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Dennis Galbraith

Dennis Galbraith Chief Marketing Officer

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The Long-Term Forecast

The larger an organization is, the more important it is too see what the market will look like in the future. Size can cause an organization to lose its ability to change quickly, so it must see farther and more clearly. While some organizations do serious work on 50 year plans, it seems to me 5, 10, and 20 year plans make the most sense for auto retailers. These plans require a little knowledge in forecasting.

 

The most important thing I ever learned about long-term forecasting came from Jeff Bezos, CEO of Amazon. He said it was more important to start with the things that will stay the same then to focus on what might change. Here are some of the things I think auto retailers can rely on for the next 20 years.

  1. The dealer’s online domain will remain a critical marketing tool. Today, this is limited to the dealer’s website(s). This may seem obvious, but it is worth noting since the same cannot be said of interruption advertising, tools like newspaper, television, and radio. Nor can one be as certain about any particular 3rd-party site (e.g. Edmunds, AutoTrader.com, Cars.com, or kbb.com). The dealer’s website is the one place the dealer can post all the information they think will aid in the auto shopping process. Much of this data may be sent to other places, willingly by the dealer or unwillingly through scraping it, but consumers will continue to view the dealer’s online domain as the original source direct from the dealer.
  2. Many shoppers will still choose to transition from an online conversation with technological touchpoints to a human touchpoint. An increasing number of shoppers may purchase their vehicle with no human interaction, but it will not be all shoppers and may not be most shoppers. Today, these forms of human-to-human contact are email, chat, text, video chat, phone, and walking in (face-to-face). Email may decline in importance and video chat may become a leading form of human-to-human conversation. What will not change is the dealership’s need to be expert at communicating in all the ways shoppers wish to communicate or contract out that function to someone who can.
  3. Demonstration of the vehicle’s interior will continue or grow in importance. This may happen online, in the store, and probably both, but the portion of consumer benefits being derived from the interior will not diminish. The less important driving the vehicle becomes, the more important it will be to be productive, relaxed, and/or entertained inside the vehicle. Even where the driver maintains the full driving process and rejects all outside stimulus other than the road and its surroundings, the ability to switch over to a fully connected platform will be a standard feature. The importance of the exterior appearance and/or performance may diminish for many shoppers. This seems likely, but the importance of the interior with all its comfort, convenience, and communication features will not be diminished. Many stores have had a difficult time keeping up with the growing functionality within the interior and will need to step it up.
  4. Consumers will demand credible information about the vehicle and the deal. I doubt anyone thinks consumers are going to become less demanding in the amount of information they require. Every shopper is different, but most shoppers today would not spend $20,000 or more on a vehicle with the kind of information they were given 18 years ago. Information demands will not slide back even to the point they are today.

 

This is not an exhaustive list. What things do you see staying the same over the next 20 years?

 

 Note: I will be giving a provocative, detailed presentation at DrivingSales Executive Summit on the way automotive retail will be conducted in 2018. 

Mat Koenig
Dennis, I think you're so right. Unfortunately for so many folks, technology has become a crutch for helping us do 'less' instead of a tool for helping us do MORE. I remember getting our first AutoBase TERMINALS back in 1995 at Battle Creek Honda Mazda (no longer Mazda) and holy golden calf moses...I was blown away at how many more customers I could contact now that I could find their information quicker than my index card file. I went from selling 15 cars to 20 cars per month just because the CRM gave me time to do more. Today, it seems like I see a lot of folks who look at their CRM as a tool to do all their busy work but people just don't maximize the free time that they've been given. I don't think it's because they're lazy though, I think it's because they don't know what to do. Leadership, in many cases, needs to get involved instead of just looking at their CRM reports too and spend more one on one time with the sales reps in the store to help guide them so their team will know how to effectively use the phone, work the service department for referrals, etc. I can't wait to see what will have changed by 2018 but my gut (which is too big right now btw) says that we'll have a wide selection of more tools that empower us to sit back and "come to work to wait". The great news is, there is the smaller percentage of folks out there who will really take advantage of the new technologies, and who understand the importance of being in the PEOPLE business, and those folks will absolutely CRUSH their competition. Thanks again for a great post.
Dee Rawls
Dennis, guru, indeed the idea of a forward-looking vision is vital for participants in Auto Retail Future. Like hitting a baseball, the anticipation of where the sweet spot might be combined with the proper form and follow through can lead to a great success at home plate. As Mat mentions, there are likely to be many additional tools, and the idea of the 'sit back and waiters' isn't likely to change. They may be replaced by robots, though - according to Bloomberg. Also, the most significant constant I see affecting our industry is "Change". As almost no other industry has ever accomplished, auto retail remained the same for over a century in the core defining processes and principles involved with transacting business with the consumer public. At the onset of the Internet, change began to affect the traditional 'Road to a Sale' that anchored the brick and mortar galaxy of Auto Retail Past. More has changed for auto retailers/dealers since the emergence of the Internet as a new information exchange for automotive consumers than had changed in centuries before. I soundly believe, the 'change' is what dealers can count on seeing (possibly in greater proportion than now, even) constant in the next 20 years. And, I also believe, they must step profoundly into the batter's box and be ready to anticipate what these changes might bring down the pipe. Jeff Bezo's was right, paying attention to the things that will remain the same is the name of the game for dealers going into the 2018's and beyond. Change is the thing most likely to stay the same. A Big Championship Trophy Hoist to you and the DrivingSales.com for keeping ahead of the count on informative industry topics like these, Dennis. You are well appreciated, indeed.
Joe Webb
Great work, Dennis. I believe some semblance of technology (regarding a software to house, maintain, continue relationships, trigger tasks) is imperative. Today it is a CRM, but it may not always look as our current ones do. However, that style of technology-assisted management of opportunities will need to remain for dealers to keep consumers engaged. I too believe that a dealer's online presence/entity will be at the forefront, but websites will be 100% different amalgamations than they are now in just 10 years. Lastly, I would say it is the ability to "sell" trust to the consumers. (I hate using the word "sell" there, but I am in a hurry.) ALL consumers, even in 20 years, will prefer to do business with an organization that they trust or have a previous relationship with that they still...well... trust. We, as dealers, need to define all interaction we ever do (and online information we put out on the Interwebs) with the end goal of building trust-based relationships. Our "trust auras" need to be in full bloom for auto dealers to survive the next 20 years.
Dennis Galbraith
Thank you Mat, Dee, and Joe. Wow Chris, an increasing focus on the total consumer experience sounds like a future worth working toward. Great vision my friend!

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