Fake Beards and Flat Brims with Nathan Hollenbeck

September 16, 2022
Here’s some numbers for you: 16 rooftops. 25,000 cars. $1 billion in sales. 15 photographers. 3 full-time web developers. 3 graphic designers. And another handful of people handling CRM, data analytics, social media, paid search and more. This is the team that Nathan Hollenbeck leads at Del Grande Dealer Group. He joins us on Auto Collabs to share his story and the things that are working at DGDG.
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What we talk about in this episode:
Intro with Michael Cirillo, Paul J Daly and Kyle Mountsier.

5:09 Nathan is a motorhead through and through. He talks about working on cars with his dad and what his favorite car of all-time is.

6:47 Nathan traces his journey in and out of auto in the midst of the 2008 financial crisis.

15:52 Moving from an agency to doing things internally can be hard, and Nathan talks about those challenges.

24:37 We close the interview by talking about some of the things that Nathan and DGDG are working on in the next 12 months.

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Michael Cirillo: 0:00Can I make a confessionUnknown: 0:08

This is auto collabs

Paul Daly: 0:10

it's the three of us. So go ahead.

Michael Cirillo: 0:13

Just the three of us. Just us. And my mom.

Paul Daly: 0:16

Is your mom recording podcast with

Michael Cirillo: 0:18

you? She's that one listener that we

Kyle Mountsier: 0:23

like download download download download. That looks real. Oh,

Michael Cirillo: 0:26

you gotta subscribe. She's got 7070 countries

Paul Daly: 0:32

right to your confession

Michael Cirillo: 0:39

No, I'm good marketer extraordinaire, with the clickbait

Paul Daly: 0:50

for 3995 You could have my full confession

Michael Cirillo: 0:53

plus my confession is and I feel like I might have to apologize when I meet him in person but every time I hear Nathan's last name Hollenbeck

Paul Daly: 1:01

Glen Barney Sami song that's well see, we just connected we've never talked about that. But every time bump bump, bump, bump, bump, bump, bump, right?

Unknown: 1:13

Yeah, okay,

Paul Daly: 1:14

sorry. Now, I wish we could use that. I wish we could use that music as the transition into the interview. But if we do no one's gonna hear it you know, but he did show up to the interview prepared but we don't know that yet. We do. We do. It just ruin that whole

Michael Cirillo: 1:35

thing. I don't think I think this is the best we should just okay Hope you enjoy.

Paul Daly: 1:43

Well, let's roll the tape. Here shins, sometimes. Parents. They actually record the intro after the interview.

Michael Cirillo: 1:55

If you can't tell already, because we're all wearing different outfits.

Kyle Mountsier: 2:02

Well, hey, look, we hope you enjoy this conversation with Nathan Hollaback Hollenbeck, actual marketer extraordinaire without clickbait. All right, we've got my man, Nate Hollenbeck, here with us. The the man the myth, the legend at DGDG hanging out there doing some crazy cool stuff. Nate, thanks for joining us.

Nathan Hollenbeck: 2:28

Thanks for having me, guys. Always a pleasure to see you guys.

Kyle Mountsier: 2:31

Yeah, awesome. So for those of you that don't know, just like five minutes before this, we get on and he is wearing a black hat and this absolutely ridiculous. We're

Paul Daly: 2:43

putting it back on. Just listening. This absolutely

Kyle Mountsier: 2:47

ridiculous, like perfect. Actually, I need to grow out my mustache so that it matches this beard at this point, because it's

Paul Daly: 2:54

very sophisticated. All you have to do is add like the little twirls at the end of that mustache, little little mustache wax. And I would certainly keep my kids away from

Kyle Mountsier: 3:03

And naturally, naturally, he checked with other you. people to make sure that it was that it was that it was perfect. So Jake Baron and Ben Hadley if you're watching or listening signed up for that. So I'm going to tell this so my first introduction to Nathan Hollenbeck was actually via DGDG. So if you know me, I used to work at Mazda stores. And I'll never forget, my boss calls me in one day. He's like, Kyle, come in here. And my boss is Chad. And he's like, Kyle, can we make our our website look like can we do like their whatever they're doing over there? And, and I was like, I was like, typed up online. And I was like, No. I was like, because that guy right there because that guy right there. So they take us back a little bit because I think a lot of people when they when they see the DGDG brand right now and they see what you've done with technology and and the marketing influence in the market, you're out and what you and Jeremy Beaver and the tech team there have been able to accomplish. They kind of see like, a lot of and even though you're not at the end product, but it's kind of this end product, but take us back in in both your journey and then the journey of like bringing the DGDG brand to where it is today. Maybe?

