🎙️ Podcast Feature: Ted Rubin on the Car Dealership Guy Podcast

 Today I am joined by Ted Rubin, CEO of ActivEngage, a people powered messaging platform, connecting car shoppers with real humans, not bots. We unpack the hidden risk Ted believes most dealers overlook. With ai losing the human connection that actually sells cars, Ted makes the case for why Real conversation not automation is still the gold standard for customer experience at scale.

A big thank you to our sponsors for making today's episode possible Auto Hauler Exchange. A lot links and of course, ActivEngage. And now let's get into the show,

Ted Rubin on the CDG podcast. Ted, welcome. Thank you. I'm glad to be here. Glad to have you on. How, how's, uh, how's life going for you? Life is going great. It's wonderful here in Florida. Yeah. You guys, you guys are definitely living it up over there. Also in the Northeast, we've had two weeks of, uh, nonstop rain.

So it's not, it's not as glamorous. I think this is gonna be a great conversation because I've, uh, I've talked a lot about dealership technology recently and just, you know, AI and how it's infiltrating into the dealership. But what's interesting about you and your company is you are leaning into the humans, tell you a quick, fun fact, um, or story, but.

We host a live show called Daily Dealer Live, and it's three times a week and we bring on, you know, experts in the industry, dealers and the two BDC directors, or call it, you know, CMOs, whatever you wanna title them that have been on the show were they are breaking records. Both told us that. They're leaning into humans.

Now that doesn't mean that they're not testing AI tools and starting to use AI tools, but they, they kept emphasizing that. I found that pretty fascinating. And so anyways, that's my long-winded intro of saying I am, uh, I'm excited to kind of hear about your vision here and how in the age of AI where. I think AI's doing great things for many dealers, you're also leaning into the human aspect.

So that's, that's my spiel with the intro. But before we talk less about my stories, tell us a little bit more about your story. Can you start us off with just a little bit about yourself, your background? Yeah. Uh, I've been in the automotive industry for about 30 years. Um, just before that I was in banking and I was in software development.

Uh, but when I got in, um. I literally started at a dealership just managing the Get Ready department and kind of subsequently over the years, I, I had every position through parts and service, uh, up through sales as well. Um, and ultimately I helped build one of the first business development centers for TMS.

Uh, and then they kind of rolled that out through, uh, a lot of the Toyota stores in the country. And I was hired by. AutoNation to be the national director of e-commerce and field operations back in the late nineties and help set up Compass and their entire infrastructure for their digital strategy. And we sold a a billion dollars worth of vehicles in that one year.

When you say one of the first BDCs, which is pretty incredible, what were you really doing? Was it online or was it just supporting local stores? Um, it was. It was just coming online around that time. So this was around 95, uh, 96. And, um, there was a company, the, it was Southeast Toyota and the Nicholson Group.

And Reynolds and Reynolds had gotten together kind of on behalf of TMS and, um, they had wanted to set up like this, uh, center. They didn't even, I don't even remember if they called it A BDC at the time. It was more just the idea of what we know now as A BDC, where they were gonna have. People that were separated from the sales floor and separated from service that were going to interact with customers for follow up and inbound calls and outbound calls and prospecting and things like that.

The original agenda was to start with sales. Um, but I had been doing some of this on my own 'cause of my software background, and so I wanted to start in service and it was much more successful. And so you could interact with customers both for follow up as well as, um, for making appointments and setting them up.

In a much more, in a much easier way than trying to do it on behalf of sales, trying to identify inventory and other things like that, and getting in the way of salespeople. It did migrate to that, but that's how it, that that ring, does that ring still true today, in your opinion, right? Like, is service still, does that still possess the lowest hanging fruit for dealers when it comes to, you know, business development?

Because most of the conversations are likely, Hey, can I make an appointment or, you know, can I come in for service as opposed to sales where you can have. A thousand different requests. You know, I'm looking for this trim. That trim. What's your take on that? I think the language of service is much more standardized than it is in sales.

So sales, you have this very one-to-one interaction and it kind of flows the direction that the customer wants it to flow. The interaction on service is, is much more expected as to what it's gonna be. It's, I have a problem, I can solve your problem. Great. When can I, when can you solve my problem? I can solve it during this period of time.

