I periodically check the sales figures of the Bovag. For a good idea of the balance of power in the car world, and because it is always nice to have a look at the bottom line. What did they sell from January to October? One Lotus, five Rollsen, seven Morgans, eighteen Maseratis and still 28 Lamborghinis, probably thanks to the Urus. Of course, those exotics do not have to rely on their numbers thanks to generous margins. But sooner than you think more or less normal brands come into view at the bottom of the sales ladder, and that’s where the picture becomes more worrisome. Subaru; 234 cars from January to October. Alfa Romeo; 226 registrations. In the past month, the brand sold six cars in the Netherlands. Six.
So for those 226 cars you have to keep an entire dealer network and a service device up and running. It was almost consoling news that last month took last place in a reliability survey by the Consumer Association Alfa Romeo; those garages still have something to do. For their own good, they therefore usually add other brands, although that is little comfort when it is Fiat in regions where they do not buy 500s. Then you understand how large dealer combinations such as Van Mossel, Broekhuis and Stern could emerge, which can take a beating with their thick brand portfolios.
However inevitable the increase in scale was, since the necessary joining of forces, the institute dealer is no longer what it used to be. Your trusted shop with your brand was devoured by the grocer who has everything; Douwe Egberts and Côte d’Or, Popla, Melkunie, Dr Oetker. The brand dealer is a phenomenon in its last days. Just as the baker, the butcher and the greengrocer were beaten by the Appie and the Aldi, so we see Alfa disappear silently towards the back door and ruin in an anonymous total package.
The dealer model has been shaking to its foundations for some time. Cars got better, suffered less and less damage due to their increased safety, and required less and less maintenance. At the same time, the customer became increasingly self-reliant. He orients himself on the internet, configures his car independently on the importer’s site and only goes to the dealer when the decision has been taken.
In 2015, the Bovag already raised the alarm with the ‘vision document’ Automotive Retail in 2020 – from distribution channel to retail experience. “More than 40% of consumers indicate that they know which car they want to purchase and see no need for further advice from a dealer.” It is true that 86% of customers still want to take a test drive before purchasing, to be sure, the consumer appears to be fine without a sales advisor. The pillars of dealership, information and temptation, are on the verge of collapse. The Bovag draws drastic conclusions to that. The thinning of the field is inevitable. “Assuming national coverage per brand based on a 30 km radius, the number of brand dealer locations could be reduced by 50%.” Furthermore, retail will have to find ‘new routes’ in the customer journey, the route from orientation to purchase.
And? Quite a lot has actually happened in five years.
Tesla has been selling digitally for a long time, with a handful of Tesla Stores as decorated shop windows – and ended last year as the second largest dealer organization in the Netherlands, according to market analyst Aumacom, directly behind Van Mossel. Polestar opened four Spaces in the Netherlands for ‘a new perspective on buying cars’. These are not dealers in the existing sense of the word, but orientation and experience zones with ‘experts instead of sales people’. In the meantime, the traditional dealer organizations are playing the game according to the old rules, albeit with an increasingly powerful emphasis on the experience that pampers the customer journey with a bit of customer experience. They pamper their customers with valet service, flagship stores with hotter espresso than the neighborhood garage and gentlemen and ladies in corporate couture.
I think most customers don’t care about that show. They want the car that they choose themselves at home, the cost-effectiveness can be stolen from them. You cultivate loyalty on competence and truthfulness. In this business as in all others, it is not about structures but about people. You don’t have to put them in an expensive suit in a glass palace along the A2. They sell themselves if they are good enough.
I brought the Audi to the village garage for the MOT, a sympathetic company in a kind of broken row house in the village. They don’t even have a coffee corner. The bosses work in their daily clothes, the occasions go up to five grand; a 7 Series wouldn’t fit in the narrow showroom. I could pick up the A2 again in the afternoon, they said. I don’t know if I can make it, I said. I couldn’t make it either. But when I got home late at night, my Audi was in the driveway with the key in an envelope on the doormat. Valet service the way Drenthe. Unsolicited, without breast patting or extra costs. I will remain faithful to those boys to death. Do you know what their secrets are? Service and small scale. The future is not up to the mega dealer, but to the service point where they can always help you. Provided it stays up to date technically it is future proof. Tesla can learn something from it.