Matt Serra is Executive Manager of the Al Serra Auto Plaza in Grand Blanc Michigan, part of Serra Automotive, which ranks among the top ten privately-held retail automotive groups in the nation.
In 1973, founder Albert M. Serra began with a single Chevy store and a simple customer first philosophy. Within five years, Al Serra Chevrolet became one of the top five dealerships in the United States and, in the process, fine-tuned a solid formula for growth and an unquenchable passion for success. Today, Serra Automotive operates in seven states and employs more than 1,800 people. The network includes 36 dealerships and represents 52 automotive franchises.
The son of the current President of Serra Automotive, Joe Serra, Matt was raised in the auto industry. Upon graduating from Miami (OH) University in 2011 with a degree in Accounting and Economics, he began at Al Serra Auto Plaza as an employee-in-training, learning every function of the business including sales, service, parts, body shop and administration. He then went on to hold various positions including Used Car Business Manager, Chrysler Dodge Jeep Ram Sales Manager and General Sales Manager for Kia, Volkswagen and Subaru.
In June 2013 he spent a year away from the dealership to complete his MBA at the Kellogg School of Management (Northwestern University). He received his MBA in 2014 and was immediately placed as the Executive Manager at Al Serra Auto Plaza, where he was fortunate enough to spend over a year working alongside veteran and legendary Al Serra Auto Plaza General Manager Denny Dunfield. Denny was promoted to Vice President of Serra Automotive (parent company) at the end of 2015 and now spends his time working with Serra stores throughout the country, specifically, it’s most recent acquisitions in Traverse City.
Al Serra Auto Plaza currently sells more brands under one roof than any other dealer in the area including Honda, Dodge, Ram, Chrysler, Jeep, Buick, GMC, Volkswagen, Cadillac, Chevrolet, Subaru and Kia.
Matt recently talked with Dealer magazine about how continuing his grandfather’s simple customer first philosophy, along with providing a great working environment and insisting on complete transparency with a unique one-price, no-haggle policy, makes Al Serra Auto Plaza one of the top volume dealerships in the country with 2016 annual new vehicle sales of 9,041 and used vehicle sales of 5,000
What made you decide to join the family business?
I love that our business provides an opportunity to positively impact people. We definitely work hard to create value for our customers and community, but what I’m most passionate about is the impact we can have on our team. For example, Serra Automotive’s focus on growth is rooted in its motivation to create opportunities so our top associates can own and operate their own store. My role at the Auto Plaza is pretty simple and a lot of fun. I get to help create an environment that attracts very talented and hardworking people. I help provide the tools, resources, and opportunities to develop their leadership and operational abilities. And hopefully, put them in a position that when Serra Automotive acquires a store, they’re picked to run it. Losing our best people to run stores is the “positive turnover” we love to see.
Our auto group encourages and develops entrepreneurs and I love all aspects of that, including:
Team building, I love to build/develop a team. Decision making – some ideas/decisions work -great keep doing it. Some ideas/decisions don’t- great, understand why, learn from it, and get better. And then OWN the results!
Our business results are very transparent and easy to understand. We get daily, weekly, and monthly feedback on exactly how well we’re performing. You can’t ask for much more than that. Every month, we compete against the same month, prior year. For example, in October we competed against October 2015 – profit, new vehicle sales volume, used vehicle sales volume, F&I PRU, customer pay sales, etc. Serra Automotive judges us on our “Win/Loss” record and overall year over year (YoY) growth. We work hard to pile on as many wins as possible and continue an upward YoY growth trend.
What are the top three best practices that make Al Serra Auto Plaza stand out?
- A focus on our associates. Our job is to create the BEST environment possible to recruit, hire, and retain the BEST people possible. We do that as follows:
- Leadership: Our ENTIRE management/leadership team goes through ongoing leadership development coaching/training because the culture and environment starts with us. It’s our job to create the culture and environment we want, and relentlessly work to improve it.
- Resources: This includes our state-of-the-art facilities and equipment; an inventory of over 3,000 units; our 12 different brands, along with the fact that our associates can sell them all; a big marketing budget and a strong BDC. We work hard to create as many sales opportunities as possible for our employees.
