By Sharon Hill

ResponseLogix, a digital CRM-integrated program helping auto dealers increase their lead-to-sale ratios, is also making considerable money for its investor and reseller A.H. Belo.

Tom Mohr, former president of Knight Ridder Digital, is founder, president and CEO of ResponseLogix.

“I was at ASU [as director of Arizona State University’s New Media Innovation Lab] and got a call from a good friend,  the GM of a very successful Toyota dealership, who said his firm was having a problem with Internet leads,” Mohr told CIR.

Internet salespeople were taking an average of two hours to respond to digital leads.  But, the friend also discovered that on those occasions when response took only 10 minutes sales doubled.

From that realization grew ResponseLogix and its mission to enable auto dealers to reply to online leads within 10 minutes. The new firm built out 300 templates for Toyota, to transparently respond to dealer prospects, providing dealer-branded price quotes assigned to dealer reps.

ResponseLogix has three elements: SmartQuote, SmartFollow, and SmartFacts, all of which integrate with the dealer’s choice of any of 50 CRM products. ResponseLogix learns all it can about each dealer’s pricing structure and its inventory, to stay on top of each lead whether from OEM, dealer, or third party, and to quickly respond to the consumer’s inquiry.

“A recent Cobalt study showed that the average dealer response time on Internet leads is over five hours,” said Mohr. “Twenty-five percent don’t get answered at all.”

Auto dealers using ResponseLogix and its 10-minute response time have realized a 35-100+ percent improvement in sales, according to Mohr.

“Our service is to execute quotes right away, stepping in front of the CRM system,” he said. “The lead comes to us; we apply the pricing-rules algorithm, and look at the consumer’s request down to trim level. For new car buyers, we offer three prices: low, medium and high.”

The SmartQuote Pre-owned application presents a VIN-specific vehicle first, followed by three similar pre-owned vehicles and up three similar new vehicles.

SmartFollow tracks communication between dealer reps and consumers, including phone and e-mail. After 72 hours of no conversation, SmartFollow automatically sends e-mails from the dealer’s rep through ResponseLogix servers.

With SmartFacts’ analytics dealers track leads, e-mails, phone calls and sales. The software tracks response times, number of calls and e-mails and compares these statistics to units sold. Currently accessible by Internet managers and GMs, a later version will provide authority levels and access by sales reps as well.

Scott Pettitt is Internet sales director of Toyota Sunnyvale in California, the tenth-largest Toyota dealership in the U.S., and the first to use ResponseLogix. His dealership’s sales obstacles were the impetus behind the product.

“Before ResponseLogix we were getting 3,000 leads a month and we couldn’t get to them all even if we worked our butts off,” said Pettitt. “We wouldn’t have been able to take advantage of Cash for Clunkers if it hadn’t been for ResponseLogix. It was physically impossible to respond to everyone. With the program’s help we sold 427 units during CforC because we were able to get there first.”

Toyota Sunnyvale’s direct sales staff of 28 increased its closing ratio from a pre-ResponseLogix 4 percent to 6 percent to its current 18 percent. Rep lead loads went from 80 to 125.

“ResponseLogix does an awesome job,” said Pettitt. “It’s really changed the way we do business.”

A.H. Belo closed about $1 million in incremental revenue in 2009, by selling ResponseLogix to auto dealer advertisers.

  “We needed to decrease our reliance on impression-based advertising as a driver of the greatest proportion of our revenue,” Jim Moroney, A.H. Belo EVP, told us. “We had to focus more on lead generation and cost-per-sale.”

A.H. Belo invested a year ago in ResponseLogix and has been selling it to dealers in Dallas, Providence, R.I., Los Angeles and Boston. The newly-separated Belo Corp. TV stations are selling it in all their markets as well.

“We now have 85 active dealers using ResponseLogix,”  Belo Interactive Media president Dave Ellett told CIR. “Incremental ResponseLogix revenue for 2009 is expected to be just under $1 million, with “a multiple of that going into next year,” he said.

“It’s a software sale, clearly different than what many of the sales people are used to,” Ellett said. “It’s attractive, with a very high ROI to dealers, but a sale that requires a significant amount of training [of media sales staff.] ResponseLogix provided that training.

ResponseLogix resellers, including Advance Publications and very recently The Washington Post, average 260 auto dealer signings each month.  Not every reseller is a newspaper or media group, however.

 “We want to find the right seller in every key market in the United States. It could be media, non-media or a single salesperson,” said Mohr.

 

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To talk to Mohr about ResponseLogix and its reseller opportunities, e-mail .

 

 

 

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