May 30th, 2010
It’s impossible to miss the phenomenon called Lady Gaga.
I don’t follow the latest pop culture, but the other day I was driving past the Bill Graham Auditorium in San Francisco and saw a line of young people lined up in front and round the block and then some more and wondered what was going on. A small sign displayed the name Lady Gaga which didn’t strike a chord, so I went on with my day, but over the next few days I just couldn’t escape the lady. She was on radio, on the Grammy award show, on YouTube, basically everywhere one looked, there she was.
It got me thinking about how modern pop culture has evolved into something that can go from unknown to known in a day or even a few hours. When you really get to the bottom of it, Lady Gaga and her marketing machine belong to the generation that they’re serving and that’s what makes them so successful. They are in tune with their listeners, their positioning is unique and their message resonates with their target audience.
In many ways, we in the business world and especially in the car dealership world exist in a different time and space. Some things are changed forever; the Internet has become the market place for autos, and even though cars are not sold on the Internet yet, customers are most likely to encounter their next car on the Internet and then email or call for more information. The demographics are changing and it’s the Lady Gaga generation that will be our customers tomorrow. It therefore becomes an important business lesson to learn from the lady and teach ourselves a new way to market, communicate and sell.
So here goes: Tailor your message to resonate with your audience. When Lady Gaga sings about a bad romance, its not Romeo & Juliet stuff, its gritty, bad boy love. The young audience get it, she talks about their life experience, hopes and desires. We need to do the same in business. Let’s think for a moment – Is price the only thing our customers care about today, do people shop purely on that? Is it convenience? Is it safety? Is it service? Do your communications speak to your audience in the same way the lady speaks to hers?
Positioning. This is the next lesson to be learnt. Lady Gaga is clearly the darling of pop. She’s found a place right in the center – Not Hip Hop, Not Rock, Not Country, Not Ballad, Not Jazz; she has her own unique positioning. Her audience is the Hanna Montana crowd growing up. I would even go so far as to call her an aspirational brand.
Dealers need to create their own unique positioning in the market place. Many dealers have done it in the past and have been wildly successful. Be unique and your message should be what your target audience resonates to.
Accessorize. Have you ever seen Lady Gaga and her outfits? Truly unique, edgy and amazing. She is wearing art. Dealers need to start selling accessories on cars. They are cool, customers want them and they are highly profitable.
Be everywhere. Make it easy to be located. Be where your audience is. Lady Gaga had a gazillion hits to her YouTube listings. You need to spread the message and spend some money doing it right. Pay Per Click advertising is as blasé as vanilla ice cream, move on to using new media to market. And spend some time along with the money you are spending. Attention to detail and commitment to your cause is the key.
Take a little risk. Lady Gaga pushes the envelope and challenges her audience to keep up with her. You do just a little bit, but venture out with a unique message and unique positioning and you’ll get the attention of the customers.
Here’s to the Lady.
May 13th, 2010
The automotive industry is in the front lines of our economy, right alongside banking and real estate. It is the bell weather of the economic condition of not only the nation but also local communities. That is because even though cars are manufactured globally, they are sold locally and it comes down to the local automotive dealer to battle it out for market share. The success of an automobile assembled with parts from around the globe in a plant in Alabama, comes down to how the local dealership markets and sells it. All the advertising in the world, all the marketing and brand building basically disappears when a customer has had a bad experience at the store level.
While this is true for any product, it is more so in the case of autos because unlike a computer or shirt, the sale is not a transaction but the culmination of a sales process. It starts with a lead, which is more often than not from the Internet and eventually ends up with a visit to the dealership and a purchase occurs. One day perhaps cars will be sold on the Internet, but that hardly matters because they will still need local dealerships to service them. One way or the other, dealerships will remain important to the automobile industry.
Dealers face many challenges and one of the most critical ones is of staffing and training. They don’t usually attract the MBAs who are looking for more glamorous jobs and most of the time will look for someone who has prior experience in the industry. That leads to a bit of inbreeding but also ensures that most of the people you meet are highly knowledgeable about selling cars and as they say know the “Car Business”. The problem that dealers face is the need for constant training arising out of high staff turnover, change in customer behavior, new technologies, and consolidation within the industry.
