There's a lot one can learn about the human psyche at a car dealer's. This is where the allegedly shady dealer meets the self-proclaimed tough bargainer. Researchers at the Sales & Marketing Department at Ruhr-Universität Bochum analyse sales talk and help the industry to work more efficiently. They recommend, for example, sending unprofitable customers away.
Car dealers spent much time with unprofitable clients
More often than not, a person who wishes to buy a car likes to be advised in-depth at a car dealer's. Lasting several hours, the talks frequently don't result in a purchase. Professor Jan Wieseke and his team at the RUB Sales & Marketing Department have found out: dealers spend 83% of their consultancy time with customers who don't buy anything in the end. "Some clients simply enjoy spending time at a car dealer's. They may block a sales person for hours on end. In the worst-case scenario, the sales person misses out on a real deal with another customer," says Dr Sascha Alavi.
In future, Prof Wieseke and his colleagues are planning to investigate this phenomenon more closely. Their hypothesis: dealers should send blatantly unprofitable customers away. In order to determine which tactics would work best here, the Bochum researchers have recently launched a collaboration project with US marketing researcher William Cron, a leading player on an international level. Together, they wish to identify the most efficient options for sales people to invest their times and efforts.
Customer loyalty is rewarded
Another matter that the researchers from Bochum are focusing on are price negotiations conducted when buying a car. They have found out that longstanding customers are typically granted higher discounts than new customers. These results came as a surprise to the sales people working at car dealers, because they perceived loyal customers as less price-sensitive on average. "Our findings have demonstrated, however, that they are bolder when it comes to negotiations, which is why they often get better results. They are very much aware that, as important clients, they have great bargaining power," says Sascha Alavi, who, together with Jan Wieseke and Dr Johannes Habel, has published a report in the magazine RUBIN.
Further information: http://rubin.rub.de/en/featured-topic-traffic/adventures-car-buying
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