Another new year and even more new opportunities.
If you’re not growing personally and professionally, irrelevance awaits you. I love pushing myself to continue learning more every year and if you’re reading this, you probably do too. Here’s my mental dump on the latest marketing strategies, technology trends and consumer behavior.
Let’s see what’s in store for 2016 in my annual DealerRefresh retail automotive predictions post.
Things are different compared to the last couple of years. We experienced a wave of new strategies and tactics, yet many are still puzzled about how everything fits together. Dealership GM’s, sales manager and Internet managers should be expected to have an understanding of the processes, not necessarily an understanding of the intricate details of core strategies. Management should be focused on building their marketing stack.
This year’s theme and general direction of things to come, is very simple:
- Frictionless, seamless experiences. For the dealer with regards to managing their activities, and for the buyer during their shopping. Not necessarily automatic, rather programmatic.
- Highly personalized, relevant interactions. Productivity will be based around tailored processes. Expect simpler experiences powered by more mouse clicks/screen taps and less keyboard strokes. Efficiency, time savings and answers to questions. The end result: greater productivity and results. These are the key ingredients which have been missing from creating the great experiences every one is promising – and expecting. This will apply to both dealers and to consumers.
Dealerships Become Martech Companies
The platform providers will continue to integrate user data into the customer profiles to connect on levels never seen before. Market data around our inventory will flow faster and easier. vAuto’s new Stockwave platform is a nice example. Automotive platform companies are helping dealers evolve into a unique version of a Martech company. (Not familiar with the Martech movement? They even have their own conference.)
CRM’s were merely acting as Customer Management tools. Expect to see an emphasis on the “R” – making it easier to enhance the Relationship.
Your platforms will tell you more about your customer, their journey and what means the most to them. Personalized data integration will help transform your CRM into a smart, contextual advertising platform rather than repetitive, broad-stroke actions. Larger companies have been plowing resources into acquiring data and additional platforms. (I mentioned DealerFire in a prediction for ’15, they were acquired later in the year) Now its time for the magic to happen.
Cheers to Sean Stapleton for being an early advocate of this philosophy: Focus on customer retention rather than solely on customer acquisition. It’s safe to say we understand the secret sauce is providing relevant, personalized information. Unfortunately, the disconnect is knowing how to piece it all together. Savvy dealerships will have a well defined marketing stack of the solutions powering more seamless processes.
The marketing stack maps the customer’s experience and creates consistency – here’s an example of the stack I created. Our new dealership built a foundation around our processes with many of the same elements. It’s an essential, continuous work in progress.
- Creating Customer Awareness – Organic search, paid search and social media marketing platforms
- Lead Management Tools: CRM, phone tracking, gateway lead CRM and lead processes improvement
- Improving Lead Conversion – Website data tracking, merchandising technology, integrated marketing platforms (disclosure: also my company) website experience elements and conversion optimization platforms
- Deal Conversion and Nurturing Customers Through The Funnel: Email campaigns, video email and retargeting solutions
- Data Collection and Analysis – Integrated ROI website data, analytics and social media tracking
Content Marketing Matures While Display Advertising Dies
I’ll stop short of saying content marketing is dead. Many have lost sight of what content marketing’s purpose is in the first place. Content becomes valuable once it moves the customer from a shopping phase to a buying phase. It loses all value when positioned to the dealership as the magical cure for every ailment the dealership suffers from.
Dealers will move away from futile efforts of creating content which, in the end, their only result is time and resources being wasted. There will be an awakening of tremendous force; the content is simply not helping and no amount of creative data spinning will make a difference.
Content will be simpler, delivered in short form and be incredibly valuable. This points directly at messaging platforms or apps, custom notification and solutions focused around providing more context regarding their situation. Diving in deeper, user activities, behavior and general location now have the opportunity to be realistic examples of context. A significant factor contributing to this is the drastic change in mobile behaviors in all age groups. Younger professionals understand this; parents of teenagers definitely understand this. Hopefully you’re seeing more of the reasons why Facebook spent $19 billion on WhatsApp.
Watch our interactions evolve. Each can provide a better understanding of what customers expect and even what annoys them:
- Smarter notifications and actions based on our activities, location and behaviors – Nest, Hue and other Internet of Things devices
- Usage of personal assistant solutions, such as Cortana, Facebook M, Google Now and Siri will create new search channels
- Smart objects such as Dash and Alexa will try to help simplify our lives while also changing how we search
- Interactions with connected cars will also help simplify our lives and data comes to us easier.