At izmocars, we have long believed in the value of consulting and dealer training and have delivered these programs to dealerships for more than 5 years now. Our Sales Performance Coaching programs addressed the need for change in the face of the emerging trend of Internet based selling and the art of dealing with the knowledgeable Internet savvy customer. We went into dealerships and spent days teaching them a new sales process that combined Email, Scripted Phone Selling Techniques, Role Play, and plain old selling techniques, that showed immediate results in the form of increased lead conversion and sales. Our iConsult program has remained one of our most successful programs ever launched.
However, something changed over the last 18 months. It was probably the recession that hit the automotive industry, which happened so fast that no one saw it coming, and it changed the way dealers looked at things. Or it was the fact that dealers after investing for a decade in new technologies and dealing with the Internet had decided to move to the next level. Whatever the cause, they demanded a new model.
We listened and the more we talked to dealers, the more it was apparent that the old model of full training days would not work. The dealers were tired of training, tired of having their best people leave after training, had developed their own training, or had training delivered to them by the manufacturer – in short they had tried everything. Most of the good dealerships already had processes in place and were looking for a better way to improve efficiency and productivity. During this period we were evolving an implementation and training process for our accessories product and we came to the same realization that the long training days were over. What really worked was regular monthly visits to dealers to provide true consulting and fix a few things that were wrong rather than force a straight-jacketed process on them.
When we first conceived iConsult’s CI (Continuous Improvement) program, there were many skeptics including our own team members. However we soon found validation by dealers when they started adopting it, preferring this program over the lengthy training program that we offered earlier. We received further validation from some of the largest automotive groups when they confirmed that they had gone away from tedious training sessions to regular but frequent visits by consultants into dealerships.
When a dealer engages with iConsult, they get a consultant who visits regularly and comes in with the objective of achieving a business goal as opposed to delivering training or completing some task. The goal could be improvement in communication, increase in lead conversion, salesperson review, or process enhancement. Each time, the consultant comes in armed with data, analytics, and mystery shopping feedback, and uses that information to actually provide advice, coaching, tools, templates – whatever is required to help the dealership.
Each visit is short, does not disrupt the business and actually delivers a measurable result at the end of the day. The iConsultant becomes a true partner of the dealer and the sales team and shares their risks and rewards.
The new iConsult mantra is to put the “Consult” back into “Consulting”.
May 5th, 2010
I’ve been away for some time now and need to get disciplined about writing this blog. I did get distracted with a lot of travel as usual but this time disruptions caused by the Iceland volcano made it worse. I had to reroute 12 flights spread over 10 days – and it was not easy!
Anyway, I’m back at the desk and it’s time to focus my thoughts.
The big news at izmo has been the spectacular launch of the izmoReader, probably the only “e-reader” with a unique business model behind it. We exhibited izmoReader at the NAA (Newspapers Association of America) Convention last month at Orlando and later at the INMA at New York. Of course the timely launch of the iPad helped immensely with everyone looking for eReaders.
Our story goes back longer. We have been on this project since late 2008 and we had the product developed in early 2009, but it took us a year to get media companies to look at it seriously. In the meantime, Amazon launched the Kindle and now with the iPad, there is no question that eReaders are here to stay. It’s been quite a journey for us though because no one believes in visionaries and this izmoReader was truly a new concept back when we started development and now we feel vindicated because the market has finally caught up with us. It will however take some more time to mature and a lot will depend on the business model that the media companies and their vendors adopt.
When we first started working on the izmoReader, we played around with a lot of models and it quickly became apparent that there are three revenue streams that are possible: Subscription, Paid Content, and Advertising. What was surprising when we created the models was that the subscription revenue always was less than 10% of the total revenue potential, but more importantly, it created a hurdle that made it difficult to monetize the balance 90%. We realized that the way to go was to provide the reader at no cost to the subscriber, in exchange for in-depth user profile information. There is enough evidence to show that users will provide information in exchange for a superior product or service, so that did not seem to be a barrier.
