It’s a well-known fact that Amazon is on a mission to reinvent the traditional brick-and-mortar store model. Until recently, they were mostly focused on dominating online sales. However, it is clear Amazon is now looking to expand its footprint to include offline sales. A great example is the $13.7 BILLION acquisition of grocery store chain Whole Foods in 2017. 

Amazon cleared approximately $258.22 billion in US retail sales in 2018, according to eMarketer’s figures. That is 49.1% of all online retail spend in the country, and 5% of all retail sales.

Let that sink in. Almost half of all online retail purchases are made via Amazon. And they aren’t done. They are now attacking the fact that they have just 5% of ALL retail sales by increasing their offline presence with the addition of traditional stores where customers can touch and feel a product.

This is an interesting trend as, in the automotive industry, only around 3% of consumers complete the entire transaction from start to finish online. The majority of car shoppers will complete as much of the process online that they feel comfortable with -- then come into the store and finish the transaction. The most successful auto dealers are set up to allow customers to buy vehicles the way the shopper wishes to do it – both online and in the store.

Amazon is doing the same thing.

In my opinion, there are a couple of strategies Amazon is focused on to help propel the company towards higher market share in the online and offline retail market.

1.   Adopting a Showroom Model – Many consumers still want to touch and feel a product before they buy it. Amazon is answering this need by adding a showroom model with its increasing footprint of brick and mortar retail stores.

They are also using technology in store to full advantage to help improve the customer experience and drive the purchase decision. With the Amazon app, you can scan the bar code of an item and immediately view its price – while you’re in the store.

And then there are the Amazon Go stores which are rolling out. We have one near our office here in San Francisco, and it’s an incredible experience. You simply walk in, pick out what you want to purchase and then walk right out! Your credit card is charged automatically. Nothing else required. In fact, we had several OEM reps visiting our office last week who specifically asked us to take them to an Amazon Go store so they could see firsthand what Amazon is bringing to retail. They were completely blown away by the experience!

I bet that Amazon will do well with this model and blow its competition out of the water. Just watch – people will be surprised and upset at how ruthlessly it drives out other brick and mortar stores.  

2.   Customer Experience – Amazon has really mastered the art of the customer experience and continues to come up with innovative ways to put the customer first, removing friction from the buying process. In fact, one-third of the population of the United States are now Amazon Prime members, as of January 2019.

With same day delivery and a simple return process, Amazon continually meets consumer needs. In most recent news Amazon partnered with the retail chain Kohl’s to enable consumers to return items purchased on Amazon without going through the hassle of packaging up and shipping the item back to them for a refund. This is mutually beneficial to Kohl’s and Amazon.

Kohl’s, however, may well be that fish that eats the algae in your fish tank -- they are banking on the fact that consumers with Amazon returns will also spend money at their store, while Amazon is further greasing the wheels of its customer experience. Only time will tell who benefits most -- but I bet that it will be Amazon. 

Amazon’s rise to dominance is in no way a mistake. Everything they have done is intentional and based on the following facts: Consumers want transparent pricing, they are impatient and want the items as soon as possible. And, if they aren’t happy with the items purchased, they want an easy return process.

Amazon’s strategy has enticed 100 million people in the United States to PAY THEM for these services. To the point that people will pay more for the simple convenience of shopping on Amazon rather than taking a trip to Walmart or Target where they could get the item cheaper; I have done it myself!

Investing in customer experience and providing a seamless transaction has merely increased their gross margins – not lessened them – which is the fear of some dealerships I talk to.

Perhaps it is time to take a lesson from the most successful online retailer in existence and provide consumers the experience that they want when they purchase a vehicle. My money is on Amazon’s strategy. Dealers that provide a seamless customer experience will prosper. While those that don’t could well lose market share.

SAN FRANCISCO, CA –April 23, 2019- — Prodigy, a unique, seamless online to in-store sales platform for automotive dealerships, today announced the release of a Spanish version of its online sales platform. The platform is built organically from the ground up in Spanish, enabling customers to research and shop online on the auto dealer’s site in their native language with proper syntax and grammar, resulting in increased leads and sales from this demographic.

According to the 2016 Census, Hispanics comprised 17 percent of the population of the United States; around 55 million people. The Census Bureau estimates that by 2060, Hispanics will make up 28 percent of the population.