- Growth/Development .We have a well-developed and highly successful onboarding process whereby each employee gets to meet the entire team, spend time in each department and has an opportunity to become fully familiar with both the people and the processes. Then, every employee has to touch up on their skills for one hour a month at a “high impact” class at the Al Serra Academy. Lastly there is daily coaching and development. The leadership team is responsible for two things – results and employee development. We have a great team and they take their role very, very seriously.
- Customer-Centric Focus: All of our strategies, policies, and processes are created from the perspective of the customer. We believe customers want a true partnership, a timely and efficient experience and transparency. It’s our job to deliver on all of those three fronts. One example is our “best price”/no negotiation sales philosophy started back in 1992. We believe this aligns our associates’ incentives with our customers (partnership), drastically speeds up the sales process (timely/efficient process) and allows us to be very, very open and transparent with the customer (transparency).
- Growth: We believe that you’re either growing/moving forward or losing/moving backwards — there’s no “treading water.” It’s something we talk about and focus on every day. We’re constantly asking ourselves, “How can we capitalize on our strengths?” “How can we shore up our weaknesses?” Where is there “friction” in the sales/service process, and how do we eliminate it?” We definitely track our competition (market share, marketing trends, etc.), but we know the real focus and growth opportunities are here at home. If we focus on us — our strategy, our policies, our processes, and most importantly our execution — the results will be there.
What is your biggest marketing challenge?
Marketing attribution is a huge challenge. It is difficult to see what works and what drives REAL results. We gauge our effectiveness based on sales/market share movement. If we’re selling/servicing more cars and growing market share then we know what we’re doing is working. If we’re not, then we re-evaluate, make some tweaks and adjustments, and try again. We also do a lot of “experiments” to learn and grow. Again, it’s the same philosophy — if we see real results (sales/market share growth) then we’ll do more. If not, we’ll cut it. All of that being said, we do rely on some analytics – Google Analytics and vAuto reporting tools to gauge traffic trends. It’s definitely not a perfect science, but we feel we do okay.
What do you think is the most innovative thing your dealership does in the marketplace?
Definitely our “best price”/no negotiation sales philosophy which we started back in 1992. As mentioned earlier, we think it perfectly aligns with what customers value — partnership, timely/efficient process, and transparency.
In addition, given the impact of the Internet, we think it’s created an advantage. Why wouldn’t you want your LOWEST price on your website and third party sites for millions of shoppers to see?
It’s also helped with our associate retention. I don’t think the best price philosophy gets enough credit for attracting and keeping really, really good people. I’ve only ever worked at the Auto Plaza, so I don’t have first-hand experience elsewhere. However, my understanding is that negotiation can be really hard and tiresome. Best price selling is a lot of fun and makes it easy to build great relationships with our customers, driving repeat/referral business. In short, it makes the job much more enjoyable which has to help associate retention.
Tell me about your innovative tech set up program for customers, the “Answer Team.”
Our “Answer Team,” or “A Team” for short, is a free service we offer to any customer to better teach them about their vehicles.
As vehicles became more and more technologically advanced, we observed that it was very difficult (maybe impossible) for a customer to walk away with a full understanding of their vehicle at delivery — even if the delivery was executed perfectly.
We still do a world class delivery, but we instruct our customers to drive their vehicle for a week or two, write down a bunch of questions, and then contact our “A Team” for a “re-delivery.”
Our “A Team” will go to our customer’s home, place of business, or coordinate an appointment at the Auto Plaza to execute the “re-delivery.” The “A Team” are experts on every vehicle at the Auto Plaza and are more than happy to learn about brands we don’t carry – the customer just needs to give us the time to do a little homework first. Not everyone takes advantage of the service, but the ones that do walk away with a much, much better understanding of what their vehicle can do. This creates a happier customer for the Auto Plaza and the manufacturers we represent — a win/win.
I understand that you have a unique management pay structure?
Yes – well at least I think it’s unique. In short, our management team’s pay is based on the “controllable gross” (essentially a proxy for profit) of the entire dealership. They’re paid to “do what’s best” for the Auto Plaza (serve customers, serve our associates, drive growth).