Yeah. Is that gonna cost? So it's not. If you're not getting a differentiation, the personality of the person that you're talking to, um, and the kinds of questions that they're asking are extremely redundant, and it's very clear what it is they're trying to achieve. Whereas with sales, the questions that they're asking are not necessarily in line with the goal of what they're trying to achieve when they ask the questions.

They could be very different, you know, um, because their basic questions and sales are really directed more toward, um, do I like you? What's your intention with this? And other things that are, you know, kind of behind the scenes that you have to interpret the conversation for. So I think sales yep. Is more complicated, uh, for conversational aspects and BDCs to respond to where it's more regimented and it's easier to figure out what you need to do.

And back then it was easier to train. B, d, c people to be able to handle service. 'cause it was that way, you know, it was more static in the way that you're gonna interact with them. And it was just, even just the fact that you were able to pick up the phone and give someone an answer on an appointment right away, or tell them if their car, that was a huge thing and it still is today, you know, service serves the role of basically financing all the costs and of the dealership.

Right. So I think that, uh, it's, it's a very valuable thing to have your BD, C. Focus on service and make sure that that's all done very efficiently and effectively. I think the, I think the elephant in the room is that there's simply a lot more operating leverage and slack in sales, right? Right. Typically, so you can absorb a lot more monthly sales and you can in service where you're probably understaffed on texts with texts.

Right. So. That's the, that's the catch. But obviously if we could all bring in more service business, it's higher margin and it's, uh, you know, likely a, a longer term customer. So now bring us, okay, so your, the beginning of your career was, I mean, it's incredible. You had just lots of exposure. All these different companies that are become extremely successful.

How did you get the idea for what you're working on today, which is active, engage. Tell us about that. Yeah, so my last company was dealer reps, which was one of the first CRMs in the industry. And uh, that came about really just taking the desk log that used to sit at the sales desk and trying to digitize it so that it was more efficient and more effective, and you could use it universally instead of just flipping pages on a pad, um, which is what we used to do then.

You could have it all in front of you on the screen and that way, day after day, you could kind of recognize if customers came in. And so as we were doing that, and it evolved into this communication tool where we were doing follow up and other things, we, we learned a, a, a tremendous amount about the kind of follow up that was gonna be effective with customers and the kind of communication that was gonna be an asset for those customers.

And so even during that time, we were training dealers how to communicate, how to communicate through this new digital aspect. Right. You know, using email. To communicate with customers and in the early, early two thousands, instant messaging and other things started to beco proliferate a little bit more, and we kinda looked at it and said, after I had sold that company, we looked at it and said, you know, there's really a value here.

Where there's a, a medium that customers can use that will keep the customer doing what they're doing, so it won't take them away from the keyboard, which is what they're doing as they're searching and seeing dealerships and seeing, um, the, uh, the websites that the dealers have. And instead of having to move to a phone call, pick up a different mode, they could stay on the computer looking at the screen and interact in a live way and talk to the dealership.

The difference was that the technology as well had evolved to the point where we felt that we could have these conversations and not physically have to be at the dealership, that we had the ability to be remote. We knew how to have these kind of conversations with the customers from all this history that I had had and that others in the company had had at the time.

Uh, to be able to bring those conversations to engage customers in a very effective way that would motivate them to want to come into the dealership, and that that really was the evolution. That's how it came up, the idea of ActivEngage, and that was the evolution of how ActivEngage has evolved. So.

Ted, you're a smart guy. You've sold a, a tech company already, and you've been in this game for, you know, several decades. How is it possible that someone like yourself is leaning so heavy into humans? I think that's the most, like under, under spoken part here, right? The fact that you are, your company has actual humans responding to dealership customers.

That's right. You are providing chat, you know, capabilities with real people. How and why? Yeah, I, I don't know. I think it, I think it has a lot to do with understanding the conversation. Um, and I also think it has a little bit to do with my, uh, development background, uh, as a developer and understanding the technology and what the capabilities of it are in a more in-depth way.

