Panel: Post-crisis, dealerships need to improve efficiency

The coronavirus has forever changed automotive retail, and creating efficiency will be critical for dealerships going forward.

That theme will be a central part of the biggest decisions auto retailers make as they reorganize their businesses around COVID-19, the respiratory illness caused by the virus, dealership technology executives said last week during the inaugural Automotive News Retail Forum: Dealer Discussion panel.

That includes how to be more efficient with staffing. With technology and processes. With the customer experience. Many of these ideas aren't new, the CEOs of vehicle listings company TrueCar and dealership technology company CDK Global Inc. told Automotive News Publisher Jason Stein in a conversation about pandemic-induced forces changing retail.

Dealership adoption of tools to help consumers complete more of the vehicle purchase online has been an emerging trend for years. But the virus outbreak quickly catapulted the industry into a digital future that will require a deeper study of the way dealerships operate, they said.

"Fortunately, we were working on advancing and enhancing the digital retailing process pre-COVID," TrueCar CEO Mike Darrow said. "COVID's certainly been an accelerant to that. In my many years in this industry, it's proven over and over again to be an amazingly resilient industry. That's truly been tested in the past 90 days."

Post-pandemic, dealers will embrace technology more than they have before and adjust processes to new consumer trends — "things that we probably should have been doing in the industry more aggressively before," Darrow said.

Retail technology providers, too, have spun up new features and products to help dealerships reach customers during the pandemic. TrueCar, for instance, introduced a text-messaging feature that connects dealerships with consumers, while CDK made its Connected Store online retailing platform free to dealerships through 2021.

Dealerships are bringing more technology to the service department, as well, from contactless pickups and drop-offs to online appointment scheduling, CDK CEO Brian Krzanich said.

Having employees with technical skills will help dealerships as the tools become more advanced — for instance, virtual and augmented reality — because they'll need to work with multiple software providers, Krzanich said. That could lead to a restructuring of dealership staffing models, he added, with a heavier investment in information technology.

"There's just too many options that people are going to need, and so you're going to need technical skills to put that together into the flow that you want to have in your dealership," he said. "On the front end of [dealerships], you're going to need probably fewer salespeople, to be honest, as part of the efficiency."