Are all your KPIs relevant? What’s missing? For example, those that embrace a direct sales approach will no longer measure salespeople by their ability to move new forecourt stock, instead, dealerships will now have targets for maintaining a more sophisticated online presence, allowing consumers to digitally spec and purchase their new vehicles.
In 2022, Jim Rowan, Chief Executive of Volvo Cars, shared his thoughts with the FT, comparing the current transformation in the automotive world to the rise of the smartphone in the mobile phone industry. He explained that as Gen Z enters the car-buying market, their expectations will be vastly different:
“Gen Z are digital natives. They were born in a digital world, and therefore, they expect that digitisation.”
As the landscape rapidly evolves and automotive brands embrace new initiatives to respond to these changing needs and remain competitive, how will they know what ‘good’ looks like to gauge dealer network performance?
What are the biggest challenges OEMs face when understanding what good looks like in these new spaces?
Despite many automotive brands having years of data based on a franchise model to help shape their targets, there’s simply no historic data for new initiatives. Therefore, setting realistic targets to drive network performance can seem like a tall task. What’s more, there’s still market uncertainty around the new direction, which, when coupled with investment requirements, can create a very pressured environment.
With increased digitisation, those brands running off disparate systems and potentially using Excel for balanced scorecards will start to become overwhelmed by data, if they aren’t already. Analysing this unwieldy data to determine what good looks like will become more onerous, time-consuming and prone to error.
3 steps for measuring good dealer network performance for new initiatives
Acknowledging that everyone is in the same boat in terms of being unable to look back retrospectively in these areas is a good starting point. Focus is better spent on future-proofing systems and processes and conducting in-depth research.
Here’s our 3-step guide for OEMs illustrating what measures can be put in place:
- Procure a centralised business performance management solution
Having this single source of truth will ensure you glean insights from the wealth of real-time data, rather than multiple systems working independently. Choose a comprehensive platform that allows you to set and monitor actions based on your data for fuller visibility and control of performance. - Start benchmarking
With a centralised system in place, you can begin setting baseline metrics. You can compare site against site in terms of performance, start to identify best practices and understand what targets are achievable. The picture of what ‘good’ looks like starts to take shape. Over time, sites can be encouraged to adopt proven methods from your high-performing sites, with the aim of reducing performance dispersion among retailers.
Just as important is keeping a close eye on the market. Conduct competitor research to ensure your product is competitive. For example, consumers will be paying close attention to average range and charging times. Broader than this, also pay attention to the latest market research findings to help spot trends and understand national and regional averages, such as the average regional EV adoption rates and the development of the charging infrastructure. - Deepen your collaboration with retailers
OEMs and retailers will need to spend more time aligning objectives so that both parties are working towards common goals. Sharing the data relating to KPIs across the network will provide clarity and transparency on what work needs to be completed. For those brands that adopt an agency model, there will be far more back-and-forth in terms of touchpoints along the customer journey. A system that allows for better communication will ensure the appropriate team is held accountable for completing the necessary tasks to ensure a smooth customer experience.
The new benchmark for success is defined by the ability to deliver exceptional customer experiences, effectively manage leads and maintain robust dealer engagement – all of which can be achieved through increased collaboration.
Automotive brands that get their systems in order and keep a close eye on the market will be better positioned to tackle the changes ahead. Combining qualitative and quantitative data now will help future decision-making, but we are very likely to see OEMs iterate their strategies on a more frequent basis than ever before. If you want to see how Loop can reform your business performance management, contact us for a demo.
