Does transparency have a negative impact on your vehicle gross?
In 2012 Florian Zettelmeyer, Professor of Marketing at Northwestern, talked about transparency and the importance of being up front with the customer to develop rapport. He also presented his research on the impact of transparency on gross.
In his research, he discovered that being transparent early on in the process can actually increase overall vehicle margins.
Why? Early disclosure breeds trust. With so many options out there for customers it is important to take every step possible to establish a positive relationship. In fact, our research shows that the top two factors customer value over all others are: the need to trust the dealership and the need to like and trust the person they’re purchasing the vehicle from.
Does that mean that your staff greets every customer with an invoice? Not necessarily, but you need to find opportunities in your sales and service processes to build and develop transparency.
What companies do you trust? Why? I bet it has something to do with providing quality experience, content/products, and consistency. Focusing on a customer’s experience will enable you to be remembered and trusted as a brand.
With the internet making it easier than ever to obtain information, customers come into your dealership knowing more than ever before. Dealerships need to acknowledge this information and build transparency into their processes. Florian’s research is as relevant, if not more so, today than it was in 2012. You can’t build a solid omnichannel strategy without transparency.
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