What's More Important, The Sale Or Your Reputation?

One definition of a prostitute is someone who sacrifices their good name in order to make a buck. But what do you do when someone else is driven by the sale but it is your reputation that suffers as a result? 

This is the risk run by any company that relies on a third party to sell their product. Franchisees, car dealers, distributors and affiliates are independent businesses that trade off of someone else's reputation. If a regional airline, for example, offers bad service it is not their company or their brand that is damaged, it is Delta, American or other brand name that appears on the side of the plane.

This is the case with car dealers also. And I recently had an experience at Fiat of Manhattan that was nothing short of mind-blowingly bad.

I walked in, very excited to get a little Fiat 500. I told them that I was prepared to make this the easiest deal of their day. I even told them that I already looked up the price on the Fiat website and was willing to pay it. No haggling required. Four hours later - that's right, FOUR hours later of being put through the ringer, guess where we ended up - right at the beginning, at the original price I offered to pay.

In the process the branch manager insulted me, took me for a moron and would try to raise the price hoping I wouldn't notice. Lies, deception, fast talk and every other tactic usually reserved for a stereotypical used car dealer were employed. I'll save you all the gory details including the tale in which I was told, "I just talked to my boss and he said I can offer you the price you want," which sounds good except she never left her seat the whole time we were talking.

The result: I felt frustrated, angry and dejected. My excitment was gone. Even when I went to pick up the car - my excitement restored, they made me wait an hour and a half despite the fact I called in advance and they told me what time to come in. Instead of asking me if I was excited and pumping me up to take possession of my new Fiat 500 - they made sure to tell me that I "made them work hard" and they weren't making any money on me - a clear indication of their priorities.

It was clear that this dealership is motivated by one thing and one thing only: the sale. Worse, it's not their name that hangs on the door. Whoever owns that dealership suffers nothing except maybe I wouldn't recommend the dealership to anyone. The name that suffers is Fiat.

So why didn't I just buy the car somewhere else you ask? The dealership has a deal with parking garages in Manhattan, offering really cheap parking. If other dealers in the area offered something similar (I checked, they didn't), I would have bought the car somewhere else. But given the price of parking in NYC, this was a big deal. Such a big deal, in fact, that even getting a bad deal on the car still works out cheaper than paying full price for a garage.

The dealership is cleaning up. Manhattan residents who want a Fiat 500 have little choice but to buy the car from this one dealer even if they know they can get a better deal or get treated better somewhere else. The dealer even bragged about their sales numbers, claiming to be the top Fiat seller in the North East.  Which is very good for them. Sadly, it is the Fiat brand and the customer that are suffering...not the dealer.

To be fair, I tweeted that this dealership was ruining the Fiat brand and someone from FiatUSA has already tried to contact me to find out what happened. I have not talked to them yet, but I will try to.

It is what happens next that really tests the theory of what is more important, the sale or the reputation. Fiat's initial forray into the American market with the 500 after a 30 year hiatus was disappointing and they are working to make up lost ground. The question is, given that indeed this one dealership may be moving more cars than any other in the region, is that more important to Fiat than the damage that this dealership may be doing to their brand and their reputation? Time will tell.

Whenever we use a third party to represent us, we must hold them to our standards, not theirs. They must earn the right and work hard to maintain the right to use our well earned reputations and good products to make their money. In return, they must promise and adhere to, protect and advance our good names. However, if the parent company fails to hold their dealers and affiliates accountable, regardless of the sales numbers, then they will end up looking like the pimp in this game. And that leaves the rest of us feeling cheap, dirty and used and likely never return to that street corner ever again.

 

Postscript, October 18th, 2012: 

I responded, multiple times, to Fiat's request to talk to me. I let them know that I was happy to take the time to talk to them. They never followed through. I never talked to anyone.

Perhaps the reason this dealer is able to get away with what they did is because they, like the parent company (which is Chrysler), reacted to the negative press and not to the concerns of a customer. Seems to be a trend these days.

Comments

[PointSouthKOA]

Why did you buy a fiat? The car or the "cheap" parking.

Your outcome will be the satisfaction with the parking deal. The original hassle is only beginning and if promises made the dealership are not delivered to the terms of the "low cost parking" by the contracted suppliers than the percieved deal will not be worth it. If issues come up from the parking folks, than a dealer is going the take another expectation "hit" because of promises made, but not fulfilled.

