Competition is the catalyst that makes the world go around. It promotes innovation, stifles complacency, and brings out the best in our businesses. However, competition can also be extremely stressful. And, with over 36,000 new and used car dealerships in the U.S., it has never been more cutthroat. Here are 3 ways you can stay ahead of your competition.
- Stay aware of your competition
As a business owner, competition presents you with a choice: you can either fall behind it or find ways to outpace it. And, the first step to staying competitive in the auto industry is having a firm grasp of the other players in the game.
To get a better understanding of your place among the competition, it’s important to ask a few questions. What do you offer that others don’t? And, what do your competitors offer that you don’t? Of course, the answers to these questions will change over time, but they also have a tendency to show where customers are going, and which dealerships are doing well.
Take a good look around you. Spend time on other dealership websites, and pay attention to their advertising and social media presence. Use vAuto to study other store room pricing and get to know the key players in the market at industry gatherings and through your business dealings. Again, as you research your competition, ask yourself what they are doing differently. Do they have more of a focus on digital sales? Do they have better customer interaction tools on their website? Are they able to eliminate inefficiencies by implementing better technologies and operations at the dealership level? Once you have the answers, the next step is to make the necessary changes that will attract more customers.
- Give your customers what they want
While getting to know your competition is important, getting to know your customers is absolutely essential. And, one of the best ways to understand your customers is to have an open dialogue with your most forward-facing employees – both on the sales floor and in the service department.
Nobody in the auto industry understands customers better than sales employees. Think about it. They interact with customers on a day-to-day basis. And, before anyone else, they learn what customers like and dislike, both about you and your competition. Savvy dealerships leverage this customer-salesperson relationship to forecast industry trends and adjust business practices. It’s an ongoing process that is constantly changing. In recent years, more and more millennials are passing up purchasing cars and opting instead to lease more luxurious, tech-forward vehicles. In fact, one study showed that 33 percent of millennials prioritize advanced information and entertainment features over advanced safety features – a striking contrast to the 91 percent of 51- to 65-years-olds who prioritize safety features.
- Implement modern technology
Just as customers have changed over the years, technology has moved right along with them. Think about how far technology has come in the past 10 years alone. In 2007, Apple released the first iteration of the iPhone. It was a revelation then, but in just 10 years, the company has made significant advancements to the phone’s hardware and operating system. Now, you can stream videos, travel across the world with voice-guided GPS, and save your information to a secure cloud network. Simply put, the original iPhone is now ancient technology.
The story of the iPhone is just one example of how technology is moving faster than ever. And, in the auto industry, it moves faster than some dealerships care to adjust. If your dealership is running on the technology equivalent of a first-generation iPhone (or worse), chances are your customers and employees are finding better places to do business. And, if your tech provider isn’t making consistent improvements to stay ahead of its competition, chances are your business is falling behind your competition, as well.
Being adaptive is essential to winning the dealership business. And, that involves getting to know your competitors, your customers, and your tech-provider. Ask the tough questions and make the right moves that will keep you competitive. Remember, when it comes to competition, you’re either moving ahead or falling behind. So, be bold enough to be different than your competitors, pay attention to what your customers want, and make a switch to a tech provider that can keep up with your modern dealership.
Paul Whitworth is SVP of DMS and Fixed Operations at Cox Automotive