Time for the dealership to be designed as an experience center

By Miguel Yelos San Martin

A lot is being said about how technology is changing the showroom. We are at a point where technology in not just changing one space but the entire world we live in. Think for a minute about Amazon, Netflix, smartphones and ask yourself how you would live without them.

In today’s world an inability to change may mean death no matter what industry you are in. Think Kodak, Nokia, Polaroid, My Space – all they are is a name from the past. Some faded quicker than others.

This is a great time to make changes and take the lead regardless of who you are or where you. Consider first movers such as Uber, Facebook, and Tesla.

The average car buyer visited 2.8 dealerships before buying a car in 2016 versus 3.5 in 2012. What if the person coming to your store would be coming to test drive the vehicle, sign the documents and drive home as opposed to coming to “kick the tires”?

Beepi.com and Vroom.com are two examples of websites attempting to do just that.

Let’s go back a few decades and see what has happened to the car dealership.

Saturn was a success not because the cars were any different than any other General Motors product at that time but because they were able to change the way cars were sold. They created a new environment that enabled a new process. Unfortunately, their new Saturn-badged models did not keep up with the revolution and the brand died.

The next design that was breaking the mold was the original Ford Trustmark, but it was way ahead of its time and failed because the OEM did not understand and did not give it enough support. How many times have we seen ideas die because their timing was not right?

Since the nineties we have failed as dealership designers to understand the new way of communication and the integration into a new sales environment. The internet is just a channel but the real “new way” is the social platforms such as Facebook, Instagram, Twitter and the like. The millennials say they have been “talking” when they really have been communicating through social media using their smartphones.

What dealerships call “internet sales” is a poor way of generating leads that in many cases are bought from giants like Microsoft. They do not understand how the new generations are communicating. After they have the lead they bring their customers to the store and use the same “old habits” they have been using for ages. We still see sales towers, F&I waiting areas and offices. In summary nothing has changed in dealership design.

The so-called improvements are changes to the finishes, the use of tablets instead of pen and paper, the way some sales personnel dresses. The new showrooms are nothing but upscale office spaces and not a retail environment. The closest to a retail space I have experienced so far is the Echo Park stores. It is no coincidence that Sonic hired a retail designer to develop the concept.

To design the new showrooms, we need to incorporate the social media platforms into the space and the process, the new technologies that Millennials use in their everyday life and, for some time, keep the old way of doing business until the baby boomers adopt the new ways.

We should enable buyers not only to do the research online but the entire sale, including F&I. The dealership should be the place where people do the test drive and take delivery of the vehicles.

How about if instead of bringing customers to the store we bring the experience to where the people are like airports and shopping malls?

We need to understand that if the electric cars become mainstream the main source of revenue for the stores “fixed operations” will change as we know it. Electric cars do not need nearly as much servicing as the internal combustion engines. If you do not believe me look at Tesla and the amount of service centers they have.

We have seen the industry change but never as fast as it has been in the last decade. The advent of the electric cars, self-driving technologies in conjunction with the new ways people are shopping and communicating are posing a new challenge to the retail end of the industry.

My opinion is that we need to start trying new ways of doing business understanding that keeping the status quo means certain death, at least in the first world. The retail business as we know it is dying. Many people are predicting that end of the Shopping malls as we know them is near.

Timing is everything. We presented many of these ideas to an OEM in a design competition in 2014. Among our design recommendations, we incorporated many screens that were used to communicate with the customer from the beginning to the end, others where they would be able to upload videos of their trips with their vehicles and share them with other enthusiasts. The idea was to create a relationship between the driver, his machine and the brand. The store was an experience center instead of a place to conduct business.

Our recommendations were totally ignored. I firmly believe we were too far ahead for the manufacturer to understand our message, especially considering that they are not retailers. The world industry leaders are technology companies and not manufacturers like they were in past. Isn’t it time we embraced the trend?

Miguel Yelos San Martin is the founder and principal of YSM Design. Based in Atlanta, Ga., YSM Design is a full-service architectural design firm specializing in automotive retail and brand implementation. The firm has designed more than 400 dealerships for brands including BMW, Mercedes-Benz, Audi, Ford, and more. He can be reached at 1-404-249-4555 X6000 or miguel@ysmdesign.com.