Stop Stitching. Start Integrating.
Everyone says they’re integrated. But do they mean it? The problem that our industry suffers from at large is a poor customer experience.
Slow Sites, Lost Sales. Why 99% of Dealerships Fail Google’s Core Web Vitals
Recent research shows only 1% of dealership websites meet Google’s Core Web Vital standards, the most basic benchmarks for site speed and performance. Why so low?
From Leads to Deals: What Dealers Want (and What They Don’t)
There came a time when just stepping into a car dealership felt a bit like walking into a high-stakes poker game: Everyone had to prepare themselves for a bluff or a hidden card up someone’s sleeve.
Outdated Practices Are Putting Dealerships at Risk. Are You a Sitting Duck?
Did you know that nearly 70% of car buyers feel misled by advertised pricing, and 1 in 4 would switch dealerships over trust issues?
In the Driver’s Seat: Navigating NADA 2024’s Top Topics
This year’s NADA conference once again brought industry leaders, innovators, and trailblazers together in Las Vegas. Within the inevitable buzz and excitement that we see year after year at the industry’s biggest event, we noticed a few major themes that remained relevant throughout. Let’s dive into them.
In the Driver’s Seat: 2023 Reflections & 2024 Predictions
As the dust settles on the changing automotive landscape in 2023, it has become clear that last year was a crucible of transformation and invaluable insights. From shifts in consumer behavior to redefined dealership practices, it’s safe to say the industry will never be the same. The impact this year will have on the next is substantial, and dealers should continue adapting to the ever-evolving industry in order to stay ahead of the curve.
It’s time to discuss the top trends from 2023, and start to think about what the industry holds for us in 2024.
A Look Back: A Changed Landscape in 2023
- Taking the Online Experience, Offline: The once nice-to-have personalized online experience quickly became a cornerstone for dealer success – but what about in-store? 2023 saw the re-prioritization of creating custom experiences for anyone and everyone who walked through their dealership doors. This shift underscores the vital role of an integrated approach to customer engagement, creating a seamless transition between online and offline interactions.
- CRM Revolution: The traditional customer relationship management (CRM) communications reached their end in 2023. Automated responses filled with typos and generic content lost credibility and were swiftly abandoned by dealers, leaving a detrimental communication gap. Dealerships started to recognize the need for more savvy communication tools that emphasize personalization and resonate with the modern consumer.
- Manufacturer Mandates: Automotive saw a power shift as manufacturers enforced guidelines that if not strictly followed, carried a risk for dealers to lose substantial funding. These evolving dealer-manufacturer dynamics put a heavy emphasis on uniformity and compliance across brands and certified vendor programs.
- Revival of Retail: Prioritizing the analysis of ad spend for more effective lead generation and conversion practices has been reborn. A new focus on merchandising inventory through strategically connected marketing has given dealers critical insight into quality leads, and has proven the importance of merchandising initiatives for dealers.
- Max Controversy: With new AI, comes new controversy. Originally launched in 2021, Google’s Performance Max (PMax) digital advertising buying platform was met with mixed reactions. Since then, the concerns surrounding privacy and data security have only continued to grow. Critics argue that the platform’s extensive data usage raises privacy issues, causing unease over the potential for a sensitive information leak. Is the convenience worth the risk?
A Look Ahead: What’s in Store for 2024?
- Amazon Enters Auto: In 2024, the automotive industry prepares for Amazon’s expansion into car sales, potentially setting a new benchmark within the vehicle purchasing landscape. The influence of Amazon could redefine consumer expectations, as it did with other ecommerce categories, with a more desperate need for dealers to offer convenience, personalization, and efficiency in order to gain and retain a satisfied customer base.
- Electrifying Automotive: With the continued rise of electric vehicles (EVs), dealers should think to revamp their service coupons and offers. While traditional campaigns feature offers for services along the lines of oil changes, there is a new opportunity for dealers to adapt their strategy to incorporate incentives catered specifically to the unique needs of EV owners.