Paid content remains an industry dilemma with opinions that range from Pay-for-All to Pay-per-Read/Download to Pay-for-Sections etc. In my opinion, none of that will work. Some publications will be able to charge for their content, but if the same content is free online, then it is difficult to get a user to pay for it. The biggest problem with the newspaper business has been that most newspapers (at least in the US) have downsized by reducing their editorial staff and thereby irrevocably reducing the quality of their content. Unless there is quality in your offering, the user is not going to pay for it and that is the sad truth of the predicament the industry has brought upon itself.
So, the only sustainable revenue source is advertising. But that too has hurdles to overcome because no single publication will garner enough downloads to attract national advertisers and that is where the big ad spend comes from, one that is large enough to distribute. But if even revered publications like New York Times find it difficult to pull in advertisers, what hope does a home town newspaper have to generate any kind of revenues?
The izmo model, I believe has the answer. The izmoReader is built upon a massive ad server that publishes advertisements into the downloaded readers. We know at any given time, what is the excess unsold inventory across all of our publications, as well as how their subscribers count their downloads. When we have 500 publications with 10,000 downloads each, we would have 5,000,000 total downloads with approximately 250 million ad impressions each month. When we aggregate this and offer it as a block, it’s suddenly interesting to any advertiser and that is the solution to the revenue problem of media companies.
Added to that, we are the only reader that will offer full classified listing support with search and select capabilities. That is a large enough piece of business for newspapers that, if delivered through the reader will not only bring in revenues but also provide an invaluable service to the user. Imagine being able to sit in an airplane and go through real estate or auto listing and select as many as you like with one click. The reader will query them on your behalf. I know it takes the joy out of sitting in a café pouring over pages and pages, but if you’re used to the iPhone, then this is the way you’d probably like it.
Izmo is now offering the izmoReader to newspapers on a pure revenue sharing arrangement and guess what – we have a lot of newspapers interested. Our positioning as the single interface to any hardware device makes it even more compelling to them, and we should soon see a number of e-publications that are enabled by the izmoReader.
What we are demonstrating is that technology alone is not the answer, it’s the business model and more importantly delivery model that completes the picture and makes a product a success. Remember that there were music capable mobile phones before iPhone, but it was iTunes with its App-Store that changed the industry forever, creating one of the most successful products of all time.
izmoReader, you’re next.
March 30th, 2010
They say that if you can dream it, you can build it. That’s exactly what happened with AddOnAuto, our phenomenally successful accessories solution. It all started when I met Sidney at Galpin Motors in San Fernando Valley, Southern California. He was one of the best Internet Managers in the automotive business and not only understood how to use the Internet to sell cars, but also had a deep understanding of its ability to impact how we do business.
Sidney had seen it all – from a struggling entrepreneur to running a public company he founded to being the most successful Internet Manager in the industry. Always a dreamer, he had some great ideas of what should be done in the automotive business and one of them was an accessories sales solution. I was skeptical because I knew the technical challenges involved and it required the building of a huge database of accessories with accurate mapping to vehicle trims and the need for all vehicles in each and every model, trim and color. I would listen to him and politely agree because it seemed like such an impossible task that it would probably never happen.
AOA- In Store Accessories Sales Solution for Auto Dealers
He seemed very committed and I wanted to help in whichever way we could so we gave him high resolution images of automobiles from time to time. This went on for a while, till one day I called him to ask how things were going and he said that his product was ready. It was the most exciting piece of news that I had heard in a long time and I flew down to LA to meet him. When he demonstrated AOA to me for the first time, it completely blew me away. Here was a product that would change the way dealerships did business, the way accessories were sold, and would impact the industry as no other product had done before.
The deal to acquire AOA itself was easy as we shared the same ideals, vision and goals. Before we knew it, Sidney was an integral part of izmocars and AOA was well on its way to creating history. But it took a lot of guts, pain, and hard work by a highly committed team to bring it to where it is today. We made mistakes, learnt a lot of lessons, and slowly but surely got AOA to being a very effective solution for selling accessories in dealerships.
Accessories are a $44 billion industry with franchise dealers having less than 10% market share. That is surprising because independent customer surveys show that consumers would rather buy accessories in-dealership than in the after-market. However, in the absence of an effective tool to sell accessories, dealerships are losing that business and have an uphill battle turning it around.
