Technology Has Transformed Dealerships

August 2012, Auto Dealer Today - WebXclusive

by Joseph Clementi - Also by this author


The automotive industry, like almost all industries, is significantly impacted by technology. Through technological innovations, processes in all areas of dealership management are improved for both the consumer and dealer.

It wasn’t that long ago we were writing credit applications by hand and submitting them for review via fax machine. The interaction between credit analyst and F&I manager was handled via telephone and not instant messaging. Data collection took days, and deal stipulations had to be created from following the snail-mail paper trail. Contracts were one-page documents that required a single signature.

CRM systems existed if/when we were lucky enough to capture a customer’s name and phone number and write it on a scrap piece of paper. Sometimes, the salesperson was fortunate to write the customer’s name on the back of his or her business card. That same business card was torn, battered, tattered and stuffed through the washing machine. Modern CRM/ILM systems integrate with DMS systems, improving data collection, marketing campaigns and response times.

The vehicle appraisal process was done by hand using guides that were, at best, weeks behind the market. Used vehicle pricing was set by the used car manager’s “feel” for what the car would sell for and the likelihood of how fast it would sell. Inventory aging was dictated by how long it took to sell the car. Today, used-car inventory management systems help us improve inventory acquisition, improve marketing viability and increase profitability.

Customer loyalty was a measurement we used when we saw a sales customer come in through the service drive. Even word-of-mouth advertising, good or bad, was kept in the customer’s general sphere of influence. Dealerships didn’t have the ability to respond immediately when a customer rated performance poorly on a CSI return. The information took days to deliver, and the response was too late to matter. Now, factory-sponsored survey calls provide dealers with next-day feedback from customer visits.

Dealerships rely on the data collection and disbursement of information to help us make a myriad of business decisions. With the advent of SEM, dealerships can accurately measure the return on investment of a specific advertisement. We engage our customer base in different formats as well. Involvement in social media improves relations with existing customers while building trust with potential customers. Technology terms like SEO, SEM, tweets, likes, follows and viral have become as commonplace to dealers as the traditional industry words like OEM, incentives and ACV.

Now we can envision where technology is taking us. Customers who enter the service drive can be immediately linked to our database through VIN scanning. Within that customer’s history, we will be able to tell what service is due on their vehicle, uncover driving habits and link purchasing history. Technology gives us the ability to mine our existing database. We can discover a customer whose vehicle is in an equity position and provide him or her with an in-stock option that gives the customer the ability to move upgrade models and keep the payment about the same. Equity management is the new inventory management, customer retention, CSI-building and used car acquisition tool!

The sales process has seen an evolution of sorts as well. iPads, smartphones and tablets have the unique ability to access information quickly. Sales processes can be integrated into an iPad so that the process from introduction to close can be dictated by the customer’s own level of comfort. The sales process can be delivered to the customer interactively using the dealership’s designated road to the sale. Information can be delivered instantly, serving to reinforce the information our sales associates are providing.

The finance process has been updated utilizing menus that are interactive. We can design a customer-specific menu and present products that meet customers’ specific automotive needs. The menu presentation gives the customer the ability to move the products from display to purchase and the payment and price will change immediately. The advancement in technology in the F&I office has made improving CSI and profits fundamentally connected.

Technology within the dealership environment has the potential to improve satisfaction, training, communication and, most important, profitability.

Vol. 9, Issue 6 


  1. 1. Britt Sutcliffe [ August 08, 2016 @ 11:08AM ]

    All of these new advances in technology are only as good as the team that manages the technology. Typically auto dealers are comprised of Sales People, with management of technology falling into the laps of assistants and office managers. DealerEdge is an industry specific program that takes Technology Management out of the dealer's hands.


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