- Prioritizing Platforms: Automotive has historically been an industry of applications, until now. We are seeing a pronounced shift away from individual applications and multiple vendors, and a large priority being put on comprehensive all-in-one solutions that offer end-to-end capabilities. Holistic platforms simplify the experience on both the dealer and customer side, making them an invaluable tool in offering seamless marketing, purchasing, and maintenance journeys.
- Spam Tech Surge: Spam filtering technology is emerging as a top obstacle for dealers. With impacts on email deliverability and reporting, dealers need to diversify their communication methods and explore alternative channels to reach their customer base. A comprehensive marketing mix will ensure dealer messaging continues to reach the right eyes at the right time.
- Integrating AI: Artificial intelligence (AI) is continuing to grow and become a vital tool for dealerships. Dealers are beginning to integrate AI technology, including ChatGPT and AI communication tools, with their existing infrastructure to enhance customer interactions, streamline processes, and continue to push innovation in automotive. As AI continues to evolve, it is becoming an indispensable tool for dealers trying to get ahead in the modern auto landscape.
So, as we reflect on this past year and move into the next, it’s imperative to keep a pulse on where the auto industry is headed. The rapid integration and expansion of emerging technology underscores the desperate need for adaptability in dealership practices. Automotive is continuously proving to be an extremely dynamic industry full of opportunity: to innovate, to thrive, to forge your own path. Will you be ready to seize it?
David Boice
Team Velocity Co-Founder & CEO
Mission Improbable: 2021
Imagine this…A customer walks into a dealership and is treated exactly like they are routinely treated online. They would meet a bunch of people, and it would go something like this:
Website: Hi, my name is Website. Thanks for stopping by. How can I help you today?
Customer: Hey, we are looking to check out the new 2022 Telluride, see what our trade might be worth, and get a feel for of our monthly payments to see if it works in our budget. If so, we are interested in purchasing over the next few days.
Website: Perfect, let me show you around. BTW, how did you hear about us?
Customer: Your friends, Google and Facebook, suggested you. They said your offers on the 2022 Telluride were awesome!
Website: Ok, but first just a word of caution. Whatever you and Google and Facebook discussed privately may not be the same information you get here. But not a big deal, right?
Anyway, let me introduce you to my helpful widget friends. Just to name a few…This is Chat, that’s Trade, and over there is Video. My friend Finance is awesome, VDP is my main man, and you might even get to meet Retail, but most people don’t get that far.
Let’s get started with Chat. Just so you know, she will jump around frantically to get your attention and bug you all day long, unless you just say “hi” and tell her who you are. If I were you, I would just do it, because if you don’t, she is never going away. No matter what. Seriously dude, I am not joking around. I see it all day long. It’s actually crazy.
Chat: Hey, how may I help you today?
Customer: Hi, can you start with giving me some info on the new Telluride?
Chat: Slow your roll stranger. How about you start by giving me all of your information in case you decide to leave quickly, and a member of my team needs to reach you…like maybe tomorrow, probably… or at some point soon?
Customer: Ok, I am already here though. Why can’t they just speak with me right now, before I leave? But, fine, here is all my contact info. Now can you please let me know about that new ’22 Telluride?
Chat: Hmmm, that is such an incredible question. Hang on for a minute while I check. Darn it, Customer. I am afraid a member of my team cannot answer your question, but we will try our best to call you back tomorrow, hopefully. Is there anything else I can possibly do for you today?
Customer: You have not done one single thing for me today. Literally.
Website: Hey Customer, welcome back. Just so you know I cannot see or hear anything that any of my widget friends say or do. It’s like they live in their own world. But let’s get you straight over to Trade and see what happens.
Trade: Hi there. Tell me all about your trade, and then I will obviously need all of your contact information, and then I can send you a value report.