When we first launched AOA, no one believed that accessories could be sold in dealerships and we won them over one dealer at a time. We went into dealerships and built sales process, negotiated between part and sales departments, actually sold accessories for them, and showed them that this was true and not some marketing gimmick. With little or no marketing, but with a lot of customers as raving fans, AOA emerged as the only effective solution in selling accessories in dealerships.
The numbers are astounding – growth of anywhere from 100% to 300% in accessories sales, an average of $400 a copy and an ROI to dealers of more than 1000%! No other product in history has produced such results and yet it takes less than an hour to learn how to use it!
Today AOA is lighting the way for dealerships across the country, increasing sales and profits, creating a new profit center within dealerships. If you don’t believe us, ask our customers…
March 8th, 2010
The Geneva Auto Show is the bellwether of the European Automotive industry. The earliest big show of the year, preceded only by the Brussels Auto Show, it sets the trend for the year. And the future is as clear as daylight – and it’s going to be Electric!
Lexus CT200h World Premiere
I was in Geneva last week and we landed to great weather (no snow) and ended up staying in a nice country motel just across the French border. To give you an idea of how things change – last year when we visited the show, we got a hotel next to the convention center a day before we flew in, but this time we could not get anything in Geneva city a month before the show. So going in, we knew that this would be a good show with a lot of attendees. We were there for the press days and got to spend time with the marketing teams of several manufacturers, undisturbed by the regular crowds.
First of all our objective for visiting the show was to evangelize and convert the European auto industry to start using the Internet for retailing. They are far too conservative in their approach and I was of the firm belief that it was only a matter of time before they get it and start doing something about it. Their customers already get it and are increasingly going online, infact Europe has one of the highest Internet and Mobile Internet penetrations in the world, so why is the automotive industry lagging behind? We hoped to find out at the auto show.
The other reason to visit the show was to understand industry trends and the challenges faced by manufacturers. We, in the technology industry ought to start paying attention to our customers and spend some time at auto shows. That is the only place where the manufacturers of the product interact directly with the consumers, without being chaperoned by a dealer. This is where you see what promises they are making to customers, where they get a chance to present their best and show how well they are in tune with their target audience. I highly recommend anyone in a management position in a technology company providing services to the automotive industry to visit at least one auto show, even a local one.
The big message at the show was “Electric” and “Environment”. It’s amazing how the consumer is forcing manufacturers to change. Europe is full of small cars; it’s a necessity forced upon by old cities with narrow roads, but now its all about being environment friendly. Just as in the US, all cars come with a MPG sticker and everyone is trying to show better MPG, its “CO2 Emission in Europe. Yes, that is what every car comes with! Proudly displayed on each vehicle is its CO2 emission and consumers are actually taking decisions based on that.
Hybrids were yesterday’s news, it’s the all electric vehicles that were the rage. From Tesla to BYD from China to Electric Porsches, they were all there. It’s a turning point in an industry when something becomes acceptable and not an exception. Exotic becomes commonplace and that is what has happened to electric vehicles. They are not about to replace gasoline engines yet, but consumers are no longer questioning the technology and are accepting it as a viable alternative. That makes a huge difference, because now manufacturers are paying attention and we all know that they have deep pockets and can get things done if they want. Makes me sad for GM though, they were years ahead with their electric vehicles – if only they had believed in themselves…
The European market is an interesting one, with a number of small manufacturers who sell anything from 20 -200 vehicles a year. I see them at the show each year proud in their independence and going strong. And you have brands that have survived a 100 years and some that are being revived after 50 years. It makes the continent exist on different levels – The mainstream European manufacturers – VW, Renault, Peugeot, Citreon, BMW, Diamler Benz etc; the Imports – Honda, Toyota, Hyundai, Ford & GM (somewhere in between) and the Exotics. All of them come together in one great event called the Geneva Auto Show.