What we're trying to do as a company, even from the very beginning, before a while I was even a part of it. Um, was to connect. So it's the relationship when you're talking about sales, especially, it's the relationship with the customer that motivates the customer to wanna buy. Customers are okay looking for a type of, uh, conversation that's gonna make them feel safe, make you trust in what it is that you're saying.

You know, customers will just call from one dealership to the other until they hit someone who they feel, okay, this guy understands me, and so I'm gonna stay with that. And then they'll stop calling. Because they've now interacted with someone who they like, well, you're not gonna get that with AI because it's, it's an inanimate thing.

And even when you try to make it. Act more human. There's uh, the uncanny valley theory. As you kind of get closer and closer to that, then you actually create longer and longer periods of evolution. Um, it makes it very difficult. Customers, we did a test at one point, and customers, if you use the exact same language to respond to a customer that a human gave in a previous conversation to the same question, and you used AI to do it now, it would piss off the customer.

Because they knew it was ai. So if you try to build a relationship with a customer and you're an inanimate object, then the customer knows you're an inanimate object and they're not interested in trying to do that. They know they're not gonna connect that way, whereas live people can. And just that feeling of community and of empathy is what actually I.

It's not the content, although content's valuable. It's really that connection that the customer goes, I like that guy. He works at that dealership. They seem like they know what they're doing. They employed this guy. I'm probably gonna go there to buy my car and it's that motivation that actually converts that conversation into a sale.

I'm not interested in producing leads 'cause anybody can produce leads. We produce lots of leads. That's not the issue. It's trying to produce leads that the dealership has to work less at closing because we can move them through that process and commit the customer more to wanting to work with that dealer.

What type of value do you think AI can best serve in our industry today? I mean, AI is spectacularly good at research. At analytics, right. So the idea behind ai, uh, as it was originally put together was, I mean, there was a communication aspect, but it was really more for programming it so that someone of more of a layman, rather than sitting and writing out equations and trying to tell some the computer to do something, that you could talk to it, to tell it to do something.

So that's really what the original, uh, utility of it was. But AI is great. Like to evaluate a doc sheet, you know, I wish I had that when I was running stores because. A lot of times there's very nuanced changes that mm-hmm. You may or may not pick up, but if it's consistent, then the AI will pick it up.

Right. And so I think there's a lot of dealers I know, I know some great dealers and I was fairly good at it before, but there are a lot of guys who are fantastic. They could look at a sheet and go, this guy's stealing from you, and this guy's not coming into work often enough. And this guy, you know, this is what's happening.

The inventory isn't where it's supposed to be. They could do it very quickly just by looking at the numbers and you could program AI quite easily to do that. And there are people who are working on those kind of things right now today. Right. Getting background and just detail information. I think it's actually good as far as identifying, um, you know, some of the details about vehicles and other aspects of the properties of those vehicles or.

Um, analyzing other types of information at the dealership, like parts, inventory and other things. Yeah. That as you're able to program those things, but I don't think that some of these things, like the vehicle things, there's nobody who's, there's really nobody who's going to a dealership to ask, does this vehicle have this, that, or the other thing.

They're just, they're not gonna waste the time to go to Google. Then find a dealership, then go to the dealership and then click into chat and go, does this happen? They're just gonna go to Google and go, does this car have this? And Google's gonna, yes, or, and that's gonna be the end of it. You know, it's the shortest path.

So your, your point there is that by the time the customer is seeking to speak with you, the highest and best use of your time or of that communication path for the consumer and dealer is to build a relationship that's right. That's going to yield in the best possible outcome for actually, you know, doing a sale.

And, and that's it. I mean, it should be all relationship building that that is the, the key driver of actually making that sale. Yeah, that's, that is exactly how we approach it. I mean, we have to have the background information, we have to know the inventory, we have to know the values that are offered at the dealership and the different, um, reasons why that separates them from other dealers in the area when we represent a dealer.

But it is really. About the conversation and about the, the intimate personality that you're trying to connect with that customer. Mm-hmm. That's why conversion is so high at, at least for us, our conversion is extremely high to a sale because it really isn't about the detail. The customer's already gotten that most likely by the time that they get to us, and so we can answer those questions, but it's more about, do I wanna buy from you?

