What’s In Store for Automotive Retail?
What are we talking about when we talk about the future of automotive retail?
Not a day passes without seeing an article touching on some aspect of how automotive retail is changing. Speculation abounds: Will dealers exist in the future? How big will car sharing or ride sharing get? What role will giants like Amazon and Walmart play? How many people will switch from traditional ownership modes, like purchase and lease, to subscriptions? And on and on.
The flaw in much of this discussion is that many are trying to land on an answer for what the future will look like so they can plan accordingly. Spoiler alert: YOU CAN’T!
There is no way to predict with a high degree of certainty how or when all this will all shake out. There’s a much better way to future-proof your business…
Here’s how we see it.
We’re not special.
Come to grips with the fact that the automotive industry is one sector of commerce. Not fundamentally different. Not immune from consumer forces. And, auto has resisted change for a long, long time—about 100 years or so. The first step in thinking about the future is realizing that this industry will be shaped by the same forces shaping all of commerce.
Commerce is coming “full circle.”
We know this will be met with skepticism and that it appears that there has been a fundamental change. Granted, the mechanisms and technologies employed in commerce have changed dramatically, but that’s not what we’re talking about. We believe that commerce is returning to the roots that served mankind for millennia. Think about how commerce was conducted for thousands of years, right up until the industrial revolution—it was one-on-one, relationship-oriented and trust-based.
Merchants sold goods to people they probably knew. And, if a merchant were dishonest and untrustworthy, word of mouth would put them out of business.
Technology created mass marketing and now it is destroying it.
Almost everyone who is alive today grew up in the age of the mass marketing that really began with radio in the 1920s. That’s also the age that defined automotive retail—that is, until just a few years ago.
Today, anyone can shop at their convenience, wherever they are, find exactly what they want and have it delivered right to their doorstep. Word of mouth rules and can support or destroy trust in a product or brand.
We’ve returned to the type of commerce for which humans have been hardwired. Commerce where the buyer’s needs, wants and desires are at the center of the equation and the focus of the seller. Commerce where trustworthiness results in loyalty and advocacy.
For automotive retail, this means rethinking dealership being the hub of the business and the product as the focus.
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Future of retail content series
In this series, we’ll be looking at the changing landscape in automotive retail with fresh eyes. Change can be intimidating and most of us have subconscious mechanisms that resist it, but the people and organizations that thrive know how to embrace change and capitalize on it. We’ll advance some thinking on exactly that and hopefully help future-proof your business. Topics will include a fresh look at what customer-centric means, which companies are leading the way, technologies that power the future and the underlying human needs that drive these changes.
- Posted on December 11, 2018