Archive for the 'Column' tag
November 1st, 2010 — Business, E-Commerce, Powersports Industry
What is DustyMoto? A particularly harsh desert race in Arizona? A porn star from the 70’s with a predilection for motorcycle apparel? Actually, DustyMoto is one of the most innovative companies that I’ve come across in our industry and one that you should absolutely be signed up for and using.
DustyMoto is a web-based service that creates a virtual warehouse in “the cloud” that is composed of all the inventory with nine months of no sales held at its participating dealers. When a dealer has demand for a part they don’t have, rather than order it from the OEM, they order it through DustyMoto, and the part is shipped from one of the dealers in the network that has it as excess or obsolete inventory.
Let me rewind and explain what all that means. First, a virtual warehouse in the “cloud” means that all of the product that DustyMoto shows as available in their system is not sitting in a big physical warehouse somewhere (if it was, it would be pretty big as DustyMoto’s CEO Bobby Franklin told me that they currently have around $45 million in inventory). All of the inventory is being held at participating dealers around the country. “The Cloud” is the term that has been developed in the internet application space to refer to data storage and processing capability that is not housed on any one machine. It’s physically spread all over the place but the application or database appears as one unified entity (Google’s App Engine or Amazon’s S3 for example).
The inventory in the system is typically all stuff that is at least 9months old. According to DustyMoto, studies show that if a part is on your shelf with no sales activity for 9 months, odds are really, really good that it’s going to be there for a birthday or two before you finally pitch it or it ends up on eBay for pennies on the dollar. DustyMoto makes it’s money off a small commission/fee to the seller, currently 15%. Considering that most shops eventually blow out old inventory at levels much steeper than 15%, and typically after incurring carrying costs that add up to way more than that over a year or two, 15% seems reasonable.
Another nice aspect for the seller is that all parts are sold at current dealer cost (the same cost in your price files). That means that it’s possible that you may have paid $100 for a part a year ago, but the part now sells from the OEM for $125, so DustyMoto transacts it for $125. You just made (or recouped carrying costs) $25 on that part.
This is the type of brilliant idea that I’ve called for in several columns over the years. Although in my naivete I thought that it would have been driven by the distributors or OEM’s. Bobby from DustyMoto sent my thinking straight on that one. He explained that the OEM’s and Disti’s have zero interest in making the supply chain or inventory management efficient across the industry. In fact, it’s in their best interest to stuff inventory into the channel with the ferocity of a farmer cramming feed into a goose for foi gras.
When I pointed out that inventory carrying costs were one of the largest contributors to dealers having financial hard-times, and wouldn’t it be in the OEM’s interest to do what they can to make their dealers more healthy. I could sense Bobby rolling his eyes over the phone as he explained to me that if that dealer dies off, it’s an opportunity for the OEM to shove inventory into another empty parts department in the dealership that steps in to take the dead one’s place. My, what a healthy industry we have…
With those market dynamics in place, it’s imperative that dealers and retailers in our industry use all the tools available to make ourselves as self-sufficient and profitable as possible. Think of DustyMoto as a Co-Op that allows all of the dealers in the country to work together to make the entire industry more efficient, effective, and healthy.
Think about it… How much old inventory do you have on your shelves that you just know someone, somewhere, is ordering brand new from the OEM…? How many times do you order a part for an older bike that you just know has been sitting on some poor sucker’s shelf two states over for the last three years? DustyMoto is in place to solve these very real problems
I’d like to see DustyMoto’s capability built into every major DMS system out there. When you add a part to an invoice that is not in stock at your shop, it should query DustyMoto’s servers first, before that special order goes to the OEM or distributor. It should be seemless. If DustyMoto has not already begun working on an integration with folks like Ziios (see Arlo’s recent article on Ziios openness to integration and extension) they are missing the boat. If DustyMoto and Ziios offer that capability, then ADP better get on board as well.
I honestly believe that if DustyMoto plays it’s cards right, they have the ability to radically transform a major aspect of our business thus making everyone at the retail level a lot better off. And like all networks, the more nodes, or participants, the better it will all work.
I think one of the biggest risks to their success is if one of the major DMS players steps in and sets up a competing network (which is not just bad for DustyMoto, but bad for the idea as a whole because now you have inventory split into multiple exclusive networks).
I also think that DustyMoto needs to implement a type of credit system that rewards buying from the network. Sure, everyone wants to unload their old stuff, but I think there needs to be an incentive system that can help re-train the behaviors of parts managers to not just order from the OEM or distributor first without checking DustyMoto’s system (again, integration into the DMS will help alleviate this). Maybe a system that the more you buy from the network, the lower commission rate you have to pay when you need to unload your own old stuff?
After a year that had me writing a few columns and blog posts that made me sad or mad about things going on in this industry, I’m happy to be able to finish up my year with a column that is as hopeful for what may be ahead for our industry as this one.
Now go sign up!
Tags:Column, dealerships, E-Commerce, ecommerce, marketing, Merchandising, supply-chain
October 1st, 2010 — Business, E-Commerce, Marketing, Powersports Industry
…And he just checked in to your shop on Facebook Places. Or on Gowalla… Or FourSquare… Or Loopt… Or Yelp… Or any number of “location based social networking” clones that are popping up all over the interwebs.
What are these sites/services? How do they work? Who uses them? Why should you care? This month I’m going to make an attempt to give you a primer on the subject that makes at least a rough pass on those questions.
Basically, the core of the idea is that now that people have gotten used to the idea of social networking by using sites like Facebook and LinkedIn, and a lot of those people are using “smart phones” that have fast(ish) connection to the internet and have some method of determining where you are physically located (GPS, cell-tower triangulation, etc.) it was natural that someone would come along and make the big connection: Combine the social networking experience with location-aware features while providing opportunity for the business location to participate. Except for the creepy stalker / exhibitionist aspect of the whole thing, it’s pretty brilliant…
Here’s a (by no means exhaustive) list of sites that play in this space:
Here’s how most of these types of services work. You sign up for an account with a site like FourSquare (www.foursquare.com). When you go someplace (a restaurant, a concert, a club) you use the application on your iPhone (or whatever device you have that is supported) to “check in.” You’re basically broadcasting to your social network (or at least the part of your social network that is using the same service you are) a message that says “Hey I’m HERE!” (and when I think about it cynically, you’re also saying to any potential robbers, “My apartment is empty, go for it!”). From there, depending on the service/site, a lot of other things can happen. If you have “friends” that are on the same location-aware social network, and they have also checked in, you can basically hook up, you can earn loyalty points (which I’ll go into later) from the business, etc.
