Two Ways the Auto Industry Is Wasting Money

Customer Experience

The inabil­i­ty of auto­mo­tive OEMs to suc­cess­ful­ly imple­ment mod­ern dig­i­tal mar­ket­ing is caus­ing a mas­sive amount of wast­ed resources and cap­i­tal that should be focused on bet­ter tar­get­ing of cus­tomers and ven­dor enable­ment over the entire cus­tomer life­time. It’s sur­pris­ing how mis­guid­ed some OEM adver­tis­ing efforts are, and how small changes to their post-con­ver­sion approach could yield big returns while improv­ing over­all brand sat­is­fac­tion.

First let’s talk about adver­tis­ing. In my own recent expe­ri­ence, the OEM fell flat with adver­tis­ing after I made my pur­chase. I kept get­ting adver­tis­ing for new cars, even though I had already pur­chased one, and the ads I received weren’t even for the vehi­cle I had been look­ing at! To make it worse, I was receiv­ing these adver­tise­ments dur­ing the long, nine-month wait between my pur­chase and deliv­ery of the car, dur­ing which I had no fol­low-up from the deal­er as to the when my car would be deliv­ered.

At a time when OEMs are talk­ing about max­imis­ing their mar­gins and reduc­ing their costs through opti­mi­sa­tion, this is a pret­ty poor fol­low-through on strat­e­gy. This time should be used to com­mu­ni­cate with cus­tomers and guide them along in the next steps of the cus­tomer jour­ney. This could be adver­tis­ing add-ons or ser­vices for the car, or even trav­el des­ti­na­tions that I could vis­it in my new pur­chase. Yet the cur­rent approach is to blow mon­ey on a one-for-all adver­tis­ing strat­e­gy. I even received a full print brochure.

A Full. Print. Brochure.

It was done in beau­ti­ful col­or, postage paid, show­ing me a car that I didn’t already buy from them. Some­how the OEMs need to fix the sys­tem that has them ship­ping full print col­or brochures to cus­tomers that just bought a car. The resource waste is stag­ger­ing. This is not a strat­e­gy for suc­cess, this is ama­teur hour at the Apol­lo, and it shows a dis­con­nect with the cus­tomer that erodes con­sumer con­fi­dence.

Anoth­er way OEMs are wast­ing mon­ey is by active­ly dis­abling their deal­ers when it comes to after­mar­ket pur­chas­es. Many deal­ers do not want to keep stock on after­mar­ket acces­sories because it ties up their cash flow in stock that may or may not sell, which puts them at a dis­ad­van­tage to e‑commerce sites that can have stock deliv­ered imme­di­ate­ly.

In my case, I need­ed some rub­ber mats for my new car. Now please note, as much as you might imag­ine me buy­ing some rare, super lux­u­ry vehi­cle, I am, in fact, not able to shop in that price range. We’re talk­ing about the most pop­u­lar car for this par­tic­u­lar OEM.

So I called my deal­er, who said they didn’t have them, and that it would take one week for them to come in. I called three oth­er deal­ers in the area and received the same sto­ry. In one case, I was told that I would have to dri­ve across town to the deal­er, man­u­al­ly place an order with them in the shop, and then wait the promised week to final­ly get my car mats.

This was not accept­able. So I went to Ama­zon where I found a Vol­vo-brand­ed shop that was run by a third-par­ty ven­dor. I found the car mats I was look­ing for and pur­chased them online. They arrived at my doorstep with­in 48 hours. Do I now have plans to go back to my deal­er for any­thing else that I might need for my vehi­cle?

That last ques­tion was rhetorical…the answer is no.

At this point I have been con­di­tioned away from my auto deal­er as a source of infor­ma­tion, parts, and ser­vices for my vehi­cle. I have an imme­di­ate need, and the man­u­al process­es cur­rent­ly in place for the major­i­ty of deal­ers are not meet­ing it. The OEM needs to bet­ter enable the ven­dor. Not by ship­ping them tons of stock to hoard in their stores, but by devel­op­ing a bet­ter back-end sys­tem that is on par with the e‑commerce ven­dors. The need to pro­vide the tech­nol­o­gy with which the ven­dors can cre­ate a long-term, trust­ed rela­tion­ship with the cus­tomer.

You see, the wast­ed mon­ey isn’t the prob­lem, it’s an indi­ca­tor of bro­ken process­es with­in the sys­tem. By address­ing the prob­lems at the heart of the mon­ey leaks, the OEMs can rede­fine what it means to pro­vide a mod­ern and excep­tion­al cus­tomer expe­ri­ence. They can focus on cap­tur­ing the val­ue of the cus­tomer over not only over the life of the car, but the val­ue over a customer’s life­time and beyond. Auto brand loy­al­ty runs deep. It is some­thing that can be passed on for gen­er­a­tions, but it can’t be cre­at­ed with­out the sup­port and com­mit­ment of them OEM.

Customer Experience
Axel G. Heyenga

Posted on 03-27-2017

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