Nathan Hollenbeck: 4:24

Yeah, so I jumped into the car business back in 2006. I was at a Mitsubishi store on Stevens Creek Boulevard in Santa Clara, California. I've always been a car guy. And so I knew at a really young age, like if I wasn't doing something around cars, I just wasn't going to be happy. So I'm going to car shows with my dad and we built like a 1930 Ford model A hot rod and

Paul Daly: 4:47

like a Motorhead car guy, you're like a Motorhead.

Nathan Hollenbeck: 4:51

Yeah. Oh, yeah, totally. Yeah, I mean, at one point, I think my dad had like, well cars, you know, literally in front of the house and then the driveway and stuff like that. So Just had to be part of the part of the story for me so

Kyle Mountsier: 5:02

Okay, okay, so then what's your favorite car of all time? Before we get into it? What's your favorite car of all time? Hard

Paul Daly: 5:07

to answer if you're so it's

Nathan Hollenbeck: 5:09

it's evolved over time and I get some flack on this answer. But it's the Audi R8 first gen bodystyle. That car like just beautiful, luxurious performance, like, sure you can probably get something like with more performance for that buck, but like just it's the whole package for me it just love that card looks and sounds amazing.

Paul Daly: 5:31

I was expecting him to say 1994 Mitsubishi Eclipse, but you know, that's just I get a lot of flack for this one. Because Paul Walker's

Kyle Mountsier: 5:43

PT cruiser is my jam, wood body PT Cruiser, perfect. Got one in the garage. No, the Audi are not not as much flak for me. Don't worry. All right, so keep us rolling. Sorry. I had to interrupt us with that regularly. Good question.

Paul Daly: 6:03

I mean, that's the question. That's really what people want to know. Anyway.

Nathan Hollenbeck: 6:07

Yeah, for sure. So yes, I took to some parts quickly, because I mean, all I did with my friends was talk about cars all day. So then you come into work, and you talk to customers about cars, and you're excited, they get excited. And so I had a lot of fun selling cars. And then within a year of being in the business, became the internet director running a team of four people. 2008 happened at that point in time and things were on their decline, jumped out of automotive for a quick minute into banking at Wells Fargo, like in the middle of all their crazy fiasco that all the shenanigans that they

Paul Daly: 6:43

were doing. Was it crazy?

Unknown: 6:47

Yeah, yeah. I wasn't willing to like, you know, do what needed to be done all the you know, opening of fake accounts and things like that to get the sales numbers. Wow. So after about six months, I bailed this go on. Sorry, this isn't for me. Kind of really cool opportunity to get into mortgage lending under a mentorship program, I got my real estate license, and eventually got my NMLS license for California. But then I was doing the refi for my old GM. And his nephew was in the internet department. And he and one of their guys were there. And they're selling like eight cars a month between the two. And he was like, You should come back. You be the internet director again. It'll be great. And so I said, Sure. All right. And I came back, because that time, you know, people still were completely underwater on their mortgages, and like trying to finally find a client and trying to get them through the refi. You just didn't get them their loan devalues and stuff like that. So I came back to the auto business a little bit with my leg, you know, tucked in between my legs, and a little reluctant, because I felt like I you know, struck out on the mortgage side, but then that being the best thing for me, because here I am now, years later. But I took that department that was selling eight cars a month and got into selling 40 cars a month within about 90 days. And so then I got a really cool opportunity to work for a startup digital advertising agency here in San Jose, was there for about two and a half years before decided to come to Digi Digi. So I'd had a client that we quadrupled their website traffic, tripled their phone calls and doubled their leads. And they didn't sell a single car and more so they fired us. And I was like wow, you're

Paul Daly: 8:29

always the marketers fault. Yeah.

