Car yard cons exposedFrom the most reputable dealers to the shonkiest private yards, many car salesmen use a number of tactics to get prospective buyers to sign on the dotted line. We tell you everything they don’t want you to know.
You’ve signed the contract and handed over thousands of your hard-earned dollars. You’re not two kilometres from the used car lot when you notice the steering wheel pulls to one side and there’s a strange rattle somewhere around the rear axle. You have a tested IQ of 130, yet somehow you were duped into buying a lemon. How did this happen?
Don’t worry – you’re not alone. Psychological researchers have identified a number of techniques many salesmen use to manipulate consumers and convince them to buy.
Perhaps the most famous technique is known as ‘the low-ball’. This is where a salesman will quote an impossibly low price over the phone to entice the customer to come to the car yard. When he or she arrives, the first salesman excuses himself and hands the customer over to a second salesman, who claims the initial quote was wrong and then proceeds to convince the customer to buy at a new, higher price.
So just walk out, you say? This can be tough, because psychologically if people commit to something, either verbally or in writing, they feel compelled to go through with it – even if the original incentive is removed.
Similarly, once a person has decided to buy, he or she finds it very hard to reverse that decision. Psychologists call this mental discomfort ‘cognitive dissonance’. Another way a salesman could exploit this is by quoting a particular price, and once the customer has agreed to it, making some excuse to increase the price by another $500.
Potential buyers should also be wary of car salesmen who are overly friendly. Studies have shown people are more inclined to buy something from those they like or feel some common connection with. “Remember, the salesman is not your friend, no matter how much you like them,” says Sydney intern psychologist, Kellie Bragg. “Number one, they’re out to make a sale. Number two, they’re aiming to get as much commission they can. So determine your price beforehand and stick to it.”
Alarm bells should start to ring if the salesman begins to talk up his car yard or a particular model of car in general terms, like, “We’ve been in business 20 years. There’s a reason for that, you know,” or “These cars have been flying off the lot”. Being gregarious animals, humans tend to look to others to see what is correct, so the thinking goes, “If everyone else is buying it, it must be a good car”. This is known as ‘social proof’.
If you were an avid viewer of the ’90s TV comedy Seinfeld, you might remember an episode where Jerry Seinfeld is buying a car and the salesman pretends to talk to his boss in a bid to get Jerry a better price. This is indeed a method used in real life and it’s a scam. A salesman already knows the rock-bottom price at which he can sell any given car – what he is doing is making the potential buyer feel as though he is going out of his way to help them. Psychological studies show the customer then feels obliged to reciprocate – in this case, by accepting whatever price the salesman comes back with.
So how do you avoid falling for these psychological ruses? Bragg offers some advice.
“First, know the tactics that car salesmen use before you go. Second, make a decision on what you want before you start – so know your highest price and the specifications of the car. That way you won’t fall for tactics like social proof,” says Bragg.
“I also recommend devoting one day only to research and finding out what a good price is – commit to not buying on that day. Then go again another day, which is the day you’re actually going to purchase the car. That way you don’t fall for tactics like scarcity [see box below] and reciprocation.”
Don’t forget this either: It’s your money, the salesman wants it and there are hundreds of car dealerships out there. That means you have the power.
If you need assistance and advice on just about anything to do with the purchase, ownership, use or maintenance of a motor vehicle, NRMA Technical Advice can help. Call 1300 655 443 or visit mynrma.com.au for more information.
Caveat emptor: more sales psychology |
| Foot in the door |
| Now part of our everyday lexicon, this simply means that if a salesman can get inside a customer’s house – or get the customer into the car yard – half the job is done. |
| Obedience |
| If a salesman fears he is losing a customer’s interest, he will suddenly walk off to another car or into the office. People will often feel compelled to follow. |
| The test drive |
| Putting a customer behind the wheel gives them a sense of ownership and makes it difficult, psychologically, for them to leave without buying the car. |
| The hypothetical commitment |
| “If I agreed to throw in metallic paint, would you definitely buy it?” The hypothetical commitment rationalises the purchase and puts the customer at ease – even if they shouldn’t be. |
| Scarcity |
| “There are only 20 of these in Australia and this is the last one we have.” A claim like this (true or otherwise) increases a car’s attractiveness and urges a quick sale. |
To get NRMA’s comprehensive used-car buyers checklist, click here.
Open Road e-zine August 2008
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