In the ever-evolving automotive industry, three key areas are reshaping how dealerships operate and drive success: CRM’s (customer relationship management tools) customer reconditioning efficiency, and proper merchandising through Digital Vehicle Portfolios, or DVPs. All three of these concepts work together to boost profit per vehicle (PPV) and revolutionize dealership operations.
CRM Innovates the Industry
In 2000, the automotive industry saw the birth of CRM systems. Convincing dealerships of the value of such tools was no small task. Dealerships still relied on antiquated paper-based processes consisting of rolodexes and shoebox filing systems. Often, when salespeople left, so did all of their customers’ history. While internet leads were on the rise, they usually were referred to as “email leads,” and dealerships struggled to manage them effectively.
Forward-thinking dealerships immediately recognized the transformative potential of a CRM for their business. The platform revolutionized how dealerships handled inquiries from prospects and ultimately communicated with customers. Early adopters of a CRM system experienced a surge in sales as they harnessed the power of organized data and improved customer interactions. This set them apart as industry innovators.
Over time, the broader automotive industry caught on to the value of having a CRM and you’d be hard pressed to find a dealership that doesn’t use one these days. Dealerships came to understand that CRM could better foster lifetime customer relationships, streamline operations, and drive sales. Today, a dealership CRM is indispensable; it’s a foundational tool that drives sales and operations.
The Symbiotic Relationship
Fast forward to today, and there’s a compelling correlation between the previous adoption of CRM, the emergence of reconditioning efficiency, and the introduction of digital vehicle portfolios.
Dealers have become increasingly aware of the significance of fast and transparent recon and its direct impact on improving sales volume and net gross. The journey of improving recon efficiency has mirrored the acceptance of CRM.
Properly managing and tracking recon is no longer an option; it’s a vital part of the pre-owned vehicle business. Until recently, dealerships lacked efficient ways to manage and predict their pre-owned inventory’s status. This need is where reconditioning software tools come into play, transforming this critical aspect of the automotive business.
CRM’s Impact on Reconditioning
Valuable lessons were learned from CRMs, including effective time management. Timely communications are crucial in both customer interactions and reconditioning decisions. To this day, dealerships closely monitor internet response times, recognizing its necessity in the digital age.
This principle extends to reconditioning, where speed is critical. To compete effectively, dealerships should set a target recon process goal of five days or less. Slower reconditioning can lead to lower profits and lost sales as buyers seek a fast, accurate, and transparent experience when shopping for a used vehicle. Modern reconditioning tools’ primary focus on time management positively influences efficient reconditioning, ensuring no time is wasted.
Digital Vehicle Portfolios Enhance Profit Per Vehicle (PPV)
Now, let’s introduce digital vehicle portfolios into the equation. These portfolios are game changers in the automotive industry, providing customers with comprehensive vehicle information, including service records, brochures, and valuable content. This level of transparency enhances the perceived value of the vehicle, contributing to enhanced profit per vehicle.
The Synergy
The evolution and implementation of a of CRM system increased the importance of recon efficiency, along with the introduction of digital vehicle portfolios are interconnected forces reshaping the modern automotive industry. Dealerships that recognize the importance of these products and adapt — and adopt early — are poised for continued success and growth, giving them a substantial competitive advantage.
With these transformative elements coming together, the automotive industry will continue to experience a profound shift. Dealerships that continue to embrace CRM, optimize recon efficiency, and leverage vehicle portfolios are positioning themselves for sustained success and growth in this dynamic, fast-paced landscape. Having a CRM and reconditioning software solution is commonplace within the industry. Forward-thinking GMs have or are considering a DVP solution as well. This dynamic trio gives transparency to your employees and your customers, allowing everyone to feel empowered.
