—and repeatedly. No matter how many people watch Customer treatment often cent when eliminating cases at your location, each connection costs a CATA member trumps price at car dealer- where buyers received only a just $149. A telephone connection is not needed; and the ships, according to a new single offer. fee includes both PowerPoint slides and audio. study by CarWoo.com, an Behavioral data also indi- To register for any of the DealersEdge Webinars, go automotive marketplace cate price is not what drives to www.cata.info. On the tan bar across the top of the website. buyers’ opinions expressed screen, click on Education/Careers and follow the drop- Its study, using transac- in online reviews of their down menu to CATA-DealersEdge Webinars. tional and behavioral data, dealership experience. Coming topics: found that dealership be- In giving five-star reviews, Thursday, June 30 at 12 p.m. CDT havior matters a lot in deter- highly satisfied buyers ranked “Read Your Customers’ Minds: How to Predict mining if a shopper accepts dealer professionalism as the the Market’s Future with Today’s Data” With nearly a particular deal. The study most important factor 47 90 percent of all auto shoppers going online to research shows that 54.6 percent of percent of the time and price their next vehicle, the “data exhaust” left behind gives in- the time the lowest price of- only 14 percent. valuable insight into what these shoppers will be buying; fer was not the one the buyer When dissatisfied buyers took. gave dealers one-star reviews, SEE WEBINARS, PAGE 2 That increases to 57.5 per- SEE STUDY, PAGE 2 2 CATA Bulletin June 27, 2011 Study customers that vehicles are properly priced in the first place, CONTINUED FROM PAGE 1 but also convincing the sales staff, lest they partake in sticker- they cited unprofessionalism as the reason 44 percent of the dicker tactics that can offend shoppers. time, and blamed price only 19 percent of the time. Pollak founded vAuto, an inventory-management software Only when buyers gave middling three-star reviews did system that tracks regional demand for used vehicles so deal- price become the driving factor, when it was ranked as pri- ers can stock and price accordingly. mary 52 percent of the time. These reviews, while ostensibly Pollak made his mark on the industry by advocating what “neutral,” were often negative in tone, much more akin to a he calls “velocity” pricing, which uses inventory-management grade of a “D” than of a “C,” a CarWoo spokesman said. to price cars right the first time. An analysis of all available data shows four major elements That turns used-vehicle inventory quicker. In the long run, go into the car-buying decision. In order of importance: dealers doing that will make more accumulated gross profit, • Professionalism of the dealership staff, including en- Pollak said. The converse is pricing high and holding out for gagement and responsiveness. high gross. But that risks cars lingering on the lot, their values • Right vehicle, and how close what’s offered meets the depreciating daily. buyer’s wishes and specification. A dealer needn’t offer the lowest prices in town, but rather • Price in the context of its competitiveness in the mar- ones that are competitive. Consumers using the Internet dur- ket. ing their car-shopping usually know values. • Distance to the dealership. Pollak said it can be the kiss of death for a dealer to price Dale Pollak advocates a modern version of value pricing a car in such a way that it fails to show up high on search-en- that precludes negotiating. This means not only convincing gine results for customers who are shopping by price. FRB might extend compliance date Webinars The Federal Reserve Board has proposed temporarily ex- CONTINUED FROM PAGE 1 empting motor vehicle dealers engaged in indirect (three-par- also, when and where. By collecting, aggregating, normal- ty) vehicle financing transactions from a new, comprehensive izing and reporting on this auto shopper data, we now have data collection and reporting requirement that is scheduled to visibility never before available. With this data, we can see, take effect July 21. analyze and react to current and specific market trends in Section 1071 of the Dodd-Frank Wall Street Reform and real time. Consumer Protection Act of 2010 requires financial institu- Thursday, July 7 at 12 p.m. CDT tions, including dealers, to inquire into whether a credit ap- “Benchmarks from the Best Parts Managers” Review plicant is a small business or a women-owned or minority- what numbers define superlative performance in parts owned business and to maintain a record of responses to the inventory management and what are the best practices inquiry that is separate from the credit application. If the ap- to be the “Best.” More than any other profit center in a plicant responds to the inquiry, the financial institution must dealership, performance is measured by a complex set of then: data, statistics and calculations. Most of the performance • compile and itemize eight fields of data related to the benchmarks employed in evaluating the parts department credit applicant and the credit requested, have been around for decades. But are they the right ones • retain the data for a period of three years, to define who is and is not doing a great job managing the • submit the data to the federal government on an annual inventory? basis, and • make it available to the public upon request. Section 1071 imposes additional requirements, such as en- The CATA Bulletin is published by the suring that the collected information does not contain any Chicago Automobile Trade Association information that may identify a person connected with the 18W200 Butterfield Rd. Oakbrook Terrace, IL 60181-4810 business credit applicant. The CATA Bulletin is distributed via blast e-mail every other Friday Because dealers will require much additional direction except during the Chicago Auto Show, when it is not produced. Listings of items for sale are subject to the approval of the CATA. from the government before they can be expected to carry Candidates for employment must submit a full resume to the Editor. out these duties, the FRB is considering extending the effec- Review past editions dating to 1998 or search by subject at tive date of final regulations which explain those duties. www.cata.info. The Board will accept public comments on its proposal David E. Sloan President, Publisher before issuing a final ruling. Erik K. Higgins Editor, Director of Dealer Affairs June 27, 2011 CATA Bulletin 3 2011 CATA Dealer Meeting & Expo a success The offices of the Chicago Automobile Trade Association were transformed June 22, when the 2nd annual CATA Dealer Meeting & Expo was held. Forty-five booths located throughout the facility and staffed by CATA allied member companies offered time- and money-saving solutions, and 12 educational seminars touched on a range of topics. Attend- ees also enjoyed lunch alfresco. 4 CATA Bulletin June 27, 2011 Thanks, 2011 Expo exhibitors! Exhibitor Product or service ADP Providing technology solutions for automotive dealers Aflac Helps protect employees at no direct cost to your company AM 560 WIND Historic signal now is Chicago’s “New Choice for Intelligent Talk” American Tire Distributors Approved OE supplier for dealers plus sales training and development Aspen Marketing Services Provides prime and subprime mail and other lead generation services AutoCheck Vehicle history reports to undestand, compare, select the right vehicle Automotive Compliance Consultants Your turn key solution for all compliance concerns facing today’s dealer AutoTrader.com The ultimate automotive marketplace BB&T Bank - Regional Acceptance Provider of indirect subprime lending services BGP Enterprises, Inc. Financial, operational & process improvement or restructuring & interim management Carnica, Inc. The leader in automotive paint reconditioning. Chase Auto Finance A leading provider of prime to subprime retail financing and floorplan products Chicago Parts & Sound, LLC Auto parts & acccessories distributor, A/V repair, vehicle restyling/up-fitting Crowe Horwath LLP One of the largest public accounting/consulting firms in the U.S. DealersEdge A partner with the CATA to provide management education webinars DealerTrack Inc.
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