So far, the big dog in this space has been FourSquare. They were the first big player that developed a large user base, got a lot of press, and captured the hearts of the VC’s. However, now that the concept is starting to prove itself, the really big dogs in the main-stream social networking space like Facebook (with Facebook Places) are starting to roll “check-in” functionality into their service offerings. It seems to me that now that Facebook is playing in this pool, where most people already have their social graph, sites like FourSquare are going to have a lot less room to move around. That is assuming that Facebook doesn’t eventually blow itself up due to privacy concerns.
Most of these location-based social sites like FourSquare have methods to provide incentives to people that check into a location a lot. The idea works like this: Business A has an account with the location-based social service and “claims” their business. Business A provides incentives (special services, discounts, free stuff, etc.) to people that meet certain levels of participation. For example, with FourSquare a user can earn points the more they check into the same location. Earning more points leads to various “badges” that tell the world “I’m a regular.” With FourSquare folks aspire to be a location’s “mayor.” Typically a business owner will provide more perks the higher up the ladder a user goes.
By themselves these location-based social services can be thought of like a game. But where they should be interesting to you is as a means to advertise your business, participate in the various ecosystems that will develop around these growing social networks, reward loyal customers, and so on.
Sites like FourSquare, Gowalla (gowalla.com), etc. are hot right now as companies look for more effective ways to use social networking tools and sites to market their businesses and make money. At the most recent Search Engine Strategies conference I just attended in San Francisco, it was very clear that businesses are becoming more and more disenchanted with the typical paid search advertising (if you purchase Google Ad Words, you know that our industry has managed to jack up relevant keyword prices to levels that are just goofy…). Display ads and other content network ads are proving to be very costly and difficult to measure except for companies that can afford complicated advertising attribution tools and services. Advertising on social sites like Facebook is reportedly not very effective for a lot of companies. Companies see the advertising and marketing opportunities that these new social networking sites offer because they mostly hinge around actually having live customers physically in their store. These sites/services may finally be the holy grail union between local, web, and social people have been waiting for. Or they may be just another flash in the pan web sensation that caters to narcissistic exhibitionists… Who knows? Some folks thought TV was a fad.
You should already be able to envision ways that you can leverage the functionality these sites provide for your dealership. Especially if your shop has, or could be made to have, a reason for people to hang out. You could also partner with establishments in your area that are hot hang-outs for riders. Here’s something to get the ball rolling around in your head: If you live close to a track, partner with the operators by offering free oil changes or something like that to the trackday-rat “mayor” of that facility. It’s a safe bet that a lot of tracks, especially ones that sit empty quite often, don’t have owners or operators that are even bothering to “claim” their business in sites like FourSquare, Yelp, etc.. Offer to step in and do it for them! I’m sure once you start using these things, more brilliant ideas will come to you.
In closing, I recommend that you keep a close eye on this area of the social web. It’s attracting a lot of attention, companies playing in this space are raising a lot of money from VC’s, and it’s already starting to develop some technical extensions and meta-level technologies that hope to provide additional value to the participants. An example of this is TopGuest (www.topguest.com) that links “check in’s” with a user’s loyalty programs (frequent flyer program for example) allowing them to earn points.
Tags:Column, dealerships, E-Commerce, ecommerce, marketing, powersports, Powersports Industry, selling-online, social marketing, social media, social-networking, web2.0
September 1st, 2010 — Business, E-Commerce, Marketing, Powersports Industry
We need to talk. All of us. Everyone in this industry needs to be talking to each other a lot more than we currently do. Sure there’s the occasional show where we all get together like DealerExpo and there’s the inevitable gripe-session that is sure to break out whenever a few dealer principals get together at an OEM show or 20 group meeting. What I’m talking about here is more of an ongoing, broad-based, industry wide series of conversations about the important issues that affect us every day.
Once again, the internet can step in to help. If there’s one thing that the internet is great at it’s providing a common, albeit virtual, meeting space where like minds can get together and discuss whatever hot issues are top of mind.
I’m sure a lot of you are part of a 20 group and recognize that quite often these gatherings are great places to share and discover new ideas that have potential to improve your business or even help grow our industry as a whole. Some of you may even have an email list where you keep those discussions going. I’d like to propose that as an industry we expand that idea and start taking advantage of some of the discussion forums that already exist.
I’m going to focus on two specific places where I recommend we all start gathering and having some lively discussions.
The first is LinkedIn. If you’re not on LinkedIn already, you really need to be. Linkedin is pretty much the best professional social networking site out there right now. In addition to it’s potential to build a network, LinkedIn has a feature called Groups. Groups are like mini-forums built right into the LinkedIn framework. A big part of these groups are the discussions and that’s what I’m really focusing on here.
There are already some great groups on LinkedIn aimed at our industry. In fact, it was the discussion from a few months ago about vendors competing with their own customers (prompted by Arlo’s blog posts at DealerNews) that really motivated me to write last month’s column. But what’s really lacking is a lot more members and a lot more active discussions of issues that really affect everyone: MAP policies, national and state legislation, general business issues, and just general brainstorming.
Here are a few of my suggestions about groups to join. These were picked because they focus on our industry and as of this writing they have the more members than some of the other groups. I don’t have any stake beyond wanting to push toward a critical mass of users to make the groups more useful.
The first is Motorcycle Industry Professionals. This group is a pretty high-level group that covers more than just dealers. It already has over 1,000 members and it has hosted a few pretty good discussions.
Next up is the Motorcycle OEM Network. This is a good group to be in if the goal is to engage in some constructive conversations between the OEM’s and their dealers.
Wrapping up LinkedIn we have the most obvious, the Motorcycle Dealers Group. Unfortunately this group only has about 100 members currently and for the sake of this month’s column, it’s the one I want to see really bloom.
Finally, we have Dealernews’ own Shop Talk. You really should be a member of this social network because you’ll also be kept informed of blog posts from the Dealernews staff as well as other important information from Dealernews.
So now that you’ve signed up, start participating! Ask questions… What impact are e-bikes going to have on our industry? What kinds of features should the ultimate DMS system have? What kinds of parking lot events are folks running that break the mold of the tired-out “open house”? If you see a question or discussion that you can provide valuable insight, jump in!
So now we’re left with the big questions of “why?” Why do I want to poke, prod, and encourage all of you to participate in these discussion forums? The answer is because I want to make sure that our industry sticks around as long as possible. I want the fundamental structure of small and medium sized dealerships to be able to compete with the growing threat of mega-online shopping sites, direct to consumer sales from PG&A manufactures and vehicle OEM’s. I’m positive that if we can start raising and answering more and more questions and addressing more and more issues that are pressing on our businesses as a collective business unit, the stronger we can be.