Unknown: 8:33

So I kind of decided I wanted to come back to retail just because I wanted to be in like ingrained into the sales process and not be just you know, driving traffic but being able to help with the end outcome. And so So yeah, so that was eight, almost nine years ago, jumping on with DGDG and had a number of roles and so getting the VP of Marketing here so it's been a pretty awesome guarantee. Yeah, for sure. So, so fortunate and blessed. Like we

Kyle Mountsier: 8:55

Okay, so I love that perspective because you have a lot of sort of single individuals that are single know a lot of people when they hear marketing they hear just like oh yeah, those are the people that are like you said responsible for getting the website traffic this the the minded focus at DGDG. So we have a VP of Sales that I've worked leads and the phone calls and that's all they do. But you took an approach coming back into it and I think still take an approach today that marketing and operations are actually like right like joined at the hip to each other. Can you explain like your perspective on that and how maybe you take the the approach every single day from the marketers like leaning to from the on the marketer side but understanding the operations kind of goes hand in hand and the perspective that you bring to DGDG in your everyday with that? with closely. Let him know what's coming down like the marketing pipeline that we're working on. And he helps sort of get that into the store level. We also have a VP of training and a director of training meaning that help like with training on the individual store level. And then I have a director of data analytics, and a CRM manager. And we take a lot of the insights that we develop from a data lake that we've been developing over the last six years and utilizing to really streamline and build our own reporting. And then to be able to take that reporting and give actionable insights to the training team and the sales team to be able to work on getting better, right. And we really believe that if you measure it, you can improve upon it. And so we've really, you know, really over invested into that reporting capabilities in that technology, how can we see an example of one one thing that like you saw on the marketing or the data side, maybe over the last couple years that you saw on were like, red flag? All right, get everyone together, we've got to attack this thing, what's one of those examples and how you attacked it.

Nathan Hollenbeck: 10:54

Um, so we take in a lot of different data sources into the data lake from inventory to sales, and other financial data and whatnot. And so I think, you know, we look a lot, we have something that we kick out three times a week called the vitals for new and for used cars, so we can understand like, pricing performance, inventory engagement, leads and conversion rates and things like that. So it's really easy to kind of look at that and get a status of like, the heartbeat of the dealer group. And if the dealership is like, Hey, I'm having struggles with this, like, you can usually dive into that report with them, and get in the weeds a little bit and uncover what it is that that may be going on at their dealership. So how could pricing be impacting their ability to generate leads or sales opportunities? Right? So I think those are the things that we look at on a regular basis where the more that we added to that report, the more like we theorize, like, what do we need in this report? What's not useful in this report that we should swap out with something else, like over time, over the years, it's evolved a lot just from looking at different data in different ways and trying to use it as the best business intelligence possible to run the organization?

Paul Daly: 12:06

Can you give Can you give the listeners some context as to the size and scale of your group, right? Because I think dealers are always trying to like say, Okay, how big is this organization? Because you just talked about dedicating people to things that pretty much very few people have a dedicated person, right? You are this right? You just focus on this only and integrate with so tell us a little bit about del grande size, age, you know, management structure, etc.

Nathan Hollenbeck: 12:35

Yeah. So, for my team, in particular, we actually have 30 people on the marketing team today. So the bulk of that being photographers keeping up with all the new unused inventory, can

Paul Daly: 12:46

you actually just talk about the stores first, and then we'll get into that?

Nathan Hollenbeck: 12:51

Sure. Yeah. So we have we have 16 rooftops here throughout the Bay Area. 16 different OEM brands that we represent. Also, like very centrally located, the

Kyle Mountsier: 13:03

roof top is a different brand.

Nathan Hollenbeck: 13:06

No, it just lines up that way. Like we have some we have like Ford, Mazda franchises. We got four, we got a Chrysler Dodge Jeep brand. So you have four brands at one location. But yeah, cancels that to being 16 to 16 grams. Um, but yeah, we don't currently have any, like highlight or anything like that. But that's one of the things that we're hoping to get into. But yeah, so it's, we kind of coming back to your question about branding. The fact that we've been so centralized throughout the Bay Area, and in Northern California, like it's become a very recognized brand. Within it as like, we really put a lot into the brand marketing efforts to make sure that people always consider Digi Digi on the shopping list when we're trying to buy a car

Paul Daly: 13:49

can have an idea of group volume, or you're not sharing me that?

