Responding to Market Conditions

I hope some of you had the opportunity to attend the  Australian Automotive Dealer Association’s National Dealer Convention this week in Melbourne. It was a a brilliant three days that really cemented the state of affairs for the motor industry and highlighted some exciting challenges ahead.

I had the honor to speak at the event, where I discussed the national benchmarks for dealer operations and critical indicators through 2017. 

Earlier this week I wrote about the current state of the motor market, now I would like to cover how we can deal with this state today and into the future.

One of the hallmarks of best practice car dealerships is the ability to fine tune the business to what’s happening in the market – it’s like adjusting your driving to the conditions on the road. This agility sets apart the leaders in the industry.

At Deloitte, we have access to data from 20 plus car brands in Australia. The insights this intelligence gives us allows us to identify the traits the best dealerships share. Through our unique performance framework we have identified four differentiators the best car dealers have in common.

I’ll  be running through all four differentiators in detail during my address to the Australian Automotive Dealer Association’s National Dealer Convention.  But to give you a taste for what I’m going to say before my presentation I thought I’d use this post to focus on one of these elements and how it can be used to enhance your business.

Our research shows the top dealerships are prepared to boldly rethink their tactics in light of current market conditions. So what do we mean by that?

These businesses are able to predict a change in market conditions. To use another driving analogy, they can ‘see around corners’ and anticipate new forces that will shape the market in the future.

Importantly, they are prepared to change their tack in response to these conditions, rather than simply doing what they always do without regard for how the landscape around them is changing.

For instance, they reconsider their operational tactics when brands release new marketing campaigns each month. They are also prepared to change their business as consumer preferences change.

In particular, they are challenging one of the most well-established aspects of the industry: the road to sale. This first emerged as a sales technique several decades ago, when information on cars was limited to the showroom. It’s been used very successfully by most dealerships since then. But it’s time we moved beyond this to adapt to the customer’s car buying preferences.

The industry is at a point at which it’s time to reconsider the sales journey to ensure it’s tailored to the customer’s unique requirements. Moreover, the better dealerships are using rich data to roll out more targeted marketing campaigns that marry cars to customers. They are also better at capturing repeat and referral customers to underscore the longevity of their business.

This is only the second of many posts on the industry to come. if you would like to hear more on any one topic area of the motor industry, please get in touch.

To download a copy of Dale's talk click here: http://www.slideshare.net/DeloitteAustralia/aada-deloitte-motor-industry-services-profit-focus

This article also features on our Deloitte Private Blog - To see the blog or read other articles related - click here

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