In the absence of a strong, nationwide, dealership-focused trade organization that has a vibrant and active membership, maybe we can build it ourselves using the amazing potential of existing social networking sites like LinkedIn and Dealernews’ ShopTalk. Fingers crossed!
Tags:Column, dealerships, marketing, recommendations, social marketing, social media, social-networking, web2.0
August 1st, 2010 — Business, E-Commerce, Powersports Industry, soapbox
This month I’m going to dive into a topic that I believe will be one of the most important factors contributing to the long-term viability of the business model that drives our industry. That topic is the retail supply chain in our industry. Specifically the issue of suppliers that sell direct to your customers.
Long before I got into the e-commerce and internet marketing racket or got professionally involved in the powersports industry I received my college degree in what’s now called (but wasn’t yet widely known as) supply chain management. Combining that education with a lifetime of being a computer geek, and being smack dab in the middle of the dot-com boom in Silicon Valley in the middle and late 90′s has provided me with a rather unique perspective with regards to how the internet and related technologies relate to doing business on the web.
Some of my first thoughts when e-commerce burst on the scene back in the dark ages of the web was that the internet was obviously going to have a tremendous disintermediation effect on pretty much every facet of the traditional supply chain. In a nutshell, disintermediation is the process of removing “links” in the supply chain.
Low and behold through a series of twists and turns in my schizophrenic career path I end up with the amazing opportunity to watch, comment on, and participate in the very phenomenon! Not only do I have this opportunity, I have it in an industry that has been so benighted, backwards, and generally late to the party when it comes to modern technology, modern business practices, and attitudes that it’s getting hit harder and faster than a lot of other industries ever were.
For background I direct you to an October 2009 post on Dealernews’ blog by editor Arlo Redwine entitled “Vendors That Compete Against Their Own Dealers“.
That post generated (relative to the majority of posts on the DN blog site) a large number of comments. I strongly suggest you go and read that post and the comments. While you’re there, take some time an offer your point of view on the subject. Our industry needs more dialog on these issues.
Arlo again touched on this issue in June with his excellent job of moving this along by offering an introduction to Shopatron, a company that allows OEM’s to sell direct, but have the actual fulfillment handled by dealers that participate in the Shopatron program.
All of this has done an excellent job of laying out who some of the players are and the techniques they are using to transform the retail supply chain for (currently only) PG&A.
I want to spend a little time looking at why the OEM’s are doing what they are doing, what you need to be thinking about and more importantly how you can prepare for how all of this is going to shape our industry in the future.
First, one has to ask: “why the manufacturers are doing this in the first place?” Why would a manufacturer that has had a retail supply chain in place decide to radically alter that by selling direct to the consumer? Based on conversations I’ve had, things that I’ve read, and my own analysis, I think it comes down to the OEM’s not believing in either the long-term vitality or maybe even the long-term survival of the powersports industry’s retail supply chain.
Put simply OEM’s don’t feel that the traditional dealers are adequately meeting the market demand for their products. That can be in terms of gross numbers, product mix, whatever. The bottom line is that for OEM’s to make this move it’s a signal that they don’t trust the established retail channel to move enough product. An OEM that’s selling direct is saying to you, “you’re not getting the job done, so we’re going to work on cutting you out.”
Quite a few of the OEM’s that want to sell direct are currently willing to use services like Shopatron (or 50 Below’s “Referral E-Commerce” affiliate program for distributors), but I think they are only doing it for two reasons: self-serving interests and political cover.
The self-serving interests has to do with Shopatron’s stated policy that fulfilling dealers must have the product in stock in order to “bid.” This has the effect of forcing inventory deeper into the supply chain, pushing it down to the retailers that want to participate. This helps the OEM’s books by allowing them to recognize the revenue and get that inventory off their books freeing cash and increasing profits. Of course this also pushes the excess and obsolete risk to the dealer/retailer, eats up their cash, and violates pretty much every tenet of progressive, modern supply chain management principals. The deeper in the supply chain a product is carried the lower its utility and the higher its cost.
Paradoxically, the more “successful” Shopatron and the OEM are in getting dealers signed up, the more competition there is for each of these orders. As the deciding factor for who gets the order from the Shopatron system is based on the combination of having the item in stock and the physical proximity of the dealer to the customer we end up with more dealers/retailers carrying more and more inventory hoping to collect more and more of the crumbs that fall from the OEM’s table.
This is great news for the OEM’s (except for those that have generous inventory rotation or send-back policies. If there’s an OEM that has a no-questions asked, unlimited return policy that is also participating in Shopatron, I would argue that they need to fire whomever is running their channel strategy). The OEM’s now have an enticing carrot to get retailers to carry more of their inventory which is something that they have always seemingly wanted more than anything, even if in this time of relatively cheap expedited logistics it’s a stupid thing to do.
Of course if the retailers/dealers balk at taking a bite at the carrot and don’t sign up for Shopatron or don’t increase their stocking levels, the OEM will make the sale anyway (most of the time at full retail!).
The OEM’s can always defend their decision to sell direct by saying, “hey, we offered the olive branch of giving you the opportunity to participate in Shopatron and make this sale. Don’t be mad at us!”
Shopatron is win-win for the manufacturer. There is no downside for them, but there’s plenty of potential downside for the dealers. I’ve already brought up the issue of inventory liability. But what about direct competition?
Take for example a prominent vehicle OEM (we’ll call them BRANDX) which sells direct from its own Shopatron powered site shop.BRANDX.com.
Let’s say that I’m a dealer that has spent considerable time and energy building an e-commerce operation selling their stuff. That includes significant investment in things like SEO to make sure my site shows up high in the search results.
I’ve managed to get ranked in the top 5 for several BRANDX related keywords. Keep in mind that several studies have shown that as you move down the search engine results pages (SERPS) the chance of getting someone to click on you drop dramatically.
Now BRANDX comes along with a naturally highly ranked domain name (BRANDX.com) that is running its store at a subdomain (store.BRANDX.com). All of a sudden my previous #5 rank in Google is #6 because BRANDX’s own site is ranked #5. Using some of my SEO tools that check search engine position, that has indeed happened. This is not a hypothetical. There are retailers/dealers that are indeed losing real online sales to their own OEM and by extension to a competing dealer that is participating in Shopatron or to the OEM themselves if it’s for a product that no one bids on in Shopatron.
