Unknown: 0:00This is Amplified, a retail automotive podcast brought to you by Reuters events and to suits you. It's time to make the most innovative voices in retail automotive. Louder.
Kyle Mountsier: 0:17
All right, one of those innovative voices is sitting with us right now. This is Kurt priser, the director of retail buying operations at Audi of America. He was close. I was close. He was close. There's so many words in your title. Why did they do that to you like that?
Kirk Preiser: 0:37
Yeah, it's all encompassing. She actually negotiated that title. It wasn't my original title.
Paul Daly: 0:42
Honestly, what was the original title?
Kirk Preiser: 0:44
I think it was like retail transformation or something like that, which I just didn't feel like it fit.You're
Paul Daly: 0:49
like, what does that even mean? Exactly? Yeah. So this is definitely more precise.So
Kyle Mountsier: 0:52
what's your actual title now that I messed it all up?
Paul Daly: 0:56
Director of retail automotive buying experience.
Kirk Preiser: 0:59
There's no automotive
Kyle Mountsier: 1:00
retail buying experience?
Paul Daly: 1:02
Well, we're just adding and we make it an acronym for the next podcast.
Kirk Preiser: 1:06
Paul Daly: 1:08
well, that's not law.Remember, depart, I'm gonna make you cry. I'm gonna make you say at the end of the episode.
Kyle Mountsier: 1:14
That'll help me remember, there's enough acronyms in automotive, I have to remember. There's only one or two more. It's unbelievable.Well, Kirk, well, thanks. First of all, thanks for joining us,and even us, messing up the name. But we've gotten to know you through a couple of different mediums through events that we've been to. And we just got to have a panel here at the Reuters event for automotive.And one of the really, really cool things that you and I have got to talk about that I love about your perspective, is your the way that you see the parallel nature of dealers, and OEMs. And how there are parallel buying experiences happening at all times. Can you talk a little bit about how you on the OEM side perceive that and approaching the customer? Yeah,
Kirk Preiser: 2:00
I mean, I, I hope it's the right path. I mean,I'll tell you, I mean, we're pretty passionate about it with respect to, you know, the industry as a whole when you when you look at what OEMs are trying to accomplish, and we're trying to bring more consistency to the brand, right? I mean, you see Apple do it. But Apple goes out, and they create their own stores so that they can completely control the brand experience the whole entire purchase experience. But those stores are in direct competition with other outlets that sell their products. Well, we're not in a position to do that. And so he's not going to go out and open its own store. So everything that we do has to be in partnership with our franchise dealers. So we're looking at the brand and trying to figure out how can we bring a more consistent brand experience to the marketplace. And the one thing that we have control over is tier one. All right, so our out of USA website, we have complete control over and for the most part, the dealers are totally okay with that. So when I talk to the to the dealers out in the marketplace, they're like, you know, Hey, as long as you don't touch our tier three website, you know, we don't care what you do on tier one, because we want, the consumers are going to go there for information about the vehicles. And to learn about the brand, decide whether or not an Audi is right for them and what kind of product they want sponsible for selling the vehicle on tier three. And so just don't touch our tier three website. And so what we what we've really looked at is trying to create this parallel purchase path for the consumers. So they can go to tier one to investigate their vehicle, to find out whether or not Audi is the right fit for them. And to find out what kind of model they're looking for. And if they want to start the purchase experience on tier one, then they can go ahead through our branded experience that we've created to be exactly the way we want it to be. But at the same time, they can also go to tier three, and they can start the purchase experience there for the dealer. And so we look at it this parallel purchase path, it doesn't have to be completely controlled by the OEM, it doesn't have to be one path. And so there's no reason in our minds that you can't have a customer that can go in two different directions to purchase a vehicle. So they can go to tier one. And they can, they can start off the purchase experience there. And we're gonna hand them off to the dealer, or they can go to tier three, and they can go all the way through with our dealer and never even come to tier one, or they can bounce back and forth between the two. And so we're going to be working on some,some technologies over the next couple of years to better sync the tier one and tier three websites. So it's going to bring a little bit more consistency to the marketplace, but at the same time still allow the dealer the individuality that they're looking for.
