Brian Benstock is the General Manager and Vice President of Paragon Honda and Paragon Acura. Since 1982, he has held many positions within the dealership including sales consultant, sales manager, assistant to the assistant manager, finance manager, general sales manager and, eventually, a partner within the organization.
Located just outside of New York City in Woodside, Queens, Paragon Honda and Paragon Acura are the #1 Certified Honda and Acura dealers in the world, delivering an average of 1,100 cars per month and 37 cars per day, every day. The dealerships have received numerous awards, including American Honda Presidents Award Elite, Council of Excellence Award for Finance, Certified Dealer of the Year Award and Honda Masters Circle Award, to name but a few. In 2016, Paragon Honda set an all-time, global sales record for Honda Certified Pre-Owned vehicles.
In the following interview, Brian talks about Paragon’s goal of creating a frictionless transaction for the consumer through such efforts as Paragon Direct, an online platform for consumers to arrange a test-drive, purchase a car, or schedule vehicle service. He also reveals what he sees as the biggest challenge ahead for all dealerships, not just Paragon.
Good morning, Brian, and thanks for agreeing to talk to us about Paragon Honda and Paragon Acura. I’d like to start by asking you about your experience in the auto retail industry. I started selling cars for Paul Singer in 1982 and I’ve been with the same organization since then. I was a retail automobile salesperson. And that’s what I still do. Sell Hondas, lots of them, and Acuras.
Paragon Honda and Paragon Acura are the #1 Certified Honda and Acura dealers in the world. What’s your secret? We believe in the product. We believe in the process. We treat it like a separate franchise. We see it as an entry point for the customers to the brand. American Honda and its Acura division have one of the best Certified programs in the world.
Could you tell us about Paragon Direct? We’ve been offering it since 2011. I’ll give you a distinction between then and now. The distinction is the technology has caught up with the process. In fact, the technology is now ahead of the process. When we started this in 2011, we did not have the same technology to support what we were looking to do that we do today. The capability to use a modern mobile-friendly display on a customer’s phone without the need to download an app is something that is unique to our process. Our Paragon Direct Service enables a customer to request a driver and track their progress from Paragon to when it actually gets to them. We keep track of the customer and the driver so we make the best use of each other’s time.
We’re picking up and delivering customers’ cars for service. Paragon is open 24-hours a day. By being open around the clock, we are able to pick up a customer’s car at night, drop it off at our Service department, service the car overnight, and put it back in the customer’s garage in the morning when the customer wakes up. The logic is simple: customers aren’t using the car on some evenings and we have service bay capacity at night; customers like the convenience and Paragon likes filling our Service schedule. What’s good for the customer ends up being what’s good for the dealership.
We’re a busy store. We’re pretty much at capacity during store hours. But we had that unused capacity at night. We wanted to provide the service but we didn’t want to interrupt our existing service customers who come in during the day. So, we came up with the concept of doing this at night to make use of that available capacity.
If you read most customer reviews about dealerships across the nation, they’re not so great. In fact, according to a recent survey, only 17 out of 4,000 customers surveyed said they enjoyed the sales process. I think the proliferation of independent service centers is really due to capacity issues at dealerships and proximity issues. I think the service we’re providing takes care of both of those.
Are there any other Paragon innovations on the horizon? Yes. We’re looking at voice technology. We think voice is the next place. A lot of dealers are looking at buying and selling a car online and I think we’ve gone past that. We’re looking at how can we do a frictionless transaction.
I understand you’re an avid runner and have completed many marathons. What lessons does running marathons teach you about business or vice-versa? I’m really glad you brought that up. My mentor and business partner in the store was ill in 2005. Unfortunately, he had cancer, and one of his goals was to beat the cancer and to run another marathon (he had run several previously). In late 2005 and early 2006, it looked like he wasn’t going to be able to that. So, I took on that challenge to run a marathon for him. I had never run so much as a mile. I guess I started in March of 2006 and I completed the New York City Marathon in November of 2006. Little did I know that it would start me on a journey that now has me completing, I think, 25 marathons since then.
The business lesson is you really learn how to make efficient use of resources to get maximum horsepower over a prolonged period of time. You’ve got, in theory, limited resources. So, how do you use those resources strategically to get the maximum output in your store, in your business, over a protracted period of time? I think it’s really helped me understand that in business. You could spend exorbitant amounts on advertising and generate business, but you can’t do that over a protracted period of time. It just won’t give you the same result, there is, inevitably, a diminishing return.
I’d like to shift to another topic for our next question. What is Paragon’s marketing strategy? The right message to the right customer at the right time. You have to know your customer. You have to develop ways of communicating with the customer. And those ways of communication have to be sincere. You can’t fake sincerity. You’re marketing to a sophisticated audience. If you are not sincere, you won’t get the results you’re looking for.
Take a look at Amazon. If you log on to your Amazon account, your homepage would be different from my homepage which would be different from my wife’s homepage. Because Amazon knows how to serve up to you the things that you are most interested in. Isn’t it shocking that we’re not using the same technology in our industry? Both on the OEM level and on the dealer level.
When I access my Amazon account, I can tell you “coffee” stuff comes up, “running” stuff comes up, and some of the other interests and hobbies I have, they come up. They get me every time. So, they know this and a lot of other details about us. They serve you up what you need. In fact, they’re getting so sophisticated with it, they serve it before you actually need it. They figure if you ordered a 40 K-Cup Keurig Coffee and you typically go through that in 20 days, the next thing you know, about 18 days later they serve you up and say “Hey, do you want to buy some coffee?” A.I. is becoming an incredibly powerful tool.