We believe that how someone is paid will ultimately drive their behavior. For example, if you pay someone to maximize service, then they’re going to work tirelessly to maximize service, independent of the impact that has on the other departments. We want our team to maximize for the entire Auto Plaza so the answer was simple — pay them that way!
In addition, our pay plan cements one of our key values – Teamwork. It’s much, much easier to get departments to sacrifice sales, gross, etc. for the “greater good” of the Auto Plaza when everyone is paid based on the Auto Plaza’s success. I firmly believe that many of our current strategies, policies, and processes would never be in place if we didn’t have our unique pay structure.
Tell me how your Auto Plaza is a test bed of ideas for the entire auto group
Serra Automotive is run in a very “decentralized” manner. All of the stores are expected to treat our people right, treat our customers right, and deliver consistent growth/results. But other than that, each store is free to run the business as we see fit.
Because of the Auto Plaza’s size/scale, we do have the luxury of experimenting and testing a lot of different ideas. All of the stores in Serra Automotive do a wonderful job of sharing their results, their successes, and their failures, which creates an awesome environment to learn from one another. Some of our good ideas definitely get “picked up” by our other stores. Just like we steal ideas from them. Overall, it’s really good teamwork across the group.
You placed #2 in the nation last year for certified pre-owned (CPO) with your GM store, tell me about your processes that produce these results?
It starts with people. We have a great used car leadership team, sales team, and support team.
The Auto Plaza also creates some distinct advantages for us including a large source of high quality inventory. Also, due to high number of new vehicle brands we represent, we’re able to attach the manufacturer certification to the majority of our inventory. And, because of this large number of brands, along with our new vehicle volume, we’re able to source a great selection of vehicles via trade-ins. In addition, our used car team does an awesome job working the online auctions to fill any/all inventory holes. Lastly, our best price sales philosophy allows us to market the most competitive internet price, enables a streamlined sales process, and, as I mentioned earlier, definitely helps reduce associate turnover.
Tell me about how you handle Internet leads
We began with a 10-person dedicated Internet sales team. Today, 80 salespeople handle every type of lead. We no longer have a separate Internet sales department. All our salespeople handle both online and offline traffic — walk ins, phone and email ups. We believe that ALL customers are “Internet customers”. There’s really no difference anymore. To be competitive in our business, our associates have to be versatile in their ability to communicate and build relationships via multiple mediums (phone, text, email, etc.).
New hires at Serra must be tech-savvy and not afraid to get out of the office. The best people are the ones that are mobile, able to walk from one building to the next, looking at their smartphone and reaching out to a customer. They have to be able to go out on the lot, take a picture of a car, send it to the customer, text them. Car sales are not about sitting at your desk anymore.
And you don’t have a traditional F&I Office?
No, it is all done at the salesperson’s desk. The salesperson walks the customer through the numbers and then a business manager comes over to the salesperson’s desk and introduces the appropriate additional benefits. This makes it fast, efficient, customer-friendly and non-threatening. All the menus are gone over with the customer on a computer screen, where they want the payment to be, trade in value, etc., and we then walk them through insurance and benefits and what may or may not make sense for the customer. We believe it to be a more comfortable process. Right from the start with our one-price selling, no negation and simple trade evaluation, the entire process is clean, transparent and easy to understand. As a result we see about $775 PRU.
What do you for your digital marketing?
John Pearson, our Digital Marketing Director, does an awesome job. He has a wealth of automotive industry knowledge and makes sure our website is customer-friendly clean, merchandized well and has transparent pricing. He studies our website every day to ensure it is customer focused.
We spend about $100,000 a month on Web advertising, which translates to approximately 35% of our total advertising budget, as TV still serves us well.
In everything John does, building the website and deciding on applications to put on, etc., he likes to ask others to look at it and provide an honest opinion. If he is at a restaurant he almost always run into customers and will hand them his phone and ask them “what do you think of this design,” or “what do you think about this service menu?” They will tell him what is good and what is not – there is a lot of commonality in that. He asks them to tell him what is missing. He does this frequently as he has found that this information is relevant and makes our site work better. It does not really matter what we think, it matters what the customer thinks. We would rather find out what they think about buying a car and then mirror that on our site.
