When your company sells a luxury product or service, it changes how you should approach the sale. Selling these items is less about price and more about the experience surrounding a luxury purchase.
“Customers at the highest luxury levels are more interested in having fun and enjoying spending their money while acquiring something they want, something that serves their own passion,” says Llewyn Jobe, Sales Manager at Bentley Beverly Hills. “We don’t sell anything anyone needs — basic transportation can be purchased anywhere. It’s about an experience.”
Smart Business spoke with Jobe about lessons he’s learned selling Bentley motor cars that apply to other luxury products and brands.
What are some challenges that come with selling luxury items?
It’s a challenge to make everything an indulgent, luxurious experience. Customers want to connect and feel at ease when they come in to spend a substantial amount of money, so the transaction needs to go seamlessly without too much anxiety over pricing and negotiating.
How can you produce good customer service, which is so central to success?
Without good customer service, there are no referrals or repeat business. The people selling the product drive the customer service experience. The sales staff needs to show passion and be informative when selling to clients; it should be fun and exciting for everyone involved. Stay in touch with your customers, or potential customers, and build a relationship by following up and staying current. Maintaining good customer follow-up comes from the productive use of a customer management database. Work through your database and keep clients and prospective clients up-to-date about upcoming new model premieres or special leasing promotions. That’s the best way to stay in touch — you’re not bothering people but informing them about something they’ve already expressed interest in. Additionally, giving appropriately branded gifts is a good marketing tactic and shows appreciation to the people spending their time with you, whether they buy or not.
What are some best practices?
Use marketing that’s clever and tasteful to both new and existing customers. It’s easy to reach out to previous customers, but how do you expand beyond your existing client base? The initial customer contact, whether through marketing or customer service, is critical. For us, part of our success derives from our location in Beverly Hills, where luxury is part of the community. However, you cannot take success for granted; you have to ask yourself, ‘How can we become better to surpass our own performance?’
Customers want to feel welcome in a comfortable setting. It’s an art to take people through the numbers of any particular transaction and get them to understand, without being too pushy. Then, it becomes more about sharing the experience and building the relationship.
If a customer asks, ‘Why should I pay so much money for X?’ What do you say?
Customers will say, ‘I can get this same car with similar miles for less.’ Well, yes, that’s commerce. But, here you get a relationship with your purchase that enhances your ownership experience. You may be able to buy this product for less somewhere else, but you’re not getting us with it.
And, that’s only comparing apples to apples. If you’re trying to bring in a new client from a lesser luxury brand, you can tell them, ‘You’re spending this kind of money because you want to be distinguished; you’re looking for an experience that’s above all experiences you’ve ever had.’
The relationship becomes more important the higher a luxury item is priced. People expect it.
How can businesses overcome post-recession hesitancy to spend money?
In 2009 and 2010, people were worried what others thought. There was caution about spending money and about what that stood for while so many had been hit by the recession. However, we’re pushing past that.
When it does come up, it’s important to let the customer know that it’s OK to spend the money, take action and enjoy their life. There’s nothing bad about it — that’s what luxury is all about.
Llewyn Jobe is sales manager at Bentley Beverly Hills, O’Gara Coach Company. Reach him at (310) 967-7124 or firstname.lastname@example.org.
Social media: Visit us at Facebook.
Insights Luxury Autos is brought to you by O’Gara Coach Company
Bespoke means custom made, or made to order. The term originally came from custom clothiers — from suits to shirts to shoes; anything someone wears can be made to order for him or her by the right manufacturer.
“Bespoke is the art of being able to modify your production line to do custom paint and leather colors along with many other things,” says Jon Boardman, general sales manager at O’Gara Coach Company.
In addition, how your company operates with each individual that comes in or calls is bespoke. Bespoke can fit into any business, one way or another, he says.
Smart Business spoke with Boardman about made-to-order sales and what that can mean for your customers and business.
How does bespoke work in the luxury car market?
For a normal brand you just get to pick from 10 to 20 exterior colors and five to eight interior combinations. Then, the manufacturer picks where the leather goes and the color of each piece of the interior, while dictating the type of wood that goes with this.
However, Bentley and Rolls-Royce have more than 300 exterior paints and will also mix paint to sample for a client. They offer 28 leather colors for the inside, and upon special request — while staying within the legal guidelines — they will consider doing wild game leather, i.e. ostrich and alligator.
Both Bentley and Rolls-Royce take bespoke to many other levels that people don’t even think of when looking for a new car. They can do custom woods, stains and finishes, such as satin or high gloss. They can incorporate the client’s name in the doorsills, wood veneer and even into the leather. They will inlay precious metals, jewels and shells into the veneer prior to it being installed into a car. For example, one customer request was to make a car’s veneer from a tree in his yard. Yet another option is to have no wood in your vehicle at all and go with turned aluminum or carbon fiber.
The Bentley stand on bespoke is stated as follows: ‘We enjoy working with our customers on their bespoke requests and are only limited by the boundaries of good taste and our ethical and environmental responsibilities.’
What’s the relationship between bespoke and an enhanced customer experience?
Bespoke allows a person to make a vehicle — or any other product — exactly what he or she wants. Whether the customer prefers a black car or a pink car, he or she has the ability to take part in the design of the car.