Of course the situation is even more heinous if the manufacturer that’s selling direct is not using Shopatron or any other method to pass the sale on to its dealer/retail channel. If you are competing directly with a manufacturer for retail sales, you need to really question why you are doing business with them and selling their products. There may be some legitimate reasons to do so, but in our industry the way it is today, those reasons are few and far between.
Why have we gotten to this point? I believe that it comes down to the systematic failure of our industry to adequately develop a supply chain that meets the needs of the modern marketplace. That, combined with the fact that OEM’s, distributors’, and retailers’ motivations and incentives are often at best incompatible, if not downright counter-purpose. Mix in thousands and thousands of retailers/dealers that are all selling virtually undifferentiated products that are relatively low margin, high cost, and high-cube and you’ve got the situation we’re in now.
So what do we do about it? Well, the first thing you need to do is get signed up for Shopatron. That’s a 100% complete no-brainer. As long as it’s there, you need to sign up for it and monitor it for any orders that you can fulfill. Keep in mind that these are already lost sales. Only by being in Shopatron can you attempt to recapture them. Unless you have a strategic interest to really jump into Shopatron, I would not recommend increasing your inventory stocking levels until you get a feel for what the market is like for the brands and products. Just use Shopatron like a line in the water initially.
To conclude, I don’t think there’s necessarily anything overtly nefarious about Shopatron, or OEM’s trying to fulfill what they see as un-served or under-served demand in the market. OEM’s that I’ve talked to say that they have basically been pushed into this position as they have customers contacting them directly wanting to buy because they can’t find what they want in the retail channel. I just think that the current solution is at best a band-aid that still tips the playing field too far in the OEM’s and large retailer’s favor at the detriment of the rest of the dealers.
Ultimatly one of two things will happen: Better information systems and processes will be developed that allow real-time sharing of supply and demand information up and down and across the powersports supply chains to insure more efficent operations… Or… There will be less and less opportunity for the smaller dealerships and retailers that make up the current landscape.
Tags:Column, dealerships, E-Commerce, ecommerce, Merchandising, powersports, Powersports Industry, Search Engine Optimization, supply-chain
June 24th, 2010 — Business, E-Commerce, Powersports Industry
Imagine this scenario: You’ve survived the Great Recession. However to make it through the epic national blood-letting you had to dramatically reduce your shop’s staff. However, now that riding season is here you’ve got customers coming into your shop looking to buy gear or get information on vehicles. Unfortunatly, you don’t have the staff level required to give personal attention to everyone. What can you do to help mitigate this issue until you can get staffed up again?
Well, do you have a website? One of those fancy e-commerce enabled ones that you’ve never really been able to do a whole lot with or see a dramatic ROI?
Here’s this month’s mind-bending idea… Turn your web presence inside out! Set up a few obvious, friendly, comfortable locations in your dealership where customers can access your website and get information about vehicles, parts and gear.
The formal name for these would be Internet Kiosks. They are a great way to leverage a powerful asset that you are most likely not using to it’s full potential right now. It allows customers to do a certain amount of self-directed research or shopping in a similar way that they do now with a brochure (but you never run out) or with those stacks of parts catalogs (without all the counter clutter).
Kiosks are not just a band-aid for a lack of staff. They have proven to be worthwhile enough that major retailers like REI, Staples, and Best Buy have made them part of their stores. In addition to just having customers use the kiosks on their own, they are useful as a tool to have your parts or sales staff use with the customer.
By seeing how effective your site can be in a real-world scenario maybe you can justify spending the time and money to make your website even better. Merchandise your site and create useful product groupings to help customers in your shop and you’ll automatically have a website that will perform better out in its natural habitat of the internet.
So how would you pull this off? Well, there are companies that can provide you with ready-made internet kiosks (Google “internet kiosk manufacturer”) so you can just plug-and-play. If you have access to someone with adequate technical capability you could also whip these up yourself.
Browsers like Internet Explorer, Firefox, or Chrome all have the ability to be run in a Kiosk mode. Kiosk mode basically locks down the browser so that the user is very limited in what they can do. There’s no ability to access the OS, run other programs and so on.
A basic PC from Dell or HP that would be suitable can be had for a few hundred bucks. You can even go for one of those new touch-screen based all-in-one models. A fairly stylish computer stand from Ikea will set you back like another hundred bucks.
You could even pull off this idea with one of Apple’s new iPads. Regardless of the computing device you choose you’ll of course want to make sure the entire thing is secured to avoid having it walk out of your dealership.
And speaking of security, you’ll want to either install filtering software on the PC or control access at your store’s network router to limit the sites that the kiosks can access. You don’t want customers surfing porn or, worse yet, visiting competing dealer’s or retailer’s sites!
Finally you’ll want to communicate to your staff what’s up with the kiosks. Make it clear that you don’t see the kiosks as a way to replace the humans in shop. Educate your staff that the kiosks are a tool that they can use to actually improve customer interaction when they have the bandwidth or as a way to allow customers to do a little “self help” when things are crazy. It’s better than having customers wander aimlessly around your shop twiddling their fingers waiting for someone to help them.
Don’t let the lack of staff be the only reason you try out the kiosk idea. Many top retailers have found that having shopping kiosks are a great way to flesh out a full multi-channel retail strategy. Maybe you’ll discover you’ve been sitting on a secret gold mine all this time. You just needed to look at it differently!
Tags:Column, dealerships, E-Commerce, ecommerce, Merchandising, powersports, Powersports Industry, selling-online
May 24th, 2010 — Business, E-Commerce, Powersports Industry
By now I think most of you reading this column have heeded the advice from my past columns and gotten onto the social media bandwagon in one form or another. You’ve got a Facebook fan page, a twitter account, maybe a MySpace page and if you’ve been really ambitious a blog or a forum. You’ve created a profile on Google Maps and Yelp where customers can post reviews. You’ve gotten out there in an attempt to make your business more visible. Unfortunately, that visibility can quickly turn you into a target.
Like so many things in life, there’s always the law of unintended consequences to deal with. The social media landscape is no less prone to subjecting you to this law. This month I’m going to address what happens when you get negative, harsh, or even intentionally hostile interactions on your social media channels.
In days gone by (a whopping 5 years ago or so) if a customer had a serious beef with your business, they were pretty much limited to things like the “We’re on your side” segment on the local news, a letter to the editor of your local paper or maybe a negative report to the BBB. These days it’s mind-bogglingly simple for a ticked-off person with an ax to grind to single-handily destroy, or at least seriously damage, your business’s online reputation. And a supreme irony here is that a lot of these soapboxes from which they shout were built by you!