Nathan Hollenbeck: 13:54

Yeah, so usually roughly around 25,000 cars a year and that's fluctuated a little bit in the last two years with with trying to get inventory. I think our best year we did roughly 30,000 cars. So it's a it's a big organization, about a billion in sales a year and a little over 1100 team members at this point in time. 16 rooftops in our management group.

Paul Daly: 14:17

Okay. And then you got back down, you have a 30 person marketing team, you were saying?

Nathan Hollenbeck: 14:22

Yep, yeah. So I mentioned 15 photographers keeping up with the inventory and we do a lot like you can actually see see behind me for those that are watching like our own beauty shots. Like we don't use stock OEM footage or images like we do everything here in house.

Paul Daly: 14:36

It's a really it's a really awesome picture. It looks great. I thought it was stock or you picked it up somewhere. It looks amazing. Amazing.

Nathan Hollenbeck: 14:46

Yeah. Yeah. so blessed to have that that part of the team. We've got three full time web developers, three full time graphic designers. I mentioned our CRM manager, our director of data analytics and Operations Management So paid search display, pre roll Facebook ads, and then communications manager that handles PR social media, online reputation and events. So it's a pretty, pretty big team that to tackle everything possible. So

Paul Daly: 15:17

yeah, I'd say I mean, when did you do? When did? Were you around when the transaction? Let me ask this question first? Is your marketing team 100%? Internal? Do you use agencies or anything like that as well?

Nathan Hollenbeck: 15:34

And the only we have an agency for traditional advertising, media buy, we produce the actual ads ourselves. So we don't, we don't outsource that.

Paul Daly: 15:43

So can you tell me about the transition, when the group decided, hey, we're going to go in house or just has it always been that way since you've been there?

Nathan Hollenbeck: 15:52

Um, there was always the desire to have everything internal and not outsource. When I first joined the group, they were using three different agencies on like, the digital side, and we're trying to figure out like, you know, which one was going to be the best performer that they could use across the whole group? Or could they find someone like me that had the agency experience, they can build all that, and how so we've slowly but surely, over time, just continue to take things and bring them in house SEO, paid search, all that different stuff. We've just found like, when you when you're using an agency, there's certainly like, uses for agency like, especially if you're not a large group, with dealers, economies of scale, like it is expensive to have this stuff, right. But once you get to that certain level of scale, when you're adding up all the management fees, and stuff like that, a lot of times you start to find that my I can probably do this in house for a little bit cheaper. And then you have people that are only dedicated to your business, and they're not trying to manage your business as well as other people's businesses. So that was one of the main main reasons for trying to bring everything in house as much as we could do.

Paul Daly: 16:57

We're definitely seeing, you know, con, I get to interact with a lot of a lot of people across the country. And we're definitely seeing a growing desire for larger, you know, larger groups with more leverage to say, like, Hey, how can we get a little bit more control over everything that's going on? And like you said, how can we have more, more just dedicated resources into the marketing department to get the efficiency of scale, and then to really make a really great handshake between the marketing and the data and the operations? And that's really that is really tough to do a fuse outside agency. So I'm always curious from, from somebody who's actually executing it well, about what it what it took to get there. And, you know, kind of what the result is, while the results are obvious. Yeah.

Kyle Mountsier: 17:39

You know, one thing that, you know, I kind of started this off, but, you know, a lot of people across the country, kind of go to the DGDG website, especially the Group website, and really kind of take a look and look at, look at that experience. And for me, and I think a lot of people it's like, okay, you have Carvana that, you know, self develops, or, or Carmax, that that self develops 100% of their, their website. But you've, you've done a lot with, you know, a website provider that a lot of people have in the country, and obviously, there's resources and team and stuff that happens like that, but what's the mentality that you take into the digital ecosystem, and how customers are engaging with your brand online, you know, to get you to this point of having, you know, a website that that feels and, and, and looks closer to something that someone like a scale like a Carmax are Carvana with a with a spin on a localized level, what's the mentality? And what's it taken to get to the point where you're at today?

