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Jared Hamilton
From: Jared Hamilton
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Joe Orr

Joe Orr President / CEO

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AmazonAuto – Really?

Today I want to talk to you about a potential future I believe is rolling towards our industry at an alarming speed. You see, what I do, is I peek around corners looking for trends that have potential teeth and which could impact the automotive industry. 

Recently I have become very concerned, as there is one particular trend that could be with us in the very near future - as a matter of fact it could be with us extremely soon. Allow me to clarify…

Recently I was at an Oregon Auto Dealers Association meeting as a guest speaker in Hawaii, attended by 300 dealers. As I started my presentation, I explained that I had some exciting news to share. I went on to say that a few hours ago I had received inside information that one of the largest publicly traded dealer groups had just merged with another company. This company was immediately changing its name and the announcement was to be made public in the very near future.

I went on to explain that this newly merged company will be creating a new logo and putting their name on all of its marketing and on all of the acquired storefronts coast-to-coast. They announced they were also going to be searching for even more dealers to purchase over the next 6 to 12 months, in order to expand.

I then hit a button on my laptop, bringing a new presentation slide up on the screen where a fancy logo spun into view, then finally stopped with the new company’s name emerging as:

AmazonAuto

I sat there quietly for about 10 seconds and looked out at all of the 300 dealers. Many sat there with a stunned look of surprise on their face, while others appeared to be more than a little worried.

My wife (who sat in the back of the room) later told me that she had overheard dealers in the background saying “Oh, S**T!”  That would have been my exact feeling as well, truth be told. I waited a little bit to let it sink in before putting them out of their misery by telling them it was not real, but simply setting the scene for the concept and concern I wanted to share with them that day. But one thing was for sure - it was NOT that unreal a concept.

I told them that, while this actually didn't actually happen, (I hope they didn’t tweet it out to the world!) it has a strong potential of happening as soon as today!

Warren Buffett came to this business because he found out our secrets -- that our profits are more than interesting; future profitability potentials are huge; the consumer confidence is low and that there are pain points that can be solved quickly allowing even more profits to be made, all while gaining consumer confidence and even consumer enthusiasm. Wall Street is slipping into our business - it's a reality. This could happen.

So tell me, what would happen, if all of a sudden one of these stores – an AmazonAuto Honda (or any make) popped up right next to your dealership?

We’re all making a lot of money right now. We’re breaking records. Our golden goose is still very fruitful. But wise voices are starting to say “This too shall pass.” Are we, as an industry, ready for that day?

Our industry has the potential of changing overnight. I think we need to prepare ourselves. Consumer confidence is something we need to gain. I invite you to think about preparing for the inevitable. Wall Street thinks we, as dealers, are too slow to change. We are the last business vertical, worldwide, that is still struggling to get into Automotive Retailing Online (ARO).

Online retailing is just now gaining inroads into the retail automotive space. And it is important to recognize that. We do not have to challenge or reduce our margins. As a matter of fact, we can gain margins. Customers will buy more, and they will buy more often, if their confidence is high and if their experience is pleasurable. Enough facts and research studies have been released to prove that.

ARO is a new focus for us as dealers. I believe we can become more efficient. I know we can have a different type of persona -- shedding any stigma of the past. We can think and do business like AmazonAuto, or ZapposAuto would, as Wall Street says, spend less and make more.

ARO also helps our efficiencies. We simply must gain consumer confidence and smooth out our processes while protecting our margins. For the majority, I promise you it is all about the process, the ease and simplicity, the transparency, the relationship and the enjoyment.

As I stated in the beginning, my job for more than 25 years with a large dealer group was to peek around corners and look at potential trends that may have teeth. As a GM, through my use of this technology, and results my team attained, I was able to prove that online retailing is a reality.

It is also one of the reasons I left a job I loved with one of the greatest dealer groups in the country. Because of my love for this industry, and the great people it employs nationwide, I felt it was almost my duty to go out and spread this word coast-to-coast about automotive online retailing and the need to continue to move toward a more efficient platform. I truly believe it is a vertical that is going to potentially be the most fruitful and the most important change within our industry since the Internet.

Contemplate the possibilities and prepare for the inevitable.

Disclaimer:

AmazonAuto.com currently exists as a reseller of automotive parts only, not as a retailer of new/used manufactured vehicles. The creation of the AmazonAuto logo and fictional emergence of Amazon as an automotive retailer is used only for illustrative purposes and does not in any way affirm or deny the possibility of Amazon entering into the automotive retailing arena. The Amazon logo, name and brand is sole property of Amazon.com, Inc. or its affiliates.

Jared Hamilton

This is awesome Joe given that you published this months ago and just last week amazon announced Amazon Vehicles.  One cannot purchase a vehicle through Amazon, or even use the service to be connected to a dealer like you would on Autotrader or Cars.com... but that could be coming in the near soon.  Amazon is clearly building an automtoive audience for a reason, it will be interesting to see what they do with it.

 

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