Why might some business owners consider using this concept for their company?
It is a great way to distinguish your company from the next, even though you are in the same field of business. Anything that gets a client to be more active in his or her purchase can only help everyone involved.
A 2011 Los Angeles Times article pointed toward the accelerating trend for customized products, especially with millennials, those ages 18 to 39. In the article, Alexander Chernev, an associate professor of marketing at Northwestern’s Kellogg School of Management, said by doing it themselves — ‘the Ikea effect’ — customers derive additional value.
Do you have any advice for executives on how to incorporate bespoke best practices?
Bespoke doesn’t have to be used in its traditional meaning. By modifying a customer’s experience with any company or brand you are making his or her experience unique. So, be creative and think outside the box.
A unique and memorable experience will have that person returning to you and speaking highly of your company while he or she is out with friends. You can do many things to thank your customers, from small dinners to event tickets to elaborate parties, anything to make sure you stand out to a client.
Jon Boardman is general sales manager at O’Gara Coach Company. Reach him at (310) 659-4050 or email@example.com.
Social media: Visit O'Gara Coach Company at facebook.com/BentleyBeverlyHills.
Insights Luxury Autos is brought to you by O’Gara Coach Company
Six percent of U.S. households have one or more leased vehicles, according to vehicle registration statistics from Hedges & Company. However, as the household income increases, that percentage goes up. The percentage of households that lease vehicles is 13 percent if the household’s income is $100,000 or more.
“Leasing is designed for the person who always wants to have the newest product out there,” says Jon Boardman, general sales manager at O’Gara Coach Co.
An automobile lease also can help a business owner receive some tax benefits, while dismissing any loss you may incur if the vehicle is damaged in an accident, as long as the vehicle is repaired to manufacturer specifications, he says. A bad Carfax report will not affect you when turning in a leased vehicle.
Smart Business spoke with Boardman about lease options, high-end vehicles, potential tax breaks and how to most effectively lease an automobile.
Why do higher income households lease cars more often?
Luxury cars are more likely to be leased. At O’Gara Coach Co., 87 percent of the luxury cars are leased, mainly because there’s a tax advantage. And let’s face it, there’s not a lot of tax breaks anywhere anymore.
However, mostly it’s a status thing. Generally, although not always, and even if people won’t admit it, you’ve got to have a nicer car than the guy down the street, your next door neighbor, the guy in the office. If you have a higher income, then you want people to know that you have succeeded. You are patting yourself on the back for succeeding, while you’re getting tax breaks.
A high-end luxury car is not sold because someone needs it. At a minimum, you need four wheels and a steering wheel and that will get you to and from wherever you may need to go. Super highline cars are not a necessity; they are desired. Society has dictated that a super highline car indicates that you are someone to be noticed, or that you are successful. People put that thought into their own heads, saying, ‘I have made it because I have a Rolls Royce or a Lamborghini.’
Does the market for leasing luxury cars change based on factors such as interest rates?
If you were to finance a car right now, on a super highline, you could get 3 percent, easily, and a lease is still calculated out at 4.5 percent. Four and a half is good for a lease, but relative to financing a car, it’s not.
If you go down a notch into Mercedes and BMW, then yes, interest rate specials are done on leases. Let’s say a car dealer has a loaded inventory of one particular model that it wants to move. So it throws a rate out there that comes out to be fairly low, it moves the extra 200 cars that it needs to, and then the rates come back up.
When shouldn’t you lease a luxury automobile?
A person’s use of the vehicle will help determine if leasing is right for them. If a luxury automobile is your lifelong dream and you only plan on buying one to fulfill that dream, then leasing may not make much sense. Again, you want to look into any tax benefit that you may be able to take advantage of, but if the car is going to be kept for a long period of time, the best bet is to get it paid off and owned free and clear.
Why are mileage limits so important, and how should you pick your limit?
Leases are designed for you to rent the car for finite usage. When getting into a lease, one must decide the months or term you are looking for and mileage you intend on driving — this way when the lease is over, there are no fees due from the lessee. When picking your limit and your fixed time usage, you need to consider:
• The length of warranty on the car;
• Number of miles you have been driving for the last few years; and
• Payment you are willing to make, as it usually goes down the longer you lease.
What financial advantages are available when leasing a car for business?
The only way to know if you can benefit financially from a lease is to speak to your CPA. Some businesses have the ability to write off the entire payment, any maintenance performed and fuel, while others cannot write off anything.
Are there certain luxury brands that are better to lease for your company?
No brand is better than another to lease when you are looking for a tax benefit; you either can use a car as a write-off or not. Again, talking to your CPA is a must. Depending on the size and income of the company, the government may not see an issue with a $1,000 payment, while a $5,000 payment opens quite a few more eyes.
What should or shouldn’t be included on your lease?
A lease should include Guaranteed Auto Protection (GAP) insurance; if it is not on the lease, then you need to buy it. GAP protects you, in case of an accident or if the insurance company comes up with a replacement value less than your payoff.
Other than GAP, everything else on a lease is very cut and dried. There are no surprises that can come up during a lease term; what you see on the contract is what you get.
Jon Boardman is the general sales manager at O’Gara Coach Co. Reach him at (310) 659-4050 or firstname.lastname@example.org.