There’s basically three variants of folks you’re going to have to deal with:
Category #1) The legitimately (at least to them) ill-treated customer that feels like they have not been able to get the resolution they want and has decided that they will “show you” and make the issue public.
Category #2) A person that is blatantly hijacking your public spaces or the web in general at the behest of a competitor.
Category #3) A common garden variety of internet troll.
I’ll give you some generally accepted methods to deal with each of these.
The first variety can be the most damaging if you deal with it badly. These are folks that have spent money with your business and feel that somehow they didn’t get the response they feel they deserved. Often these people have already talked to someone at your shop about their grievance (in person, phone, or email). That means if it gets to the point they are venting on your Facebook page or ripping you apart on Yelp your customer feedback process in the real world broke down. They left not just unsatisfied, but so pissed off that they have sworn a vendetta against you and by God they will personally see to it that not another living soul ever does business with you again (again, once upon a time there wasn’t that much one irate customer could do to you… Now all they need is a little time and know-how and this once idle threat can be alarmingly real).
There’s basically three outcomes from this kind of altercation. The first involves you taking a big step back to determine if this customer’s got a legitimate point. Not from your standpoint, but from the standpoint of a typical customer that is going to read what’s going on online. You may not like it, but customers have certain attitudes about what is and isn’t fair. Face it, you feel that way plenty of times. There’s always two sides to a story. Sure you can deny the guy’s extended warranty claim because of some small print, or sure the customer is supposed to deal with the manufacturer of that widget for repairs, but customers don’t always see it the way you want them to.
If you decide that it’s best to appease this irate individual then I recommend doing it offline and as part of the “agreement” convince them to post how the outcome was favorable and everything is just fine now.
Of course a great deal of damage can already be done because it’s probable that their Yelp review, “Crazy Harry’s MotoMall is run by a corrupt ferret!” has already been crawled by GoogleBot and indexed so that when someone Googles your business name they see the post header or page title, but never see the retraction or follow up. And no, Google (or even Yelp for that matter) will not remove that entry. Welcome to the brave new world of a permanent online record!
The second outcome is that you feel the customer is being unreasonable, you are almost 100% certain that most reasonable people would agree, so you post your side of the story calmly and clearly and wait for the general public consensus to come to your aid (i.e. your Facebook fans, Twitter followers, etc. rally behind you and essentially shout the complainer down).
The final outcome is just to ignore they guy. Let him vent, maybe let some of your forum members, Facebook fans, etc. defend you but you essentially remain above the fray. This option is probably not the best for small business. The big guys like Dell and Apple can operate this way because they are huge and the vocal minority, no matter how loud, will not make a large enough impact. You are a small business that relies on a smaller number of customers that may be swayed by the complainer’s arguments. Therefore I suggest that you engage these folks and don’t just ignore them.
Next up is something that’s gaining more wide-spread attention. Your competition, either directly or though various proxies, make a concerted effort to blow you up online. Believe it or not, there are actually companies that you can hire who’s sole purpose is to essentially nuke your online reputation. They don’t typically advertise this fact, but they are out there, often as a part of a marketing firm or SEO/SEM company.
It’s often hard to tell if what’s going on is the work of a “real” customer or a hit-job by a paid online assassin. The best indicator is if the negative online vibe is cranking up all at once, or if it’s just a onesy-twosy type thing. If you start seeing your business name all over the web in negative posts, or if you go from 3 positive reviews on Yelp to 300 Negative ones in the course of a few weeks, it’s pretty easy to figure out what’s going on.
Unfortunately if you get hit with this kind of thing, there’s really not much you can do to fight back beyond trying to overcome it with legitimate positive karma. If you have run a good business for years and you have thousands of legit and happy customers, fans on Facebook, or forum users, quite often your friends will come to your aid in denouncing the attackers. That’s the best you can hope for. A grass-roots uprising of supporters defending your honor in the court of public opinion. Of course if your business has developed a somewhat well deserved reputation as a place to get screwed and you’ve focused on how to squeeze every penny out of a deal at the risk of long-term customer loyalty, well… Karma’s a bitch.
There are companies starting up that focus on “online reputation management” that can help you out to an extent, but they are not typically cheap, nor are they fool-proof. If an attacker has created a ton of negative pages on websites like joe-bobs-moto-shack-sucks.com and avoid-joe-bobs-at-all-costs.com and they do some basic SEO so that when a person searches for your business in Google and your real site is #5 behind these assassination pages or a ton of negative reports on www.ripoffreport.com, your only recourse is to create some more sites and SEO them so that the “bad” pages fall off the first page in the SERPS (search engine results pages). Yes, it can get ugly.
The killer here is that as far as I can tell there’s nothing legally wrong with this if the pages, posts, reviews, etc. have factually accurate information. In the US at least the truth is a defense against libel and slander. So imagine that you get bad reviews from real customers on Yelp that rip you apart. An “attacker” can take the facts of those negative reviews and essentially repeat these “facts” on a few hundred websites, blogs, forums, etc.
Most of you out there do not have the luxury of really solid, defensible positions in the search engines therefore you are very vulnerable to this kind of attack. If you have not been in the top 5 or so for years for your own name, it would be really, really, really easy in a long afternoon for someone with the will and the know-how and a little bit of cash for domain registration to blow you away.
The last kind of issue you’re going to have to deal with are the internet “trolls.” Trolls are basically losers holed up in their parent’s basement basking in the relative anonymity that the internet provides and throwing grenades into online forums, Facebook, etc. just to make you look bad and to feel a power rush. Typically if they post under their own name like on Facebook, they are not a troll. If they post with a cool handle like m0T0dUde or something else anonymously they are a troll.
The primary axiom when it comes to these idiots is: “Don’t feed the trolls.” If you are positive that the poster in question is just a troll and does not fall into one of the above categories that require action or a response, just ignore them. Hopefully your loyal customers will beat these idiots back into their basement where they can go back to playing World of Warcraft or giggling like school girls at the latest LOLCATZ. But make sure that you do a good job of identifying the person as a troll. If you get it wrong and ignore them they can easily go into category #1 and if they are really pissed off at you, they can take it to category #2
The moral of this story is that today, more than ever, it’s vitally important that even marginally (in your eyes) pissed-off customers are handled before they get a chance to do real damage to your online reputation. The best defense is a good offense. Make sure you are running your business in a way that only the most unreasonable folks have cause to go screaming, pitchfork and torch in hand, through the virtual village to burn down your castle. Make sure that you have established a wide and deep social media presence and that you own site is SEO’d to the hilt so that it can’t get buried by negative decoy sites. Because now more than ever, the world is watching, and they ALL have access to the microphone.