We also makes good use of video to answer key customer questions such as “Why buy from Al Serra?” “Why buy a used vehicle?” and “Best price philosophy.” And we have a video featuring career opportunities at the dealership.
The service department is also well featured on our website with menus from each brand along with pricing for basic services, service specials and the ability to check for recalls. Video is also a tool used here with a video introduction to the service department that features customer testimonials, service advisors and managers, and me talking about the customer experience and how we want the customer to feel a part of the family — not just another customer that comes in.
John uses Facebook and Twitter and WordPress blogs to publicize everything from availability of a new model to a Subaru Pet Supply Drive. We do not use Facebook as an advertising platform to advertise vehicles and such, but more to get people to engage with the dealership. We aim to be more entertaining with giveaways and support community events. We also have a large focus on customer reviews and have a great rating on Facebook.
How do you digitally beat your competition?
We don’t because we don’t spend much time focusing on anyone else. We just care about what we do here and what we do for our customers. Everything John does is built on simplicity and making it easy for people to get information on our website in a fast uncomplicated way. We also ensure that our site provides our salespeople with a simple, easy way to catch up on information so they are on the same page as their customer. If someone is shopping online we have over 2,500 new and used vehicles they can view. One salesperson is simply not going to know every vehicle. However, they can quickly view the history if they look it up online, so they then have as much, or more knowledge than the customer.
It is an efficient market place where a buyer and seller have equal knowledge. It’s the way John frames and designs digitally. It’s about simplicity and staying ahead of the curve and being as creative as possible. There is no model for this. We do not look at other dealerships with the idea of taking something, just worry about what makes sense to our customers and tweak that.
I understand you are having great success with a new review process?
Yes, John has been working on new review strategy for a couple of months to figure out how to get both quantity and quality.
We are such a large dealership with a lot of customers and were getting a large number of negative reviews. We read them and thought, “Wow! – where’s all the good stuff?” Customers tend to leave more negative versus positive reviews. If the person is happy, they usually just go on their merry way. But if upset they feel they need to vent. That’s Okay. John figured out how to get happy people to review us by providing a quick and easy solution with direct website access. We just started this process in early October. While the customer is still here, before they leave, the salesperson sends a text message, “Hello, this is Joe, your salesperson at Al Serra Auto Plaza, do you mind leaving a review about how I did and mention my name?”
We are working just the sales side right now, service will come later. So far we’ve had incredible success. In just the first week alone we got 175 reviews and all but two were positive. But negative is good too as we can take that information and make any needed changes to ensure that particular mistake does not happen again. It’s mainly things like the sales process took too long — nothing hateful.
We use the Podium review management platform and set up the app on each salesperson’s cell phone. It was key to make it a mobile solution — that is half the battle — getting the salesperson to use it. Now they simply go to the app and it takes about 30 seconds to send a text. We have set it up in order of where we want to direct the customer to post their review. If they have a google account we direct them to google or Facebook and then DealerRater as a third option.
Tell me about any future plans
We have a very strong foundation, great people, great culture and great policy/strategy processes in place which we have steadily built over the past 40 plus years. It’s a great time to be in business as every franchise is setting records. Right now we are on target to sell close to 9,000 new vehicles this year and 5,000 used.
We will continue our focus on the customer – all of our strategies, policies, and processes are aligned with creating value for the customer. Along with our focus on our associates and ensuring that all of our strategies, policies, and processes are aligned with creating the best environment to attract, grow and retain the best people. Lastly, we will continue our growth strategies, creating good habits in good times, creating innovative tweaks, adjustments to our business model and developing future leaders to operate Serra Automotive acquisitions.
That’s our focus: the customer, our employees and our growth. If we continue to focus on those three fronts the results will be there.
Author: Digital Dealer
Digital Dealer exists to help dealers and their managers sell more vehicles more profitably by creating the best live events and media in the industry.