Lessons come frequently, if you pay attention. Lessons are disguised as many different things. Were you paying attention? And to what? What you have control of or what someone else told you? Last year taught us plenty, and it taught us nothing at all. Your point of view will determine which side you’re on (if not both).
Many things in automotive could be easily categorized from what took place in the year that just (slowly) passed by, like ‘data’, however it is essential – if not mandatory – to take a deep look at what resulted in your year. And, how your business got there…. Quite frankly, it was not one thing that had an effect on whether or not your business made it through well.
Let’s deal with the elephants in the room (yes, they’re still there): digital retailing, marketing co-op funds, operations (fixed and variable),and inventory. There are some other, smaller elephants playing patty-cake in your facilities however those are the main ones.
Not on the list, the biggest factor in making lemonade out of 2020 was whether your business was able to pivot in a leaner and, dare we say, meaner environment. More than anything, your ability to pivot and have the entire dealership culture thrive was bigger than anything else driving results last year, as well as the foreseeable future. Staff counts got leaner, and so thinking had to change for the smartest operators.
Many had the dreaded inventory/availability item however seemed to make it through (relatively) unscathed depending on how you secured inventory in unconventional ways. Dealers that could open in what resembled mostly ‘typical’ operating hours over the bulk of the year had per-unit profits that resembled years gone by.
The buzz word (read: buzz kill) of the year, especially OEM-mandated programs, was digital retailing. In our experience, same-store sales completed by digital retailing , based on opportunities grew incrementally (at best) and provided some daylight as well as perspective into what is possible going forward. Listening to industry-wide data along with CRM-based results, showed that there was a ‘lift’ from these tools, however not the godsend promised by any stretch of the imagination. That said, the dominant driver of tool utilization shows that what consumers want to do is know how much to expect to pay per month for a truck, sport utility, crossover or car. As OEM bolt tools on their websites (and charge franchises for customer/transactions that predominantly end up as showroom visits), we are now looking at the data play IM@CS has been telling dealers about for nearly a decade.
Many operators experienced lift in used car operations and fixed/service operations, while some even had banner years for their parts operations. No matter what, the theme seems to be making it known that you offer full-service and customer service and customers showed up, called and wanted it shipped or you picked up and dropped off their cars for sales and/or service. Hold on for a moment….2012 called and wants their flexible business ideas back…guess we’ll have to take those “idea trophies” back.
2021 is going to present huge challenges and opportunities, you can determine your own path to success as long as you have dogged determination to not resort back to the 1975-2015 mindset. It’s easy to do when profits remain high and some semblance of inventory remains.
Are you genuinely vested in your marketing (focusing on equity mining in 2021 as a new strategy doesn’t qualify as ‘your marketing’), messaging and operations? Market driven factors aside, do you already see your February and March plans in place and starting to shape your reality?
Be ready for more shifts in local marketing, specifically search engine optimization and citations, paid search and measured conquest opportunities. Other than those, don’t think or blink too much. Because if you don’t drive your business, as in 2020, you’re simply focusing on keeping your hands and feet inside the ride at all times… Don’t wait!
Best Practices, Professional Insight, Powerful Results