Tags:Column, community-marketing, dealerships, Powersports Industry, social marketing, social media, social-networking, web2.0
April 1st, 2010 — Business, E-Commerce, Powersports Industry
The idea for this month’s column came to me last year when I was out doing some Christmas shopping. I didn’t have a specific item in mind, but I did have a general idea. Now this is a store that I don’t normally do a lot of shopping in so I’m sure when I walked through the door I had a little of that “deer in the headlights” look. Fortunately this store was staffed with knowledgeable and helpful staff and I think even more importantly, the products were organized and presented in a manner that made it, if not enjoyable, at least pleasant to shop in.
One thing that’s pretty obvious from looking through those stacks of catalogs on your parts counter is that we are in an industry with an insane number of products that our customers can choose from. While a small percentage of the hard-core enthusiasts know exactly what they want (you know the type.. The ones that have the distributor catalog memorized and come in with reams of printouts from the forums) most people need some help figuring out what they need or even more importantly what they don’t know they need.
Unlike in your physical store where you can have one of your knowledgeable and helpful staff aid a lost customer, on your website for the most part, the customer is on their own (unless of course you’ve got some type of online chat and co-browsing or co-shopping application on your site).
When it comes to e-commerce, the only tool you really have to help the customer is the merchandising on your website. For the purpose of this column I’m going to define merchandising to encompass three things:
- Organization of the products (product or feature groups, category and taxonomy development, etc.)
- Selection of products (what product go into those groupings or receive some other type of “feature” status)
- Presentation of the products
The first two elements go hand in hand. You can create a “category” on your site and call it something like “Maintenance Essentials” with products that pretty much anyone that rides any type of powersports vehicle is going to find useful or necessary. One of those items may be chain lube. Let’s say you’ve got access to like 10 different brands each with 3 variations and 3 different sizes. That’s 90 different combinations! For one simple product!
Imagine this type of scenario that I think makes up 80% of the shopping situations out there: A guy rides his motorcycle as an alternate commute vehicle and an occasionally for recreation. He likes his motorcycle, but he’s got a life. He doesn’t spend every waking moment on forums to determine what the ultimate chain lube is. He doesn’t ride with a big group of people that will sit around debating the relative benefits of various type of chain lube. All he knows is that his chain looks dirty and needs cleaning and lubing.
He goes to your site, or any typical site, and types in chain lube and is presented with almost 100 choices! For a simple product like chain lube! You need to make sure that on your site that you’ve picked the “best” one or two options for these major product types and present them in a way that makes it 1) easy to find and 2) communicate that based on your expert opinion that these are the ones to go with. Basically the exact same thing that a good parts person would do in a face-to-face situation. The difference is that online you need to do all of this before the customer ever comes onto your site.
There are a few different ways that you can do this. The first is the idea of creating multiple personas of model customers and so scenario planning on how they may interact with your site. Create like 3 to 5 customer types (the hard-core enthusiast, the casual rider, the spouse or parent of a rider, the total noob, etc.) and then imagine a few different scenarios for each type (a major part broke and they need to find a replacement right now, they are new to riding and need everything but don’t know anything, they need to buy a birthday gift for their wife, son, friend that rides, and so on). Pretend to be these various types in various situations and try to organize your site so that there are obvious categories and product assortments that make each customer’s shopping experience as fulfilling as possible.
If your site has been live for a few years and you’ve been using a good analytics package, you can use its data to see how people use your site and utilize real-world data in your scenario planning. Where they go, what they buy, what they look at and don’t buy, etc. etc.
Obviously this is all a lot of work. It’s so much easier to just buy a site from a 3rd party vendor with all the catalogs pre-loaded, or build your own and dump a product feed into it, have a few general categories like helmets, exhausts, etc., and be done with it. That’s what 99% of the sites out there do, and that’s why 99% of the sites out there suck and don’t sell anything! Not only does merchandising make it easier to shop, it’s just about the strongest tool you have to differentiate your site from all the other sites out there!
That doesn’t mean that you should do away with the potentially millions of other products in your online catalogs. More often than not, you’ll want to present that potentially overwhelming selection on a second layer behind the your primary merchandising and allow customers to drill down to explore. Always have a “See all of our chain lube products” link next to your hand-picked selection. Of course a robust and powerful search tool is your best bet to handle these kinds of shoppers.
So now that we’ve dealt with the product selection and organization ideas, let’s move onto the final piece, the presentation of those products.
There are so many cool technologies these days that can help you communicate the features, advantages, and benefits of the products that you sell. You’ve of course got the good ol’ custom written and compelling product description. You’ve got the ability to take your own product photos that show things like the product in use, various angles or views, mounting options and so on. You’ve got videos that you can post on YouTube and embed in the product page. You can post sound files of exhaust systems. The limit is really only your imagination and the amount of time you want to devote to it.
At the very top you can even go big time and use rich-media technology like Adobe’s Scene7 (www.scene7.com) that can provide a huge range of presentation and interaction opportunities.
Try to remember that you are the expert in what you sell. Use that expertise to help customers figure out what they should be buying and communicate it through professional merchandising on your site.
Tags:Column, copywriting, dealerships, E-Commerce, ecommerce, internet, Merchandising, motorcycle, powersports, Powersports Industry, selling-online
April 1st, 2010 — Business, Marketing, Powersports Industry
The idea for this month’s column came to me last year when I was out doing some Christmas shopping. I didn’t have a specific item in mind, but I did have a general idea. Now this is a store that I don’t normally do a lot of shopping in so I’m sure when I walked through the door I had a little of that “deer in the headlights” look. Fortunately this store was staffed with knowledgeable and helpful staff and I think even more importantly, the products were organized and presented in a manner that made it, if not enjoyable, at least pleasant to shop in.
One thing that’s pretty obvious from looking through those stacks of catalogs on your parts counter is that we are in an industry with an insane number of products that our customers can choose from. While a small percentage of the hard-core enthusiasts know exactly what they want (you know the type.. The ones that have the distributor catalog memorized and come in with reams of printouts from the forums) most people need some help figuring out what they need or even more importantly what they don’t know they need.
Unlike in your physical store where you can have one of your knowledgeable and helpful staff aid a lost customer, on your website for the most part, the customer is on their own (unless of course you’ve got some type of online chat and co-browsing or co-shopping application on your site).
When it comes to e-commerce, the only tool you really have to help the customer is the merchandising on your website. For the purpose of this column I’m going to define merchandising to encompass three things:
- Organization of the products (product or feature groups, category and taxonomy development, etc.)
