Embracing AI: How Automotive Dealerships Can Supercharge Their Operations and Reconnect with Humanity

By Nick Askew, CEO and Founder of Space Auto.

Originally Published at AutoSuccess Magazine, March 2024

The sweetheart buzzword of 2024, AI.

In the fast-paced world of automotive sales, the term “AI” has become a buzzword that’s impossible to ignore. Yet, many within the industry perceive it as little more than a novelty, limited to chatbots on websites or sophisticated versions of chatGPT. However, this narrow view overlooks the transformative potential of AI to revolutionize how dealerships operate, enhancing efficiency, decision-making, and customer relationships. The key to unlocking this potential lies not in the technology itself but in how dealerships manage and store their data.

At its core, Artificial Intelligence is akin to a human brain, thriving on connections and information.

The Frankensteined Dealership Dilemma.

Every automotive dealer has been there: a patchwork of software solutions that, instead of creating a sleek, high-performance engine, resembles Dr. Frankenstein’s creation. This fragmented approach to technology is not just inefficient; it’s costly and detrimental to the customer experience. Integrating various vendors and piecemeal solutions can lead to significant spending without solving the root problem: a disjointed and cumbersome buying process.

Imagine if parts of the brain worked in isolation, never communicating or coordinating. That’s the reality for many dealerships today—a collection of independent systems that fail to harness the collective power of their data. The result? Slower sales processes, frustrated customers, and missed opportunities. This Frankenstein approach hinders the ability to leverage AI effectively, leaving dealerships struggling to catch up in a rapidly evolving digital landscape.

Dealership Data, Connected and Effective.

The more integrated and accessible the data, the more effectively AI can function, mirroring the capability of the human mind to make informed decisions. This analogy underscores the importance of centralizing data systems within automotive dealerships. By doing so, dealers set the stage for AI to work its magic, turning raw data into actionable insights.

Imagine the possibilities if AI could access a dealership’s entire ecosystem of information, from the Dealer Management System (DMS) data, customer communications, trade valuations, to real-time lending decisions. This isn’t just about automating mundane tasks or generating reports. It’s about empowering the sales team with “superpowers” they never knew they had—the ability to make the best possible decisions swiftly and efficiently, without being bogged down by manual labor.

The true transformation, however, doesn’t lie in the technology itself but in how data is stored and utilized. AI, in small doses, can handle minor tasks, but its true potential is unleashed when it integrates with the dealership’s data infrastructure. This integration enables AI to provide unparalleled insights, such as identifying when customers are in an equitable position to trade out of their vehicle, generating content, and optimizing follow-up schedules. This isn’t just about making life easier for the sales team; it’s about elevating the customer experience to new heights.

Charting a Course for AI Revolution in Dealerships.

To move beyond this fragmented reality, dealerships must embark on a transformative journey. Here’s how to prepare for the AI revolution and ensure your dealership is not just surviving but thriving:

1. Consolidate Your Systems

First things first: dismantle the Frankenstein monster. Centralizing your data is crucial. Imagine having all your data—customer, inventory, deals, website analytics, marketing—in one place. This unified approach is the foundation upon which AI can thrive. Tools like Google Analytics are invaluable, but their true power is unleashed when integrated into a central system where AI can apply its analytical prowess. Begin by developing a transformation strategy that consolidates your data, paving the way for AI to work its magic across your operations.

2. Define Your AI Goals

With the myriad applications of AI, it’s essential to identify how it can best serve your dealership. Could AI predict profitability by analyzing customer interactions, deals, and inventory in relation to website traffic? Imagine leveraging generative language AI to enhance customer communications or utilizing AI to streamline follow-up tasks beyond the rigid schedules of traditional CRMs. Setting clear objectives on how AI can simplify operations and improve efficiencies is a vital step toward meaningful integration.

3. Beware of Shiny Objects

The allure of the latest “AI-powered” tool can be tempting, but caution is key. Not every shiny new gadget will drive your dealership forward. Remember the debacle of AI chatbots being coaxed into untenable sales promises? It’s a stark reminder to focus on solutions that truly integrate and enhance your data-driven decision-making process. AI should not be about quick fixes but a strategic commitment to evolving your technological ecosystem for long-term success.

AI’s Role in Rehumanizing Automotive Sales.

Critics might argue that this shift towards AI-driven processes could marginalize the human element in automotive sales. However, the reality is quite the contrary. Integrating AI doesn’t mean replacing humans; it means enhancing their capabilities and allowing them to focus on what truly matters—building meaningful relationships with customers. The goal is to streamline operations, eliminating the redundant tasks and processes that detract from the customer experience. Instead of being ensnared in a web of inefficiency, sales representatives can engage in genuine, impactful interactions with clients.

This paradigm shift signifies a return to the essence of the automotive business—the “people business.” AI serves as a tool to remove technological barriers, enabling human qualities to flourish. By reducing meaningless work hours, staff can dedicate more time to understanding and meeting customer needs, thereby fostering loyalty and satisfaction. This human-centric approach, augmented by AI, is the cornerstone of a dealership that not only excels in sales but also in creating lasting connections with its community.

Getting back to being in the people business.

Effectively, the integration of AI in automotive dealerships heralds a new era of efficiency, insight, and human connection. By centralizing data systems and embracing AI, dealerships can transform their operations, giving their sales teams unprecedented capabilities and redefining the customer experience. 

This journey towards technological empowerment and human-centric service isn’t just about staying competitive; it’s about reimagining what it means to be in the automotive business. Let’s finally get out of being software button pushers, CRM task doers, and meaningless digital process followers. In the age of AI, dealerships have the opportunity to transcend traditional boundaries, becoming more responsive, insightful, and connected, both to their customers and to the essence of their mission—the people business.

Selling cars doesn’t need to be a struggle, and this revolution won’t unfold overnight. Take the time to learn, reflect on what obstacles are blocking your path to success, and gear up to simplify your processes.

Remember, easy does it.