Dealership Communication Tools

Can integrated CRM systems replace the DMS?

Some dealers have a love/hate relationship with the Dealer Management System (DMS). They depend on the functionality that the software brings but they hate long-term contracts and the cost associated with the technology.  Placing a value on DMS is not the point of this article.  I would like to focus on the death of DMS systems, as we know them today.

Rarely do I see online forums discussing the latest updates or features in DMS software.  This may just be a reflection on the “boring” nature of DMS software or the lack of real updates from DMS vendors.  What I do see are article about the new features added to popular CRM systems.

Customer Relationship Management (CRM) software was originally a way to track leads and customers in a database.  Early CRM software made it easier to create follow-up systems via phone or email.   The CRM software had a defined role.

Today, when you look at automotive CRM software, the scope of features and functionality are significantly larger than the original definition.  CRM software is becoming the operational “dashboard” for the dealership.  Automotive CRM software is integrating data from dealer websites, Adwords, Analytics, inventory, merchandising, leads, phone systems, mailing houses, and the list goes on.

I found a marketing flyer produced by VinSolutions about 2 years ago.  This excellent marketing tool asked dealers to write down the costs associated for software products and tools used at dealerships.  At the bottom of his long list, the dealer was asked to total up all those costs.   The punch line was that the VinSolutions website technology and CRM replaced all those individual expenses.  It made an impact on me and I’m sure on dealers as well.

That was two years ago!  Since then VinSolutions has added dozens of new features to their integrated marketing platform, which stirs up some questions for us to discuss on DealerRefresh:

  • Is the new breed of CRM products designed to eventually replace the DMS?
  • Will the best integrated website and CRM companies get dealers stay glued to their integrated tools and reports?
  • Will DMS become a secondary player; a plugin to the integrated marketing platform’s dashboard?

VinSolutions is not the only company that has and will redefine the term CRM and integrated marketing tools.

I have had the pleasure to see the new CRM software, which will be introduced to the marketplace later this year.  The CRM software tools and dashboards, which integrate seamlessly into their single login platform, were honestly breathtaking.  There is a tsunami of change coming to the automotive industry for companies that have integrated, end-to-end software solutions.’s CRM will give their dealers unprecedented access to data, which will allow their teams to run more efficiently.  The ability for dealership employees to work anywhere, access data on any device, and be held accountable for business processes and workflows is without peer. has a wide range of products on their single integrated platform. CRM was the only glaring hole in their product strategy and now it has been expertly filled.

The product roadmap, although not shared with me, was obvious to me.  Create an indispensable, robust software platform that gives dealers valuable insights into all areas of their business. It is clear that if accounting is on their feature list, DMS as we know it, may become history.

The companies that can provide an integrated platform will, over time, squeeze out single solution companies and our industry will take a major step forward in productivity and profitability.

Are the CRM products, produced by VinSolutions or, really just CRM?   Absolutely not, they are and will increasingly become the primary dashboard for dealership operations.

A few months back I wrote an article that the new companies just needed to purchase a DMS vendor.  Now, I am ready to take that statement back.   Why purchase a software company that has a limited, decreasing role when VinSolutions’ own marketing platform can be expanded.

As I look at things from this perspective, will the ADP/Cobalt technology marriage also produce a very strong, integrated software platform where the lines that were once CRM and DMS are blurred?  Will VinSolutions’,’s, and ADP/Cobalt’s integrated marketing platforms shrink the automotive website marketplace from 50+ vendors down to a few dozen?

Time will only tell but the role, function, and future of integrated marketing platforms based around intelligent CRM software looks like DMS killers.