- Selection of products (what product go into those groupings or receive some other type of “feature” status)
- Presentation of the products
The first two elements go hand in hand. You can create a “category” on your site and call it something like “Maintenance Essentials” with products that pretty much anyone that rides any type of powersports vehicle is going to find useful or necessary. One of those items may be chain lube. Let’s say you’ve got access to like 10 different brands each with 3 variations and 3 different sizes. That’s 90 different combinations! For one simple product!
Imagine this type of scenario that I think makes up 80% of the shopping situations out there: A guy rides his motorcycle as an alternate commute vehicle and an occasionally for recreation. He likes his motorcycle, but he’s got a life. He doesn’t spend every waking moment on forums to determine what the ultimate chain lube is. He doesn’t ride with a big group of people that will sit around debating the relative benefits of various type of chain lube. All he knows is that his chain looks dirty and needs cleaning and lubing.
He goes to your site, or any typical site, and types in chain lube and is presented with almost 100 choices! For a simple product like chain lube! You need to make sure that on your site that you’ve picked the “best” one or two options for these major product types and present them in a way that makes it 1) easy to find and 2) communicate that based on your expert opinion that these are the ones to go with. Basically the exact same thing that a good parts person would do in a face-to-face situation. The difference is that online you need to do all of this before the customer ever comes onto your site.
There are a few different ways that you can do this. The first is the idea of creating multiple personas of model customers and so scenario planning on how they may interact with your site. Create like 3 to 5 customer types (the hard-core enthusiast, the casual rider, the spouse or parent of a rider, the total noob, etc.) and then imagine a few different scenarios for each type (a major part broke and they need to find a replacement right now, they are new to riding and need everything but don’t know anything, they need to buy a birthday gift for their wife, son, friend that rides, and so on). Pretend to be these various types in various situations and try to organize your site so that there are obvious categories and product assortments that make each customer’s shopping experience as fulfilling as possible.
If your site has been live for a few years and you’ve been using a good analytics package, you can use its data to see how people use your site and utilize real-world data in your scenario planning. Where they go, what they buy, what they look at and don’t buy, etc. etc.
Obviously this is all a lot of work. It’s so much easier to just buy a site from a 3rd party vendor with all the catalogs pre-loaded, or build your own and dump a product feed into it, have a few general categories like helmets, exhausts, etc., and be done with it. That’s what 99% of the sites out there do, and that’s why 99% of the sites out there suck and don’t sell anything! Not only does merchandising make it easier to shop, it’s just about the strongest tool you have to differentiate your site from all the other sites out there!
That doesn’t mean that you should do away with the potentially millions of other products in your online catalogs. More often than not, you’ll want to present that potentially overwhelming selection on a second layer behind the your primary merchandising and allow customers to drill down to explore. Always have a “See all of our chain lube products” link next to your hand-picked selection. Of course a robust and powerful search tool is your best bet to handle these kinds of shoppers.
So now that we’ve dealt with the product selection and organization ideas, let’s move onto the final piece, the presentation of those products.
There are so many cool technologies these days that can help you communicate the features, advantages, and benefits of the products that you sell. You’ve of course got the good ol’ custom written and compelling product description. You’ve got the ability to take your own product photos that show things like the product in use, various angles or views, mounting options and so on. You’ve got videos that you can post on YouTube and embed in the product page. You can post sound files of exhaust systems. The limit is really only your imagination and the amount of time you want to devote to it.
At the very top you can even go big time and use rich-media technology like Adobe’s Scene7 (www.scene7.com) that can provide a huge range of presentation and interaction opportunities.
Try to remember that you are the expert in what you sell. Use that expertise to help customers figure out what they should be buying and communicate it through professional merchandising on your site.
Tags:Column, ecommerce, marketing, powersports, Powersports Industry, selling-online
January 1st, 2010 — Business, E-Commerce, Powersports Industry
Welcome to 2010! I want to kick off this year with a column about selling online, but selling someplace else other than your own website. This is something that you can engage in even if you’re not directly engaged in full-blown e-commerce on your dealership’s primary website.
What I’m talking about is taking advantage of things like e-commerce applications on social networking sites like Facebook and other “widgets” that you can embed in blogs or forums.
The first example I’ll point out is a company called Payvment [http://www.payvment.com/] that has a nifty little storefront application for Facebook.
In order for this to work you’ll need to have a Facebook fan page set up for your dealership. You simply install the application on your page, set up the look at feel of the storefront using the tools that Payvement gives you, enter in some information about your shop, and then start loading products. (Obviously there’s more detailed steps involved and Payvment’s site provides all the details).
I’d recommend experimenting at first and a load a small selection (around 10) of products that are impulse buy, gift, general interest type of products. You’ll want to keep in mind that Facebook is not really a shopping destination, and typically you’ll want to focus on the interaction and social networking aspect of Facebook and keep the sales pitches to a minimum. But since it is a fan page, I see it as a great way to sell things like t-shirts, hats, and other items branded with your shop’s logo, or the brands that you carry.
Considering that Payvement is totally free to use right now, there’s really no reason to not give it a try and see if there’s a sensible way for you to fit it into the overall online activities.
One dealership that has begun experimenting with Payvment is Ducati Seattle [http://tinyurl.com/ykppl42]. What’s interesting about the fact that they have this e-commerce application running on Facebook is that they don’t even have any e-commerce on their primary dealership website!
Ducati Seattle’s Cindy Wallace is in charge of the Facebook storefront as well as their eBay store where they focus on selling crash damage take-offs, excess & obsolete, etc. Cindy told me that based on a combination of factors (strong local community support & involvement in the shop, etc.) Ducati Seattle has made the decision to not have a full-blown e-commerce operation. “People prefer to come into the shop to buy things where they can actually see them and to see other people there as well.”
But that doesn’t mean that they are not active online in other ways. Based on leadership by Ducati Seattle’s owner David Roosevelt they have made a decision to be very involved in social media like Facebook. Considering that they have over 1,200 fans on their Facebook page it makes sense that they are giving the Payvement application a test ride.
Another Facebook application for selling products from within your Facebook page is Nimbit MyStore for Facebook [http://tinyurl.com/yzvdzxh]. Nimbit seems to be going more for the rock band trying to sell merchandise angle (so they offer features like the ability to sell tickets or downloadable music), but I don’t see why you couldn’t use it to sell merchandise for your shop. Nimbit has several offerings that range from free to about twenty bucks a month.