Customer: Ok, here is all my trade information, but I literally just gave Chat all my contact info, can’t you get it from her? Don’t you all work here? It’s the exact same information she just asked for 30 seconds ago.
Trade: Listen Customer, I can see you are already frustrated because you have not gotten a single bit of useful information since you arrived and have repeatedly been asked to identify yourself. I am sorry to say that this is only the beginning. Every other widget friend will need the same information. It’s what we are born to do. We cannot share your information because technically, none of us work here. We are employed and powered by other companies. See my real logo. It’s better to think of us all as “certified” and completely independent contractors. We can only keep our job if we prove to the boss that each of us have separately obtained your contact information. It’s like our fun game. Anyway, then we send your info over to CRM. He is getting old; he still counts the leads with his 20-year-old ADF calculator. Does that make sense Customer, in some small way?
Customer: No, not even in the slightest. I came here to get information to buy a Telluride. So far, all you want is for me to give you information to send to CRM. I thought you wanted to sell me a new Telluride. Google had me so convinced I could get a great deal, and it would be easy.
Website: Hey buddy, welcome back. I get it, just keep your chin up. I am going to get you straight over to my main man, the one and only VDP. We try and make sure everyone here meets him.
VDP: Hey Customer, I promise I am going to get you exactly what you need. Sounds like someone needs a great price and a payment on this 2022 Telluride. Am I right?
Customer: Yes, thank you VDP. You seem friendly with Website, so can you please tell me how much our monthly payment would be on this Telluride, including our trade information that I just gave your colleague, Trade.
VDP: Didn’t Website already explain all that? Whatever info you gave Trade stays with Trade. Sorry, I basically need all your exact same information. Relax, take a breath, because you may or may not like this… but the “awesome offers” you first saw from Google, or anywhere else, before we met are not actually our very best price. Isn’t that surprisingly fantastic news? We have something special called an E-Price. BTW, nobody knows what the “E” stands for. I am pretty sure it’s supposed to be like our “Extra” Special very best price. But it is not here now, it’s in a secret hiding place. All I need is your information and a spot to send this extra special E-Price because you understand I cannot exactly give it you now, right? I hope you get it. Fingers crossed.
Customer: Whaaaat? We are standing in the middle of your showroom right now, and we are ready to buy a Telluride. I don’t get it? I already gave your widget friends all my information and I just want to know an idea of my extra special payments NOW. That’s why we came here in the first place. Is that too much to ask, VDP? I mean, isn’t this a super common question?
VDP: Chill Customer. Please don’t bounce on me. We do have one final last-ditch option, and that’s to introduce you to the biggest, baddest widget friend in the dealership, Retail. But I am warning you, once you two meet, we may never see you again. She is a lone wolf with her own unique style and has her own entirely separate way of doing things. But perhaps she just might be able to help you. Really, at this point what do you have to lose? Are you ready?
Customer: Sure, let me meet her. But first, please tell me that all your other widget friends, or you, Website, already gave her all my contact information, all my trade information, and all my shopping history. I can’t take explaining this 2022 Telluride again and again. I don’t want to answer the same questions again. PLEASE!
Retail: Hey Customer, you look beat. By the way, what’s your real name? If I am going to help you, we need to start over fresh, and I do not want to hear about your time with Google, Facebook, or Website either. That’s all in the past.
Customer: Seriously, Retail? You also need my contact information, trade information and the details of what I want, too? And why are your prices and payments different than your associates, Google, Facebook, and Website? Are you joking?
Retail: Nope. Look, whatever your name is, only 3% or so of people even get this far. You should feel great about your effort. You have worked so hard and met so many widgets. Let’s finish this thing. Now, again, what’s your name, how can I reach you later, what are you trading, and how are you paying for it?
Customer: OMG! Do you even know Website, VDP, Chat, or any of the other people I have dealt with along the way? And shouldn’t Website have been able to just give me all this basic information himself, quickly? I still do not have an ounce of information I originally asked for. It’s so maddening.