Are you gonna treat me the right way? How do you kind of treat people who you talk to at the dealership? It's almost as if. If someone walked into the store, then you wouldn't if they said, Hey, I'm looking for a Camry like that one over there, you know, does that one have these features? You wouldn't just go, here's a brochure.

All the data's in there. Thanks. Let me know if I can help you start interacting with that customer. You wanna have that personal connection with them so they come back to you as a salesperson and that they follow through and that you're following through with them the whole time. You try to spend more time with them on the floor, you take 'em for a test drive.

All of that is relationship building, and it's trying to connect the customer to the dealership, to you, to the car, so that they're doing it all there. There's no dealerships that. Think of a walk-in as a lead where they can just walk in and maybe they'll buy, maybe they won't today. And if they leave, that's okay.

'cause I'm just gonna follow up with mm-hmm. Later. That's foolish. But that's the way we see a lot of people handling things like chat and texting and other types of messaging online because they're like, well, they're online, they're not here. But that's. It's still the first conversation you want to be able to interact.

So, Ted, a couple, a couple more questions on this. What are the primary tools right now that you're working with, with dealers? Is it, is it online chat, texting, anything else? Uh, well, we're pre, we're pretty pervasive actually. So we do, uh, the, the messaging that's, uh, chat and text that's on the website. We do campaigns, um, where it doesn't have to, we can initiate them or, or things can be derived from your CDP or there's other ways that we can pull information to be able to send things to customers, you know, about different campaigns or drivers that may wanna get them.

Uh, we do phones so we can do, um, outbound phone campaigns. There's some inbound phone campaigns. And those are, those are real humans as well. Those are also real humans as well? That's correct. Oh yeah. And where are, where are the humans? They're here. So we have, uh, we have about 20,000 square feet here in Orlando, and we have, uh, locate other locations where we have personnel here in, in the United States.

Wow. North America. Yeah. So you have like a massive Florida call center. We do have a big. Uh, area here. It's, it's not a call center. It's mostly a a, a chat and text. We are able to take calls here as well and do calls also from here, um, and, and our other two locations. Actually. This episode is brought to you by Auto Hauler Exchange.

Ship Smarter Pay Less, no Middleman Auto Hauler Exchange connects dealers directly with haulers, the result, faster deliveries, lower cost, and zero broker hassle. Learn more by visiting auto hauler exchange.com. That's. Auto hauler exchange.com. We're clicking the link in the show notes below. Alright, so the million dollar question, right?

How are you advising dealers that come to you, you're chatting with and they say, Hey look, I want some automation, but I also want human connection. How are you advising them as a dealer? If I say, look, I need some automation, but I also want, I hear your point of having some human connection. How do you respond to that?

Right. Well, I mean, it, I think everything should come down to ROI, right? So it's gonna come down to what is the cost of what it is that you're trying to accomplish with the product that you're trying to accomplish it with, with the return that it's gonna get. Um, so I'm not against, uh, AI at all. I think that AI has.

Really significant value in certain areas. I just don't think that it has any really significant value when it's facing the customer for communication. Um, if you want to have it where it's, you know, simply answering questions, uh, about vehicles or other things like, then it's not gonna, it's not necessarily bad, but there, when customers get to you, as we talked about earlier, then they could say, does this vehicle have side airbags?

And you do have to answer that question. It's imperative to answer that question. In fact, uh, you just posted something on your newsletter not that long ago that talked about a report, the PI Piper report, where they said, you gotta answer the questions, right? And if you don't, then you're gonna lose track with the customer.

So while that's true, just because they're asking that question doesn't mean that's the only thing they're thinking about. This is a test. You know, when they're actually choosing to directly interact with messaging, with chat or text or something like that online, then they're testing you to see. Do I like you?

All the things we just talked about before. Do I wanna deal with you? How do you treat people who ask questions? And so if you're not taking the time to go, I understand that you're asking that question. And here's the answer to that question. What is your concern about having side airbags? Do you have children?

