Official Dealer

Official Dealer

Of Auto Dealers and Icebergs

There’re Not Enough Life Boats! Few phrases are as closely linked to tragedy as this one. For the remaining 1500 men, women and children left on the Titanic with nowhere to go but the frigid waters of the North Atlantic on that historic night in 1912, the grim realization of their fate must have been devastating.

As I build towards a marketing point I see parallels in this tragic event to what is happening in the auto dealer industry. With deep conviction I feel as though I am recording it as it happens. I see the water rising above dealers’ ankles and I wonder why more of them are not reacting to the danger.

There is no doubt today’s auto dealer is experiencing the business equivalent of Titanic’s grave situation. A jagged berg of competitive pressure and a new, sophisticated customer with much higher expectations have pierced the industry at its weakest links. It is life or death. The parallels between Titanic and the Auto Dealer Industry are chilling; both rely on moving metal for survival.

•Both segregate their customer. Titanic: 1st, 2nd and 3rd class. Auto Dealers: Men and Women. There is a clear distinction in how each are treated.

•Both recklessly race to their destination. Titanic: New York. Auto Dealers: The Sale.

•Both consider themselves ‘Unsinkable’. Titanic by Superior Technology. Auto Dealers by Superior Sales Process. The very strength of which they boast proves to be their weakest link.

•Both dismiss warnings. Titanic: Icebergs. Auto Dealers: Customer Dissatisfaction with the sales or service process.

•Both take dangerous risks. Titanic: Sail Faster. Auto Dealers: Sell more, faster. One risked lives. One risks relationships. Relationships are the lifeblood of existing and repeat business.

•Both struggle to change course. Titanic: ‘Iceberg Dead Ahead’ Auto Dealers: ‘Follow Whatever is Ahead’. Today’s dealers are drowning in a sea of sameness. They cannot resist the influence of their crowd; even as it pulls them deeper.

•Both waste critical opportunities. Titanic: Fill the Life Boats. On Titanic many were launched half-empty. Auto Dealers: Build Customer loyalty. Many Auto Dealers launch half-empty relationships.

•Both experience dramatic collisions. Titanic: The Iceberg. Auto Dealers: Customer Needs, Desires and Expectations.

There is no denying, the auto dealer industry has squarely hit its iceberg. It can be argued it repeats the collision with every negative customer experience.

For the Titanic, slow reflexes contributed to its demise. The same is true for auto dealers; as slow movers grasp false hopes onboard a sinking ship.

•Secure your safety. One of the biggest opportunities in this industry is in serving women. They influence 85% of the purchase decision. Tune into their frequency and offer a sincere experience that is tailored to them. Master this and you will find a safe and rewarding harbor.

•Slow down. Do not collide with your customers…bond. Customer sensitivity is heightened during the car-buying experience. Customers are on the defensive. They are expecting a push. But, a push leads to push-back. End this vicious cycle by moving at the pace they set.

•Get your bearings. The best companies know their customers and strive to evolve their products and services to meet customer needs and desires. Many times companies discover unmet needs which when addressed lead to additional revenue. No business is unsinkable. It must be constantly evolving. Titanic exceeded needs until the needs changed.

•Melt the Ice. Understand that humans are emotional beings. In purchase decisions emotion trumps reason every single time. Unfortunately, most dealers focus on reasoning or misuse emotion. Championing lower prices versus a sincere, respectful buying experience, auto dealers fail to realize customers do not remember prices, they remember how you made them feel. Others use fear and intimidation to force a hand. It is time for those dealers to go down with the ship.

•Follow a truer compass. Get back to the basics of building relationships. Car buyers are looking for someone they can trust. Today, staying on the charts with customer expectations is harder than ever. How do you think the experience you create for your customer compares with their Starbucks experience? Customers are contrasting their best consumer experiences (regardless of product or category) with their experience with you. Do you think you are headed in their direction?

•Take the helm. Unfortunately, fewer and fewer executives are involved with marketing. Noted business management pioneer Peter Drucker once said “there are only two functions that generate customers; Marketing and Innovation. The rest is overhead.” The top needs to be involved and focused on building a sales experience that takes the sell out of the sale.

•Sail under a new flag. It is extremely hard for the consumer to distinguish one dealer from another. The buildings are the same, the products are the same and the gimmicks are the same. Is there any reason to believe the experience is different from dealer to dealer? Differentiation is about communicating and delivering a meaningful difference to your customer. It is finding that one value or niche that strikes a fundamental cord. Differentiation from your competition will prove a major advantage if you are committed to it. There are 100 years of poor car buying experiences associated with this industry. As a dealer you need to distance yourself. You need to become the Un-Car Dealer...and fast.

•Stay together. Building customer loyalty affords great opportunity for those who embrace it. That means staying in touch. Caring after the sale. Growing the relationship post-purchase is investing in your future. Dealers - do you have quarterly ‘Thank You’ events for past customers? Does the GM or others in the management tier regularly call and thank customers? Evaluate your relationship building skills right now – can you name your last 5 customers?

•Abandon pride and ego. Have you noticed that dealer advertising is focused on dealer ego? “We have the largest volume”, “We’re #1”,“We can’t be beat.” Advertising is meant to attract your potential customer, not to pound your own chest. The fact is, the customer does not care about any of these things and they are officially numb to the hype. They are watching and listening for proof points that a car buying experience with you will be positive.

As an auto dealer, the time to scramble for a life boat is now. There are not enough life boats and the most discerning customer to ever shop the planet is choosing who gets a seat.

About the Author

Derrick Daye, is the Managing Partner of The Blake Project, a leading brand consultancy. He helps large and small growth oriented companies design, manage and build brands that drive revenue through differentiated customer experiences. He co-authors the branding blog Branding Strategy Insider, has worked with the White House Press Corps, the National Basketball Association and Johnson & Johnson. Reach him at ddaye@theblakeproject.com or (888)

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