There is a lot of fear-mongering going around our industry lately. And look, I understand why people are scared. Personally, I have been in the auto industry for 25 years. I’ve seen the good and I’ve sure as heck experienced the bad. A lot of what’s happening around us needs to be properly understood and digested before coming up with an unreasonable response. I won’t beat around the bush…there is chatter about what to expect next, how to react, and what we can do in preparation.
The answer won’t come easy. But we as an industry do have an ally in data and technology solutions. I’ve championed technology on the lot for several years. There have been tons of advancements that have improved the way we acquire inventory, merchandise vehicles, and sell cars. So, my ears will always perk when I hear someone start to use economical fear as a reason for going back to the way things were done in the past. Listen. Now is not the time to jump ship. Technology is getting faster, data is getting smarter, and dealerships have more resources than ever before.
Let me give you an example. What kind of cell phone do you currently use? It’s a simple question, but I would gamble to say that it’s most likely not an old-school flip phone like the original Motorola Razr. Rather, it’s probably something new, sleek, and technologically advanced. Assuming I’m right, would you ever give up your iPhone or Android for the limitations of an older model if given the option? Probably not. Technology is here to stay and will only further improve our day-to-day operations.
Specifically for the automotive industry, technology presents endless possibilities. Over the years, new technologies have revolutionized the ways we do business while also infiltrating new areas of the dealership. This has created a division between what’s viewed as how we used to do things and what needs to be done to achieve future success. There is no need to second guess the importance that data and technology play for dealers around the country.
But let’s be honest, even without technology, things are going well. Profits are up and customers are clamoring for your inventory. I’ve heard stories about dealers turning a profit off of vehicles that they would previously turn away. Now isn’t the time to be picky.
Consumers are hungry for automobiles and dealerships are rich with opportunities. Because of this, there exists a bridge between your customers and your inventory. What this means is that it’s time to put on your consultative hat and coach consumers through what’s available today and what they will have to wait for tomorrow. It’s not about selling anymore. It’s about being a partner in the overall path to purchase.
And the best way to do that is by relying on technology. Over the years, I discovered that data is buried deep into the DNA of our industry. The richer our response to facts, the better we can address consumer needs. This provides more opportunities to improve the customer experience, not hinder it. And when the customer realizes that you are on their side, you’ll create a relationship that extends beyond a simple transaction.
This is all easier said than done, I get that. We know where we’ve been, so the question becomes more closely associated with where we head next. Many voices will have you believe that the waves are crashing hard against the boat; that capsizing is imminent. But is that really the case? Look, we’ve been in unpredictable situations before. 2008 is a perfect example. It was a rough year for many people. Dealerships were pushing so many incentives to simply get foot traffic going. But instead of progress, this reaction caused an all-out race to the bottom.
From my perspective, this taught me a few key lessons. And that was to focus on the 3 P’s: people, product, and process. Specifically for the automotive retail industry, these factors are continually fluid. For each aspect to be successful, you need to have technology integrated into your operations.
Moreover, when it comes to your solutions for inventory management and merchandising, emerging trends prove to be the difference between where we were and where we are headed. Your dealership has the natural ability to sell products, but imagine how successful you would be if you leaned into technology. If you leveraged data in the past, then you know how it can help to train your people, provide a unique product and experience, and deploy a great process for your dealership.
But is that enough?
To really put the pedal to the metal, you have to embrace technology and leverage data from yesterday to today and into the future. When we are talking about inventory management, you must look at your past sales history to get a better understanding of a strategy that works specifically for you. With customers fighting over cars, now is not the time to go back to old-school methods. If you are buying the most expensive vehicles available and your mindset is to sell them for cheap, you are going to lose. Plain and simple. And I don’t want that for you.
Instead, focus on incorporating technology. For inventory management, if you are still utilizing an old system, now is the time to upgrade. The flip phone is out. And you don’t have to be in survival mode any longer. On top of that, data paired with the ability to use OEM window stickers will put you ahead of the other stores. Couple that approach with a digital showroom for merchandising, and you are assisting customers in ways never before seen. That’s the future…and it’s built on technology.
You don’t need to overcomplicate things. Technology is about empowerment. But it isn’t about just you and me. It’s about the customer. This is, after all, likely to be the second biggest purchase they will make. So approach the process with transparency. Give the consumer quality descriptions that actually paint a picture of the vehicle with SEO-friendly words. Use clean images that illustrate the true beauty of the car. This will set you apart. But, data of this caliber can only be found in a next-generation inventory management system. If you are ready for the future, then don’t you think it’s time for an upgrade?
Put the woes and worry in your rearview mirror. At the end of the day, data drives us to make smart decisions. Market and transactional data help us stock. It gives us a true picture of what the industry looks like and provides an opportunity to partner with consumers for a better experience. Don’t be afraid of the economy, don’t be afraid of technology, and don’t be afraid of change. Embrace the future and get rid of that outdated flip phone.
I challenge you to examine your take on technology and audit your data. If it is subpar, then you have a reason to be fearful. Reach out to me directly and I will help you analyze your process and gain an understanding of why a next-generation inventory management solution is a smart choice for your dealership.