In what ways do you utilize social media? We know that social media is a lot like traditional marketing: if you don’t have a strategy that ladders back to your broader business objectives, you’re going to fail. So, we start with a solid strategy that ties to Paragon’s overall business strategy and mirrors our commitment to customers. Then we build our social media strategy, content, and tactics to reinforce it. And as with everything else we do, the customer has to be front and center. We don’t aim just to collect likes or views; we try to use social channels to deepen our brand promise and improve our overall customer experience.
We hire digitally savvy professionals who not only understand these social media channels, they understand how their work leads to our business success. They understand our customers; they spend a lot of time getting to know their needs and anticipate their behavior. And they understand our commitment to customer experience. These aren’t just “kids” we let loose on social channels because we figure they grew up on it; these are professionals with specialized knowledge for a specialized business channel.
How would you describe your management style? How about pain in the butt? I think I give my team a lot of latitude. I think they know I have a very high expectation of them. I push them to grow beyond where they even see themselves. I am proud of the men and women who work in the store. They do a fantastic job, truly a fantastic job. My business partner, Edith Singer, is fantastic. She gives me the latitude to run the store and is super supportive. She owns a majority of the store and she doesn’t feel the need to jump in. Of course, if I go off the rails she brings me back to reality. What’s a good manager if he’s constrained? He’s not going to be able to grow. I try to do the same thing for our people, which gives them the latitude to grow. This means giving them a chance to make mistakes. So long as those mistakes are not integrity mistakes, you suffer and you allow those mistakes to happen. When it comes to integrity mistakes, we don’t have any tolerance.
What do you look for when hiring new employees? A couple of things. Rule #1 is the quality of niceness. We can train them on how to sell cars, we can train them on the sales process. It’s very difficult to train somebody to be nice and nice sells. Nice is a very good quality. The second thing I look at is how would I feel if this individual were working for my competition. If I say it wouldn’t matter to me if they were working for the competition, then they’re probably not the person I want to hire. But if a man or woman is sitting in front of me and I’m thinking “I can’t let this person go” and “I need to put them on the floor today,” – that’s a good sign. I want the proverbial puppy wagging its tail with excitement sitting in front of me.
How do you keep your employees current on products and processes? I don’t want my team to be current; that’s a low standard. I want them to be ahead of the curve. I want them to be seeing around corners. I want them to be smashing a customer’s expectations when it comes to customer service. The car knowledge is a given. They’ve got to know that cold. But I’m really looking for ways to blow the customer’s mind with exceptional service, that’s what we’re looking for. Again, I think we have a high energy machine. The dealers we compete with nationally, in the group we’re within, are among the best and the brightest in the country. If you slip up in any part of your game, they’re going to gain distance on you. I look at it as if we’re professional boxers at the highest level of the game. You can’t make a mistake when you’re up against a professional. He’ll knock you out. It’s the same with the people we compete against. If you’re not on your game in new car sales, used car sales, service, internet, marketing, people development, you’re just not going to be able to compete with these very formidable competitors.
What steps or processes do you follow to ensure customer satisfaction? You start well before you ever measure. We teach our team to begin each transaction by placing themselves in the customer’s shoes. How would I want this transaction to go? What would make things as easy, frictionless, and even as positive as possible for me if this was my car being serviced, or if it was mom or my child buying this vehicle? When your whole team is focused on the customer’s experience from the beginning, rather than the process or the numbers, you often see satisfaction numbers that reflect that focus.
We also recognize that customers are using technology in increasingly sophisticated ways in every other aspect of their lives. This goes back to what I was just saying about keeping ahead of the curve; if we don’t provide an experience that reflects the patterns and behaviors customers expect from other businesses they interact with, we will seem inconvenient at best, archaic at worst. That’s why we keep looking at ways to make the technology that people already use a bigger part of our process.
And of course, we have internal metrics to track customer satisfaction. We have two separate companies that follow up and ask questions after every transaction in sales and service. We’ve got a team of people that analyzes any transaction that rates as less than a favorable review; we break that down and look for trends. We then take this information and make real-time changes that have a positive impact on the overall experience of our customers. We are constantly working to improve in all aspects of our business.
How does Paragon give back to the local community? The most important thing is the tax revenue we generate for the local municipalities. As you know, automobile dealers contribute among the highest level to state tax bases. Most people don’t realize that but the sales tax that we generate, millions of dollars a month, goes to help pave the roads, pay for the firemen, pay for the police and the other infrastructure. We think that’s part of being a good neighbor. Of course, we’re one of the largest employers in our market. This creates tremendous opportunities for the community. We have, right now, over 450 employees. As far as charitable giving, I’d rather not talk about specifics. We’re proud to support local communities, local schools, and local charities in our market. By and large dealers, not just Paragon, are amazingly strong contributors to their local community. It’s an important and often over-looked role that we play. Usually the most generous businesses in any community are the local auto dealers.
What do you see as the biggest challenge facing Paragon Honda and Paragon Acura? Paragon’s challenges are not really separate from the challenges facing the industry as a whole. The biggest challenge facing the industry, in my opinion, are the disruptors: the Gang of Four of Google, Apple, Facebook and Amazon. They are promising to change the business model. So, it’s best for us to change the model before they do. I’m much less concerned about the competition from other dealerships. At this point we can handle ourselves fairly well against most competitors. I’m just saying that what the local Nissan dealer or local Toyota dealer are going to do — that’s not the stuff that keeps me up at night. The concern that I have is how do these other entrances into the market impact the future of retail.
Any closing words or final remarks? I think dealers are best equipped to lead the change that’s happening in the industry — dealers working together with the OEMs. The OEMs can’t figure this out themselves and the dealers probably can’t, either. I think together we can do a good job preparing our industry for the changes coming. In fact, we can lead the way with those changes. Jack Welch once said, “The most exhilarating thing about business is starting something new inside of something old.” I think that’s a great pull quote for what we’re talking about.
Author: Digital Dealer
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