Paul Daly: 4:33
What do you see as the the non negotiable, so you said they don't have to be exactly the same, right? And they can kind of pass back and forth. What are the elements that really do need to be the same to have a retail buying experience that is feels linear feels on brand, you know, and keeps people in the same in the same you know, energy of the brand. I guess I'll put it that way.
Kirk Preiser: 4:52
Yeah, no good question. I mean, obviously,you've got to have a look and feel of Audi so it's got to be our our colors and our themes and our pictures and everything like that. I think that's, I think that's kind of expected in the marketplace. And that's the way most OEMs do it. But one of the important things for us is,as we get more and more into digital retailing, and allowing the customers to do more at home, is that everything that they do at Tier One has to match what they would do with tier three. And that's the hard part.Right? Yeah. And so, you know,in my mind, if they come to tier one, and they do inventory search, and they find a vehicle,and they calculate a payment on the vehicle, and they put$1,500, down and on a 36 month lease or whatever, whatever payment is calculated, should be exactly the same. Harry across said they would find on tier three end when they walk into the dealership. And so that's,that's an important piece of what we're trying to do is in that's the full real omni channel experience, right? And then it's all of that if
Paul Daly: 5:54
that one piece is wrong, right, and you go from the OEM site to a tier three dealer, it immediately plants a seed of distrust in your mind.Right? Somebody's playing games.Yes.
Kirk Preiser: 6:04
Yeah, absolutely.I mean, and I've said that before, that if from back in the day back in the 90s, when when websites first came out for dealerships, and I was working with dealerships on putting their inventory online about the worst mistake you could make, is not taking a vehicle off your website that you had sold,right. And so a customer would come in, and they would be looking for a particular vehicle, and it was something that you had already sold, and you hadn't you hadn't taken it down for your website. And so people will kind of get over that, because they realize that cars are being sold all the time. Nowadays, though, if they calculate a payment on your website, or on the tier one website, and then you hit them with something different,they've lost trust, before you even started the conversation,right? You're
Paul Daly: 6:45
on your heels from the beginning,
Kyle Mountsier: 6:46
what are the what what are you seeing as the biggest barriers to making that happen? And getting the data right, so that, that that piece can move seamlessly for a consumer? What are you dealing with right now,
Kirk Preiser: 7:02
from a technology standpoint,
Kyle Mountsier: 7:03
or just any of the battery technology that sounds like probably is the biggest one.
Kirk Preiser: 7:09
That's why I mean,that's a big piece of it. So right now, what we're trying to do is ingest everything from the dealer. Okay, so it's easy for us to come up with the the MSRP is those are ours, right, we own the MSRP. US we create recreate the MSRP, that's, that's not really a big deal. The big deal is pulling in the dealer rate markups, the dealer pricing, all of the dealer, dock fees, etc.So we have to ingest that from the stores. And we have to make sure that they're keeping their prices updated correctly with us the same way that they would on their on their website. And so it can't be two different prices in two different places. So that's, that's the first thing from a technology standpoint.The second thing is a process standpoint and working with each of the dealers on making sure that they're picking up where the customer left off. Because we can't, we can't start them all over again. And so if they're doing steps of the sales process, whether it's on tier one or tier three, it's unacceptable for us to be in a position of where we make that customer start over. Okay, we have to take the time to go in and ingest everything that they've done. Everything that they've told us about the trade was their credit, here's all of that. Yeah, exactly. And that comes from in store process building. And so we've got a team of people that are working with the dealers, on building those processes in store to make sure that before we you know,respond to a consumer, we're doing a little bit of homework first. So in fact, we don't push the response time as much as some others do. Okay? response time is super important to us.But a proper response is more important to us than the response time. So don't just hit somebody with a phone call or a text message or an email, you know, five minutes after they submit a lead if you haven't done the research to figure out exactly what it is that they're that they're trying to buy from you and what the parameters are and what they're trading and etc.
