The Digital Dealership will focus on the transformative impact of information, expectations and the new channels of engagement with customers and your audience.
Over the past 2 decades we’ve seen a massive shift in the business models of many different industries. We’ve also seen the impact of a changing demographics as new generations come into the working world and as the world of digital communication broadens. The result is a growing gap between the old approach to business, and the younger generations. The old approach to business was built by the older generations who are also, frequently the most senior managers. The newer generations, who are often the buyers, have their own expectations on how they want to carry out business. This collision of generation, technology and expectation creates both the most significant opportunity to differentiate and grow, and the highest risk to existing dealerships. In the past decade alone, we have seen major retailers and corporations lose decades or even a century’s foothold in their industry. Gone are companies like Borders and Blockbuster, and JCPenney almost joined them. Numerous others have simply failed to keep up and been relegated to the margins. Each of these companies failed to react to clear changes in the industry and buyer expectations, while their competitors did.
There are clear differences between the companies that failed or succeeded. Those that succeeded have several things in common. First, they saw the change in the market and buyer’s expectations and changed their business model to address these changing conditions. Second each of these companies started to understand the importance of information to their business and learned how to apply it. Finally, these companies applied these first 2 points to their entire business, they didn’t make it a bolt on to their existing business, which remained operating in the old way.
The first point is probably the hardest to grasp as it’s a combination of 2 inputs each effecting the other to produce an exponential rate of change in buyer expectations. In today’s business world we have 3-4 generations comprising our teams. With some of the last Baby Boomers still in the work force and often in the most senior positions, Gen X is now well placed throughout organizations, the Millennials are getting a strong foot hold in decision making and now Gen Z is entering the workplace. All this means we have some people who started in the corporate world before any computers existed and, at the same time, we have new entries into the business who have only known a world with smartphones and internet. How these different generations see the realm of possibilities couldn’t be farther apart. I’ll admit, I’m in the generation that thinks if the internet goes down, in a store, they should switch to handwritten bills and take cash, but that makes me old. Some people have never seen this type of POS terminal, it’s completely foreign, so they would avoid a store that still uses it. Furthermore, our youngest generations have always been able to find the information they needed, when ever they wanted. When they wanted something, they can order it from their phone. This collision of generational experience gap and changing expectations will drive the fastest change in business to business buying and business process we have ever seen. Change we’re already seeing in other industries.
Information has both contributed to the prediction of change and the resetting of expectations in all areas of commerce. Many of the most admired and referenced companies in our world have been the best at applying information and technology to their business, vaulting them over competitors, or blasting from obscurity to relevance. Information, and more importantly the analysis and application of information, has allowed organizations to foresee changes in the business. They have fine tuned their operations to trim waste and better apply capital. Furthermore, the analysis has driven action and change. Change in how companies engage with their customers and meet their customers’ growing expectations. While personal relationships and partnership remain a cornerstone of any business relationship, the expectation for partnership now includes deeper integration and focus on improving the transactional efficiencies. Information has inspired a massive improvement in understanding the drivers in a buyer’s decision making. It has highlighted the small differences in presentation and product definition that impact sales. The best competitors have combined this insight with a growing database of customer data to capture increases in total sales and market share.
When the acceleration of changing expectations come together with information, we see the genetics of the best of the best organizations. Those “Most Admired”. These organizations have used the information they are collecting daily to see the growing rate of change coming from new generations, and new expectations fueled by technology, social media and digital systems. They apply this analysis to all aspects of the business, changing the structure of the organization. In some industries we’ve seen long standing businesses either change or be replaced by new entrants who understand what a modern organization need to be. For dealers in our industry, both mainline OEM and independents, it’s no longer adequate to meet these changes with partial measures. Your website can no longer be a billboard, your social media engagement can’t just be advertising, your parts department can’t remain a “call for availability” or a “call to place an order” department. Your sales department won’t survive on “call for details”. The growing rate of changing expectations is your opportunity to succeed.
Each one of you have no doubt worked with family-owned contractors that saw a change in generational management. The original owner handing the business to their children came not just with a change of faces but came with changes in the approach to business relationships, focus of the business and new expectations on your role and how to be a partner.
The Digital dealership looks at all these items in more details. We will also look at actions any dealer can take to assess the impact of these changes in their business. We will look at what actions can be taken to implement new approaches to the business and remain a leading competitor in the field.
If you’re going to AED, I look forward to seeing you in the Digital Dealership session, and if you’re not, I’ll continue to develop the details in this blog series.