It has been a busy week in the digital retailing world.
Two dealership digital retailing providers have been acquired in the past week. The buyers? Dealership management system giants CDK Global Inc. and Reynolds and Reynolds Co.
Last week, publicly traded CDK closed on a $360 million all-cash deal for Roadster, which gives the DMS company more capability around online transacting. Executives from both companies also said they see a path to grow the Roadster business. Those executives added that the combination will help improve the technology that links into dealerships' back-end systems, which is important to create a seamless experience for customers as they transition from online to in-store, or the other way around.
Then on Tuesday, privately held Reynolds and Reynolds said it acquired Gubagoo, a retail technology vendor that specializes in conversational and virtual retailing tools. Terms of the Reynolds-Gubagoo tie-up were not disclosed, but Reynolds executives said it expands the company's "Retail Anywhere" approach that is intended to allow dealerships to accommodate consumers no matter how and where they're shopping.
Both companies told me the platforms will be available to dealerships regardless of the DMS provider a dealership uses.
There's no question that the pandemic sped up dealerships' adoption of technology to power online and remote sales. Being able to work with buyers outside of the dealership was logistically necessary when showrooms were shut down last spring, and there's a consensus now that with the economy reopening it will be necessary for dealerships to continue — and even expand — their ability to transact virtually. That's the experience many customers have come to expect.
That creates opportunities for digital retailing companies, from improving their own third-party tools to providing the technology that powers in-house tools for dealership groups, such as Gubagoo's partnership with Asbury Automotive Group on that retailer's Clicklane digital retailing platform. And, based on the acquisition moves of this past week, it's also a market opportunity for tech vendors such as CDK and Reynolds that may see digital retailing and communication tools as complementary to their existing suite of software products.
It's a space I'll be closely watching.