Retail: Look, I admit I do not know them well. Except we go to conferences together and party like rockstars 😊. But, just between us, I am always the last person you’re gonna meet. It’s just how it works at our dealership. Now, like I said, let’s relax and start from scratch. It’s much easier if we both pretend everything that happened before we met is erased from your memory like it never happened. Even though it did.
Customer: You have got to be kidding me.
Can you imagine if this is what the in-store experience was like?
If you know the automotive landscape, I hope you enjoyed a laugh or two, like I did while writing this. While fun to smile, we are seriously devoted to creating solutions that empower retailers to dramatically improve their customers’ experience, both online and offline.
The bottom line is this…a dealer’s sales process (inside their stores) would never mimic the online sales experience. I would argue the customer experience is currently far better, more informative, and logical inside the dealership. Online, it’s typically disjointed from the first click of an email or a digital ad all the way through to a website filled with widgets. It’s even worse on mobile devices. The current online shopping journey takes consumers from one siloed experience to another, littered with distractions along the way. This ecosystem has slowly developed over 20 years and was not designed to easily facilitate the most important result: a transaction. Dealerships cannot efficiently manage 8-10 companies, all with individual goals and technology, and expect to create a meaningful customer experience that generates a great outcome for their business.
Integration is a change already established in most other industries, but not automotive retail… yet.
I call it “Mission Improbable” because the current ecosystem was developed like separate pieces of a puzzle that were never designed to fit. Given the exceptional online experiences customers have in other areas of their lives, it’s improbable they will play hopscotch through the maze of inconsistencies in both offers and user experiences. This siloed ecosystem is unique to automotive, and it’s heavily supported by a financial model that rewards silos, OEM certifications, etc. It’s become the norm.
But what are the alternatives? I see two logical pathways to improvement. The first would be a format to share customers’ contact information and shopping data across different platforms. Real integration between various technologies. But, the chances of wide enough adoption are unlikely because the level of cooperation would require tech companies that fiercely compete to also agree. On top of that, growing consumer privacy regulations and security environments would prove challenging.
The more likely alternative is the birth of all-inclusive platforms that were designed, acquired, or both, to facilitate the entire customer journey from the creation and first click of an ad to the final click of scheduling a sales delivery or service, without any unnecessary interruptions, all originally engineered to work together seamlessly. But, platforms like this will take time to adopt because investors, dealers, and OEMs are accustomed to the current mindset. Integration is a change already established in most other industries, but not automotive retail… yet.
We are passionately committed to a better alternative that is facilitated by one, fully-integrated technology platform, designed from the ground up for all “widgets” to work together for customers and dealerships. It is how the rest of the world is already retailing, and we believe we can too.
David Boice
Team Velocity Co-Founder & CEO
“I want to be just like (insert Dealer name).”
Are you sure?
Each week, a growing number of new or prospective clients ask us to provide, “whatever (insert dealer name) is doing that is working so well.” The belief being, if they work with the same company and use the same technology, the results will also be the same. Maybe, maybe not.
Why?
We are fortunate to serve many OEM’s and over 1500 progressive dealers in the automotive, RV, Powersports, marine, and motorcycle industries. A common belief amongst them is that by substantially improving and personalizing their customer’s experience, they will, in turn, complete more transactions. In this regard, they are customer experience mavericks. Their belief system (and ours) has formed the entire basis for our Apollo technology platform.
Before you try to emulate a dealer, you perceive as successful, I would encourage you also to evaluate changing the way you think about retail. We know that change, whether good or bad, is resisted with equal intensity. While that is true for humans, it is even more true for organizations.
To be as successful as a progressive retailer, it requires more than just switching companies. It requires re-thinking as well. One change, without the other, is a formula for continuously switching vendors or strategies and then wondering why you are not getting similar results.
