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Learning Without Scars

Learning Without Scars

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    Learning Without Scars
    S1 E64•October 28, 2021•16 min

    Mets Kramer and Ron talk about Strategy for the digital world (3 of 3).

    Send us Fan Mail (https://www.buzzsprout.com/1721145/fan_mail/new) This Candid Conversation with Mets continues our discussions on the Digital Dealership. This subject considers the critical nature of marketing and establishing our strategy to penetrate the marketplace. We need to have a plan on what we need to do and how to do it. The subject of this Podcast is to establish strategy.  Visit us at LearningWithoutScars.org (https://www.LearningWithoutScars.org) for more training solutions for Equipment Dealerships - Construction, Mining, Agriculture, Cranes, Trucks and Trailers. We provide comprehensive online learning programs for employees starting with an individualized skills assessment to a personalized employee development program designed for their skill level.

    Transcript

    0:00

    Aloha, and welcome to another Candid Conversation. Today, we continue our discussion with Metz Kramer on the digital dealership.

    0:13

    The next chapter, I guess, is strategy. We've done our market segmentation of our audience. We know what the needs and wants are of various segments. What do we do with that?

    0:27

    Well, as I said in the last segment, it's about needs and wants. So now that... you understand or have a way to find in your audience a group of contacts, then you can decide when you have something to sell, which segment fit those needs or has the needs and wants that fit that product. Way back when I was running service at the dealership, we would have like a very... one size fits all kind of metric, sell mark contracts with everything. And then when I started visiting customers with some of the sales reps, you start to realize that one size doesn't fit all because some don't even understand what a mark really means. All they see is a giant number. This contract is worth half a million dollars and it sees no value. And so for each customer, As we looked at service, we had to look at, you know, what is the service product that best fits this customer?

    1:37

    And then from a pure marketing perspective, it's like which customers in general fit this product type? Well, last segment, we talked a little bit about the do it with me, do it for me, do it myself types customers. That segment helps you understand, should you be sending a information package to that customer about, the technician capability and hourly rates, or should you be sending a package on marked contracts?

    2:08

    And that kind of leads us to the fact that you're going to have to have a strategy for service, another strategy for parts, another strategy for rentals, another strategy for equipment, perhaps a strategy for finance. Yep. It's more complicated, isn't it?

    2:27

    It is, but that's what computers help you do.

    2:30

    I agree, but let me come up further in the helicopter. If I look at the equipment dealer world, I don't see a lot of dealers that have a marketing department.

    2:44

    No, unfortunately, most dealers have an advertising department.

    2:51

    There you go.

    2:52

    And the definition of marketing has very often been forgotten. I ended up in a conference one year for a manufacturer. And they said, we're going to do a group working session on marketing. And all they sent were two junior people from the advertising department who wanted to know if the brochures were adequate. Now, if we go back to the definition of marketing or like some of the simple ways to remember the four, something like the four P's, product placement, price and promotion. Most people only have the promotion, the advertising piece. But the really important part of marketing is defining the product and then the placement. Where do you want to place it? And this discussion on audience and segmentation is all about the placement and the product and matching those up properly. And if I have a bunch of people who are large contractors with mechanics, then for that, I want to place in front of that piece of my audience a product.

    3:58

    that matches their needs and wants rather than something that doesn't. And especially in the digital world, when it's so easy to flood out a ton of information, if you're just hitting everyone with the same message, you're going to fatigue segments that don't match the product that you're sending out.

    4:17

    Yeah, I get a little bit more pointed. I define marketing as anything and everything that helps facilitate the sale of a something. to someone. And the four Ps, product price, place, and promotion have been replaced in universities now with a thing called SEVA, Solution, Information, Value, and Access. It's the same thing as just changing the words. It's kind of like industrial engineering becomes TQM, et cetera, change the term and charge more. But that was being cynical, not factual. The interesting thing about marketing is exactly what you just said. Most people think it's advertising and promotion. It's brochures. It's conventions. It's trade shows.

    5:12

    Marketing needs to be a continuous piece of the business. When you build your business plan for the business, when you started it, it was hugely based on marketing. You understand the market, the product, what you want to sell, and you build your whole business on it. And then people forget to do their marketing. But marketing, you say it's everything that helps support the sale of something. It really should be the strategic cornerstone of almost all of your operations.

    5:48

    Yeah, I agree. I

    5:49

    agree. And it should be changing. Where are you selling parts? Well, you sell them over the counter. In 2021, Why aren't you selling parts online? I asked this at a recent conference that I spoke at, and I said, put up your hands if you sell parts on your website, any of them, and not a single one put their hands up. And yet we had a presentation on how Amazon is coming for your business because they're already selling your parts online. They're not doing it well yet, but they're already doing it. Yeah.

    6:20

    And I can list off the brands that you can buy parts on Amazon for equipment, but I'm not going to do that. just yet. But what becomes interesting is one of the major brands in construction equipment had a storefront and started selling parts online in 1990. And the big fight that took place, and there was a pause caused by it, was it was parts that got sold out of the dealer's territory. So that area of responsibility and the contractual limitations, et cetera, hit the front real quick. In the 30 odd years since, I cannot find one equipment dealer that sells 10% of their parts on the internet, not one. And I'm being very generous when I say 10, it's two or three or 4% typically, if any.

    7:16

    That's kind of stunning to me.

