When you're shopping for a car, the experience you have at a dealership can make all the difference. Edmunds.com Senior Editor Matt Jones worked for 12 years as a car salesman, Internet sales manager, and finance and insurance manager. He now highlights dealerships and car-selling best practices that make car shopping easy and enjoyable. Got an innovative dealership story to share? Contact him: matthewj (at) edmunds.com
It's a humid late Friday afternoon in Charlotte, North Carolina, and I'm at Town and Country Toyota, looking at a lot awash in Camrys, Tundras and RAV4s. After 12 years in the car selling business, this setting should feel familiar. But in a lot of ways, it doesn't. That's because today, I'm not an Edmunds editor or a car dealership insider. And this dealership is supposed to be something very different, too: nothing less than a revolutionary way for people to buy cars. So, dressed in shorts and a T-shirt, with a notepad and pen in hand, I'm going undercover, posing as just another middle-aged guy checking out some of the country's most popular cars.
"Welcome to 1 A.D. (After Dealerships)"
There's no shortage of progressive car dealerships and salespeople across the country: I know they exist because I've been writing about them for the better part of two years. These places make car buying easy, hassle-free and fair.
Still, many car shoppers tell Edmunds.com that there continues to be room for improvement, and the toughest part of car buying remains the protracted transaction at the dealership, followed closely by the difficulty of getting an exact price for an exact car.
So when I heard that Sonic Automotive, one of the largest dealer groups in the country, was changing its sales process to better match what car buyers actually want, I listened closely.
Sonic plans to implement what it calls the One Sonic-One Experience program in all of its 125 stores. It describes One Sonic-One Experience as a customer-centric sales process that is speedy and offers transparent, no-negotiation low pricing. Advisors who are there to "help you, not to sell you" present the cars. Sonic doesn't even call them salespeople. Instead they are "experience guides." Sonic touts all this as "1 A.D.," the dawn of the post-dealership era.
Currently, One Sonic-One Experience is in place at five Sonic-owned dealerships in and around Charlotte, North Carolina. The first dealership to implement the process was Town and Country Toyota, which began using the program in October 2014.
By phone and email, I'd arranged a Saturday meeting with the general manager to get a tour of the dealership and talk about how the program is working. Sure, I'd get a good explanation of the process details, but that wouldn't tell me what a customer would actually experience.
So here I am, showing up unannounced and a day early. Except for the general manager (who I won't see today), no one at the dealership knows my name. I don't know anyone in Charlotte. I hop out of my rental car and head onto Town and Country's lot.
There's no gaggle of salespeople at the entrance; that's the first thing that strikes me. It's a pretty common dealership practice for sales personnel to stand near the doors to greet potential customers once they've parked. But it's a greeting that isn't always popular with car shoppers, who sometimes feel like they're being pounced on.
Because I'd done some research about One Sonic-One Experience, I know that lack of the usual meet-and-greet is supposed to give shoppers space and time alone to kick some tires. Once shoppers' body language suggests they are looking for help, someone from the sales team will go out and greet them.
So I take a few minutes to check out the inventory. Every vehicle has a large white tag dangling from the rearview mirror. Some of them have people's names on them. These cars and trucks have been pulled up in front of the showroom and are waiting for customers who have called ahead for a test-drive. The majority of the tags I see display Sonic's predetermined, discounted price, meant to cut out drawn-out haggling.
After a few minutes of looking at Tundras, Tacomas and 4Runners, I go inside.
Finding a Salesperson
The showroom is brightly lit and modern. A cheery sales guy wearing a polo shirt and carrying an iPad greets me. He introduces himself as Brad, says that he will be my experience guide. He asks if I'd been to Town and Country Toyota before. I tell him I'm from out of town and haven't ever visited the dealership.
"We do things a little differently at our dealership," Brad says. "Let me tell you a little about how the process works here."
For the next few minutes, Brad walks me around, explaining the differences between this dealership and a traditional one. Here there are "imagine bars," tall tables outfitted with iPads, in case I want to do online research, price comparisons or car configuration on my own.
The echoes of the Apple Store are intentional. Sonic notes that its tablet-based process is not just for customer research. iPads are the backbone of the sales process, reducing the number of signed paper documents from more than 40 to just four.
The showroom features seating areas that seem better suited to a hotel lobby than a car dealership. These coffee tables, surrounded by leather chairs, are where customers and experience guides talk about cars and financing. It's a far cry from the partitioned work stations I'm accustomed to from my time selling cars.
Brad tells me that if I decide to buy, he'll be the only person I will deal with, from beginning to end. I won't be handed off to a sales manager or finance and insurance manager. He says that most people who decide to buy a car can complete the purchase paperwork within 45 minutes. He also says he isn't on commission, but instead works for a salary. Brad later tells me he has never sold cars before. His last job was as a salesperson at Best Buy.
Before he can go any further, I hit him with some questions:
Me: "So if I have questions about financing and payments, you're the person I talk to? I won't be paying cash."
Brad: "Yes. I'm the one who works out the payments with you and everything."
Me: "I'm not buying today. But I'll want all the numbers to take home and review with my wife."
Brad "Not a problem."
Me: "Cool. I want to test-drive a Camry."
Brad: "OK, let's go find one you like."
I tell Brad that based on my research, a Camry SE would be the best fit for my wife and me. I quickly land on a white 2015 Toyota Camry SE. Brad gives me a thorough demonstration of the car's features and easily answers my generic car shopping questions.