Here are five out of a list of many real-world examples of how progressive dealers think versus a typical retailer. So, before you change companies, ask yourself, are you ready to be like dealers who think this way?
1.) Let us start with an easy one–scheduling service online. Progressive dealers want fewer inbound phone calls and chats to schedule service. Is that a typo? No. They think scheduling services online should be easier and faster and ideally completed with just a few simple clicks or voice commands. The common thinking and old KPI’s reward conversion metrics for more calls and chats. The more conversions, the better, right? Wrong. Progressive dealers consider those KPIs outdated, less attractive, and not in the best interest of their customers. Ideally, they want most service appointments to be scheduled online without ever requiring a customer to speak with a human or chat with a bot. More online service appointments and fewer inbound calls/chats equal fewer failure points with decreased operating expenses.
2.) Progressive dealers believe in providing customers with all the information they need online to complete a sales or service transaction quickly and efficiently. Providing their contact information is only a voluntary step along the way. Traditional thinking requires the customer to provide all their contact information as a necessary first step. Most dealership advertising and websites are littered with interruptions during the process of requesting contact information. Innovative dealers need traditional leads but focus more on developing a seamless information-based customer experience without interruption.
3.) Progressive dealers believe the primary purpose of their website is to facilitate sales and service transactions. Commonly, automotive websites are overwhelmed with slow 3rd party widgets solely designed to extract contact information from consumers in exchange for the promise of a better deal, accurate price or payment, higher trade value, etc. Conversions, not transactions, are King. Progressive dealers believe these constant distractions undermine the very purpose of their website, which is to help them sell and service more cars.
4.) Progressive dealers believe in the value of humans answering inbound texts during business hours. As a percentage, there is no higher type of engagement that converts to a sales or service transaction better than a well-written text exchange between humans. Text is, by far, the most preferred method of communication among adults in the US. Unfortunately, typical thinking is to outsource 100% of these opportunities to bots that cleverly gather customer contact information and routinely end with “Sorry I can’t help you with that. A member of our team will contact you”. A phone call is an opposite outcome the consumer prefers, but ideal for typical retailers who believe their websites should primarily extract information from consumers so they can follow up later. So, rather than having a live exchange upfront, they delay a potential transaction with the hope of reaching a customer later. Progressive dealers think that is illogical.
5.) Progressive dealers prefer fewer technology applications with deeper integration for the companies they choose. Conversely, traditional thinking is, “We cannot put all of our eggs in fewer baskets.” Dealers who think like this often work with 15 or more companies to string together a disjointed customer experience. Progressive dealers gain their inspiration from companies like Tesla, Carvana, Amazon, and others with innovative, fully integrated platforms like Apollo, which provide information and facilitate transactions openly.
Progressive thinking is hard to adjust to because, for 20 years, marketing efforts and websites have delivered a high volume of lead forms and phone calls, not transactions–two distinctly different outcomes. Tesla, Carvana, Vroom, and others have designed their entire platform from scratch (without widgets or independent retailing tools) to facilitate transactions. Their main call to action is to create a secure online account that allows consumers to facilitate a transaction from start to finish. Everything else is a distraction in achieving that goal. We agree.
The bottom line:
The company and technology you choose should reflect how you feel about retailing. Before you make the switch, ensure you are equally committed to thinking differently. Your belief system will dictate your success. Take some time to think about it upfront, so when something does not go as planned, you can stay the course. Along with our progressive clients, we believe the 20-year-old KPIs are outdated and increasingly less useful. Completing sales and service transactions with simplicity and ease should be considered the new standard for success.
The Shift from Retailing Tools to a Transactional Platform
This Thursday, April 16th, I am hosting a webinar with Automotive News to discuss the future of digital retailing and its necessary evolution in the current customer experience landscape. At NADA, we launched our website platform, Apollo Sites. Since then, I have answered the questions below hundreds of times and thought it might be helpful to publish in advance of the Automotive News webinar.