Do you have other things to try to open up the conversation and have some empathy for why they're asking that question? That just isn't gonna be done by ai. So that's why I would suggest that you don't do that. And what ends up, the reason we know that is because of conversion to sales, right? So, mm-hmm.

That are supplied, I mean, there are, there are third party agnostic companies that can identify that the conversion to sales is what you really wanna look at. And so it's always odd to me, you know, that the better products, um, in general, that. Are digital that are offered to the stores. You know, a lot of these products are the difference between the best product and the worst product can be $500 or $600, but you're selling $42,000 vehicles just to get going.

And most of, most of the dealerships are selling more expensive vehicles. So the ROI on being better, being the best. Isn't a $500 or $600 a month issue, it's tens of thousands of dollars. Yeah. There's a big, there's a very big variance. Sure. But I think that dealer get very caught up in, I'm a dealer, I'm used to negotiating things.

I have to get the best deal. And so I'm looking to cut prices. You just don't want to cut them with your customers. You don't wanna cut things that are customer facing that help them and that help me. I think it depends. Like, I think there is, I, I think that nowadays, you know, dealers are, I mean, things have gotten smarter, dealers are more sophisticated and I think I always go back, you know, if it sells cars, dealers will pay for sure.

I, it just, you know, it's very simple. If it moves, the battle dealers will pay. I'm, I'm curious to know how the, who, who actually works with you. Like what type of dealer is it? The dealer that has A, B, D, C but needs more support? Or are people like outsourcing their entire BDCs to you? Right. What does that type of client look like?

Who, who is the best fit for you? I think that virtually any dealer can work best with us, so we're probably better at handling these conversations 'cause we handle so many more of them. I mean, we have literally million. When you say these conversations, what do you mean by these? These conversations that exist where?

If they're interacting with you over the web, through your website, or they're interacting with you in this initial communication about ident, about responding to an offer that you made or something that, you know, inbound, these, these initial conversations or these offer conversations, we handle so many of these.

We're able to look at these and we're able to use AI to help, you know, analyze these conversations, to be able to determine what's effective or what's not effective, and train our people in a very effective way to be able to learn and evolve that to be better and better each time that we do it. And I just don't think that inside a dealership, they're part of your dealership.

But to be super effective of that, you have to have management and you have to have a very rigid training schedule, and you have to have the right people that are hired and they have to know how to. Constant correct of these conversations, and it's not cost effective to do that on that scale. Right on, on the scale where we have lots and lots of dealerships and we have hundreds of people that are working for us and we're constantly evaluating this information across all the different areas, taking into the, into the equation the nuance of brand and region and other factors that impact the way that you communicate with customers.

It's, it's a very big project to be able to do, and I think that we can add significantly to any dealer that. That is out there, you know, that is offering a service where you're allowed to communicate through the website, but. I don't think it takes anything away from A, B, D, C either. I think that if you have a B, D, C, then we're gonna give you a, a customer that is further through the funnel, through the sales funnel, and you're gonna engage them at a point where now they're motivated, they know the car, they're ready to buy.

You just have to finish the negotiation, then get 'em across for the sale. It's not, you know, I, I also think that's a difference with us and, and, and a lot of the other systems is it's not just. Let me get your name and information and I'll have someone contact you. You know, we wanna take the, the customer as far through the process as we can.

We integrate with several of the DR platforms and other things so we can even navigate through pulling credit through soft pulls, through trade valuations and a lot of these other things. And we want to, you know, our average conversation is like nine minutes long, so, wow. You know, we really want to matriculate the customer through the process.

And put them at a lower point in the funnel so that the people in the store, whether it's the BD, C or the salespeople, they're able to begin their part of the journey with the customer. Where the customer's already motivated, you know, they're good, they wanna buy now. Now it's just, yeah, you know, finalize the rest of the information, sell them f and i products, get 'em over the curb with the vehicle that they've chosen now.

Take me one step further on the customer experience. Right. Where do you think AI Today is playing, or what are its strengths when it comes to customer communication? Is there anything you think it's doing well? 'cause I'm trying to understand, is there long term, right. Are all dealers going to be on an AI tool, or will they all eventually defect to a tool like yours that's kind of human led, or just have humans doing it internally without any AI tools?

