Building a Customer Base from Scratch

Hyundai of St. Augustine Constructs its Business Online 

For a store that’s only two years old, Hyundai of St. Augustine in Florida has made some major headway in its market. General Manager Andrew DiFeo said, “I opened the dealership in May of 2008. Hyundai didn’t exist in the St. Augustine market before that.”

“We’re up to about 80 [sales] a month now. When we first started, we were averaging around 50,” he said, adding, “Granted, there are a lot of factors in there.” The dealership was building its brand throughout one of the most challenging times in the industry, but it was also selling a make that was rising in popularity, Hyundai, which saw an eight percent year-over-year increase in the U.S. in 2009.  

DiFeo considered building the dealership’s image and brand from the ground up to be an advantage. Over the years prior, he began to notice a “fundamental change” in consumer behavior and auto retailing as a result of the Internet, and he built the new store with that in mind. Accordingly, Hyundai of St. Augustine focused on the Internet and proper CRM practices.

“We’re an Internet dealership … We make the assumption that 100 percent of the people we talk to … have used the Internet at some point in their buying and shopping process, so we need to make sure we speak their language,” said DiFeo.

Laying the Foundation
In order to speak the customer’s language, the employees of Hyundai of St. Augustine must be familiar with the sites that customers are visiting. “We’re very familiar with the sites they use, and we … kind of prove our credibility by bring up [sites like] Edmunds True Market Value, TrueCar.com, Kelley Blue Book when we appraise trades. We find that third-party Web sites are really instrumental in being able to establish trust with the customer.”

On its home page, HyundaiOfStAugustine.com, the dealership showcases its interaction with third-party sites like the Better Business Bureau, Edmunds and DealerRater. DealerRater, a third-party site that houses customer testimonials, has been the dealership’s main focus since opening. “Third-party testimonials have been a huge part of our success in terms of establishing trust and credibility with the consumer online and in person. I’m a big believer in third-party testimonial Web sites.”

To build on that, DiFeo is currently expanding his focus beyond DealerRater. He said, “We’re in the process of creating a Web site called ILoveHyundaiOfStAugustine.com. We’re going to incorporate video testimonials, which we don’t use right now. We’re also going to try to solicit reviews from our sales and service customers on other sites such as Google Maps, Judy’s Book, Angie’s List [and] Insider Pages, so we have a broad spectrum of reviews.”

He feels the dealership’s rating on DealerRater, which is a 4.9 out of 5 and garnered him the 2010 Hyundai Dealer of the Year status on DealerRater, has become almost too good to be true. “Because we have such a high number of reviews and such a high rating, some customers actually don’t believe it.”

It’s important Hyundai of St. Augustine maintains its good reputation online. “Really, one of our strengths is our reputation. I’m trying to exceed people’s expectations and change the way people look at the car business,” said DiFeo. The dealership tries to communicate that message through all of its advertising, 90 percent of which is Internet-based.

The only traditional marketing the dealership does is a half-page ad on the front page of the local newspaper’s auto section. The dealership once had a larger mix of traditional marketing, but it didn’t last long. “Because we didn’t exist in St. John’s County, which is where St. Augustine is, we did cable television, direct mail and newspaper to let people know that we were here. We stopped doing that after about four months because we felt that our name was out there.”

After the initial branding phase, it was time to move online—where the customers are. “A dealership’s Web site … that’s their new dealership. We might only see 10 or 15 people in the sales department, physically, a day. Just on our main Web site alone, we are averaging about 100 to 120 unique visitors a day,” said DiFeo.

In addition to online reputation management, the dealership’s Internet spend includes display advertising, vehicle classified listing sites, third-party lead providers, search engine marketing (SEM), search engine optimization (SEO) and social media. The bulk of the dealership’s display advertising can be found on KelleyBlueBook.com, as well as on the local newspaper’s site, Yahoo! Autos, and the local Internet provider’s (Comcast) site.  

