Disruption is Coming for the Automotive Industry. Are You Ready?
We all know a universal truth, change is hard. We struggle with changing simple things that would improve our lives and even more so when it comes to decisions based around bigger changes. This constant struggle has been analyzed many thousands of times over and after all of the research I believe it boils down to something unbelievably simple, we are just creatures of habit. Everything you do is reflected in the neurons of your brain and the more you do it, the strong the neural circuitry for that habit becomes. Love popcorn and like watching movies? The more you continue with popcorn and a movie the more that habit will become "wired" into your neural circuits, to the point that skipping the popcorn with your movie feels foreign. The brain is an ever evolving organ and structure of your brain will physically change throughout your life based on your behaviors, so be careful what you do!
These habits go far beyond eating popcorn and watching movies, they also directly affect our ability to assess and validate adopting new processes and technology into our personal and business lives. And that's really what I'm here to talk to you about today, adopting technology into your work life to change your habits for the better. There are a few industries where the majority of participants lag behind a broader curve of technology adoption and the automotive space is certainly one of those.
There's a lifecycle for everything and most of them are defined with a bell curve just like this one:
I'm sure it looks familiar, most of these are fairly related so let's throw something into this lifecycle to make it more relevant for this article. Remember back in 2001 when the Palm Pilot showed up on the market? How many people did you see using those devices? It wasn't many was it? Now jump forward 18 years and try to remember the last time you saw someone sit down and not pull out a smartphone, not easy is it? Here's how I plot out the acceptance of smartphones with respect to the Technology Adoption Lifecycle.
Smartphones and smart devices are now everywhere and dominate our lives on many fronts and facets. People feel vulnerable without them and being unplugged from the flow of information is extremely difficult for millions of people. That flow of data is more critical now than at any time in the history of civilization and that's how all of this fits into a blog post about automobile dealers.
We have talked to hundreds of dealers and can share a few universal truths:
1. Acquiring the right inventory is hard
2. Acquiring the right inventory is time consuming
3. Most purchasing decisions are based on instinct
4. Most purchasing decisions are not profitable on the front end of the deal
There are a lot of software solutions already in the marketplace and more are coming online all of the time. The software world is aware how far behind the technology curve the automotive world is and we are here to help. We are building better software and leveraging big data from massive and disparate datasets to help you buy the right cars easier and with far less effort.
It is my opinion we are almost exactly where Palm Pilot was in 2001, just hitting that early adopter phase and within a year we'll be dipping our toe into the "early majority" of the lifecycle. This time it won't take 18 years to get to the end of this lifecycle graph, it will be in the single digits and utilizing a data based approach to purchasing will be the norm within 3 years. You as a dealer don't want to be one of the "Laggards" in this adoption lifecycle. We are not talking about finally getting a device you can stream Netflix on or being able to do a video chat with your kids. We are talking about the lifeblood of your business remaining viable and healthy because you make smart decisions that work for your dealership using data that's accurate and reliable.
It's time to get uncomfortable, break the habits of the past, and the way you have always bought wholesale vehicles. Within a few short years two things will happen. The first, a dealer not relying on data to make buying decision will be at a significant disadvantage when matching up against a competitor that does. The second, a dealer will be so dependent on data from the marketplace and their own internal datasets that buying a wholesale vehicle without leveraging some type of algorithm will feel just like losing your phone for a day.
The tools and technology have emerged for this trend to become a fast moving train before you can blink twice. Make sure you are on that train, not in front of it, standing on the tracks.
If you want to make sure you're on the right side of the track schedule a meeting today!