Geneva Auto Show 2010
The great thing about the show was the general optimism. If last year was all doom and gloom, this year was a fresh beginning. Spring was in the air and I’m not talking about the outdoors, it swamped everyone and that’s good for business, all business. A word of caution though, it remains to be seen if this optimism will translate into sales. Each country is its own market and if Europe can get past Greece, this will be a great year for the industry. I certainly hope so.
February 25th, 2010
I’ve been traveling once again within Europe and Asia and am enriched by my experiences with auto dealers in different parts of the world. From the Lotus dealer in Antwerp to the largest Hyundai dealer in Bangalore, I’ve been fortunate in meeting a lot of interesting people with different backgrounds but one common thread – a passion for automobiles.
Today, I was a guest at the inauguration of a Suzuki dealership in Bangalore and met with the Chairman of Suzuki India along with the CEO of Suzuki. This dealership is a remarkable story; they will sell 11,000 cars this year and will write 90,000 ROs. They employ 1,600 people and plan to double in 3 years’ time. Their website (done by izmo, of course) generates 20,000 unique visitors a month and 1,500 leads. The website allows consumers to put a down payment for a car and purchase it online if they want. On the day of their inauguration, they were sold out of inventory.
The message from the Chairman of Suzuki was that their challenge was adapting to a new world of competition as their sales crossed 1,000,000 cars this year. Virtually every small car manufacturer in the world has a base in India and now uses India as a test ground for new cars. They feel that once they are successful here, they can be successful anywhere in the world. Today, Suzuki has 60% market share in India, but with Renault, GM, Ford, Nissan, Honda, Toyota, Fiat and VW nipping at their heels, they are anything but complacent. Their mantra is growth as is everyone’s in this country.
I look at the two fastest growing automotive markets – China & India, and the challenges faced by the industry in meeting their demands, which is really a big opportunity for technology companies like us. The single biggest requirement we have is for training dealerships which are going from a seller’s market to a buyer’s paradise. The challenge is to adapt to local environments and bring in best practices while being culturally sensitive.
Izmo has been at the forefront of providing solutions to the automotive industry in different parts of the world. We have clients in the USA, Canada, Belgium, France, Turkey, & India. We operate the 4th largest automotive portal (www.carazoo.com) in India which generates close to 2,280,000 leads/month. With the launch of our indY platform, we are poised to expand into Australia, South East Asia, Europe and South America through a network of distributors and franchise partners. FWZRVZYWPJTN
At izmo, we keep moving on. Miles to go before we sleep…
February 15th, 2010
I just returned from the JD Power and Associates International Automotive Roundtable Conference in Orlando of which izmo was one of the main sponsors. It turned out to be a great event; the information provided by JD Power was excellent, as always, and so were its panel of speakers.
However, my biggest take away this year was the collective determination of the industry to push ahead despite the recent setbacks it has suffered on account of the recession and recalls.
For izmo, the event marked our coming-out party. We had just released IndY, creating waves across the industry, our AOA Accessories Solution was showing phenomenal results, and now we were gearing up to release full Social Media Integration with our CRM.
For the last 3 years, we had been quietly assembling a solutions platform built on product excellence and driven by the key message that our dealer-clients had been giving us – they wanted “One Throat to Choke” because they were tired of dealing with vendors whose applications were impossible to integrate.
It was a challenging task, but we’d done it, the only company that offers dealers the following:
- Interactive Media Content: From our own studios, which are the world’s leading library of Interactive Media Content for the automotive industry.
- Websites: izmoIndY is setting new standards for automotive websites across the globe.
- Online Marketing: izmoRainmaker, a solution that has included Social Media Marketing for the last two years.
- Internet Lead Management & Customer Relationship Management: Yes, we have both and what’s more, they are integrated with social marketing.
- iF&I: An F&I system with full desking and bureau support.
- AOA: The industry’s leading Accessories Solution for dealerships.
- iService: Online Service Appointment and Service Management.
- iConsult: This is our most important division and provides on-site training and consulting on all our products, enabling us to become a stakeholder in our client’s business.
Most companies in our space either have multiple products or try to partner to provide a suite, but not one of them offers best-of-breed products across their range.
I believe that today, we not only deliver product excellence but also, more importantly, provide the integration our dealer-clients need across all our products, with the creation of IndY – the new web operating platform for automotive digital marketing.