Q: Why is Team Velocity adding primary websites to its Apollo platform?
A: Here are the top 5 reasons in no specific order:
- Most of our leadership team came from the automotive website space and carried lengthy non-competes. All our non-competes in the automotive website sector expired allowing us to re-enter the website space.
- Many clients asked us to integrate a primary website with a digital retailing application into Apollo using the same technology that generates and deploys all their other advertising. It’s a logical extension of Apollo and a space we know well having previously owned two of the largest privately held website companies.
- Our clients are focused on retention just as much as gaining new customers. They asked for a better-performing website that would provide relevant and personalized experiences for their current customers rather than treating existing customers the same as the public. They said, “integrate my DMS and make my website work like Amazon.” So that’s exactly what we did.
- A dealership’s website is the hub of their advertising efforts. Our clients need their ads on all other mediums – like Google, Bing, Facebook, YouTube, Email, Direct Mail, etc. – to identically match the sales and service offers on their website, 100% of the time. Dealers lose credibility and opportunities when their primary website is not a perfectly aligned extension of all their other advertising. So, we built a website platform that matches every offer, to the penny, on every single vehicle in stock, across every customer touchpoint, 24/7/365.
- Our clients are increasingly frustrated with the current mentality of most existing website providers. Significant traffic is driven to a dealer’s website, with the hope that the website will generate not just “leads” but an actual service or sales transaction. Unfortunately, many websites are solely focused on generating “forced” sales leads by requiring consumers to fill out a lead form just to get basic information. They also require expensive widgets and plug-ins, have poor performance ratings for speed and mobile friendliness, and can’t distinguish a current customer from a prospect. The “get e-price and unlock savings” is 20-year-old thinking and offers little in terms of useful information. We built a website that fulfills our vision: deliver a friction-less consumer experience, from the initial engagement to a final transaction. Using Apollo’s technology, we dynamically generate a personalized, customer-friendly, widget-free website that is highly rated, independently, for its performance. Our website platform is called, Apollo Sites.
Q: Do Apollo Sites have a digital retailing solution? If so, what’s different?
A: Yes. Apollo Sites has a digital retailing application called Transact. It’s unique from other digital retailing tools because it’s built natively into the entire website platform, making it easy for consumers to navigate. Our vision wasn’t to have just another digital retailing tool, but an entire transactional website platform. Transact is fast on mobile devices and uses the same UX as the website. Consumers never leave the dealership’s site and all the reporting is included in the analytics. Also, when current customers sign in, (using something as simple as their phone number or email), all their information is pre-populated, so they never waste time filling out forms, figuring out their trade value, equity, payoff, etc. Existing customers have a very fast and easy ability to complete another sales transaction with ‘one-touch’. This feature is critical for dealerships who have databases they need to retain. The existing digital retailing solutions are plug-ins to a dealer’s primary website with entirely different UX, reporting, etc. And, they treat every customer like the public. We think this is not only illogical but archaic by today’s standards.
Q: How about Service Scheduling? Does Apollo Site have that capability?
A: Yes. Apollo Sites was built with a complete service scheduling application that allows a customer to schedule service in about 45 seconds. Thus far, it’s generating 2-3x the number of online appointments as the leading providers in every implementation. An added benefit is that it automatically runs all service appointments through Apollo’s equity tools to alert the dealership when service customers are in a good position to upgrade, what specific upgrade options are available, and calculates to-the-penny payments for that particular customer. Everything is integrated, so there isn’t a need for any additional expensive equity mining software.
Q: Given the current challenges related to Covid-19, is there any technology to facilitate service and sales transactions outside the dealership?
A: Yes. Even prior to the Covid-19 outbreak, we were building virtual dealership applications to help our large metro dealers go to the customer versus the customer coming to them. What was once a nice benefit has now become a necessity. Every aspect of Apollo Sites allows customers to select options to have their vehicle picked up for service, sign up for test drives completed remotely, and, for vehicles purchased online, to have their new vehicle delivered offsite (if the dealership is capable). All of this is easily managed in Apollo’s appointment system or can be delivered to a dealership’s CRM.
