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Taking on the Big Boys – Differentiation Part 2

In my last article I discussed the importance of knowing who you are and what your sweet spot is. In this article I would like to explore the concept of differentiation and the role it plays in winning business. To illustrate this point, I’d like to ask you a question, the same question we ask at the start of all our agent sales programs.

Why would a dealer be willing to hand over a multi-million dollar piece of their business to you?

Take a moment…what did you come up with?

More than likely, you came up with something like, “we provide excellent training designed to improve F&I performance”, or “we’re a well established local company with a long track record of success”, or “we’re experts in the area of wealth building for our dealer clients”. While these answers may well be true, they’re probably not going to get through to your prospect. Why? Because it’s the same thing they’ve heard before.

Look at it this way, if you were the dealer and someone pitched you something that was essentially the same as what you currently have, what would be your motivation to change? Change is hard, and in order for your prospect to be willing to take on that change, they must believe that you or your solution is a sufficiently better option to what they currently have. If not, they’re likely to stay with the status quo.

So, how do you differentiate yourself from your competition? It begins with changing the way you think. The power of the mind is an amazing thing, and if you change the way you think, you’ll change the way you act. Yes, you have to know your stuff. Yes, you need to have a compelling value proposition. Yes, you need to be able to provide high quality products and services to your customers (all of which I will address in subsequent articles). But more importantly, you have to stop thinking that your prospect is doing you the favor by buying from you.

Let me repeat that. You must change the belief that the prospect is doing you a favor when they decide to partner with you or purchase from you.

Once you know your stuff, and you have the ability to convey your strong value proposition to the prospect, you change your belief to — I’m doing the prospect the favor by offering my products and services to him / her. There are a ton of options out there, but only one of me. When you change the way you think, you change the way you act.

A word of caution, before you go running off to your next appointment and tell the dealer that he / she should feel honored by the fact that you’re even talking to them, please keep in mind that this approach is based on a significant amount of research. More specifically, it’s based on neuroscience or the study of the brain. In short, the modern brain has three levels with each level separated by a gate. The first gate will open only if you’re compelling, different or interesting. If you’re not, if you’re just like the last guy, you have little or no chance of success. But once you understand the power of being different, doors will open. Change the way you think, and you’ll change the way you act.

To illustrate this point, I’d like to put you in a familiar scenario. You’ve been trying to set up your initial meeting with a prospect, and after a few weeks you finally get the meeting. You arrive at the dealership a little early, you have your best suit on, you walk into the dealer’s office, smile and extend your hand and say… “Hi John, I’m Peter, thanks for taking the time to meet with me.” While this may sound professional and courteous, it sends the wrong message. It suggests that the prospect’s time is more valuable than yours, that the prospect is doing you the favor by meeting with you. Without even realizing it you’ve begun your acquisition attempt in a hole. Now I’m not saying you won’t be able to climb out of the hole and win the deal, but I am suggesting you’re making it more difficult than it needs to be.

When you believe it’s you that is doing the favor by meeting with the prospect, the scenario plays out differently. You still arrive at the dealership a little early, you still have your best suit on, you walk into the dealers office, smile and extend your hand and say… “Hi John, I’m Peter, I’m glad we could find the time to get together.” By starting off the conversation on a level playing field, the prospect feels, rather than knows, something is different about you, and you’re more likely to get past the first brain barrier. And, when you’re really good at this and understand the entire process, you’ll be able to actually walk into the dealer’s office and say…”Hi John, I’m Peter, I’m glad I could make the time to meet with you.” But remember, until you fully understand the concept of how a buyer’s mind works, don’t start acting like a jack wagon. I just wanted to illustrate the power of differentiation. If you’re interested in more information about this topic, feel free to contact me.

When it comes to competing with the “Big Box” F&I providers, you have to get your prospect’s attention very quickly. Differentiation is one of the keys. Mull this information over. How often do you automatically take a subordinate position relative to the dealer? Give it a try, rather than thank the prospect for his / her valuable time, tell him / her how happy you are that you could get together. And finally, give some thought to how you’ll answer the question “Why should I do business with you?” Know the answer, practice the answer and then deliver it with confidence and conviction.

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Taking on the Big Boys – Differentiation Part 1

How can independent agents compete for and win business from the “Big Box” F&I providers? Before I provide my thoughts on the subject, let me start out with a definition of “Big Box” F&I provider. For the purpose of the articles I am writing, I’m referring to the large, well established, direct employee providers in our industry. They would be the Goliath in the biblical tale of David and Goliath. Actually, the story of David and Goliath provides a good backdrop to the situation a lot of high quality independent agents’ face on a day-to-day basis. Much like David, the odds look horribly stacked against you. The competition is much bigger than you, financially stronger than you, and has been terrorizing the townspeople for years. Yet, in order to survive, you (like David) have to believe in yourself; you have to defy the odds and you have to take the giant down, but how? Over the next few issues, I’d like to share some of the things I’ve learned over the past 28 years in the sole hope that it will help you elevate your game.

In order to win new business, you need to be able to describe your value proposition (more about that in future articles) in a clear, concise, and compelling manner to prospect dealers. Before you can do that however, you need to determine who you’re going to be. Whether you’re a part of a full service agency or on your own, you need to determine your sweet spot. In other words, where you think you’ll have the greatest competitive advantage. An agent’s sweet spot may be as individual as his/her fingerprints, but it’s an essential element for success. When determining your sweet spot, you need to be honest with yourself and realistic with your expectations.

What are you good at? Can you work with underperforming F&I departments, raise the PVR and improve product penetrations? Do you remain current on the legal climate and how Dodd-Frank and the CFPB are likely to impact dealers today? Are you an authority on reinsurance and wealth-building strategies for dealers? Do you have the manpower to service a multi-store dealer group? Do you have the cheapest product on the street? Do you have something unique and different? These are just a few of the questions you need to ask yourself, and remember, when answering, be honest with yourself.

Next, take a look at the providers you represent. Are your offerings better suited for franchise stores or independents? Do you have an advantage with domestics or imports? Is there a particular make that gives you an edge?

How well do you know the competition? Whenever you attempt to unseat an incumbent, you need to know what you’re up against. Why did the dealer choose them in the first place? How long have they been working together? Who has the important relationships? How good are you at introducing doubt in the mind of the decision maker?

These are just a few thought-starters for you. Once you know who you are and what your ideal prospect looks like, then you can move to the next step, which is segmenting your market. Market segmentation involves looking at the opportunities in your marketing area, and then comparing them to the list of attributes that best align with your sweet spot. This step allows you to prioritize your acquisition activities and better leverage your strengths.

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