Last week, thousands of dealers, thought leaders and allied industry members met at the Driving Sales Executive Summit, Digital Dealer Conference and J.D. Power Automotive Marketing Roundtable in Las Vegas to discuss best practices and industry trends. Following up on the first DealerADvantage recap, which shared key takeaways related to the conversations on social media, today’s post focuses on “Big Data,” another key theme discussed during the conferences.

Similar to the industry conversation surrounding social media, “Big Data” affects many facets of the online automotive space and can be scaled depending upon your dealership’s size and needs.

Simply put, “Big Data” in the context of the retail industry represents the massive amount of information related to shopper activity – and the power to use that information to inform advertising, design and process decisions, driving better performance for dealers and manufacturers alike.

In a presentation at DrivingSales, Dr. Florian Zettelmeyer of Northwestern’s Kellogg School of Management shared how online retailers, such as Target and Amazon, commonly use “Big Data” to provide a more relevant, customized experience to shoppers based on demographics, activity patterns and preferences, increasing sales and informing purchasing and supply chain decisions. Though global companies collect and store data on thousands of servers, Zettelmeyer explained how dealerships can follow similar strategic principles with just a hard drive’s worth of information.

“The key,” Zettelmeyer elaborated, “is to design all processes with measurement in mind.”

A “Big Data” mindset can often show a bigger picture than what’s at surface level, Zettelmeyer explained. In one referenced case study, a dealership tested providing the invoice price of vehicles to customers at the beginning, middle and end of negotiations. The findings showed that, on average, providing the invoice price at the beginning or middle of a deal yielded a greater total customer value than when the invoice was given as a last resort at the end of negotiations.

While willingly giving up part of the gross of the sale would be unheard of for most dealers, the study found that when the dealership looked beyond the initial sale and tracked data to evaluate the total value of each customer (i.e. financing, service, repeat business), they found that the trust established between the customer and the dealership through pricing transparency made up for the smaller margin.

Jared Hamilton of DrivingSales and Doug Frisbee of Facebook linked “Big Data” to the concept of multi-channel attribution. Hamilton, along with other industry leaders, repeatedly cited that there is no longer such a thing as a “single-source car deal,” and that dealers must look beyond cost-per-lead and cost-per-sale metrics to truly understand all the marketing investments that influence shopper decisions.

Pierce Hasler of and Jason Ezell of Dataium echoed industry sentiments during their breakout session at DrivingSales. Using the recent independent Dataium study commissioned by as a launch point, the two examined the role of automotive marketplaces and research points throughout the modern car buying processes.

Finally, Billy Beane, General Manager of the Oakland As, weighed in on the “Big Data” conversation with a unique perspective. In the mid-1990’s, Beane implemented his now famous data-driven, “Moneyball,” style of player valuation, which uses complex data analysis to measure the importance of individual statistics such as home runs, batting average and on-base percentage.

“Every business, including baseball, has metrics,” said Beane. “We had to figure out which were the most important.”

Moreover, the A’s success came from understanding their identity and setting goals that matched it. Beane joked, “We can’t all be the Yankees.”

The lessons from “Moneyball” can be applied to dealerships by constantly evaluating performance and using information, rather than gut instinct, to dictate decisions. Understanding how each aspect of your business is connected, from website analytics to basic customer service processes.

Assembling a team that defines and measures its goals can bring more success to your store.

What metrics are you currently using to evaluate success at your dealership?


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