- Virtual Reality and immersive content – more on this below
People interact much differently with ad content – specifically display ads. Rather, they won’t interact with them. The rise of ad blockers among younger users illustrates this trend. 27% of Internet users between 18-34 already use an ad blocker on their desktop.(The State of Ad Blocking 2015) Mobile ad blocking will help ruin this space. Display will become a wasted element of ad budgets going forward. Even more proof of how this ecosystem is evolving, Apple just announced they’re getting out of the advertising-sales business. If Apple is quitting a segment, they see the handwriting on the wall. Facebook has 38% of the mobile ad revenue market while Apple only had 5%.
Standalone SEO Gets Assassinated
SEO dies a horrible death. If you are the person searching for an individual search engine optimization service, you are not the person who should be managing SEO. If you’re selling a standalone SEO service, just stop.
Search is powered by the machine. Semantic technology and machine readable data are learning faster than ever and will never stop. The machines understand the content and can predict our intent. Mobile behavior and location is already connected with our desktop activity. Two worlds are colliding and the contextual explosion is happening right in front of us. There is talk of contextual elements within our mobile devices which lie dormant. Apple has said they will not turn it on yet, due to how much information it can provide will frighten us.
You don’t need to hire an SEO professional, you need to hire a team of marketing professionals who also understand data science, shopping psychology and user intent.
Is This Real Life?
Towards the end of the year, we’ll see the early stage of a massive transformation of consumer behavior. Users will interact in ways which are more acceptable and even expected in certain situations. Motion and gesture controls will be more familiar once devices such as the Oculus and HTC Vive quickly become the must have entertainment gadgets. This should also indicate how massive the divide will be, between old-school content creation and this new version of real life – virtual reality.
The OEM’s will be a leading indicator, creating incredible virtual reality experiences for new vehicles. I don’t expect to see this hit the retail level. This will launch the most significant wave of content development and consumer interaction.
I do expect VR products to influence more video usage within dealerships and eventually we’ll see 360 degree video used more frequently. Customers will expect more immersive video experiences. Dealers choosing these formats will change the minds of customers even quicker. A tip of the hat to Doug McIver and Andrew McIver for not wasting any time and shooting 360 video driving tours.
What Do You See Happening?
As usual, you guys shared amazing thoughts, ideas and predictions for this year. Regardless of whether they’re spot on or completely off-base, it’s still great to see so many people share their vision for the industry.
Thanks for sharing. Keep the passion strong, push the needle and have an amazing 2016!
3. As in-car tech evolves, the number of product experts at the dealership will need to increase.
Love reading those articles about when dealers should and shouldn’t see a n outside person. The smartest, most successful dealers I’ve met take the time whenever they need to in order to learn, evaluate their business and grow.
Yes, more pressure will come. The first pieces will come when the Fed lending rate goes up (maybe this week?), any downward pressure is applied (wall street, employment/unemployment figures, etc), incentive changes and the like halt people in their tracks.
And, just like with our clients in 2009 and 2010, those who are prepared will increase market share. 80%+ of the dealers aren’t prepared for a more-integrated digital consumer or improving their digital performance.
There will more platforms to help consumers buy a car online but adoption will be low, although intention will be high.
Given the estimated growing increase of connected devices, responsive and adaptive will be replaced with “are you online-or-offline”? (most consumers will be connected). Many more 3rd parties will make interesting products and solutions for vehicles to grow the connected consumer experience (auto segment is predicted to grow the fastest). These products will connect to interesting dashboards and push new interesting data to power websites, CRM’s, etc.
More vendors will realize the customer journey is not linear and will make disrupting products to accommodate for that . At the end of the day process will become more important than ever and the new gadgets that could be powerful will not be utilized to the fullest. These new technologies will be akin to fitness trackers like Fitbit, Jawbone, etc which provides great data, but unfortunately don’t make you lose weight (yet)…Dealers with the strongest processes will win. The minority that can introduce these new technologies while strengthening their processes will jump ahead even further.
Dealer consolidation will continue at an even more torrid pace. Vendors will be forced to consolidate further to offer the required scale to service the larger dealer entities. Larger, vertically integrated vendors, will leverage their data gathering capabilities to strengthen OEM partnerships, filling the chasm between specialty consulting and existing preferred-partners. Traditional venture capital and private equity will be readily available to fuel the retail automotive growth, as tech-startup valuations soften dramatically. The big will get much BIGGER.
Consequently, the small will have to deliver tremendous value. Mom and pop stores will have to create a differentiated experience, or be forgotten. Those who strategically focus on a specific market segment will win big. The small providers on the vendor side will be collecting their last checks. The scale and complexity of today’s business will wipe out the “generalist.” Those who specialize, and can scale to the necessary level, will soldier on. It’s the time in history to eat or be eaten. Boldest prediction: Despite record sales, FCA goes on life support.