“We have a large footprint of dealers who serve Spanish-speaking communities, such as the Miami, FL area, and we've adapted our platform to serve these customers better. It’s one thing to have a Spanish speaking employee who can talk with customers in a way they understand. However, what about engaging them when they aren't at the dealership, how do you do that? Through your website! That's where our new Spanish online version comes in. These customers will better understand you and, as a bonus, feel that your dealership cares about them and their ethnicity, and can genuinely assist them for all their sales needs,” said Michia Rohrssen, Prodigy CEO.

Prodigy’s patent-pending SaaS platform was designed to enable a seamless transition from online to in-store sales and vice versa by allowing dealers to engage their customers both online and in-store, delivering a consistent, modern experience with one platform. It boosts profits, builds trust and reduces sales turnover.

The platform has been rigorously engineered and tuned to the specific needs of auto dealerships seeking a next-generation solution that enhances all aspects of the customer experience. Prodigy enables online, instore or a bidirectional blend of sales between the two and ensures process management compliance, full lender/factory/credit bureau integration and a range of sales experience enhancements such as on-lot driver license scanning for instant drive tests. Prodigy fully integrates with all legacy systems and dealer-specific software.

“Today's car buyers conduct a majority of their research online. If Hispanic-speaking customers cannot understand your website, it's the same as if they were standing in your showroom unable to talk with your salesperson. However, if it happens online, you may never have the opportunity to correct that situation and could lose plenty of potential sales as a result," Rohrssen stated.

For more information, or to schedule a demo, visit, https://getprodigy.com/. Alternatively, call, 1-833-DEALER5 (1-833-332-5375).

About Prodigy:
For more information visit, https://getprodigy.com/

If you haven't heard already, Tesla was in a world of hurt after reporting its Quarter 1 sales. In fact, the pain was so great that some could say it almost became the Titanic with a series of unfortunate events including sales reported lower than expected, missed essential tax credits and Elon Musk was forced to appear in front of the SEC as he was unable to keep his (Twitter) mouth closed.

Tesla sales fell 61% in the United States and 31% worldwide resulting in an 8% drop in stock price. While that may not sound like a lot, that effectively reduces Tesla’s market cap by $17 billion! That’s nothing to shake an iceberg at!

You do have to give Elon Musk some credit though. While his changing behavior puzzles and angers many, he’s also widely regarded as a visionary and a genius. But, while his cars are beautiful, innovative works of art, it seems he can’t get his fundamentals in place to solve the problem of auto manufacturing and sales at a scale that meets promises he has made and keeps up with consumer demand.

It doesn’t matter how great the vehicle is if Tesla can't deliver it. Also, cars need to be serviced and, while Tesla seems to be working to make that easier, it just can't effectively handle sales and service with the limited number of locations it has. There is a reason why Toyota and other major brands are so successful … because they are accessible!  With a Ford dealership every 3 miles, consumers find it really easy to buy and service their Ford vehicles. In fact, Ford has about  3,000 dealerships in the United States alone!

Do you know how many Tesla has?

Eighty in the United States.

While Elon Musk tries to reinvent the retail vehicle sales system, it looks more like his sales (and stock) have taken a ride to Mars on SpaceX.

Almost all of Tesla’s sales are online. Customers can touch and feel a car in a gallery -- but not THEIR vehicle. Anyone that sells cars knows that the getting the customer to take mental ownership of a car is the whole point of a test drive and, by tapping that emotion, it becomes much easier to close the sale.

But Tesla can’t do that. Why? Because Elon Musk is busy fighting with state auto dealer associations and legislators so he can have his direct-to-consumer model. Meanwhile, vehicle manufacturing and sales are suffering.

Perhaps it is time for Tesla to reconsider its strategy. Vehicle franchises have been around for decades and are likely to continue for a long time yet. Tesla has undoubtedly created and adopted some cutting-edge technologies, including over-the-air updates, and their cars certainly have sex appeal. The company has also made the process of BUYING a car online a breeze (even though it can’t necessarily deliver one on time.)

Perhaps if Elon Musk were to adopt a franchise model, he could put the legal woes, battles, sales issues and, potentially even manufacturing issues behind him. And, here's a thought, maybe this could be made even simpler if he partnered with an existing manufacturer that has an established quality manufacturing infrastructure.

In my opinion, that is how Elon Musk and Tesla can break away from the iceberg and continue their journey. Failing to do so just means that "all aboard" are bailing water to stay afloat.

And we all know how that story ends. I’m sure we’ll read all about it on Twitter!