The AutoNation Brand
By Dennis Galbraith on Jan 31, 2013
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utoNation announced that nearly all of their stores will carry the AutoNation name, similar to CarMax. The shift from the AutoNation collection of stores to an AutoNation brand carries with it a lot of implications. Experimentation will undoubtedly continue, but a brand image demands a high degree of uniformity. You can't have one GM trying to become the second coming of Carl Sewell and another GM under the same brand name going on TV in a clown costume and acting crazy. Some degree of uniformity with respect to promotions becomes mandatory under a brand strategy.
You can't have one store delivering full value transparency and another refusing to price their vehicles online. So there needs to be a uniform level of transparency across the brand, and AutoNation appears clear about their dedication to transparency as a competitive advantage. Already, stores uniformly offer a three-day, 150-mile money back guarantee.
Brand uniformity is easier across used cars, and CarMax has done a good job of it. AutoNation is not including its highline vehicles as part of this move. Selling Bentley under the same brand name as Smart is a bit like trying to expand the Kmart name across Tiffany stores. There will need to be some level of uniformity around the quality level of used vehicles and the quality of customer care provided. The more different the product mix is across a retail brand strategy the greater the need for uniformity around how those products are merchandised and delivered.
Much of the uniformity necessary has already taken place. It would be a mistake to announce a national brand strategy and then hope it can be pulled off. AutoNation has not been secretive about its long move in this direction. By the firm's own accounts, this has been in process for at least 13 years. Other dealer groups appear to be taking similar steps toward the same objective. It will take time.
CNN compared the AutoNation move to becoming the McDonald's of car dealers. I'm not sure that is a good analogy. There are some things AutoNation still cannot do, like national advertising. Outside of manufacturers, only AutoTrader.com and Cars.com have enough national coverage to cost effectively buy advertising on a national level. (I know others have done it, but I said cost effectively.) AutoNation claims to have no ambition of becoming a truly national brand. However, AutoNation already had branding strategies within various regions. There is a reason they are moving forward with a national brand strategy. This strategy of a national brand without national distribution would have been less beneficial in a TV era than it will be in the Internet era.
While I am not permitted to discuss the online marketing I performed for one publicly held dealer group. I can say the Internet has opened new opportunities for retailers with a widely recognized brand name selling dozens of nameplates. In my first book, Sales Integration, I suggested some of the changing opportunities. This first is but one of the many milestones to be crossed in the future of automotive retail.
(Sources used include public documents and articles from AutoNation, Automotive News. CNN, Sun Sentinel, and Bloomberg)
Comments
Such a smart - and overdue - move by AN.
The decision to keep the highline out of the mix is also a wise move; their entire marketing efforts always seemed very fragmented and inconsistent.
And even so, they still did a great job at connecting on the local level with their customers, this should make their marketing efforts even more productive and efficient. (Kudos to their original social marketing team as well: Gary, Stephen and Mallory)
January 31st
Great post. I agree with Eric; this decision should have occured a long time ago. Better late to the dance than never.
January 31st
The logistics of this are nightmarish yet this. is a long overdue move.
January 31st
Dennis, good points.
My first thought: Welcome to Point-Click-Buy. 2 years and they will be nationwide.
My second thought: Lots of risk. What if stores don’t quite go along? There is no unrigging this bell.
January 31st
I think this is a great idea. If they do this right, it should greatly enhance their reputation and that of car dealers in general. It should also raise the bar for independently-owned dealers and groups much as CarMax has raised the bar in the used car markets they serve. All-in-all a great move forward for the industry.
January 31st
I happened to have been part of the initial AN rollout back in the mid-90s in Florida. At first, well-known dealership names were preserved, partially because they wanted to use the AN brand for the used car superstores. The Autoway brand name was then rolled out to the new car stores in FL.
The consolidation of branding should certainly benefit in reducing their marketing overhead and as pointed out by previous comments, improve the overall consistency in customer expectations. I can tell you from having worked for other national retailers through many acquisitions, once you navigate through the internal cultural hurdles, the benefits to the consumer are very evident.
Interestingly, it was not the shuffling of the store names that caused the most heartburn within. It was the adoption of the "one-price" strategy that sent many of the ants off the driftwood.
January 31st
I wonder if there is transparency at AutoNation between their management and their sales staff, let alone consumers. How is transparency defined? Do we reveal all of our costs and negotiate the margin. Do we inform consumers of the margin we are actually making, INCLUDING hold back, trunk money, star step, carry over, etc?
In most stores who brag about their "transparency," none of this is in place. The sales people aren't even provided this information.
January 31st
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