On this week’s episode of Kain & Co., David Kain explains how giving the customer an actual vehicle price instead of avoiding doing so can actually help in negotiations.
VIDEO TRANSCRIPTION:
David Kain: Hello, I’m David Kain, president of Kain Automotive, and I’m here on Kain & Company on the CBT automotive network to bring you some startling news: vehicle price is actually your friend. Now I say that facetiously, because I run into dealerships to where you have the price on your listings, you have the price on your website, and yet inevitably you’ve got some manager that’s sitting out there, maybe reading an old school book saying, “Don’t talk about price. As soon as you give a price, customer is going to go someplace else and buy,” as though they were just waiting, “Oh please give me the price so I can go check with your competition.”
David Kain: Here’s what’s great about it is, I’ve studied this for years and we found that most of the time, north of 50% of the time, if you will give the customer a price, they will actually pause shopping and engage with you. And there are different ways to approach that. And ultimately there’s in the written format to be in a position to where you can say to the customer, “The price on that specific vehicle has been discounted down by $3,500. And yes, it used to be $13,500, but now we’re able to offer it to you for $10,000, that’s a remarkable savings.” And in that kind of situation, when you spell it out, customers tend to appreciate it.
David Kain: So obviously that’s a used car example, but even in a new car example, if we’re on a specific VIN number and the customer has expressed interest in it, when I give the price, I would add a little more flavor and I would say, “The vehicle that you’re interested in retails at $45,000. However, we’re offering a $2,000 discount, which will take it down to $43,000. But I’m suspicious that you also qualify for some additional incentives or rebates, depending on where you work and what kind of vehicle you drive. Can you please give me a call or email me back with that information, and I’ll be able to see what else you qualify for?”
David Kain: So the customers, when they see the price, you’re not hiding it from them, and then you let them know that you might have even more, it drives up engagement. Compare that and even think of your own shopping habits, compare that to the email that goes out, “Thanks for your interest in the vehicle. We have a great selection of them. The vehicle that you’re interested in is such and such retail, please give me a call so we can disclose the price.” Customers don’t call, customers don’t even write back, they won’t text back. What they’re looking for is that transparency that they can then build trust on. It’s also a waste of their time. So when you combine transparency, trust, and time, that’s the holy mix that the customers really are looking to define their effort in shopping for a car.
David Kain: Additionally, when we give a price, sometimes it’s not on a VIN specific vehicle, it’s just on a Ford F-150, for example. So if we don’t know the equipment level, what we can do is give a price range and say, “Thanks for your interest in the F-150. Those vehicles start at price and go up to, depending on how you want it equipped, and the body style, and the drive line, and all the other features. Additionally, we have additional incentives and rebates that you might not have seen online and if you’ve reach back out to me at this number, I’d be glad to go over that and provide you the price on exactly what you’re looking for.”
David Kain: So parallel to that is the price discount range. So similar to the price range, what we can do is to say, “Oh, thanks for your interest in the F-150. We’re able to offer discounts between this amount and that amount, depending on how you want that equipped. Additionally, we have some incentives and rebates that, depending on where you work and what you drive, will allow me to give you some additional incentive.” So that’s a great way to start to build the trust with the customer, and ultimately we’re going to find that less than 10% or 15% of customers really are those hard nose, hard drivers that say “I want the very lowest price.”
David Kain: Everybody wants a price, be transparent, give them the information, and then of course ask for engagement. We sometimes run into where we’ll provide a price in an email or on the phone, we’re going to text, and we forget to put the second line in there, which is, “Does that price work for you?” Or, “How does that look?” Or, “Is that going to fit your budget or your expectations?” So mirror what you do in a live environment on the floor on a telephone call and in an email and I think you’ll get better results. So remember this: price really is your friend. And I’m David Kain, and I appreciate you spending a few moments with me today, and I look forward to seeing you next time here on Kain & Company.
Speaker 2: This has been a JVF Business Media production.
