The automotive industry has entered a time when staying comfortable and maintaining the status quo can lead to a dealership’s downfall.
Today’s customer is evolving — they are more knowledgeable about what’s available than any customers in history and have a much better understanding about what things truly cost. The key to survival and success is to adapt to their thought processes and provide what they are demanding; otherwise, dealerships will lose out to those that do.
Today’s customer does not want to take hours to negotiate a deal. While a vehicle is still one of the biggest purchases they will make in their lifetime, they’ve already done their research online and want to make the purchase in the most time-efficient way possible. This type of customer is shocking dealerships out of their traditional comfort zones. While it’s a challenge, it’s also an opportunity to stand out from the crowd and thrive. To thrive, though, dealerships must be willing to change and adapt to their customers. This requires not only next-level thinking, but a willingness to take action.
“Apple, Tesla and Google have targets on our backs — they see our industry from a completely different perspective. This is when major business disruptions occur: think about Uber,” said Brian Benstock, General Manager and Vice President of Paragon Honda and Paragon Acura. “What happened when Apple aimed their sights on the camera industry? The music industry? Or the phone industry? Kodak, Tower Records, Motorola were all robust, strong, incredibly profitable companies that became irrelevant overnight because of their failure to adapt. At the end of the day, consumers dictate demand. Kodak said that people will want the quality of a printed photo over the convenience of a camera in a phone, and Motorola stood by their strategy while Apple eviscerated their business. These giants are no longer relevant. Google, Apple and Tesla are all hiring automotive retail experts in preparation for their move into the automotive retail space. The dealership model is not customer-friendly, and consumers are demanding change. We, as dealers, need to own that responsibility and fix it. Who wants to wait for four hours to buy a car? Apple, Google and Facebook will change the way automobiles are manufactured and retailed. Are we prepared?”
“Seismic shifts in the industry have already begun, and many dealers are still very consumed with their Facebook page fans. Paragon has already started preparing for this shift. Move fast and break things by moving at the speed of the customer.” An avid runner, Benstock got a first-hand view of the “Apple experience” when his earbuds broke during an early morning run. With traditional thinking and business practices, he would have been out of luck. Because Apple has regularly stretched the bounds of “normal,” however, he was able to go straight to the Fifth Avenue Apple Store in New York, which is open 24 hours a day, and purchase a new pair. Apple knows their customers and seeks to meet them where they are.
This experience got the Paragon team thinking. They wanted to take what Benstock learned from his scenario and apply it to the stores, to become the “Apple Store of Honda.” Paragon put this thinking into action and implemented a 24-hour service facility. By doing this — by meeting their customers where they are — they opened the doors to accommodate a new type of customer. This service has become widely popular to Uber and taxi drivers, police officers, EMS drivers, doctors and nurses, city workers and others whose schedule only allows them nighttime hours. This “thinking like the customer” mindset has put their dealership ahead of the competition with this element, and gives them an advantage when it comes to servicing or selling to this demographic.
This is only one idea that the leadership team has put into action to stay ahead of the curve. In a time where disruptive technology — online pricing, social media reviews and increased information is available to the public — is causing some dealerships to panic and try to keep their heads above water, Paragon Honda and Paragon Acura are committed to riding the wave to larger market share and customer satisfaction.
For instance, Paragon is aggressively shifting focus to carry out more online transactions, including using a tool, “Make My Deal,” with their website that allows a customer to move through a transaction almost 100 percent online. They can submit their trade information, any rebates or incentives they qualify for, e-sign documents online, select their vehicle and submit a deposit. While this type of transaction might not be in the comfort zone of the average customer just yet, the segment who does appreciate it is growing, and will only grow larger as time moves on, putting Paragon at the forefront of dealerships willing to meet the needs of current and future auto buyers.
“In our drive to go from good to great, we have to be relentless,” said Benstock. “The market is constantly changing. We have an excellent team and we’ve broken multiple records across all three stores for several consecutive months but we know there’s more there.”
Paragon is in a constant state of evaluation and re-evaluation. They don’t believe in having vendors, but rather having strategic partners that are as committed to the mission as they are. Their partners have to bring their “A” game every day. “They push us, and we push them,” said Benstock. “Fail fast, learn fast, adapt and move on.”
Team Velocity Marketing is one of the strategic partners Paragon relies on to connect with their customers. “We’re thrilled to have a partner that holds us accountable every day in our quest to make each other better,” said David Boice, founder of Team Velocity Marketing. “He never lets us rest on past accomplishments, never says ‘we’re there.’ Paragon is always pushing us to do something better tomorrow, regardless of what we did today.”
“Paragon forces us to push our boundaries every day,” said Scott Fletcher, co-founder of Tier 10, “with everything from our creative, to our data, to our strategies — we consistently explore uncharted territory with Paragon. We are relentless. Being relentless means you’re never satisfied.”
Benstock said, “We are truly fortunate to work with some of the best and brightest people in the industry, from the executives at American Honda to the various coaches, trainers and associates we work with. We are certainly are going to need all of these resources as the economic, political, and business climates change. Let’s face it, interest rates have been at an historic low, demand at an historic high, and all business is cyclical.”
These are warning signs that the good times might not last forever. Now is the time to prepare for the demands of tomorrow’s customer using strategies, customer service, and technologies that support the customer across all platforms and dealership departments. As Google, Tesla, and Apple enter into the business and disrupt the existing business model, new opportunities will be created.
“Peter Drucker had it right,” said Benstock. “The important challenge in society, economics, politics, is to exploit the changes that have already occurred and to use them as opportunities.”
It’s truly an exciting time to be an automobile dealer.
For more information, please visit Paragon’s Facebook, Twitter and Instagram pages. You can also visit BrianBenstock.com for additional resources.
In A Nutshell
Paragon Honda and Paragon Acura embrace next-level thinking and strive to become the ‘Apple Store of Honda’ through innovative company culture and process.
– INGENUITY – Paragon’s “thinking like the customer” mindset has put their dealerships ahead of the competition and gives them an advantage when it comes to servicing or selling to each particular demographic in their market.
– CUSTOMER TRENDS – Paragon Honda and Paragon Acura are constantly implementing faster, streamlined processes that are appealing to the customer. The new customer wants instant gratification and often values speed over price and Paragon Honda and Paragon Acura have become exceptional by embracing this mindset.
– UNDENIABLE RESULTS – Paragon Honda and Paragon Acura have both posted consecutive record-breaking months in 2016 during months that are typically not very strong. The constant next-level thinking that Paragon implements in their business continues to prove successful in an ever-changing industry.