Q: How are the OEMs reacting to the Apollo Sites?
A: Some of our best meetings have been with OEMs because this new technology solves many of the challenges they face. First, because the OEMs are hyper-focused on loyalty rates, the ability to offer existing owners a personalized, custom experience is ideal. Just a 1% gain or loss in retention is substantial for any OEM. Second, Apollo Sites creates a personal website for every customer, pre-establishing a “one to one” relationship. Dealers can immediately offer existing customers their best pricing without forcing a customer to “get e-price or unlock savings” on their website. OEMs love that feature, and some are starting to think about further personalizing incentives with this platform down to the customer level. Third, current website providers basically outsource Fixed Operations to 3rd parties. Service is an afterthought at best, but the OEMs all recognize the relationship between sales, retention and service. We built all service components into the website platform natively, with zero widgets required. Customers love how easy it is to schedule service, check their service history, get their own custom coupons, have their vehicle appraised while their car is in for service and the ability to check their vehicle’s value anytime. The first major OEM who reviewed the Apollo Sites website platform quickly added us to their list of approved providers, which was a very encouraging sign for our dealerships.
Q: What inspired the innovation behind Apollo Sites?
A: It’s just all new thinking. And RE-THINKING what we thought we knew. We were most inspired by the concept of Amazon Prime. Nothing in our industry, except perhaps Tesla and Carvana, have fully adapted to meet the consumer’s expectations. The current offerings lack the kind of thinking and features our clients expect from a website. And we are just getting started with this new integrated website platform. We are re-investing another $6M in 2020 to further improve the Apollo Sites website platform and plan to introduce many features that will be entirely new to our industry. We aim to set a new and very high standard of excellence for both consumer experience and for what dealerships should expect from their websites. Our focus is squarely on facilitating sales and service transactions for both existing and new customers.
Q: The evolution of Apollo to include websites seems like the final piece of the puzzle. Will there be another generation of Apollo?
A: The addition of Apollo Sites has certainly enhanced the entire Apollo platform but there will certainly be another evolution.
Here’s a hint on what we are working on next…
What if a dealer’s website, not their CRM, dynamically generated beautiful, relevant, image-based, follow-up automatically? What if it was based solely on ALL the behavior and data collected on each customer and cross-referenced with the DMS? Just like Amazon, VRBO, etc., when customers complete a sales or service transaction, they automatically get new and relevant messaging. Our goal is to create a smart website that focuses on generating service and sales transactions, not just leads. Dealers have been in a stranglehold with outdated, text-based follow-up emails that don’t work well because ADF-XML technology is literally 20 years old. Yet, everyone still uses it. We consider it digital road-blocking and it kills progress. Think about it and stay tuned.
Want to learn more?
If you want to get a deeper dive on the changes we see coming, please join us with Automotive News on Thursday, April 16th at 2pm. You can register here.
Mission Improbable: A Game of Technology Tag
Before I get to the heart of the article…you might rightfully point out that I missed a few large technology silos. You are correct. I ran out of room, so I included the most common and universal categories that apply to franchised dealerships’ most popular sales and service advertising strategies. And, you would also be correct that some excellent companies are missing all together. Agree, let me know who is missing. The companies included are all great at what they do, and I listed them alphabetically. However, adding more silos and logos only makes the reason I am writing this more relevant to the challenges faced by dealerships in the current 2020 ecosystem.
Now, if you are an entrepreneur, what an impressive list of companies that make up much of the technology ecosystem in the automotive industry for advertising. Some of them cover one silo perfectly while others dabble in 2-3 silos. A few of these companies are worth billions of dollars and many worth hundreds of millions. Not bad, right? But when I reviewed this graphic with my dealer friends, I discovered the average number of companies they work with to help sell and service cars was between 10 and 12 from these main ad categories alone — but way more vendors are required. This is just the tip of the iceberg.