Like where, where are we headed over here? What is AI doing well and what is it not doing as well? I. Well, I'm gonna answer it 'cause you talked about long term, so I wanna address it, what they're doing today and, and, and where it's gonna go. You also had an article just recently that was from Tom Goodwin and he talked about Darwinism.

Right. And you know, dealers just, they feel like they have to have AI 'cause it's this new thing. But you know, he's basically talked about. Kind of missing, missing the point of what the communication is and offering real customer service and empathy to these customers. 'cause that's what moves them over the curve.

Well, you, you saw what he said, by the way. I mean, he reached out to the dealer, got like eight different, you know, people contacting him and he was like, what the heck is going on? Right? And, and, and none of them really addressed. You know, as you kind of go through what the rest of it is and he talks about, um, you know, that it's good for other areas of the business, but he doesn't really love it for the communication aspect.

Communication. I really connected with that. I don't think that there is gonna come a time for sure, without question that AI is gonna be massively more significant because. It will have reached a point, uh, which is really level three, right? That's the next, we're in level two. That's the highest level of communication and, and capabilities of ar i right now.

Um, that when it achieves that, then it'll be much more effective at kind of, uh, intuiting what the customer is trying to do and what human interaction should look like. And it, it's still not gonna be human, right? It's, but it won't matter as much because it'll be attuned to it a little bit more when we've looked.

Uh, at using it or when we've deployed ai 'cause we're, we also have a lot of expertise with AI and using it on both ends. But when we have deployed it, the difficulties are that, first of all, there's always gonna be hallucinations and, and the need for accuracy, especially on the sales side, is just so high that you just, you're not gonna get it.

You know, it's not. Capable of getting there, 90% accuracy is not good enough. Even 95% accuracy isn't good enough. You need to be at 99, you know, 98, 90 correct percent. And so that's, that's an innate problem to AI to begin with. And, and, and sometimes if it fails, it's just gonna fail catastrophically. And, and it's not really an issue, but if it fails where.

If you're not, the customer doesn't perceive that it's a failure. That's where it gets really dangerous, right? Because it may give you something that's just wholly inaccurate, but it was delivered in a tone and with the way that it looks like it could be something that is, and that's how you get pissed off customers.

So we don't. This is why I, I just don't think that AI is ready to be full scale for communication at this moment in time, but we're constantly working with it and using it in other areas of our business. It's continuing to evolve and get better and you constantly see new its of it, you know, from the companies that.

Have ai, uh, and that are producing it, right, that are actually producing the AI so that we know where it's going to, but it just isn't, it isn't kind of ready for primetime for the conversations. It can give you a superficial conversation. So if you limit it where it's just really basic and, and generic information about the dealership or about a vehicle or other things like that, then it's fine.

It doesn't count very well. It doesn't do inventory very well. It doesn't, there's a lot of things it doesn't do well, so you're kind of cutting a lot of things out and then you're still not getting what. The value of the conversation is, which is that's human interaction. This episode is brought to you by LotLinx One, to move metal faster and make more on every deal.

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Check out lot links.com. That's L-O-T-L-I-N x.com or hit the link in the show notes below and see how the lot links machine can power your dealership. Going back to the core service right now, that is end in dealerships. You said a lot of great things about what the human touch does with sales. I think many will agree, some will maybe not disagree, but might have a different opinion that humans can do it best.

How are you measuring your performance and success, right? Like if, if a dealer right now works with you, how do you know you're doing a good job? We know that we're doing a good job. Basically, we're constantly, internally, we're watching our own communication. There is a certain amount of volume that we wanna make sure is there, and it's consistent with, I think that most of the messaging providers provide about the same amount of leads generally, unless they're having a bad month for some reason.

Things that are more concrete shown appointments, both for sales and service. We try to work with the dealers where we can, you know, get the information from them about what's converted to a sale. Pull data from their DMS. We have some, we have a significant number of dealers where they've given us access or given us the information so that we can identify, you know, what the actual conversion from the leads that we send over are to a sale.

