In writing about retail automotive operations for 26 years now, I’ve covered innovations that have shaped the way cars are sold, financed and serviced.
I was writing back in 1991 about what’s now called legacy DMS, parts-scan tools, and how emerging service technologies would change the customer service-profitability ratio.
The biggest challenge, because it was so novel, was helping to familiarize car dealers about the Internet and how to use it to expand market reach.
That discussion, among many others, continues today, as auto retailing shares ideas and develops new technologies to engage with customers. It is alerting the face of car business.
In 2000, I was part of a team that helped ADP Dealer Services (the predecessor to CDK Global) launch its DealerSuite.com portal at the National Automobile Dealers Assn. convention and expo.
The ADP product was one of many disruptive technologies introduced that year. I recall the buzz of excitement (and confusion) on the expo floor over these new ideas. The conversation and debate was brisk about what this “Internet thing” might do for the industry we all love so much.
It has been a long wait to find out.
A leading industry thinker said at NADA’s convention this year that online car sales (and online F&I) would be commonplace by 2019. Are you ready?
It’s been a long wait for me too.
After Y2K, my business went into cardiac arrest. I took a job selling Fords. I wasn’t particular good at it, but I learned the business, the personalities and how to work a deal. I noticed the front-end people had little to say to the guys in the back, and vice versa.
In a dark little room where a fax machine sat on an antiqued wooden desk was a green-screen terminal for inventory ordering and searching for dealer trades.
My general manager had a computer in his office for credit and financing purposes. But salesmen (even with Gleena leading the sales board month after month, we were still salesmen) did it the old way: pencil on paper, sourcing vehicle specifications from thick books when writing up factory orders.
“Mobile” phones were still mostly hardwired into vehicles. We waited for “ups” in wolf packs by the front door.
Perhaps because I wore nerd glasses (still do, though not the same ones), the general sales manager foisted the lead sheets on me.
On those stacks of computer paper were listed inquirers’ names, addresses and phone numbers only, if I recall correctly. During slack times, I would work through the list. No one else even asked what I was doing. I managed a few incremental sales because I did it. I sold a few others via fax.
Within a few months, I got a call and got back to writing full time again.
In retrospect, I discovered, somewhat to my surprise, that I really had liked the car business, the customers, my peers and the processes. I was proud that I had been a car salesman. The experience was the best education I could have received for someone writing about the auto business.
Since I began writing about it, much has changed, such as the evolution of the sales process, the power of digital F&I, the focus on upsell and retention through the service experience and the growth of the compliance industry.
And while not necessarily a novel idea, adoption of business by metrics and accountability are helping dealers reduce costs and find opportunities heretofore ignored, neglected or unknown.
Breakdowns still happen, from clunky online-to-brick-and-mortar car-buying experiences to questionable advertising and other practices.
Staff turnover still roars and new people need skills. General managers still hold their service managers feet to the fire to achieve and maintain their effective labor rate and boost the fixed-absorption rate. Marketing is now more numbers-driven than ever before.
New stocking and pricing tools have replaced used-car guys who worked by pencil and hunch. I had always wondered why Benny at the dealership I worked for left a ’92 Cadillac Coupe Deville to sit on the lot all summer without dropping the price once. “She’s a beauty someone will cherish,” he always insisted, until the wholesaler came for it.
Today, I do my car-shopping online too, but appreciate a thorough vehicle walkaround by the sales associate when I arrive at the showroom. But that seems to happen rarely today.
I know what the studies seem to say; I think they’re wrong. It’s a great opportunity to differentiate yourself and your product from the other guys’.
I was taught to pop the hood and explain to shoppers the redundant safety of the vehicle’s dual reservoir brake fluid master cylinder. I advised my sales manager that all cars used this feature since at least the 1970s. “Yeah, you know that,” he said. “Don’t count on the customer knowing it. And if you’re the only one who notes this, it may be the tipping point for their decision to go with us.”
The technology may be refined, but let’s not forget the human heart in every interaction.
Time will tell whether the impending end-to-end online car-sales age is an improvement. And we’ll see what comes with autonomous vehicles. God willing, I’ll have a few more miles to go in my career to find out.
Jim Leman writes about automotive retail operations from Round Lake, IL. He can be reached at [email protected]