Moving away from Facebook, I want to point out that there’s a growing number of widgets that allow you to place shopping experiences on more content-centered (as opposed to shopping-centered) websites and pages. A widget is a small bit of code that you embed in a webpage that provides a little area or box where something shows up that gives people information (weather, race results, etc.) or in our case a product display with the ability to buy it right there.
These widgets allow what I call contextual commerce. Where you can offer products that go along with the content the visitor is reading about. Writing a post in your blog about how to bleed the brakes? Why not have a widget in the side bar selling brake fluid, brake bleeders, pads, etc?
There’s quite a few people playing in this widget area out there. Here’s a few leads to get you started: BlinkCart [http://www.blinkcart.com/], Shopit [http://www.shopit.com/], CartFly [http://www.cartfly.com/], and Amazon [https://widgets.amazon.com/] even has widgets that let you sell products they offer (or that you have loaded as an Amazon merchant) on your site.
Check out Widgetbox (a clearinghouse of all things widget) as well and check out the ecommerce tag http://www.widgetbox.com/tag/ecommerce. Finally, of course, you can always Google “e-commerce widgets” to track down more of the latest and greatest as developers keep the wheels of progress humming along.
Having a storefront on Facebook or an e-commmerce widget on your blog is most likely not going to be a silver bullet in terms of generating a huge amount of extra revenue. A lot of this has to do with the fact that most people out there are not in the shopping mood when they are on a social site like Facebook. However, having a good selection of impulse purchase products and gifty items makes a lot of sense. It gives you a chance to have a few more hooks in the water in terms of selling things and it keeps you abreast of what’s going on in the world of e-commerce technology and off-site merchandising.
If you give this a try, please let me know how it works for you!
Tags:Column, contextual commerce, dealerships, E-Commerce, ecommerce, internet, marketing, Merchandising, motorcycle, powersports, Powersports Industry, selling-online, social marketing, social media, social-networking
November 1st, 2009 — Business, E-Commerce, Powersports Industry
Last month’s column generated more emails than any other that I’ve ever written. After years of telling dealers they needed to get online all it took was the near collapse of the Western world’s economy to get through to you. You’re a hard bunch to motivate.
The reason I’ve been so gung-ho on the web was because it was the only practical way for a dealership to dramatically grow its revenue. A dealership could do nothing and float along with the economy, and we’ve seen what’s happening to them. A dealership could try to expand it’s physical presence into other markets by opening more shops, but that’s expensive, difficult, and risky. Or a dealership could take on the web in a big way.
On one hand, it’s good that so many of you seem to be doing this now. On the other hand I think a lot of you may have missed the window of opportunity. At least as far as jumping into straight e-commerce goes. Especially if my email load is any indication. I know of at least 10 dealerships that say they are going to jump in. Add to that the huge number that didn’t write to me, the number of dealerships already doing it, and of course the huge pure-play e-commerce guys like MotorcycleSuperstore and RevZilla, and as you can see, the pool is pretty darn crowded now.
So given this situation, I want to end my series of columns for 2009 playing Nostradamus and set the stage for a plausible future that I think you need to be thinking about, if not outright planning for.
The year is 2012. The previous two years didn’t provide the much hoped-for economic recovery (think I’m being overly pessimistic? Read this: http://blogs.harvardbusiness.org/tjan/2009/09/the-next-crisis-coming-in-2011.html). The economy as a whole managed to eek out a small amount of growth but only enough to keep it from sliding backwards. What’s worse is that it proved to be a totally jobless “recovery.” Consumers in the USA didn’t have the disposable income nor the security necessary to fuel the powersports industry at a level necessary to maintain it’s current model. More and more dealers closed. So many closed in fact that large urban centers around the US were now without a single powersports dealership. OEM’s were sitting on warehouses and leased lots full of vehicles that were working on their second or third birthday. Production back in their respective home countries was at a virtual standstill.
The dire economic situation had now forced the OEM’s (as well as parts, accessory, and gear manufacturers) to rethink not only their own business models, but the overall business model for our industry as a whole. The idea of having literally thousands of typically undifferentiated retailers across the country selling virtually undifferentiated products out of establishments that by their very nature were burdened with unsustainable overhead and other expenses had finally proved its ultimate folly.
Customers still wanted their motorcycles, ATV, PWC’s, etc. The OEM’s still wanted to stay in business producing them. The ultimate problem was the distribution and retail sales system. Finally, the smart OEM’s hit on a model that had worked before. They looked at the personal computer market pre-Dell and realized that there was an opportunity to leverage the phenomenal opportunity that the internet provided and essentially sell semi-direct. Customers would shop on the OEM’s, pick out the vehicle and options, and then buy it online.
However, unlike the relatively inexpensive and “basic” home PC, the products in our industry presented a level of technical, financial, and legal complexity that they still required one more node in the supply chain. Unlike a PC from Dell, the vehicle would not be shipped directly to the end customer.
The solution was to evolve to a model that traded information for inventory. Vehicle and PG&A inventory was now held as high in the supply chain as possible. What were once “dealerships” that occupied ten’s of thousands of square feet were now transformed into small “authorized delivery, setup, and service” locations. It was a radical transformation from huge dealerships to many more boutique-type establishments that now focused on much more high margin business activities such as the F&I portion of the sale, vehicle service and warranty work, and so on.
The fundamental discovery that allowed this model to work was the realization that the just-in-time logistics costs to get the right vehicle to the right delivery point at the right time could be done far more economically than the aggregated real and opportunity costs of the old (i.e. current) way of doing things.
Customers also shop for OEM branded and produced PG&A on the OEM’s site and have the opportunity to take delivery (for installation or set-up for instance) of the products from participating retail/delivery locations for a revenue share with the OEM.
These Delivery, Setup and Service locations were now composed of mostly high-magin activities and were relieved of much of the non value-added overhead burden from the previous industry model. However, because there was the potential for so many more locations in any given market, the emphasis on quality and high levels of customer service was even greater.
So what’s the moral of this cautionary tale? It’s this: “if you think the internet has been disruptive to your business so far, you’ve most likely not seen anything yet”! Our industry has not yet even begun to scratch the surface of what the internet and all of it’s prodigal technologies and business practices can do for (or to) us.
I’m sure a lot of you are shaking your head and saying: “this guy’s nuts!” Keep in mind I was telling you all two years ago to get into the e-commerce game. I’m sure more than a few of the dealers trying to finally get into the e-commerce game once said the same thing about selling on their websites. Most of you didn’t move until it was too late on the e-commerce front. What if I’m right about this? What are you going to do to prepare?
Tags:Column, dealerships, E-Commerce, ecommerce, internet, motorcycle, powersports, Powersports Industry, selling-online