  • J
  • April 20, 2012
Wow.  Gulp. :)  Very, very interesting Brian -- thanks!!! 
  • C
  • April 20, 2012
Is this a blog post or advertisement. Remember the top crm company that does everything full circle is elead. They have the full circle thing down to a science hence most of the top groups and stores in the U.S. use them. Next time Brian research and try not to just write an ad for a company that your buddy's with. They can afford advertising.
  • D
  • April 20, 2012
I wouldn't view this post as an advertisement because 2 CRM companies were used as examples. Of course there are several CRM providers in our industry. eLead being one of those. I've been a supporter of eLead over the years and continue to be. 
The question here is - are we evolving to a point where the DMS is second thought to the CRM? 
Can integrated CRM systems replace the DMS?
We're not there yet. Not even close. Unless you've used a DMS in a dealership, you maybe be ignorant to all the departments the DMS touches. 
CRM is not an accounting tool, it's not a parts tool. It's rare to find a dealer that has completly replaced their service scheduling and reports with a service outside of the DMS.
Articles that talk about CRM replacing the DMS are usually written from the sales and marketing perspective and forget about all the other departments in the dealership using the DMS. 
Today's CRM services/software are merely scrapping the surface of what the DMS provides for the dealership - antiquated and as bad as we think they are.
Would you agree or am I missing something?
  • B
  • April 20, 2012
@crmninja  Obviously you don't know me or my values well enough so see that your statement is far off base.  I didn't write this post to promote any one company or product.   This is a discussion on the future of CRM and the software integration movement that will consolidate our industry tools. 
Brian - great article! If a DMS system is a "Dealership Management System" but your CRM grows to handle desking, F&I contracting, and menu driven service selling and dealers simply stop using those features in their DMS systems - at that point we will need some new names for our software because the "CRM" will truly be the sales & management system, and the "DMS" will be nothing more than an accounting core that offers open integration. Thought provoking discussion, thanks. 1mglynn 
  • T
  • April 20, 2012
Great article Brian...  I would echo Jeff in that DMS is WAY more involved than anything any CRM provider is currently addressing.  From the Parts Department (think depreciation, inventory, Fast Moving Parts, shrinkage, obsolescence, parts matrix and markup calculations, and billing/invoicing/accounting etc.).  Or Service Department (think dispatching, Open RO reports, Scheduling, ELR, Margin Calculations, and billing/invoicing/accounting etc,)  Let's not forget the Accounting Department (think payroll, A/R, A/P, Financial Statements, Cash Flow Statements, DOC sheets, and the list goes on and on).  Finally you have the Manufacturers who require their specific Financial Statements submitted electronically in a specific way... 
While I foresee the lines between CRM and DMS blurring in the coming years, we have a LONG WAY to go before someone pulls it all together.  From what I'm seeing on the DMS side of things, these companies are FINALLY realizing the importance of CRM and are taking steps to bring this into their fold.  I still gotta think we see a DMS company figure out CRM before a CRM company figures out DMS.  I'm not saying this is right or something I personally support - just more the reality IMHO.
I would like nothing more than to see a CRM company conquer the blue bloods of the DMS systems, opening up competition and thus driving down costs to the Dealers.  DMS is a significant investment and is severely over-priced.  Until another alternative arrives, we are stuck with the two different components of our businesses.
Just my two cents...
  • L
  • April 22, 2012
DRM or CRM? I see it as all of the entries into either system are customers and the position they occupy in the cycle of ownership, and their postion in this cycle certainly require differing datapoints. Allowing each department to analyze and use this data to maximize customer satisfaction and profitablity should be the same, be it for the parts, service or vehicle sales customer. As to the accounting and inventory management, the data required for these functions can be a ancillary set of data that gets managed right along with the customers and employees. In the end I believe that there similar practices that can be used for every type of customer, parts vs service, they just require differing labels to identify thier position in the cyle. IE, prospecting for service and parts customers should be the same as vehicle sales. In the end it's all sales and customer satifaction brings them back.
  • L
  • April 23, 2012
I am completely amazed that a man who has never worked on the floor, knew what bell to bell meant or had any understanding of what it takes to operate a car store gets so much attention here.  Clearly Mr. Pasch has never used a DMS nor understands how it provides dealers with what is needed on a day to day basis.  CRM has its place regarding sales and service but don't think that it can ever replace the accounting functions and fixed ops requirements of a dealerships.  I have been in the CRM space for a number of years and don't know of one company that can adequately provide the dealer the ability to open a repair order, maintain a parts inventory, calculate a month end financial statement and so much more.  Perhaps you Mr. Pasch should stay in the area of your expertise and not delve into areas you know nothing about.  
