Is it a car show or an Internet show?
It was Yahoo! and America Online that dominated the first press day of the Detroit auto show.
Yahoo is teaming up with Ford Motor Co. to develop services for Ford owners, and AOL is doing it with General Motors.
Ford has the most developed and far-reaching Internet strategy in the auto industry. CEO Jac Nasser is determined to change virtually every aspect of the company for e-commerce and connectivity. It is a brilliant vision, from core business practices to customer relations to multiplying shareholder value via public offerings of Ford's Internet-related business units and partnerships.
Nasser's new mantra: Become the world's leading online consumer company.
A couple of cautions. The first surfaced when Ford revealed some concept cars that make the Internet an integral part of the car.
The red flag here: The cars were butt-ugly. Ford viewed them as merely a medium for the message of connectivity. But it's still a car show, after all. The press and consumers wanted to see interesting cars, not bucks for a computer. In becoming an online consumer company, Ford risks losing its focus on creating great cars.
The second caution is in misjudging the importance of the car dealer. Brian Kelley, Ford's e-commerce vice president, outlined changes to the industry because of the Internet. He said distribution must move from 'dealer-centric' to 'consumer-centric.' He also said Ford itself must change from being a 'manufacturer to dealers' into a 'marketer to consumers.'
Maybe yes, maybe no. The Internet virtually requires an automaker to connect in new ways with individual consumers.
But the franchised dealer always will be a central link between the factory and the consumer. And there's a reason researchers predict that only a small percentage of new vehicles actually will be 'sold' on the Internet.
In the Internet world, there's an axiom that it's better to be fast than right. But Ford was too fast with its Ford Retail Network (now Auto Collection). The collections were a rational experiment. But Ford quickly built too many and made them the vision of the future for Ford retailing. Oops. Ford's factory stores don't work.
If Ford avoids that kind of thoughtless clumsiness in its Internet strategy, the strategy can create the kind of advantage that Nasser envisions. But whether or not it's an online consumer company, Ford must remember that it's an automaker, first and foremost.