"When the pace of change in your industry exceeds that of your business, the end is near."
Find yourself desperately trying to hold on to control of the customer and the purchase experience while the world evolves all around you? Join the crowd. The traditional automobile dealer is at a crossroads. A defining moment of truth. The actions you took yesterday, today, and tomorrow, shape your future or lack thereof.
I come from four generations of car dealers and have dedicated over 30 years of my life to this business. I have great respect and love for the industry. It is this passion that compels me to sound the wake-up call.
While there are many hugely successful dealers across the country, too many continue to operate in stale and obsolete selling environments, despite the empirical evidence of a constantly evolving and more discerning consumer. A consumer aided by a digital world that exposes information once held in sacred secrecy. For those dealers who try to cling to practices reminiscent to the days of old, new progressive and innovative competition looms large steered by sophisticated leadership teams with an eye on easy prey. More and more, the enemy is our own success. Dealer profitability today fuels the resistance to change. It is why so many are leery to make the necessary course corrections to get their business on track.
Dealers throughout the U.S are successfully failing to the tune of millions of dollars a year in unsustainable long-term business models, blinding them to the consumer-driven car buying evolution unfolding right in front of them. History is littered with examples of industry giants no longer with us who resisted change and innovation.
The fatal mistake made by Blockbuster, Polaroid, Pan Am, General Motors, Compaq, and many more was that they stopped listening to the voice of their customer and resisted innovation. In 2000, a small, but up-and-coming company approached the industry video giant, Blockbuster, with an offer to sell them their company for $50 million, but Blockbuster passed, regarding their business model as "small" and "niche" despite clear evidence to the contrary. In 2010, Blockbuster filed bankruptcy. The small company they dismissed 10 years earlier for $50 million is worth $194 billion today. We know it as Netflix.
There's no crystal ball out there that provides a clear path to success in the ever-evolving complex world of commerce, but there is an absolute, tried, true, and tested blueprint for failure.
Before 1900, human knowledge was doubling at the rate of every 100 years. By the end of WWII, it was doubling at the rate of every 25 years. Today, human knowledge is doubling at the rate of every 13 months. In the months and years to come, it’s believed that the build-out of IoT (Internet of Things) will double our knowledge every 12 hours. In an ever-changing world, the one thing we can all count on with any level of consistency is that nothing will ever stay the same and the rate of change will accelerate with each passing day.
What can a dealer do?
Step 1: Accept that most of us are extremely late to the party. Luckily, that actually works to our advantage, but not for long. Because the industry's resistance to change has been so widely embraced, there are very few holding us to a higher standard. But if you're conscience today, you can't help but see that times are most definitely a-changing.’
Step 2: Commit to change up your strategy today.
Step 3: Arm yourself with the information to craft your plan.
Step 4: Surround yourself with like-minded people who can help take you to the next step.
Step 5: Employ strategic partners that can provide you with the tools and consult with you to get your organization pointed in the right direction.
Step 6: Execute your new strategy!
This level of change is not for the weak of heart. Those undertaking this journey will have to steel themselves for radical change. Most of us have waited so long to change that we’re 20-30 years behind. This is a complete overhaul of your business, and you’ll need to employ those who lead the charge of change to help guide you down the path.
The automobile dealer is one of the most significant, integral, and important contributors to our country’s cultural and economic growth over the past 100 years. We owe it to the generation of automobile dealers who came before us, who represented progress and innovation, to answer the call of change.