“The Internet will kill off dealers as we know them. Manufacturers will sell directly on line.” “Cars will sell themselves without any profit to the dealer as customers demand and get invoice pricing off websites.”
We all remember those bold statements as well as the Internet winners-losers' lists from all sorts of know-it-alls (and refuted by the few of us who, even back then, knew, wrote and spoke of how it wouldn't be so).
Of course, there were even more ridiculous claims of the millions of dollars that a few guys were going to make by digitizing their sales systems, and by eliminating the middlemen in the wholesale and finance lanes.
And there were the Wall Street criminals who made billions selling anything “dot-com” to anyone who would buy their scheme. I admit, I was not spared from this temptation and don't know many who were awake that were.
But reason has replaced lust in our marketplace. It always does. We're still not “one-priced” as Saturn predicted, we are still not “consolidated” as CarMax predicted and we are still not “digitized” as Wall Street predicted. We are still peddling the metal, one car at a time, face-to-face, just as we always have.
Or are we? Not exactly. As each of those tidal waves washed over us, they left us a little different from the experience. And like most times, and this time especially, our change is for the better.
Not all the players have evolved just yet. But most of us are improved because our sales tactics, which always seem to be at the center of retail revolutions, are more and more legitimate nowadays. Our customers are, more and more, getting what they bargained for. And the solid dealers are becoming more secure as relationships with their customers become more based on continuing service and repeat business.
I get calls almost daily from dealers, consultants and manufacturers who still cling to the dream that untold riches are as close as a faster uplink married to flawless software and sprinkled with a little inventory. If only those damn customers would appreciate the simple elegance of our offering, The callers whine. Then they ponder whether, just perhaps, a few more ads on the Super Bowl will win them over.
After they've missed their numbers (and shot their budgets) is when I usually get a call as if their god were temporarily missing and I might give them directions to where he might be hiding.
The conversation always starts with whether I've seen anything that's working. I suppose they are hoping to avoid blame by attributing their failure to something in the air or in the economy, something beyond anyone's ability to control or predict.
But something, somewhere, is always working. They know that. So we quickly move past the first question as if it were a polite ritual, like asking someone how they are doing.
Next they venture a toe in the waters of self-doubt by hazarding a guess as to where things went wrong. Almost invariably they are incorrect and still on the track of someone else's fault.
Finally, we go where the answers always are; we go to the customer side of things. Not actually to the customer, (there will be plenty of time later for focus groups) we go to the psychology of the customer and we look through his or her eyes. Those eyes always see a better offer somewhere and a sucker bet to avoid. They always see a want, a need and a preferred supplier. This is where the hard/easy work of retail strategy is honed.
Often, my new best friends on the phone are soon on a plane to meet with me and my team to see how we've already piloted change. As often, I find myself flying around the country (83 days last year) to witness their inner workings. But always, we find our solution in the three pillars of retail: product, staffing and attitude.
No, it's not now and never was about the speed of the data flow. It has always been and always will be all about providing comfort and value. The likelihood of a sale is high if you give a shopper 1) a comfortable experience and 2) a decent price.
Don't overcomplicate those two basic drivers and you will outperform almost every strategist. Everything else in the marketplace is a poor substitute for the lacking of one or the other of these. Sophisticated customers know it. This is the legacy of the web and all the connectivity that is now a part of our daily lives.
The sophistication of our customers is increasing exponentially with the growth and distribution of technology. That's to say dancing donkeys and techno wizardry are less and less strategic advantages in the war for market share. Using them effectively, on the other hand, is an advantage.
(Next month let's talk about the marriage of your computers, the Internet and a call center to develop business.)
Peter Brandow is a 25-year veteran dealer with stores in Pennsylvania and New Jersey. He is president and CEO of Brandow Companies.