  • B
  • April 23, 2012
@Lesterjack1941  Thank you for your passionate reply to my post.   
Seven years ago, the thought of an integrated website platform replacing over a dozen stand alone marketing tools, would probably get the same response from newsletter companies, mail houses, video marketers, inventory management tool providers, and service schedulers.  (That's why I loved the VinSolutions checklist!)
VinSolutions,, Dominion Dealer Solutions, and ADP/Cobalt are expanding their suite of single login software with integrated data collection and analytics.  This is proof that the single silo data solutions are heading for consolidation.  The backend tools continue to grow to meet the expanding data management needs of dealers. 
Keeping track of the entire customer record and leveraging all data connection points is critical for effective customer management and retention.   Fixed Ops customer data has been an orphan for integrated marketing. VinSolutions recently added Service scheduling and data marketing to their website platform.
Parts?  Today most dealers are forced to use TradeMotion websites to sell parts which are ugly, cumbersome, and they suck at search optimization.  I don't know why there is not a better alternative on the market. I do know that products are coming that will make their crappy websites obsolete. 
So, where does the line stop for software development?  It doesn't.
Ask a dealer how they are marketing their parts customers? Ask them if they are using their parts purchasing history to create more revenue?  What happens when service and parts transactions are part of the rich CRM database and integrated marketing tools.
Yes, today DMS software seems like it's indispensable but so did VisiCalc and WordPerfect to early PC users.  The change that I wrote about will not happen overnight. What we see today is a poor excuse not to connect the dots.
There is an underlying opportunity that smart companies see;   tap into the high dissatisfaction with current DMS pricing, functionality, and data integration. 
All it will take will be companies that unlock the value of dealership data and integrate that data into a comprehensive marketing platform, and things will change.  The separate data silos will become one and the potential of fully leveraged dealership data will finally be a reality.
Finally, thank you for pointing out that I never worked at a dealership.  That is actually where my clients find great value.  I bring a new set of eyes to budgets, processes, and strategy that are often needed to pull dealers ahead of their competition.  It's a great collaboration actually, because both parties learn from each other to yield amazing ROI.
  • M
    Mike Esposito
  • April 24, 2012
You raise some very interesting points some of which are valid and some of which are a little off base. Also you seem to have a myopic view of the DMS market.
I agree with your assessment... "They depend on the functionality that the software brings but they hate long-term contracts and the cost associated with the technology." of which I assume you are talking about ADP and R&R. If you view the market as ADP and R&R (myopic) then you are spot on BUT this is not what is actually happening in the DMS market today. Non-legacy DMS vendors are, on a daily basis, talking market share from both R&R and ADP owing to  the validity of your statement. You wrote in your response to one of the posters "There is an underlying opportunity that smart companies see;   tap into the high dissatisfaction with current DMS pricing, functionality, and data integration. " This is EXACTLY what is happening now. My company, Auto/Mate, along with the likes of Dealer Track, AutoSoft and ACS to name just a few are capitalizing on the archaic technologies and business strategies that make up ADP and R&R. 
You have to ask yourself why are there multiple silos of data being kept by the dealer. Data from their 3rd party desking solution and data from their 3rd party CRM solution and data from their DMS solution (read ADP /  R&R). Well the main reason is that intrinsically no matter what ADP and R&R say, they believe the DMS system that the dealer pays for is theirs and not the dealers. Both ADP and R&R have had a history of making it difficult for the dealer and 3rd party vendors (CRM / Desking / etc) to access their databases hence the term "hostile interface". In current years they have softened their stance in that they now have "certification programs" which are still costly to 3rd party vendors. The new DMS companies like Auto/Mate and Dealer Track have open API's that allow bi-direction integration to a single data silo that is housed on the DMS. Auto/Mate Open/Mate API even allows realtime updating of any 3rd party vendors system data. 