Paul Daly: 8:58
So what are you doing from your end to help? I don't know if it's monitor, that is the right is the right word to use. But what are you doing on your end to try to encourage the right behaviors in that in that arena that you just mentioned response time and the right response?
Kirk Preiser: 9:13
It's it's in dealerships support really, I mean, one of the things that I recognized in the industry is that we have a lot of really great smart individuals out there calling on dealers but most of the time their their metrics and their KPIs are based on sales metrics, right? So their job is to go out and coach and counsel with the dealer on getting them to increase sales,it's not fixing their processes.So what we're you know, we rely on the dealers to fix them themselves. So I'm I'm guilty as charged over many decades of my career of going in and sitting down with a GM at a dealership and saying, This is where you're broken. This metrics too low that you never respond so well to that don't think they love it. And this is low, this is low, your closing ratio is low.This is bad fix said I'll see you in 30. Who wants to work together? Well, exactly. And in many cases, they want to fix it.But they really don't know how to fix it. They don't have the time
Kyle Mountsier: 10:10
to say, yeah,it's not the priority. It's not priority time
Kirk Preiser: 10:13
fires to put out they get hot, heated customers in their office, they
Kyle Mountsier: 10:17
do real estate to purchase changes in Yes,yeah. So what I really saw
Kirk Preiser: 10:21
as a gap or a problem, or an opportunity, I guess I should say, is, is really to get somebody in there to help them build these processes, okay, and that could share best practices from dealer to dealer to dealer, because the consulting firms, some of them out there do a good job with that. But they don't work with every Audi dealership across the country I do. So I work with every single Audi dealership across the country. So if we have a dealership in Florida,that's doing really well, that using a digital retailing tool in store, we can take those best practices, and we can share them with a dealer in California, we can share them with a dealer in Michigan, we can share them,wherever, and so to so to me,that's the heart of what we do is sitting there analyzing where the breaking points are, where the areas of opportunity are,and working hand in hand with them.
Paul Daly: 11:09
So as a final question, what would your encouragement to be to, you know, will speak will speak to Ali Audi dealers, but dealers across the board? What would your encouragement be for them to engage the process with their OEM? And I know the OEMs are different, but so maybe we'll just speak, you know, but what are you saying to them? How are you encouraging them to move closer to this joint effort?
Kirk Preiser: 11:29
Yeah, it's, it's really hard to say, with respect to their relationships with their with their OEM, but I will tell you, that it all comes down to just being willing to listen in to come up with these collaborative Win Win solutions.The best thing I can tell you is a perfect example of something that we came up with with our digital Working Group at at Audi. And so we wanted to change the tier one website experience with respect to how you find inventory. So historically, Audi had always asked a customer to put their zip code in, and then we would push them directly into one dealer's inventory. All right. And we wanted to expand that, as you can imagine, so that a customer could go to tier one, and they could see vehicles from all over the country. So our dealer working group was obviously a little concerned,because now you could have a customer that's in a zip code that's right near their dealership that could now see cars from all over the country.Right? So we were polar opposites on this, right? The dealers were no send them directly into my inventory.They're right across from my dealership, okay, this customer is, and then Audi's on this side saying no, we want them to see every single vehicle across the country. So we came up with a win win solution where effectively what we would do is we would take inventory only from a smaller radius. And we would filter it so that the vehicles closest to the consumer showed up first. Okay. And so when you went to the SRP, the very first vehicle you saw, so location is like the number one metric location is the filter by which customers see those vehicles first. So when you go farther down, you can see other vehicles that are farther away.And to me, that's exactly what we're supposed to be doing as an industry good communication,meeting a happy medium and ground of I understand your point of view as a dealer and why you want them in your inventory. Please understand our position as an OEM. Let's see if we can figure out a solution that's in the middle and we did.
Kyle Mountsier: 13:22
Awesome. Well,Kirk Preiser director of the retail buying experience for Audi America, thank you so much for joining us here on amplify.Love, your comments and your and your encouragement.
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