As Tom Peters said "stains on the flip down tray in the airplane, means the engines aren't serviced properly"

[Jim Hausch]

Wow, what an post... Since I work for a distributor, the beginning got me a little fired up. I am glad I continued to read.

Car sales are tough. Whereas every interaction I have with a customer is mindful of the past relationship and future relationship, a car sale does not have that "burden". They know you are here for this single transaction and that's it. The exception might be the higher end dealers who are very mindful of repeat customers and treat folks a little bit differently. Their margins (%) might be just as tight, but the higher dollar amount likely helps to offset it.

These fine Interwebz and their ability for experiences like yours to do real harm to a brand may help foster change, but it's hard to say. Those same tools allow us to comparison shop now more than ever - further removing the margins needed to employ good people.

Pure service industries where bad reviews can trump a price decision may have the most to gain. Hotels come to mind. A crappy list of reviews on Trip Advisor certainly encourages me to pay "just a bit more" and continue my search.

However, back to your post. You wrote, "Franchisees, car dealers, distributors and affiliates are independent businesses that trade off of someone else's reputation." My only comment - this goes both ways.

Manufacturers seek out strong reps and distributors for their existing relationships, trust of their customers, and local knowledge. We are very careful about whom we choose to distribute.

Unrelated comment: We (our company) just went through some strategic planning and your Ted talk was a small part of the overall experience. It was fun hammering out our why/how/what.... Thanks.

Thanks again for the thought provoking post.

Regards,
Jim

[Lawinsider]

No where is the ABC (always be closing) mentality stronger than in New York City. You came in knowing exactly what you wanted and knew the price to match. I guarantee the sales reps are taught to break you from that price point whenever possible. That price got you in the door-- now it's time to see if they can get you for the bike rack and the flood lights. But here's the real issue: for every guy like you, there are 5 more who happily get up sold. So while I agree with your position personally, as a business owner, my approach would be to let my sales guy piss off a few people in the process of reaching for a higher ticket conversion.
The real secret is having managers who can do damage control after the fact. And I suspect by the fact that you tried to engage with Fiat after their follow up call, that you were prepared to forgive-- which further proves the point. Fiat's system could work perfectly if they could tighten up the post-sale. ABC.

[Youarenotalonedotorg.wordpress.com]

Hi Simon,

I was given your name by a mentor of mine. The first thing I found was this piece on prostitution and I have written a bunch on the subject. I think it's interesting because of the societal need and the societal denotation associated with the word. I'm excited to follow your blog. I've been writing every day since I was five years old, but wrote my first blog today (yesterday). If you have time to have a glance and possibly provide me some feedback, it would mean a lot to me. I have a lot to say and I hope that everyone can take something from my posts as I have just received from yours. The link if you have a minute: http://youarenotalonedotorg.wordpress.com/
My email address is [email protected] - you're a very interesting mind and I'd like to get to know you (as creepy as that sounds - it's not). Anyway, great piece.
Very Respectfully,
Josh Rizzo

[Armen]

Are you really surprised that a dealership does this? That's why our Law Firm is in business and filing charges against the dealerships and manufacturers is ALL we do. I know this is sad, but that's 90% of our practice.

[CMasterson]

I was thinking the sales people didn't have a good "why" for the work they did. The same things holds true for garbage collectors, burger flippers, and car sales people. If they're "why" is just money, if can be a weak motivator.

[Cdenis321]

Hello Mr. Simon Sinek

My name is Caleb Denis; I am the Studio Director of FIAT of Manhattan. I would like to say we at FIAT of Manhattan make customer service our #1 priority. I apologize that your sales experience was not a fulfilling one however; I would like the opportunity to turn that around throughout your ownership experience.

Thank you

[Tim Platt]

Simon,

I hope you read this comment, because unfortunately I believe you have come to the wrong conclusion on cause and effect.

Why do so many dealers focus on sales quantity, rather than quality?

Who drives that focus? The dealer, or the car manufacturer. In this case Fiat.

I would humbly suggest that it's the focus and business practices of the manufacturer that creates this environment.

I have run a car dealership in the UK for nearly 25 years and we give excellent customer service despite the behaviour of the manufacturers we represent, not because of them.

Car manufacturers need to start treating their dealer networks with genuine respect. That way, I genuinely believe, this sort of situation would be very unusual.

