Incremental Payment vs Lump Sum: How to move a customer to a newer vehicle.
What do you do when a customer drives up wanting to look at a specific vehicle and it’s been sold?
Sometimes you can successfully move your opportunity further by asking your customers alternative questions such as, “What kind if equipment were you hoping for in your next vehicle?” “In addition to (vehicle), what other vehicles were you considering?” But what if the customer won’t budge? What if they say, “That’s the only car I want?”
Well, you have a few options.
Option #1: You can go into Locate Mode, where you try to find that 4 year old, 60,000 mile perfect vehicle. (Which rarely works because they’re either priced too high, located too far away, or if the price does match, it has too many miles.) When you can’t find an exact replica of the vehicle your customer is looking for, they gently bow out telling you that they’re just beginning to shop and to give them a call if one “just like it” comes in. Feeling defeated, you write their name on the corner of a Chinese takeout menu, (That is a write up isn’t it?), then 5 minutes later, another salesperson orders sweet and sour chicken & low mein noodles from your Chinese takeout menu (aka your write up), and you lose your customer’s info forever. (I’m sure you would’ve remembered to call them back when the Perfect Trade came in, wouldn’t you?)
Option #2: You remember that 4 year old “perfect” vehicle, has a little sister- a 3 year newer Perfecto model with only 23,000 miles on it! When you suggest the newer model what is the first question your customer asks? “How much is it?” You stumble, repeat the question back trying to them in an effort to stall, and try to coax them to go look at the vehicle first, but all they want to know is a price. Feeling as though you have no other choice, you spill the beans, blurting out a price that is $5,000 more than the older, sold model. Discouraged, the customer doesn’t even think about it saying that she can’t afford it- the customer and your hopes of making a sale drive away; you and your takeout menu are left standing in the parking lot.
Option #3: When you offer a newer vehicle, but the customer won’t even look at it until you tell her how much it is- when all of your favorite stalls and coaxes fail, try using an incremental payment range in lieu of a larger dollar amount because the perception of incremental payments is easier to digest than a one lump sum dollar amount.
For instance, a customer comes in to look at a 2011 Dodge Charger for $17995 that sold yesterday. Using $18000 as a baseline, you offer other vehicles in that price range, but they only want a Charger, and the only Charger you have in stock is a 2014 for $24995.
Instead of saying, “That one is only $7000 more!” thus killing any chance you have in making a sale, instead incrementally adjust their expectations by saying, “With the right terms and conditions, I can get you in a 3 year newer car, under factory warranty, 30,000 less miles, for less than $30 or so per month. (Newer model equals better terms and conditions & longer initial warranty coverage) Let’s see how it fits!” ($24000 x 72 months x 3% APR = 365/mo vs $18000 x 60 months x 5% APR = $340/mo.)
Remember, your job outside is to keep the opportunity moving; obviously there’s still other specifics that come in to play such as a trade, down payment, credit, and loan terms, but you’ll never be able to work on those details inside, if you’re left standing alone outside.
Keep working! I’ll see you next time on the Blacktop.