Connecting clicks, bricks and likes
How will OEMs market their products in the future? Who will their customers be, what will they be expecting, and how will OEMs know what customers really ‘like’? What will be more important – a valuable product or brand value? Clicks, bricks, likes and connectivity will all play fundamental roles in the future of automotive retail, and those four terms summed up the core themes of Automotive World’s Marketing Summit USA 2013.
A key issue is not how the dealership of the future will look, but whether there will even be a place in the future for brick-based dealerships. Analyst Glenn Mercer, quoting NADA research on the operations of US car dealerships, claimed that, to date, not a single car sale had been conducted exclusively online in the US, including the complete transaction and all accompanying paperwork, without the need for a traditional dealership visit. Vishwas Shankar – referencing Frost and Sullivan’s Bricks and Clicks study on the future of car retailing – provided a confident forecast, however, of four million cars being sold online globally by 2020, equivalent to 4% of new car sales.
Clicks: online sales and marketing
The need for a brand to be online is undisputed – but how do you measure the financial return of an online advertising campaign, or make money from a Facebook ‘like’? What is a click worth? And how do you turn it into real money?
Being online and ‘social’ is about more than just direct sales, emphasised Mary Henige, GM’s Director of Social and Digital Communications. It’s about getting the right message out there, developing the brand, and “having a conversation with consumers”.
John Waraniak, Vice President of Vehicle Technology at SEMA agreed: people do not buy things, they buy into things. Frankfurt, Detroit and Tokyo are motor shows for people who like cars; SEMA is for people who love cars, and attendance has never been so high, attracting 60,000 visitors in 2012. SEMA is for car owners looking to personalise their vehicle after purchase. For those OEMs savvy enough to get in on the game, it is about more than a separate aftermarket business – it is an extension of the brand. That’s why, Waraniak said, brands should market with their customers, and not to their customers. Quoting from Graham Brown’s book All is Social, Waraniak explained that the 10-29 year olds of ‘Gen O’ “will be the generation that shows the industry the way forward in how new technologies, apps and products will be used to optimise the customer experience”.
The role of the car
Many see the role of the car changing from an object of desire into an aspect of the ‘internet of things’ – one more tool in the box that includes everything from public transport to domestic appliances. The car in the ‘internet of things’ knows when you are leaving the office, prepares your personal settings, selects an appropriate route based on traffic and your habits, and even sets the temperature in your house before you arrive, said David Miller, Chief Security Officer at Covisint, the event’s lead sponsor.
But will people even buy cars in the future? In the internet of things, private vehicle ownership could be superseded by car sharing, which might take one of two forms: car pools owned and operated by fleets, where registered members use vehicles on demand, perhaps paying by the hour; and private users renting out their cars when not in use. IBM’s Joe Speed believes that, were the infrastructure in place, cars that would otherwise sit in the company car park for eight hours could prove a lucrative source of income for office workers.
And if car sharing, not car buying, is to be the source of income for the automotive industry, then the financial value lies more than ever in the value of the brand, not the product. It is time to get marketing.
Martin Kahl is the Editor of Automotive World