Unknown: 18:44

Yeah, I think you know, so when I started with the group, we were on DDC for pretty much all the websites, and we were like, as customized as you can get on DTC. And really, we're looking for more we're trying to get out of the, you know, the stereotypical dealership template, right? And, and break the mold and be able to like, integrate some of it, especially as we grew the data lake like being able to integrate some of the data that we have there and the likes and customize experiences, and we just weren't able to find that there. And then when we met Joe and Bruce over Dealer Inspire them like 2015, then a GA and they showed us what they had developed on WordPress, the ability for customization. We actually came to them with our own UX UI that we had built internally and said, Can you guys go this? And they took on the challenge. And it was a it was a long development cycle initially, was entirely custom. So we weren't, we weren't utilizing a lot of the systems as di went on. And so over the years, we've kind of worked to customize their their infrastructure so that we were being able to take advantage of updates and improvements to their plan. I plan. But, but yeah, I think the big thing for us was like, we we really tried to be an open resource for consumers. So whether that's price validation from third parties, consumer reviews from current driver, showcasing all the recondition that we've done to the vehicle to share the value to that consumer, um, you know, just like, how can you give people no reason to object that that vehicle before coming in, or just now in the days of digital retailing, like, make them feel comfortable with buying that car online. So the more that you can put in the hands of the consumer, I mean, there's so many top retail brands that are proven that right Amazon, Apple, Best Buy, there's just so many that come to mind, where if you just give the reins to the consumer and give them sort of freedom of choice and take away friction, they're willing to pay a premium for that. And that's really been the focus for us as an organization.

Kyle Mountsier: 20:52

I know you're in the Bay Area. So you know, obviously a very technological forward area. And are you seeing, you know, we hear other reports and see other reports, are you seeing a higher level of adoption or speed to sale or ease of entry with, you know, with your, you know, between the the digital and the physical showroom? Is that is there? Is there a faster sync for you than what you're seeing, you know, with the rest of the United States and maybe other brands that you follow? And do you think that's attributed to kind of like, the journey that you've built? You know, what's, what's your perspective on, like, the adoption rate of that type of ecosystem for for your customers?

Nathan Hollenbeck: 21:38

Yeah, so for us, we ended up launching digital retailing, in the middle of the pandemic. So in a way, it was good for us, because that was the only way consumers can buy cars. And it was the only way dealers could sell them. So the team had to adopt it fully adopted and fully embrace it. Because, you know, we were shut down and sales for six days, which was brought him in really, really tough time for us in the business over that, that period. But when we opened back up with sales, and with digital retailing online, it just kind of happened to be that we were already in the development process of it with our partners, currently prodigy now upstart auto retail. But I think that the one thing for us in going to digital retailing because consumers here in the Silicon Valley, area like they they're used to ordering their coffee at Starbucks right on the app, and then coming in and picking it up in store like they're used to all of this technology in their normal, everyday life. And what was important for us was, you know, when you think back to when digital retailing first started, it was really like this glorified web lead online that came into a really antiquated CRM, and you had to like open the ADF lead and look for the comments to figure out like, what did this customer do online, right. So we were really like, we did not want to over promise online and under deliver in store. So we looked for partners that had a tablet experience tied to online, so that we could easily pick up where they left off. And what we found in looking at a lot of the customer reporting that we built, as we went along with, with that process was a from the branding and the packaging that we did on our websites, we actually just just by putting it on there doubled website conversion. So we got twice as many web leads off of our website as we did prior. And then what was really interesting to see was that we were tracking not only like the people that, you know, we'd never seen them before, they clicked on our no brainer checkout, or what we find it and went through it and submitted the lead in and bought a car. But we were also looking at who was influenced by the digital retailing. So we got a lead from Auto Trader. And then three days later, they went through a no brainer checkout on the website and got the permanent line. So we were able to see like not only like the direct attribution, but like sort of that multi touch approach into it. And so it's been hugely successful for us. And we've continued to really brand it heavily to make people know that like buying a car from dddd is much like that other technology that they're used to in their everyday lives and that it's that simple to do business with us.

