After returning from an event I attended recently, I woke up to see the article, “Inside the New Normal," in Auto Finance News, based on an interview with Rick Ricart, a dealer principal with Ricart Automotive Group, who also owns a Harley-Davidson dealership. After reading this article, I thought to myself, this is the new NORMAL?!
Within the retail transportation industry, it has always taken major events for change to happen. In the 1970s, we had high gas prices that caused consumers to shy away from high fuel consumption vehicles. In the 1980s, we saw the introduction of new OEMs, bringing more competition to the table. In the 1990s, manufacturers lowballed each other with crazy incentives, which created the “race-to-the-bottom” that every dealership hates to this day. And in the early 2000s, a financial crisis forced dealerships to embrace the Internet for advertising and marketing. For the past 18 months, the pandemic has led more dealerships to embrace digital marketing to acquire customers and to focus on operational technology (digital retailing, anyone?) to not only be able to make the sale but to create the customer experience that consumers desire.
The bottom line is there will always be something that is going to make dealers recognize and adopt changes to stay in business. Regardless of whether it's an automotive, powersports, marine, or RV dealer, dealers will HAVE to make this change to remain competitive and in business. Is this phenomenon something new? NO!
Past behavior predicts future behavior. What is new (if
anything) is the speed at which these changes are happening. Because of the
rapid speed of technology combined with the societal circumstances we are
experiencing, consumer expectations have increased at a more rapid pace,
similar to Moore’s law on microchips. In the past, consumer expectations have
always been seen as a desire, not a necessity. Now, however, society has given
the consumer the upper hand and forced dealers of all types to understand
that these “desires” are not only things that consumers have always wanted but
also that if they don’t acquiesce, they will lose business.
What are these “things?”
These are not new. Consumers have ALWAYS wanted them. For example, think about Amazon. How many freakin’ Amazon boxes are on your porch every day, and how frequently? Chances are that YOU even love Amazon, buying from them very often. Why? Because they give customers what they ask for!
Dealerships should understand that to be successful, they
also need to figure out how to incorporate, solve and provide the same consumer
desires that Amazon does. How do they do that? By making it easy for
salespeople and managers to provide these experiences and to stop losing sales
because they want to maintain the status quo and are worried about
losing profit! You can’t lose profit if you never make the sale in the first
place!
If the pandemic has shown us anything, it is that price is
not a deterrent but only a consideration. Consumers still want to buy things.
They just want businesses to be responsive, transparent, and make it convenient!
Most dealerships think that they are in the product business, but it is the opposite. Dealerships are in the SERVICE business with a product
to sell. Dealerships are NOT Walmart! Consumers aren’t coming into your
dealership to buy a bottle of detergent for 10 cents less. They are spending
THOUSANDS of dollars!
Now, I want you to ask yourself these questions:
Ultimately, it boils down to knowing what is happening in these engagements and how they translate into sales? Do you even
know?
The easy start is to address current processes in the dealership’s sales department and how those align with what customers want, along with the tools provided to the salespeople, their buy-in, and use of those tools. Can a dealership make it easier for both the
sales department and the consumer? By addressing the “easy” part and providing
the tools they need, salespeople are more likely to follow the
process. This will result in a better consumer experience that will ultimately
lead to more profit simply by influencing consumers to buy from YOUR dealership
rather than your competition! Consumers are not only spending
more than ever to get what they want “right now” (think Amazon, again), but they
are also willing to pay more to companies that can provide it!
The “easy” part is just the start, though. To succeed in streamlining a process that starts with a consumer finding you and then reaching out, engaging, and buying from you, introspection is an absolute necessity! Dealerships must discover their vulnerabilities, which will enlighten them on potential threats by their competition. Once found, dealerships should take immediate action to stop those leaks through a change in either process, technology, training, or all of these.
So, I'll leave you with this advice:
At the moment, sales may be all raindrops on roses and whiskers on kittens (you know the rest), but all of this will change, and dealerships WILL need help! Those brown paper packages tied up with strings are ABSOLUTELY your favorite things right now! Eventually, however, those brown paper packages will show up with no strings, then there won’t be any brown paper, and last but not least, those packages will just go away altogether.
Larry Bruce, entrepreneur building Marketing Technology for PowerSportsX and PSXDigital. Former Vice President at Reynolds and Reynolds, Founder, President & CEO of OnlineDrive inbound marketing platform, AIMData an industry-leading data management and CRM company and ClickBuyDrive online vehicle buying platform.