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Jared Hamilton
From: Jared Hamilton
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JD Rucker

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The Irony of Simplicity in Choice for Discerning Dealers

Consolidation

Consolidation is happening. We see it in the automotive industry all the time. Large dealer groups are getting larger. Big vendors are getting bigger. This adds a level of simplicity for dealers as they make decisions for operations, marketing, and processes.

The irony is that this is something the industry needed six years ago when the recession was starting to turn the corner and dealers were making choices on their own. In many ways, there were too many choices. Consolidation back then might have been a good thing.

Dealers were forced to fend for themselves and as a result, the "discerning dealers" chose to modernize their procedures and decision-making capabilities. In other words, they started hiring and training to meet the demands of the digital age. They hired new people or trained old ones who understood Schema.org, responsive design, and behavioral targeting. If they didn't know what geofencing was, they researched it. Many dealers today know more about the various products than the vendor salespeople delivering the pitches.

Today, a good chunk of dealers (such as those who read DrivingSales.com regularly) are well-equipped to vet out their vendors and make appropriate decisions. They can see the difference between products or services that are likely to work and the false systems that have nothing but a slick sales presentation behind them. It's funny that right when dealers are best able to make choices, the options are being limited.

Don't get me wrong. I'm not against consolidation as a general practice. There will be big vendors and little vendors and both have their strengths. However, as companies broaden their scope through acquisitions, they're homogenizing the products so that the selection process for vendors is reduced to one or two options rather than the diverse range of hungry companies fighting for wallet share.

As consolidation increases, quality decreases.

This is made worse by the OEMs. They are also limiting choices in the name of compliance and quality control. The funny thing is that they often make decisions based upon solid financial books rather than solid products. They are more concerned about a recommended vendor being profitable than about the recommended products being the best.

The point of my rant is this: don't let consolidation make you complacent. Just because something is bigger doesn't mean it's better. Just because a company is smaller doesn't mean they aren't capable. Look at the products for what they are and be discerning.

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