    7:17

    Well, it's dangerous as hell. You know, you and I talked about the... The fact that millennials buy 40% of the millennials buy everything on the internet, everything, food, everything. Yep. And the part that makes that scary is that 72% of the people responsible for purchasing in business in America today are millennials. Correct. And is that not a message that's getting across to people? So the strategy, one of the strategies should be, okay, how do you want to deal with me? Right. Do you want to come to my store? Do you want to use a telephone? Do you want to use what we're calling glass systems, screens, computers? Yeah. And our dealer management systems, I wrote a blog last week and Alex Schuessler and I talked about it. We're going from paper to glass without changing any of the blasted processes.

    8:11

    Oh, yeah. I remember that when I commented on it.

    8:13

    Yeah. But isn't it true?

    8:15

    It's very true. People emulate what they do. They think the way. But when they set up online part sales, they think like it's the parts counter. You still have to go through all the same steps. You know, it's not it's not rethinking how would you do would you do this if you had a completely different way to do it? You know, it's still, you know, like you said, paper, paper to glass or electronic hammer and nails. Instead of rethinking the attached things, you know?

    8:46

    Yeah, exactly. One of the things that was interesting to me, made some business in the consulting world for me back in the 90s, was one of the manufacturers bought a financial reporting package. Yeah. They bought a license for every single one of their dealers. And it was a wonderful package, very comprehensive, gave you access. You could get P &Ls to shop tools if you wanted to. Yeah. And I was contracted with several of this brand's dealers to help them with the implementation. And to a dealer, every single one of them duplicated everything they had in their old system. Yep. And they threw out all of the benefits that were possible with the new system. You know, change resistance is real. Yep. You know, the example I used before paper to glass was this, the. steam engine to electric engine, and it takes a generation. And in that paper to glass article I talked about, that was a generation. That's 100 plus years ago.

    9:48

    Today, computer systems, paper to glass, that's three generations so far, and we haven't done it yet. Do we have the same problem with strategy? If we don't have marketing departments at dealerships, other than for advertising and promotion and trade shows, et cetera, who the hell drives strategy?

    10:08

    Well, that's what we need to do. That's what dealers need to think about because as we do the last generation of advertising, marketing, and try and bring that into the current world, we're seeing the same thing. I've spoken to people from dealers and say, yeah, we have an advertising department or a social media department. They're all the way over there and they don't talk to anyone. They're missing the entire... doing social media like they were doing print advertising. Just going to the platforms and posting the same kind of stuff that they were posting on in the magazines, they're now posting it on social. And they're thinking that that is going digital. Whereas if you really talk to people doing digital marketing, social media marketing is about person-to-person engagement. You want to be able to have your customers see...

    11:09

    social content about their sales rep because that builds the relationship and changes that customer's perspective of their sales rep. You need to come up with a different way to think about what your advertising department working with social media should be thinking about. They have to think differently. At the same time, I see dealers who have their sales rep spending 20%,30% of their time. creating social media content because they know it's important and they want to be out there, but they're doing the work of the advertising department because the two are disconnected.

    11:47

    Yeah, it's actually worse than that. Our internet web page designers, if you look at equipment dealers, you line up 100 dealers and go look at their web page, it's almost identical. Just change the colors, change the content words. But the stance is the same. And I used to tease back in the 80s when the internet first came that we wanted to put the dealership up on the internet and everybody wanted to, you know, it was an ego game. Here we are. You know, I'm the dealer of so-and-so in such and such a territory. And to use the Steinfeld, yada, yada, yada, you know. And then we added equipment. And, oh, we added... video and audio and we could see the machine driving around. This is really cool. But it never went anywhere. If I'm less than 10%, it's kind of like, what do you do with a dead horse? Get a stronger whip. Yeah. Or change riders, you know, and we, we, we don't have a clear vision.

    12:55

    It's, it's almost like the industry is still won by baby boomers when millennials have taken their place, but we just don't. We either don't want it to be true or we're in denial or something, but this has got to be great for your business to be able to go in, like you say, looking at UCC filings because they weren't doing that, were they?

    13:19

    Some people aren't doing it. Some people will buy all of the data and not know what to do with it. They just, you know, they spend a few thousand dollars and buy it and then they don't build a strategy from it. So, yeah, I ran a couple of weeks ago. I ran a workshop exactly on this and I have a worksheet to share, to walk dealers through just rethinking this. Like this stuff is fundamental and it's you don't need to be technical or digital or a millennial to understand it. It's just taking the time to rethink. how you're approaching this part of the business. And the heart of it is understand who the people are that you're going to talk to. And for each group, create a message that fits and put it in the place where they're looking. If you're selling breaks, it's great to put a billboard at the end of the road at the stop sign. But for all the other products, there is a great place to position it digitally.

    14:25

    and find ways and there are tools to make sure that the right people are seeing it and it's not being shown to everyone.

    14:33

    That's a pretty good summary of what the strategy should be. And that's probably where we should stop for this particular discussion. Anything you want to add to that conclusion?

    14:46

    Just do the work. Like if people want a copy of the worksheet that I put together for that session, I'll happily send it out. But it's a simple couple of hours of work to walk through it. But just like you said, the dealership needs analysts. The dealership needs to have someone who's a true marketer, head of marketing or whatever you want to call it, the person. But you need to think marketing if we're going to keep the dealership ahead as the market continues to change.

    15:22

    That's a good place and a good way to stop it, Mets. Thank you very much. I think this has been very beneficial.

    15:28

    Thanks, Mark.

    15:31

    Thank you for listening to our podcast. We appreciate your support. Should you have any thoughts or comments, please don't hesitate to contact us at www. learningwithoutscars. com. The time is now. Mahalo.

    Mets Kramer and Ron talk about Strategy for the digital world (3 of 3).

    0:00
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