Frank Cespedes DSES Keynote Focuses On Aligning Strategy And Sales

October 30, 2015 0 Comments

Frank Cespedes was a keynote speaker at the 7th annual DrivingSales Executive Summit (DSES) 2015 at the Bellagio, Las Vegas where over 1,000 progressive dealers and industry professions gathered for the most progressive event in the automotive retail industry. Frank shared the latest research about improving sales strategies for profitable growth and the leadership implications for dealers.

Frank Cespedes teaches at Harvard Business School. For 12 years, he was Managing Partner at The Center for Executive Development. He has written for numerous publications, including Harvard Business Review and Wall Street Journal, and is the author of six books, including Aligning Strategy and Sales. He received his BA from City College of New York, MS from MIT, and PhD from Cornell University. Cespedes sat down for an interview with DrivingSales news during the DrivingSales Executive Summit. Cespedes began by explaining how the evolving consumer has changed auto-sales processes.

Cespedes explained, “We know for an empirical fact that car buyers in the United States now spend more than three times as much time researching their purchase on Edmunds.com etc. than they do in the actual dealership. Now what that means is that they are walking into the dealer armed with information; cost, prices, and options that 10 years ago they did not have. Does this mean that the salesperson is obsolete, no, but it does mean that the sales tasks are changing. There’s much less time for warm-up, much less value added on what a decade ago was basic information that the sales person could convey. The buyer is walking in with that information that value added of the sales person now has more pressure put on it and that’s where training is important.”

Cespedes also explained that the expertise of auto salespeople has shifted, forming a new challenge.

“There are core selling skills about getting people to open up, about listening, about closing that are relevant, but increasingly those skills have to be exercised in a very different context,” Cespedes said. “And I would argue that given what is going on in the industry in terms of the product itself, the job of the car sales person has actually become more technically complex, and that’s an opportunity.”

Cespedes also spoke about the research conducted by DrivingSales, which indicates that 99 out of 100 consumers go into car shopping expecting a hassle. Cespedes says that it all starts with the point of sale.

“Don’t forget the point of sale,” Cespedes said. “Don’t forget the sales person that does remain central and I think that there’s an overwhelming amount of data that says it remains more central than for example social media. In the aggregate, the dealership industry has actually don a pretty nice job with the point of sales experience. That is what the data tells us that 99 out of 100 are expecting a visit to the dentist when going to the dealership, but the majority walks out satisfied or very satisfied and that’s an achievement.

Cespedes ended by mentioning Alfred P. Sloan’s book: My Years with General Motors and how Sloan’s expertise in the 1930s still applies to dealers today.

Speaking about Sloan Cespedes explained, “Sloan is the guy who put the dealership system in place. He’s the guy who understood why the dealer was going to be important, not just for sales but for financing, for service, for customer education about a very complex problem and what Sloan pointed out 70 years ago is that with the exception of buying a home the automobile was the biggest monetary purchase that most households make. The reality now almost a century later is that Sloan is basically right. It’s still house and college tuition, but once you get beyond those it’s the automobile, and he’s even more right about the nature of the product. And again, I think that Sloans’s comment at the end of his great chapter about the dealer system is also relevant. Great is the inertia of the human mind. This industry (retail auto) would not be the first industry that would be presented with a potential golden goose that had it robbed by somebody else.”

With an increasingly informed consumer, how much has the auto sales position shifted towards being more technical? Finally, how do you think that learning about how the dealership system was created can help dealers today?

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The DrivingSales News team is dedicated to breaking the relevant and the tough stories affecting car dealers. Have questions for DrivingSales News? Reach the team at news@drivingsales.com.