How did izmo do it, when so many companies have tried and failed? Four sound reasons:
- We built and evolved an innovative company, named izmo, and refused to sell it off for short-term gain
- We made huge investments in technology with one of the best engineering teams in the industry
- We had the clarity to acquire products that were absolutely visionary
- We employ talented and motivated professionals (more than 300 in 6 offices across the world).
Today, we have a matrix organization that works at multiple levels:
- Individual product groups ensure each product is allocated the resources to continue development.
- Pooled engineering resources provide cross-divisional transfer of skill sets.
- A centralized sales team that is supported by a vast resource of consultants.
It’s no mystery, why we have multiple product releases in the same month and are able to deliver to a cross-section of clients without ever compromising on service.
A big advantage we deliver to our customers is our ongoing investment in product development and technology. Many companies in our space build a product and sell it long after the technology is obsolete, simply feeding off trapped customers who’ve invested in training and have customer data locked into the application. These captive customers are forced to use an obsolete product because of the high cost of training and data migration.
As an engineer, it bothers me no end when companies refuse to invest in product development, electing to milk their clients for fat profits for as long as they can. I’ve seen this in connection with websites, online marketing, and CRM, where server-based, green-screen software still sells – a situation I find surreal.
At izmo, our DNA is pure engineering. We believe in building new technology and are passionate about bringing it to our customers at continuously lower prices. We even go to the extreme extent of killing our own products, in order to build better, newer, and completely open platforms.
So unlike our competitors, who still chose to make it more and more difficult for our dealer-clients to integrate third-party products, you’ll find that the izmoIndY platform easily enables anyone to build widgets or apps, which can be added to the dealership website. And BTW, an IndY website costs less than $300/month! LOL.
As far as technology goes, this will be an interesting summer for the automotive industry. izmo guarantees it!
February 7th, 2010
Yesterday, izmocars announced the release of its IndY Operating Platform.
izmoIndY is the result of more than three years of smart work put in by some of the best software minds in the business. Three years is nearly forever in the software business and represents an enormous investment by izmo, which begs the question: “Why did izmo build IndY?”
I’m pleased to say that Indy really is izmo’s response to the feedback from loyal customers across all of its products. We have listened and responded to them by delivering the IndY Operating Platform.
The primary feedback from our dealer-customers was that they wanted more control, one solution instead of many, and a real platform for online marketing. IndY delivers all of that and more: Its enterprise architecture allows dealers to control all aspects of the application, it is a unified platform on which all izmo products will be integrated,and it offers an SEO-compliant online marketing platform.
Here’s a quick insight into the power of indY:
• Since at its heart, it is a platform designed to build new applications, IndY offers unparalleled ability to scale up, giving dealers and developers the power to build and launch their own applications in the future!
IndY allows you to manage several dealerships and applications from a single sign-on. That means you can add specials, manage inventory or change banners on any website within your dealer group. It also means that you have reports across all your stores in a matter of minutes.
• Managing inventory using IndY is really easy; with just a few clicks, you can combine the inventory of any number of stores and display it on any website, or you can export it to your favorite third party listing service. The clustering ability of IndY is one of its most powerful features and allows users to instantly combine databases across dealerships and make changes to several websites all at once.
• IndY is the only operating platform in the industry to offer a website application, an in-store accessories sales solution, and a full CRM on one integrated database.
We believe that IndY will be to the automotive industry what iPhone is to the cell phone industry – a new way to build & launch applications and fully extend the world of online marketing to dealers and developers.
We also believe that innovation should be the key driver for new technology and the cost of applications should come down as they proliferate. That’s why, the IndY websites are offered for as low as $225/month, which makes it the lowest-priced, full featured solution in the industry.
And, we are not talking of a few web pages put together on a template to resemble a website, but a complete website with Interactive Media content, Inventory Management, Ad Server Integration, Online Specials and Ad Manager, Detailed Analytics and so on.
I’ll be writing more about IndY in the weeks to come but in the meantime, I hope you’ll have a look at what IndY has to offer you. It’s all available right here at www.izmocars.com