Paul Daly: 24:16

Well, we only have time for one more. What do you see like the trajectory of change is so fast right now? Right? So even like trying to predict what it's gonna look like a year from now or two years from now is is a little bit rough. But you have some very specific initiatives. What are you most excited about? Over the next 12 months, we'll say, you know, what you are trying to do?

Unknown: 24:37

Yeah, I think one of the big things that I've been excited about for a long time it's been a long time coming is our implementation of Salesforce. It's, it was a big animal. You know, we really, we knew it was going to be a challenge. In the beginning. It was even harder than we'd even initially theorize but we launched our first initiative with Salesforce on the First of this month, that is tied into our sell to DGDG website that we sort of CO developed alongside that. And so people can enter in their, their, their license plate number or their then we extract their vehicle history report, we run a KVD API, and we come up with an offer of what we're willing to buy the person's car with that, and then those leads, you know, we don't, we're not using ADF. We're just built API technology straight into Salesforce. And we're running that process. As of today, since we launched on August 1, on our websites. And I've already seen like, with zero marketing, nothing but a homepage banner, and adding it to a navigation, we're getting 12 to 15 offers a day. And we've been converting about 50% of those are people after they see the offer, say, Okay, I want to sell my car. And then, so far we were our win rate is about 3%. But we still have stuff that scheduled it's in the pipeline. And then it'll be interesting after we get to like 60 to 90 days. We've also been very conservative with the offers that we've been giving just because it's new technology. So I think we'll be ratcheting that up to help meet more conversions and higher win rates. But knowing that it works net and seeing that it's working is very exciting, because now we know a lot more and when we go to implement it in the stores will be that much more ready for it. So that's what's really exciting for me right now.

Paul Daly: 26:23

Well, if you're listening, and we didn't say it, go to dgdg.com. And yes, ladies and gentlemen, he did say Salesforce for all of you. They're like, Wait, did he just say southward? Yes, he did. Nathan Hollenbeck. Thank you so much for giving us some time today. And continuing to push the bar forward, we need the people who are going to continually push it to show us all what's possible. So thank you so much.

Kyle Mountsier: 26:49

When we dropped into that interview, and my man had a beard, and a hat on knowing full well, that is not what he looks like. I was floored, set aside. And here's the thing is the he also communicated that to two of my good friends, making sure that they thought that that would be a fun idea to and this is the way he's been the idea before he did it. He vetted the idea before he did it, there's a data driven individual right there. Well, yeah. And that's what I was gonna lean into here is because he makes calculated insightful decisions like that with a particular level of energy every single day. And you see that when you look at the way that DGDG goes about marketing goes about interacting as a team content delivery, right, the fact that they have 20 Something people on their content and and Technical Marketing team across photographers and videographers, and IT specialists and developers and himself like that, that is a dialed in man that that he takes that same approach into coming to a podcast that he did the research, bought the hat bought the you know, all of that type of stuff, you can't be at that level without bringing that level of game to everything that you do,

Paul Daly: 28:07

working together. Like when he talked about how big the team is. And it's I think it's easy for people to, you know, say well must be nice, right? When you have someone that has a big team or has worked to get the resources or you know, in the intentionality to do things in house, the must be nice attitude comes out probably pretty quickly. And I think the lesson to take away from it is the fact that the more people understand what the plan is, and are working together to solve the overarching problem, this can go span sales service, you know, back office, whatever, the more people that understand that, the more effective your customer experience is going to be. So I mean, think that's the takeaway, I think that everyone regardless of the size of your marketing team can actually deploy today.

Michael Cirillo: 28:49

That's a very unique skill set to like talking about where you want to go one skill set, being able to actually get your team on board so that they understand that looks like an application, what that looks like is more conversations probably than you want to have. But that you know, are necessary just to make because like people spin out so quickly. And you know, no organization is immune to like just the fact that we overthink things and whatever. So like, I just really think, to me, it stands out how important of a skill set that is to be able to actually to your point, rally a team around a focus point and make sure they're all moving in that direction and understand it is certainly tremendous. We hope, of course that you enjoyed our conversation with Nathan Hollenbeck. On behalf of Paul J Daly. Kyle Mountsier. And myself, Michael Cirillo. Thanks for joining us on Auto Collabs

Unknown: 29:41

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