More than 800 Dealers, dealership staff and allied industries spent a valuable two days at the 2017 AADA National Dealer Convention, at the Sydney International Convention Centre, at Darling Harbour, this week.
In what was one of the best AADA Conventions yet, delegates heard from keynote speaker, former Treasurer, Peter Costello, that change was unstoppable, and thus it was essential to be prepared.
Guest speaker, technologist and futurist Steve Sammartino, said that change would come faster than everyone expected, and predicted the shift from petrol to electric cars would be as swift and as universal as the change to smartphones. Within 10 years, you won’t be able to buy a petrol car, he foretold.
“When new technology arrives, customers can have their problems solved in different ways. That’s what technology does,” Mr Sammartino said.
“The business that we are in is the problems that we solve, not the products that we sell. The products that solve people’s problems change; we have to change as well.”
Advancing Innovation, Technology and Engagement
The Convention theme was conceived to address the challenges facing our industry as we move into a future of electric and autonomous cars, dealing with a new generation of customers and employees.
Facebook and Google led vital sessions, educating delegates on the strategies crucial for success in the Digital Age.
Facebook’s Head of Automotive, Ted Bergeron, demonstrated how to use Facebook to generate leads, how to use targeted advertising to cut advertising spend, how to use content – and what that content should be. He shared with delegates how to create the kind of ‘social experience’ that will attract attention in the crowded digital space.
The Google Digital Event consisted of four sessions covering: ‘Making sure your customers choose you’, ‘Your On-line Showroom’, ‘Bringing Customers Back in the Door’ and finally ‘The Evolving Dealership of the Future’.
Former Tesltra CEO and current CSIRO chairman, David Thodey, spoke to one of the convention themes, ‘Innovation’. He said businesses must create cultures that foster innovation, with the customer at the centre of decision-making.
“Being a customer-centric organisation is far deeper than just delivering great service,” Mr Thodey said.
“The most important thing you can do is to have such a customer-centricity that you never stand still. If you’re really listening to the customer, your business cannot stand still, because customers need change and they’re looking for more. Don’t get fooled into thinking customer-centricity is just about better service; it’s about very deeply what your company or your group stands for.”
Mr Thodey said Dealers should not regard themselves as in the business of selling cars, but in helping people to get where they needed to go.
“Innovation’s become a very popular term,” Mr Thodey said.
“To me , innovation’s very simple: it’s the constant desire to improve, to never accept the status quo, to always do something better. Innovation can be the way I prepare a presentation, it can be the way I answer the phone, prepare an email, or it can be a really big innovation: a new design of a car or something like that.
“You’ve got to actually invest time in it in your organisation. You’ve got to say, ‘Hey, I want new ideas. I want new things to come out. I want you, the people of our organisation, to be forward-thinking and action-thinking about what you do’.”
Closely related to innovation was the concept of reinvention.
“I think companies move in five-year cycles, and you’ve got to keep reinventing yourself. What you did last year is not good enough for next year. And it’s the same in your careers, you’ve got to keep reinventing yourself.”
ACCC Chairman, Rod Sims, whose organisation has spent the past 12 months investigating the new car retailing industry, reassured Dealers that the ACCC did not hate them and was not out to get them.
In fact, Mr Sims called on manufacturers to stop putting the squeeze on Dealers through Dealer Agreements, policies and procedures, and step up to meet their consumer guarantee obligations under the Australian Consumer Law.
He told delegates there was an inbalance in the manufacturer-dealer relationship, which imposes significant cost on dealers that ultimately affects consumers.
However, Mr Sims also reiterated the ACCC’s determination that service and repair information should be shared with independent outfits, in order to provide the best result (lower prices and greater choice) for consumers.
Federal Minister for Urban Infrastructure, The Hon. Paul Fletcher, told delegates that attitudes towards car ownership were shifting, and that the industry was understandably concerned about degree of change regarding the question of whether consumers should buy a new car.
“For example, we’re seeing a drop-off in the distance people drive their cars every year. Average annual per capita vehicle kilometres travelled peaked in 2009, and have been falling since then,” he said.
“Australia’s experience is similar to other developed countries like the UK, Japan and Germany. At the same time, younger Australians are not rushing to get their driver’s licence at the same rate as earlier generations. In Victoria, the percentage of 15 to 24-year-olds with licences went from 77 per cent to 66 per cent between 2000/2001 and 2012/13.
“Another emerging trend is a perceptible move away from a personal ownership model to a shared model. We’ve seen the rise of car-sharing: companies like GoGet, in most Australian cities. Ride-sharing companies like Uber, and growing use of public transport. These changes suggest that at least among younger Australians in big cities, there’s increasingly an attitude that you purchase ‘mobility as a service’ rather than buying yourself a set of wheels.”
Former Federal Minister for Small Business and current Executive Chairman of the Franchise Council of Australia, Bruce Billson, told the Chairman’s Dinner that Dealers must ‘tell their stories’, to remind politicians and the general public that they are significant contributors to both the economy and the community.
“Part of what we’re having to deal with right now is an educative process: to explain that amongst two and a half thousand franchise brands in Australia, there is about 80,000 locally owned, often family businesses providing the local market knowledge, the horsepower, the capital, the know-how, to grow opportunities and employment in their communities.”
Mr Billson highlighted the massive role franchises play in Australia, accounting for 11 per cent of the economy compared with less than 4 per cent in the USA. Three out of four standalone start-up businesses die within five years, while three out of four franchises are going strong.
Mr Billson urged Dealers to speak up, to advocate for their own cause.
To assist with that goal, AADA launched its ‘Electorate Fast Facts’ tool at the Convention. This website allows Dealers to roll their cursor over their own particular electorate, and view the economic footprint made by the retail automotive industry. It can be found on the aada.asn.au website.
For every electorate in Australia, we have put together an infographic highlighting the massive contribution to the economy made by retail automotive Dealers.
At your fingertips, we have collated statistics on:
- total of Dealer wages and other expenses
- Dealer employees
- tax paid
- duties collected
- new vehicle registration
- Total Economic Contribution in dealerships in every electorate in Australia.
This data will be regularly updated, to ensure you always have access to the latest information.
Dealers who actively engage with both technological progress and the consumer desires that drive it are the ones who will profit. They must engage on all sides: with manufacturers experimenting with new technology; with customers to ensure they help them get what they want, and with governments, so they are abreast of planning and legislative developments likely to impact their business models.
Those who arm themselves with the knowledge and aptitude to grow with this new world should continue to thrive. That’s what we aimed to provide with this year’s convention, through every department of the modern dealership, and we’re proud to say we succeeded.