The Camry I pick out has a price tag of $19,491, reflecting a discount of $5,722 from the sticker price. This is the same pricing the dealership uses on its website. Later, in my hotel room, I confirm that this discounted price is several hundred dollars below the average price being paid for a similarly equipped Camry SE in the Charlotte area, according to Edmunds.com True Market Value (TMV®).
After the product demonstration, Brad asks if I'm ready for a test-drive. Before we hit the road, Brad takes a picture of my driver license with his iPad. I learn later that is how I am entered in the dealership's data system.
Brad says it's important that I see how the car performs in both city and highway driving, so he leads me on a course that offers both. Before we are finished, he has me make a U-turn in a cul-de-sac so I can test the car's turning radius. My test-drive lasts about 10 miles.
Working out a Deal
Once we get back to the showroom, I ask Brad what this new car is going to cost me: bottom line. We take a seat at a coffee table.
I tell Brad that I plan to finance the car with my credit union at 1.9 percent APR for 60 months. Once again, Brad puts the iPad to use. And within 10 minutes of sitting down, I have this:
It's worth noting that to get my deal payments, Brad doesn't leave our table to go talk to a manager. He doesn't have me fill out any forms or bring over any other dealership employees. No four-square.
After calculating my payments, Brad and I run through a few different purchase scenarios, using different down payments and interest rates. We also change the length of the loan and calculate what would cost me less: using a rebate from Toyota or taking advantage of its APR special.
Brad and I also talk about various warranty and service products that are available for purchase. This is an important difference in the process: There's no hand-off to a finance manager, or a trip to the F&I office. Brad uses his iPad to show me warranty and service products, just as he has used it to illustrate payment options. If we were going to seal the deal, Brad would also use the iPad to run my credit.
Dropping the Disguise
Since I sold cars for years, I know the impact of taking a salesperson off the floor at the beginning of the weekend, even if he's not on commission. So I try to keep my mystery shopping moving as quickly as possible. We are finished in less than an hour. Nevertheless, I get the impression that Brad would go at whatever pace I needed to feel comfortable. I don't think a more deliberate shopper would feel rushed.
After we talk about different purchase options, it's time to fess up. I hand Brad my business card, tell him who I am and what I'm doing. I ask if I can speak to him and his manager away from the sales floor.
I'm not sure how this will go over. I am, in essence, telling them that I've wasted an hour of their time on a Friday. I'm bracing for a tongue lashing. Instead, both Brad and his manager are gracious and actually excited that I'd tested the program. In fact, they want to hear my impressions.
By the Numbers
The next day, I meet with the store's general manager, Sanjay Prakash, and learn how the program has affected the dealership.
Between January and May 2014, before Sonic implemented the program, Town and Country Toyota averaged 171 new car deals per month, Prakash tells me. That rose to 231 new car deals for the same time period in 2015, after the implementation of One Sonic-One Experience. Prakash says the dealership's market share of new Toyota sales in the Charlotte region grew from roughly 12 percent to more than 21 percent. He attributes some of that growth to an increase in repeat and referral business from shoppers who enjoyed the One Sonic-One Experience process.
Customer satisfaction scores also are up, Prakash says. He believes that's due not just to the One Sonic-One Experience process, but to the nearly two-month training program that new employees go through before meeting customers. The experience guides take part in daily training to make sure they are on top of both vehicles' features and this new selling process, he says.
Prakash adds that since the implementation of the program, employee turnover has been virtually zero. Nationally, car dealership turnover hovers at around 36 percent.
What Will Car Shoppers Think?
According to Edmunds research, 64 percent of car shoppers value the importance of both price and time when they're buying a car. If One Sonic-One Experience can deliver a 45-minute buying experience and offer no-negotiation pricing that is at or below market average, it should make most people happy.
About 20 percent of car shoppers, though, consider themselves extreme "price grinders." They will take as much time as they need to make sure they get the lowest possible price on a car. Sonic's assurances that its no-haggle prices are at or below market average are unlikely to sway these shoppers. They will probably try to negotiate for a better price elsewhere.
A less crucial question is how car shoppers will react to not being approached by eager salespeople as they arrive at the lot. I think most would prefer the laid-back approach, but others might read the lack of a greeting as a lack of interest, though that is clearly not Sonic's intent.
What Makes Sonic's Program Different
Sonic is not staking out unique territory with one-price car shopping. Edmunds.com, for example, offers Price Promise® through its network of more than 10,000 dealer partners.
There are, however, three things that set the One Sonic-One Experience apart:
Scope: In 2014, Sonic Automotive sold upward of 245,000 new and used cars in the more than 125 dealerships it operates across the U.S., so it has the potential to touch a whole lot of car shoppers. If the One Sonic-One Experience process goes national, shoppers may begin to ask why all car dealerships can't be this way.
Training and Experience: The six- to nine-week initial training period for Sonic's experience guides is much longer than what many dealerships offer new employees. When I started selling cars in 2001, for example, my training barely took a week. Some dealerships offer even less than that. Sonic also has ongoing training to keep its experience guides up to date on products. That doesn't always happen at car dealerships, either. Better-trained employees who stay in their dealership jobs longer will offer shoppers better service than they would get at a store with a minimally trained, less experienced staff.
A Great Process: Although a great deal on a car is certainly important, a rock-bottom price isn't the only ingredient a dealership needs to win over customers. Believe me, I've seen plenty of people buy cars for super-low prices and still leave the dealership unhappy. What car dealerships need to deliver to shoppers is a good deal and a fast, simple process. After what I experienced at Town and Country Toyota, I think Sonic Automotive is onto something.