Joe Mitchell, 46, swears he never even turned on a personal computer until June 1997. That is odd considering the suburban Chicago car dealer wrote a check shortly after that to buy $80,000 worth of new software, plus new PCs for the sales staff, at his Mitsubishi store.
And it is even odder considering that two years later, the dealer is now one of the country's most eager proponents of the information technologies that promise to revolutionize auto retailing.
'One look, and I had to have it,' says Mitchell, president of Biggers Mitsubishi in Elgin, Ill. 'I realized this is the future. This is it.'
Mitchell's enthusiasm is part of the reason that Mitsubishi Motor Sales of America Inc. is so wired about the concept of computer-powered dealerships. This summer, Mitsubishi began rolling out an extensive new national dealer communications system. When it is fully in place in two to three years, it will have changed the way Mitsubishi's 493 U.S. dealerships manage their sales staffs, handle their floor traffic, order vehicles, process service business and even track customers for future business.
And it all started with a visit to Mitchell's store.
SEARCH FOR INNOVATION
Mitchell's revelation that auto retailing could be modernized and improved through better technology started him down the road two years ago in search of innovation before Mitsubishi started its program. Mitchell, a member of Mitsubishi's dealer advisory board, recalls that he was simply looking for a way to improve how his dealership operated. It began with a store administrative assistant typing up lists of shoppers into a database that she printed out and distributed to the sales staff every morning. As Mitchell developed a taste for immediate information, the data got more and more advanced. He finally retained an outside software development company to create a proprietary system to track the customer names and chronicle what was happening to them.
'The first thing I knew, we had a factory manager in here looking at our system,' Mitchell says. 'The next thing we knew, the president of Mitsubishi is in here playing with it. And the next thing, they're taking it nationwide.'
The sharing of ideas, the rapid-fire embrace of information technology improvements and the conversion of old business practices to new efforts are symptoms of the current auto-retailing revolution. Other U.S. makers are currently in some stage of overhauling their national dealer communications systems, including American Honda Motor Co. Inc. and Saturn Corp. In Saturn's case, the automaker finds itself playing catch-up after only 10 years in business. In the early 1990s, Saturn turned heads with its use of dedicated computer lines that connected factory and store by satellite for up-to-the-hour communications. Now, even a company spokesman notes that Saturn has fallen behind the times on available technology.
Ironically, it was the zeal of a former Saturn executive - Pierre Gagnon - that opened the door for Mitsubishi's new system. Gagnon is now executive vice president and COO for the Japanese automaker's U.S. subsidiary.
Mitsubishi announced this summer that it would launch its first phase of the new system, which it calls Diamond Contact. This leg of the technology helps the dealership keep track of customers, determine what shoppers are looking for and follow up on them as sales leads. It also allows a dealership manager to keep track of the sales force.
That in itself is a technology breakthrough, says Dan Gerard, Mitsubishi's retail sales support manager, who is helping to roll out the program. Gerard himself spent a decade as sales manager of a California Mitsubishi store before going to work for the factory. He recalls - not too fondly - the frustration of having no formal procedure for keeping track of customers.
'I used to go out into the parking lot on a slow day and find my salespeople out there, drinking a cup of coffee or having a cigarette,' Gerard says. 'You'd ask them if they had followed up on all the sales leads they had. They'd say yes, and that would be the end of it. You could either call them a liar or go back inside.'
PCS FOR EVERYONE
Under the Diamond Contact system, every salesperson will have a PC and will use the new software program as a sort of daily scheduler. The new system keeps a list of every customer who comes into the store. It compiles a report of every potential customer to the salesperson, who must take some action - call the customer, determine what vehicle the customer is interested in, determine that the customer no longer wants a vehicle or determine that the customer is no longer a viable prospect. The system then requires the salesperson either to sell the customer a car or to move the customer off of the list.
The manager, in turn, receives a daily call report from each salesperson. That report tells the manager what has happened to each person on the sales list. If the manager believes a potential customer has been moved off the list incorrectly, the name can be passed back to the salesperson.
Gerard says the system will help dealers keep up with interested customers, but it will still require some finesse from store personnel to obtain customer names.
'Seventy-five percent of shoppers will identify themselves,' he predicts. 'The other 25 percent won't. We'll at least be able to follow up on that 75 percent now.'
KIOSKS WILL HELP
The second leg of the new system will put dealership kiosks to use doing this work. That phase will begin to roll out in Mitsubishi stores this month. Showroom visitors will enter their names into a simple touch-screen information center that will guide them through the shopping process. It will help them narrow down their product search and answer their preliminary financial questions, as well as capturing some of their own preliminary financial information.
Gerard says the 64 Mitsubishi dealers who first went onto the new information system have seen their sales-closing rates improve on the order of 30 percent.
'Auto retailers may be very good at selling, but they can be very poor bookkeepers,' the factory manager says. 'What this technology does is give them a way to keep track of everyone who's thinking about buying a Mitsubishi vehicle. It does it for them. All they have to do is follow the system.
'I wish I'd had these systems 14 years ago when I was out there selling,' he adds. 'I'd still be out there.'
Mitchell, the newcomer to PC-based technologies, is more enthusiastic. 'I work 70 hours a week,' he says. 'I suspect other people in dealerships also work 70 hours a week. What this technology is going to do is turn my job into a real 9-to-5.'
All told, Mitchell estimates he has invested $200,000 in new software, laptop computers and other equipment to take his store out of the past and into the new realm of possibilities.
'It's not that much,' he reasons. 'I will be able to do much more than I could do in the past. I'll be able to look at what I've been selling over the past few months and order my own vehicles from the factory and order the right ones. I'll be able to walk in here tomorrow morning at nine o'clock and see where we stand on contacting customers who need to be contacted. It will help me manage the store. The way I see it, two years from now, I've got a 9-to-5.'