And that's really the measure that we wanna see, you know? Mm-hmm. That's what makes. Both the dealer and us feel that it's successful or not. Um, so that's where I think that, uh, we know that we're doing a good job is, is, I mean, anybody can produce a lead. I'm, I'm old enough to remember, you know, back into the late nineties and early two thousands where, you know, at and t was providing leads, you know, all kinds of other odd, you know, remember, remember the services where, remember the services where like.

You'd get all these leads and then they're like, oh yeah, just dispute the leads that were not actually leads. Right. And we'll refund you. Oh yeah. So let me just get all these leads and then do all this extra work. So you give me my money back. Like, yeah, no, thank you. For sure. Well, there were companies that literally, dealers just were so desirous of getting into the internet.

It was another like evolution, a little like AI that they were so like, I gotta get the internet leads. And so. There were lead providers who were buying other leads from other companies that really weren't even automotive. They were like referral leads just so they could supply volume. And you know, that's, that's the same kind of, I feel like that's the same thing that's happening now.

Anybody who lived through that, you know, from like 99 to 2003, where it was just like, give me any lead that I can get, you know, and then they realized. Dude, I'm like fighting some of these leaves. I might as well just pick a name out of the phone book and call 'em and see if they want a car. Oh yeah. Um, that, you know, that's where we are with ai To me today, it's not that it's not valuable to have it, it's that you know, you're trying to do something with it.

That it isn't really designed to do it. This period in time. It has to evolve a little bit more and there are some values for it. Use it for those types of things. I just don't think that. Customer communication is the biggest asset for what it is. And if you're measuring, I, I mean, look, I ran dealerships, so if you're measuring the value of something, it isn't against leads, it's against sales.

We both supplied us and the other company that they were testing, we both supplied about the same number of leads, but. Their conversion to sale was zero and our conversion to sale was 13%. So, wow. You know, that's a, that's a massive thing, and I'm not saying that all competitors are gonna be at zero, but that's how you measure it against sales.

Alright, so Ted, can you tell, like, what's the most we've talked about, you know, b, d, c, humans versus ai, like what's just the most exciting thing to you right now in, in our space? In your company, uh, for our company. I, I think that, and in this space too, I think that one of the most exciting things, and, and we kind of touched, uh, in that direction a little bit ago, is this flip to text piece that we have.

So we, you know, when I was running stores and even watching how they're interacting right now, um, you know, it, I. They have, they have a, they have a phone issue, right? There's a problem in that, you know, certain times of day, especially if you try to call into a store, I, I have a car and when I try to call into a store, it's, you know, almost impossible to get through.

And you get to the operator and she puts it up in the air for sales, or she puts you on hold to get to service, to make an appointment and other things like that. And I, I think it's very difficult and we've tested with a number of dealers where, um, they're, they're on a sip, which is. 20, 24 lines and it literally pegs the system and you call and you get a busy signal.

So now you're just missing calls that never get through and the customer's just gonna go somewhere else. So we, we played with a lot of different things, uh, tried to just assign other operators to it. And what we came out with is this flip the text piece. So on the IVR on, when you call the automated attendant, we can actually put a piece that says, if you'd like to speak to someone right now.

Who can answer any of your questions for sales and service? You can do this through text, press one, and when you press one, it'll actually move the conversation from the phone line over to texting for the customer and whoever the agent is smart, that they get, they can answer detailed questions about the vehicle, they can make service appointments, they can uh, look for parts and other things like that.

They can. Really answer any of the customer's conversation without having to go to an operator or switch to another person. They have documentation of it. It pulls it off the line, which opens up the phone lines for the rest of the store for other people to be able to get through. And what ends up happening over time, actually, as we've seen it now, it's been piloting for several months.

Not only is, is it successful for what it's doing, but. The people who start engaging on it, they stop contacting the store through the phone and they'll just ret text the number, which is the store number by the way, but they just ret text the number, and now they're able to inquire or do whatever they want just simply by texting.