[mori414]

Shame, but this pretty much highlights about majority of the car dealerships in USA. A lot of them simply concentrate on the sale, instead of hanging on to repeat customers. What is that concept they always teach in business school? That it is easier to keep a customer than to find a new one? Apparently the auto dealership people elected to skip that day.

All my friends, at least those that I talked to that had bought new cars almost always buys from a far far away dealer. The far away dealerships far away doesn't care either, so they will sell for lower prices knowing they will never come back again. Then my friends will have their services done at the closer dealership, who tried to sell cars at much higher price. While the auto dealership at least by themselves, get a good portion of the profit from services, still decides to sell at a much higher price.

[Malonso21]

Thnsk for sharing Simon. What this made me think is that given the new possibilities customer have to express their feelings about any experience, brands and everyone involved in the process has to have a higher commitment to what they do and realize how important their behaviour is to the brand's reputation.
Let us know when you finally contact FIAT´s reps, because, its also true that nowadays unsatisfeid customer tend to spread their message using their social graphs but rarely try to reach brand directly, so, by the time brands know about the problem, is often too late.
I also wanted to tell you that I really enjoyed Start with Why and you have no clue how much I talk about it and reccomend it.
all the best!

[LesliBoldt]

This was an interesting piece - on how third parties (or in my case, subcontractors) represent your brand and in doing so, the wrong contractor or dealer can hurt your brand.

I've worked with subcontractors I thought shared my values, but when I lifted up the hood (to extend the automotive analogy), I discovered their sole aim was to increase billable hours and upsell my clients with products and services they didn't need.

While your prostitution analogy might have been accurate in a literal sense of the word (to devote to corrupt or unworthy purposes), the use of the image of a female prostitute in this piece was inappropriate, irrelevant and off-putting to me as a reader. I think you'd agree that there's a big difference between doing anything to sell a car in Manhattan (and get that cheap parking), and the provision of sexual services in exchange for money (off the street no less).

[MarkOrlan]

Simon, you just have to shake your head in disbelief. What you experienced at the car dealership seems to be so common that too often consumers just come to expect it. Margins are so thin, salespeople (if you want to call them that) are a dime a dozen, the OEM is disconnected from the dealer, and no money is spent on training people in how to listen and service customers...the focus is all on the product and how to up-sell various maintenance packages, extended warranties, etc.

One might assume that something so obvious as a customer coming in laying his/her cards on the table, saying they're prepared to buy today, would be a no-brainer. An easy, quick deal.

The sad part is, this dealership has been successful - the top Fiat seller in the country - despite offering a great customer experience, but rather, because of their prime location and their competitive parking garage deals. They're buying "loyalty" just as so many airlines, hospitality chains, and Telcos do - by making people an offer they can't refuse, through point programs or bundled incentives. So, they continue to hide behind their impressive sales numbers.

Good luck helping FiatUSA recognize what's important for long term success. Hopefully, the people at the top are better listeners than those who deal directly with customers.

[Tj_hutch]

Griffin,
I appreciate what seems to be a heart-felt, sincere response to Simon's blog post. I do want to highlight something you said though.

"But I just want to let you know that it's not easy to get up in front of people and help them purchase a car." This struck a cord with me. All that are in sales have the same difficulties and pressures, but we choose that to deal with that. It is our duty to provide a seamless transaction leaving the customer feeling fulfilled and excited about their purchase.

Good luck with your new adventure in car sales. I think it is pretty amazing you got to learn first hand from Simon, and I am sure this will enhance your career more than you will ever know.

[Account Deleted]

Hey Simon,

I can see what you mean about 3rd parties and I'm genuinely sorry that the process wasn't as simple as it could have been. We are the largest FIAT Studio in the North East but not the country, and even still we are all learning. Myself for instance have been doing this for a month and a half and the rest of the FIAT specialists have only been doing this for a short time. If I knew everything better I would have been able to help you out much more.

But I just want to let you know that it's not easy to get up in front of people and help them purchase a car. It's often the 2nd largest purchase people make and it can be emotionally charged and I wish I could have been more helpful for you. But do know that I've learned a lot and your patience will help the customers who come in afterwords since I will be better able to help them out myself.

If there is anything you need please contact me first, and I will do everything I can to help you out. Also thank you for the copy of your book I've read the prologue and I'm starting the rest tomorrow on my day off.

Best,
Griffin Green
FIAT Specialist