I call this “Mission Improbable”, meaning it’s highly improbable this siloed model is going to succeed. Here are some comments from good, really good, retailers who passionately want to create a frictionless customer journey for their new and existing customers and do it in a way their internal teams can efficiently and profitably execute.
“A world-class customer journey isn’t possible with this many companies and competing technologies involved. It’s too hard, so we settle for mediocrity.”
“It’s like a game of Technology Tag and I am always it. Nothing quite works together like we are all promised.”
“We have 8 offer management platforms just to price out cars and create compliant offers. None of them are consistent. It’s no wonder customers lack trust in our process.”
“I have 4 franchises; my OEMs all use different certified vendors in their Co-Op programs. It compounds our challenge by 4x. It’s getting worse every year.”
“It’s too expensive and the real costs are all the people we need to hire, train and re-train in order to use these technologies that were never designed to work together.”
“All these companies are all chasing the exact same people. I only have two types of people to sell or service…my existing customers and prospective new customers in my market. Is it really that hard?”
“We have all been so focused on the customer journey, we all forgot about the dealer journey through all of these independent platforms.”
So, the problem for dealers is logical and well-said by the growing frustration of dealerships who are spending more for technology and getting less of a return, if any.
What’s the solution?
With every big challenge comes a great opportunity to solve it. As we enter the new decade in 2020, I would propose some or all the below suggestions to help combat Mission Improbable.
Here are my Big 5.
- OEMs. I would encourage you to do this ‘silo’ exercise with your current and future programs. Some technologies are setup to share data and integrate with other companies through secure API’s. Some are not structured to integrate and never will. The current universal method of sharing data is through ADF-XML which is 20 years old. This was originally designed for getting lead forms with very basic data into a CRM. The entire world has changed, and data integration has exploded. You have the power and position to force real integration across silos to dramatically improve the customer journey while reducing the burden on your retailers.
- In 2020, you will see companies (like ours) continue to develop and rollout technology that already integrates and connects the silos. We won’t be alone, but the customer journey now touches everything from targeted communications like email and mail, to all the major digital media companies to websites. Integrating all those offers and experiences is the best way to ensure a positive customer journey. Just look at the most successful digital retailers like Tesla, Carvana, Amazon Prime, etc. Less technology silos, less friction, less expense, and more of what you want…transactions.
- We must rethink 20-year-old technology as the primary manner to share basic data amongst companies and platforms. I am hopeful, but doubtful, that the current landscape is ripe for this type of cooperation.
- Consolidation and/or real integration. Some of the companies should get together and start creating “Reese’s Chocolate Peanut Butter Cups” with their ingredients. Dealers want less solutions that do more and are easier to use. I can see some solid partnerships forming in 2020 that offer dealers and/or OEMs fully integrated solutions that were intentionally designed to work together.
- Go Direct. Digital advertising is perhaps the most siloed, crowded and fragmented of them all. Starting with the public groups and the large privates…dealerships are going to start to bypass traditional digital vendors and OEM programs all together. By either creating a solution themselves, or by endorsing a few existing tech platforms, the big media companies have everything to gain (and so do their advertisers) enabling dealers to advertise their inventory and services directly without the need for an agency. Think about it, what value does a travel agent offer its passengers these days? Very little. Google, Microsoft, YouTube and Facebook will have to look at this in 2020. There is too much at stake not too. And while standalone franchises might be able to muscle through the myriad of companies in these silos, large groups have to scale and be more efficient. Dealers will develop direct relationships with the major digital media companies that the vast majority of their money is already flowing into. It only makes sense for them.
I am going to be at NADA this year with Team Velocity at Booth #4288C in the main hall. If you want to talk more about this, or set up a time to see how we are solving the game of Technology Tag, please send me a private message.