There will always be dealer who wants one stop shopping..all products from one vendor. As one dealer I spoke with said "I just want one throat to choke" . But the truth of the matter is that dealers want to be able to choose. To choose the best CRM and the best desking and the best web appointment system, and the best etc., and to have these seamlessly integrate with the DMS system that houses the data. This is what products like Open/Mate are all about.
As the President and CEO of a DMS company I believe in giving my dealers what they want and what I am hearing is flexibility to choose and to know that even though I may not purchase the CRM product from my DMS vendor that my DMS vendor has my back as to ensuring that 3rd party product I purchase will work in the environment of my DMS.
You are probably correct. As Bob Dylan wrote "The times they are a changing" and the DMS vendor who doesn't understand that will most certainly die....
  • B
  • April 24, 2012
 @Mike Esposito  Thank you for joining the conversation and voicing a perspective from the DMS vendor side.  I agree with you that open API's allow for greater integration and best of breed solutions without creating isolated silos of data.
I commend your desire to provide alternatives for dealers who want to choose their data, analytics, and marketing partners and decide which level of access each will get.   This is part of the change I was speaking about.  It is coming, and your voice is proof that when choice is limited, innovation will come to the rescue.
I would love to learn more about your solution so that my insights to the opportunities that exist for dealers can be expanded.  
  • B
    Blake Andreese
  • April 24, 2012
Brian, I like this subject, I will throw my 2 cents in here. Putting the dealer first is paramount. As someone that spent many years in an executive position in a large group, I battled all the time with my DMS provider about data and security, and why I am charged so much for what I receive. But I had no real choices back then. I also had many conversations for no apparent effect to my manufacturer that forced upon me my website provider, my ILM tools, my marketing, among otherthings. The point I am making is the companies that have ability to react daily not annually to widening dealership needs are growing and are becoming masters at their segment. With that said I do not believe that a DMS/CRM inclusive company is the best option. R&R and ADP tried it and have failed. I see a few CRM companies that do everything for the Customer, Sales and Service staff, and management, Including marketing, digital presence and desk management. They are experts and laser focused on the CRM and dealer R.O.I. I see great companies like Autobase, and Dealertrack doing the correct thing and focusing on the dealers wants and needs by having open API and secure data transactions between the dealers third party choices and them. with open mate API  it even updates the other 3rd party vendors data realtime. Bottom line is great focus on the DMS front and the CRM companies while allowing the dealer to choose whats best for them, without being forced in any one direction because of integration is putting the person that paid for the store in charge of who to do business with. as well as not be pigeon-holed because one company you need won't integrate with anything but themselves or charge you if you do. "Hostile Integration" started on the corporate side of ADP ad R&R not the dealers and vendors.
  • B
  • April 25, 2012
Thank you for contributing to the thread and yes, companies that are creating open API platforms do give dealers the flexibility to add new marketing and analytics partners that come to market.  Today, for some DMS products, the barriers to creating integrated products are high upfront fees and sticky contractual agreements, which may just very well hinder innovation.  Companies like Autobase and DealerTrack obviously want to change that image of DMS software providers. 
  • Y
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  • G
  • May 1, 2012
For the attackers on Brian, please... cool your jets and assaults.  What exactly is getting you so angry?  I don't think it is at all naive to think that CRM is becoming the dashboard of the dealership from a sales and marketing perspective.  As @tomwhitejr Tom White stated, I think everyone is sick of the industry be pushed around by a couple of DMS providers and would welcome competition both for innovation sake and overall operating costs. 
I also agree that we are a long way away from a fixed ops and accounting perspective, however that might be as much of a Herculean task as you might believe.  
Brian's post is one that should excite you because the ultimate CRM/DMS blurred line creates a system that is better for our business.  Dealers and consumers alike.  
  • K
  • May 7, 2012
Reynolds has long been known as a DMS company. Now, they will tell you that while a DMS is still a necessary tool, it is not a sufficient business tool. And they are moving away from DMS just like CRM companies are moving away from CRM. What's called for is a retail management system, with ALL the requisite components. The tier one DMS companies already have the most difficult core component - its the CRM companies that will need to get to work to keep up.
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  • November 13, 2012
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