The dealership’s inventory is on a host of classified listing sites, some of which DiFeo purchases leads from too, like AutoTrader.com, cars.com and more. While he feels that leads are “very necessary,” he said many people are hesitant about submitting their information online nowadays because they have been burned by giving a company their e-mail address, making them more likely to just visit the dealership after doing research online. However, not all people are hesitant, as the dealership is able to purchase 350 to 400 leads a month for its six-person sales team to work.

As for the dealership’s SEO/SEM, he acknowledged how competitive those aspects of Internet marketing can be. They’re extremely important at Hyundai of St. Augustine because about 65 percent of the dealership’s Web site traffic comes from search engines, with 80 to 85 percent of the search traffic coming from Google. Of the traffic that comes from Google, 60 percent is from SEM and 40 percent if from SEO. DiFeo acknowledged the fact that more click-throughs are coming from SEM is “surprising to me because I have never clicked on an SEM ad.”

Of late, SEM has gotten even more competitive in the St. Augustine market. Previously the dealership was dominating there, but he said, “A lot of my competitors are starting to really up their spend on SEM and [are] getting a little bit smarter in that, so I’m working … on adjusting my search engine marketing strategy, so I’m at least in position one or two when somebody’s searching specifically [for] ‘St. Augustine Hyundai.’”

It takes a solid strategy and consistent work to maintain top SEO, and DiFeo partners with the Pasch Consulting Group to help ensure he’s the leader in organic results in his market. The dealership is dominating the organic listings by owning several top-ranking sites and having a presence on top-ranking third-party sites. The 12 organic search results for the Google search “Hyundai of St. Augustine,” all lead back to HyundaiOfStAugustine.com. Four of them were direct links to the site, three go to other sites owned by the dealership and five are third-party sites that link back to the dealership home page.

As for social media, the dealership is just starting to form its presence on Twitter, Facebook and YouTube. “My feelings toward social media are don’t do social media unless you are prepared to devote a lot of time to it … If you do social media and you do it badly, you’re actually worse off than if you didn’t do it at all.” While the dealership is new in the social realm, it’s likely to succeed there too because DiFeo understands the purpose of it. “Social media is really about listening to the customer and just being there for them … It’s not about … posting my entire inventory to my Twitter feed.”

Building on the Foundation with Follow-Up
While having such a diverse Internet marketing mix provides a solid foundation for customer relationships, having the proper follow-up processes is the mortar that keeps relationships strong. With a small sales staff of six, Hyundai of St. Augustine relies on technological tools such as ResponseLogix and DealerSocket to streamline processes and effectively communicate with customers.

For all Internet leads, the dealership quotes price immediately. “The reason why we do that is the majority of people are looking for a price … We’re going to get a price to that customer as soon as possible,” said DiFeo. The price quotes are automatically sent out through ResponseLogix and include other vehicles the customer might be interested in. The quotes are “an out-the-door price, line by line detailed, so it’s not just one number. The customer … sees the selling price, our dealer fee, taxes, the amount of title and registration, [and] any applicable rebates.”

DiFeo estimated that it would take at least 15 minutes to manually put together an e-mail with such specific data, so utilizing ResponseLogix’s quote service saves Hyundai of St. Augustine’s salespeople, who each receive about 80 new leads a month, quite a bit of time. If six salespeople save 15 minutes per lead and they collectively work 480 new leads per month, that amounts to an estimated 120 hours saved among the sales team per month thanks to sending out automated quotes.

Customers receive their quotes within about seven minutes, and the dealership’s goal is to call the customer within 10 minutes. “That phone call is simply an introductory phone call from the dealership … to make sure they received the quote. Most of the time we get a voicemail.” However, when they get a live person the closing percentage increases greatly, hence the importance of continued follow-up.

“In terms of Internet leads that come in, we try – and I stress the word try because we don’t do a very good job of it, and that’s something we’re focusing on this year – to call the customer twice a day at varying times, preferably once in the morning and once in the early evening for seven days or until we make initial contact with them. Our number-one goal is to get the customer to re-engage with us after they’ve submitted the Internet lead,” said DiFeo.

Vol. 7, Issue 5