So you start to get texts where they're communicating more often about more nuanced or simple things like. Hey, do you have this car? Have you seen this new vehicle? Other things like that. And they're asking those things to the dealerships. So now you're building this very intimate relationship with the customer.

They're always gonna buy from you. Right? Well, I'll tell you texting. We all know texting works. We all, you know, we all do it. Uh, but I'll tell you that after we had, uh, texting episode on the podcast, I swear to you, I have never received so many messages from dealers. It's just, it's, people just want it 'cause it works.

Right? So I think it's, it makes total sense that if you could, you know, you know, if, uh, get the customer to begin texting with you in a very frictionless way. Right. I can see why you'd be excited about that, because that totally, you know, is aligned with what just consumers want nowadays. Yeah. I think it solves this problem that's existed for a extremely long time of just.

The amount of calls that come into the dealership and an inability for an, an operator or even just a couple of operators or, you know, to be able to answer, uh, all of those people and do it in a way where the customer really feels like they're being satisfied, uh, in an efficient way. So, I love that product 'cause I wish I would've had it when, you know, I was.

Mm-hmm. Tell us a, um, I, I saw on your website you have, uh, a coffee is for closers, uh, a link over here. So I'm trying to understand what, what am I looking at? What is this? Yeah, so we were, uh, kind of bouncing around the idea of, uh, uh, something that we were talking about earlier here in this conversation about, um.

Converting to sale. That's the thing that we really are trying to do. Right? And, and trying to give you leads that are the best leads that are gonna convert much more efficiently. Um, and it just brought to mind the movie, um, yeah, Eric Glenn Ross. And so, uh, as I was talking to someone about it, uh, they actually said to me, uh.

They're like the Glen Gary leads. And I was like, oh my god, that's an ad campaign right there. Just plug, oh, look at that. Um, and so we kind of built this whole campaign around the idea that, you know, these are the leads that you want, these are the leads that convert the easiest with the least amount of effort, and they actually get sold.

If you've seen that, you know, seven minutes, I get it. So, mm-hmm. With Alec Baldwin and Jack Lemon and Yeah. Yeah. Then you know, it's very clear that there are leads. There are these kind of crappy leads and then there are the leads that are all wrapped up in a golden bow. You know that those are the Glengarry leads and uh, you know, that's, we are trying to figure out a way to convey there is a difference.

It's not about getting the lead and getting it to the store. 'cause there can be all kinds of leads and lots of volume of leads, but it's about getting those leads. The Glen Gary leads, the, the best leads, the highest closing leads. That's what we'll be able to give to the dealership. So well said. Ted, a year from today, you're, you're, you're back on the pod.

What op, what opinion have you changed a year from today? I'm back on the pod a year from today. Um, I mean, it's a, it's a very unusual environment that we're in right now. So I think that the, the, uh, the, the whole world, uh, and the way that the economy and the environment of buying vehicles, especially as well as other products is, you know, changes every couple of days.

It just kind of depends on which way the wind blows. So, I, I. I think that you could, you could interview me in a month and I might have a different opinion on the industry. Touche. That's good. Yeah. But you know, I, I, I think that we're gonna continue to see AI evolved and we're gonna look to deploy, you know, more of it, um, in ways that support us.

Ultimately, I'm sure it'll get deployed in a way that'll be conversational, but not until we, you know, really believe that it's capable of having those conversations. And I, I'm hoping that dealers that the next time that we talk a year from now, or maybe it's, hopefully it's sooner than that, but um, if we talk a year from now, I think that dealers will be looking at the experience that the consumers are having and.

They'll be more focused on satisfaction and on, uh, lifetime value of what that customer is and servicing them to be able to get those sales, uh, as opposed to, you know, just back to back to the nineties and looking at, get me so many leads. Well said, Ted Rubin, active, engaged, thanks for coming pod.

Appreciate you, you know, giving us the insight and sharing a different perspective than, uh, than we've heard before. So thanks for coming on, Ted. Yeah, I really appreciate you having me here. Thanks. Thank you. Alright, hope you enjoyed that episode. Please give the podcast a rating. Consider subscribing to the show and check the show notes for links to what we talked about.

Thanks for tuning in. I'll see you guys next time.